Top 10 Shady Business Practices

People are fighting harder for their dollars these days, and it has definitely bled over into the shady side of things. Many companies are guilty of doing things that are less than ethical, less than legal, and honestly, downright terrible. Obviously, we all know how to spot the Pyramid Scheme from a mile away, no matter how excited your old high school buddy is to ‘just catch up with you’ and not many of you take a car salesman’s words at face value. Here are ten different shady practices that aren’t as obvious, and it will pay to keep your eyes peeled for them.

Minimum Wage for Wait Staff

Minimum Wage for Wait Staff

Many people are too shy to ask about money when they’re in an interview for a job they really need. It’s understandably uncomfortable, but if you’re applying for a job where you’re going to be considered a tipped employee, then you might want just to bite the bullet. In many places, waitstaff makes less than $3 and are supposed to be compensated if they don’t make at least minimum wage in their tips each week. Many businesses skip the step and let your wallet take the hit. Additionally, if a place pays you over minimum wage as a tipped employee or your tips push your earnings past the mark, your employer can legally confiscate all your tips in several states.

Check Engine Lights

Check Engine Lights

Obviously, you’re aware that there are some shady things that go on when it comes to selling cars. It’s a cutthroat business, salespeople work insane hours and make very little for the work that they do – it’s often all commission. While it’s easy to understand the financial plight, it doesn’t justify some of the behaviors. When you start your car, the check engine light, as was as the gas light, and maybe a few others are supposed to flash briefly. When you get into a used car to test drive it, pay close attention when it starts. If there is no flash, the chances are good that the dash was tampered with to keep it from happening and revealing a problem.

Car Dealership Prize Promotions

Car Dealership Prize Promotions

Car dealerships love to mail out keys and scratch-offs. They don’t care if you’re a recent purchaser off their lot if you can’t afford a car or anything. Promotional cards are mailed out at random, sometimes with a key declaring that if it starts one on the lot, it’s all yours! Or, you scratch it off to reveal you’ve won money, a television set, or a steep discount on your down payment. These promotional offers are very clearly just trying to get you in the door. As soon as you arrive, it’s all the soda you can drink and the best deals they have until you sign on the dotted line. These are tricks to get you in the door, and even if your prize was for cash or a television, they pull the classic bait and switch. You only might win it if you buy a car.

Debt Detectives

Debt Detectives

Sometimes, if you’ve been unfortunate enough to have one of your debts go to collections (and honestly, sometimes that doesn’t even matter), this may have happened to you in the past. Someone posing as a detective will call you, the caller ID may also show a legitimate government phone number or some ‘official’ business name. This person posing as a detective will threaten you about an unpaid debt. Usually, they try to leave a voicemail rather than speak to you directly. They may toss out names of police officers, judges, anyone to sell you on the fact that this is legitimate and you’re in danger of facing legal repercussions. When you call back the number they leave you, the collections agency picks up instead. But they have great news! They’re not sure about the detective who called you, but they can make it all go away if you can make a payment right now.

One Year of 0% APR

One Year of 0% APR

There are hundreds of credit card advertisements floating around out there, and you probably see a ton of them each day. Many of the companies behind those ads will boast a 0% APR for the first year or some other shockingly low rate. People eagerly transfer balances over, or sign up and make lofty purchases and then get hit with a harsh truth. These companies lure you in, but sometimes there are ‘mistakes’ with billing so that you won’t receive the first month’s bill or something to that effect. While the APR is 0%, there are still penalties for missing a payment which can skyrocket all the way up to 40%. It’s hard to read the fine print when applying for and agreeing to the terms of a credit card, mainly because it is so extensive, but it is well worth it in the end.

Unnecessary “Insurance”

Unnecessary "Insurance"

Would you like to purchase a protection plan on that $14 wireless mouse you’re purchasing? Or perhaps, you’re buying a new phone from an authorized retailer, and you’d like to purchase their handset protection program? There are so many things out there that just don’t need to be insured. Cheap computer accessories, LEGO sets from Walmart, knives, and the list goes on. The problem with these insurance offers is that retailers like Target and Walmart sell you the plan but aren’t directly responsible for it, there is a lot of fine print and registration processes after the fact. Additionally, authorized retailers usually use a third-party to insure devices instead of something approved by the carrier or manufacturer. You can pay for this service and then find out that you’ve invalidated the warranty on the device or worse because the third-party isn’t compliant with the policies set in place by the carrier or manufacturer. Also, if you use your store warranty before the insurance, the insurance is now null and void because you don’t have the original device. If you use the coverage to receive a replacement before using the warranty, the same thing happens.

SEE ALSO:
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Price Match and Product Number

Price Match and Product Number

How can places like Best Buy, or mattress retailers afford to promise you that if you find it cheaper somewhere else, you get your money back? Quite simply, they just make sure that you’re not going to see it anywhere else. Mattress retailers will strike deals with manufacturing companies to give a store-specific name to their popular models, making them unique from other stores. Let’s say one mattress place in your town sells the Cloud Sleeper, and you buy it. A week later, you notice in your travels that the other shop has it for $75 less but despite being the exact same product, it’s the Cloud Dreamer instead. At stores like Staples, Best Buy, and more, there will be a random character or two thrown into the product code.

Rentals or Payment Plans

Rentals or Payment Plans

24 easy payments of $109.99 and that gorgeous 55′ Curved 4K Ultra HD Smart TV is all yours. Sounds great, right? But, those televisions really don’t cost that much. Furniture rental companies like Aaron’s abuse the human predicament in which we’re obsessed with instant gratification. You could theoretically just save up for the new TV, but why bother when you can bring it home now and just make payments? Most people neglect to do their homework on this sort of thing, and this exact TV from Aaron’s costs $1,549.99 if you pay cash. If you go through the leasing program, what they call their “Total Cost of Ownership” is $2,639.76. Cell phones, appliances, furniture, and more are all things to watch out for. It sucks not being about to watch your favorite shows on a colossal crisp fancy set, but only a sucker would pay twice as much just because you need it now!

Fake Sales

Fake Sales

You may have read about this before because some companies structure their entire business model around it. People see price and think quality, so stores like JC Penney and many outlets will have the “actual price” listed as some unrealistic price, and the sale price is only $19.99. In reality, it only costs $19.99, but when people see a lower price tag, they associate it with being cheaply made. When people see the exaggerated actual price, they feel like this is a higher quality item, and the fact that they’re apparently getting such a good deal makes them feel good. Other stores, generally smaller ones, will also seem to be continually having their closing sales or a grand re-opening that you didn’t hear about until you drove past the sign. When people are under the impression that they are getting a bargain, the rush of dopamine takes over, and they buy it without considering that just last week this store did the same thing/this price is higher per unit than another item that isn’t on ‘sale.’

If You Don’t Act Now

Act Now

This usually happens on larger purchases like a car or a house. It’s simple, at the car dealership after you’ve shown some interest and had a conversation with the salesperson; they hit you with it. “I can sell you this car for just $8,000 but only if you buy it right now!” Usually, the reason that they give is that you’re a special customer, or that this is a one-day-only sale and the price can’t be guaranteed beyond that point. Another excuse is that someone else came to see it today, and they’re coming back tomorrow with cash. Some shady realtors will use that tactic to close faster when they’re worried you’re not going to buy. If you’ve shown some interest in the house and are in the process of haggling with the owners, the realtor will hit you with first-time homebuyer kryptonite. “They’ve also got a cash offer for their full asking price… if you don’t hurry up, you could lose your chance,” and it works. Sometimes, there might be another offer… but odds are, you’re not going to fact check them because you feel backed into a corner, so you act. Don’t let people take advantage of you and push you into an impulse purchase.