Reader Voices: The Rebate Police

Do we need the government to police the rebate practices of vendors? The recent story about one tech company that was caught tossing customer rebate submissions into the dumpster prompted readers to discuss a variety of ideas for cleaning up the rebate business.

There have long been many who would like to see mail-in rebates outlawed outright. “Simply stated, rebates are a form of discrimination,” wrote one reader. “They discriminate in favor of people with the leisure time to devote to doing the paperwork, making zillions of copies of everything, and then following up with phone calls and e-mails when the check doesn’t show … It’s such a scam, I can’t believe it would require that much re-writing of the postal regulations to eliminate them entirely.”

Of course, the FTC and other law enforcement agencies do occasionally go after the worst deadbeat rebate vendors, but readers suggested the dumpster incident might provide an enforcement opportunity not be missed. “Perhaps a creative federal prosecutor [could] file 1,300 charges of mail fraud against the owner, since they required the rebate forms to be delivered by mail,” a reader wrote. “One or two high-publicity convictions of scofflaw owners would have them rethink such actions.”

Others hoped a legal formula could be found that would require fairer practices. “I have had numerous rebates ‘disappear’ and always suspected they were just being ignored like this,” wrote another reader. “Perhaps the best way to handle it is with state laws requiring vendors who sold products with rebates offering the products with instant rebates taken when the product was purchased. Staples has this on some of the rebated items they sell and I know some other vendors do as well.”

The government could play more of an intermediary role, postulated another reader. “Another possibility would be to have some government ‘blessed’ organization be the middle man in handling the rebates — perhaps along the line of the check clearing houses. Then at least, the government would have a better idea of when the rebate processing centers are not fulfilling their obligations.”

But even many who dislike mail-in rebates don’t want to see new government regulations. “As a very general proposition, I would like to see product rebates eliminated,” posted another reader. “But that doesn’t necessarily mean I want the heavy-hand of government to prohibit them outright. A better approach, I think, which still leaves the viability of rebates largely to the marketplace to decide, is very strict, stepped-up enforcement by the Federal Trade Commission. The FTC should establish an easy-to-use procedure (online, preferably) to allow consumers to file their rebate grievances, thereby allowing the FTC to more easily confront the offending companies. Over time, I see this as having one of two possible outcomes: 1) The rebate industry would eventually clean up its act, thus resulting in fewer grievances being filed going forward; or, 2) The rebate industry would tire of the nagging enforcement of its self-imposed rebate obligations and eventually phase out rebate programs altogether. Even though my preference is for the latter, I would be happy with the former.”

What do you think? Post your comments about this story below.