The National Advertising
Division &
The Better Business Bureau
…&how they keep us
safe and happy
Veronica Krutous
15 February 2005
What is the BBB?
• founded in 1912
• This organization is based in the US &
Canada
• It’s purpose is to promote and maintain
ethical, honest business practices
• primarily funded by its member corporations
(thus leading to criticism that it is less than effective as a consumer protection agency)
Alright, the BBB is devoted to
honest business… but what
exactly do they do?
Core Services Include:
• Business Reliability Reports
• Dispute Resolution
• Consumer Complaint Settlement
• Charity Review
• Consumer and Business Education
• Advertisement Monitoring
( focusing on truth and accuracy )
• Screen advertisements involving products
for children
• Provide information to consumers &
businesses that will help them make
informed purchasing decisions
the BBB in action…
In Jan, 2005 the BBB and
Javelin Strategy & Research Co. released a
Identity Fraud Survey Report.
(This was an update of the Federal Trade Commission's 2003 Identity Theft Survey Report)
What they’d found:
 “Despite growing fears about
identity theft and online fraud,
such crimes are more
frequently committed offline
than online”
 Internet-related fraud problems are actually
*less severe *less costly
*not as widespread
than previously thought.
Online/ Offline
• The study concluded that
those who access accounts
online can provide earlier
detection of crime than those
who rely only upon mailed
monthly paper statements.
• By managing their financial
activities online, consumers
can reduce access to
personal information on
paper bills and statements
that may be used to commit
identity theft and fraud.
key points made in the report:
• The most frequently reported source of information
used to commit fraud was a lost or stolen wallet or
checkbook.
• Among cases where the perpetrator's identity is known,
1/2 of all identity fraud is committed by a friend,
family member, relative, neighbor or in-home
employee - someone known by the victim.
• Although identity fraud is not growing, it is still a
significant area of risk.
• The majority of identity fraud crimes
are self-detected.
The BBB urges Consumers to:
• Protect their Wallets, Purses and Checkbooks
• Keep Highly Sensitive Financial Information Away from where
others, including Family, Friends, Neighbors and Employees who
perform work in your house, can get access to it.
• Take A Close Look At Your Mailbox (pick up your incoming mail as
soon as it is delivered and you don't have a locking mailbox to
protect it, consider getting one.)
• Move to Online Statements and Bills and Pay Bills Online
Whenever Possible
• Shred personal papers to avoid "dumpster diving"
• Be Safe Online : password protect your computer and your
sensitive files , ensure that you have a firewall , make sure you have
good anti-virus/anti-spyware
• Monitor your credit report at least annually
• Take the BBB/Javelin Quiz & find out: “HOW SAFE ARE YOU?”
http://www.bbbonline.org/idtheft/safetyQuiz/
How the BBB can help you:
• If you go to their website
(www.bbb.org) you can
find information on over 2
million organizations. . .
• Before investing or
donating to any business
or charity, you should
check this site out
Another service the BBB provides:
• If you think that a company or
charity has treated you unfairly,
file a complaint online at
www.bbb.org.
• (this includes issues pertaining
to: Lemon Law/ Auto,
Warranty, Cell Phones,
Business, Charity, ID theft, and
Privacy)
• The BBB will contact the
organization to help resolve
the issue.
The National Advertising Division
• The National Advertising
Division (NAD) of the
Council of Better
Business Bureaus
(CBBB) takes
responsibility of
reviewing national
advertisements for
truthfulness and
accuracy.
• Their mission is to foster
public confidence in the
credibility of
advertising.
What NAD does:
• Advertisers who use NAD save money.
(The NAD process is much cheaper than litigation…and it also saves
companies several thousands of dollars typically spent seeking
compensation through the court system)
• NAD provides a quick and private process
(Companies can expect advertising challenges to be resolved while
the ad campaign is still running because NAD provides written
decisions/ responses within 60 business days)
• NAD settles disputes fairly and effectively.
(The in-house counsel, marketing executives, research and
development departments and outside consultants work together
to decide whether claims are valid. Each party has the
opportunity to explain its position and provide supporting
data)
How else NAD helps…
• NAD attorneys are experts in advertising review.
(NAD has experienced attorneys working for them. These
attorneys have substantial experience working with claim
validation, advertisements, regulations on trade, legal
actions and negotiation.)
• NAD helps to ensure a level playing field.
(Government regulation is usually costly and burdensome.
NAD has earned the respect of consumers and regulators alike for
providing an effective, successful self-regulatory
mechanism. Advertisers' willingness to support NAD and
voluntarily adhere to its decisions help ensure an honest &
open playing field in advertising.)
One Example of NAD in action:
Five Brothers Brand
Pasta Sauce
What happened?
• A competitor challenged freshness-related claims made by Lipton for
its Pasta Sauce
• 1st, the NAD concluded that claims of a product attribute, in this
case, that the product was made with fresh tomatoes, did not
necessarily constitute an implied, comparative taste claim
• Thus claims such as "Fresh tomatoes make the difference!" and
"made only with fresh, vine-ripened tomatoes," did not, in the
NAD's view, necessarily imply a better or fresher taste claim.
• ALSO- the challenger also contended that the "fresh tomato" claims
conveyed the message that the Five Brothers Brand sauce was
itself fresh, and that such a claim could not be made for a
thermally processed product, such as pasta sauce
• The NAD, however, distinguished the claims made here from
claims that imply that the product itself is fresh.
Then what?
• The NAD found that the advertiser's claims
simply conveyed, truthfully, that the
product was made from fresh ingredients,
not that the product, itself, is fresh
• The NAD determined that Lipton was not
wronging anyone and that the competitors
were out of line