Original Article URL: http://www.thenyrm.com/000658.html
Desperate, young magazine peddlers are out there,
roaming America in search of the next sucker.
Have you been conned?
By Rupal Parekh
The New York Review of Magazines
May 17, 2004
IN early September of 1997, I was living away from home for the first time. Campbell Hall at Rutgers University that year housed a gregarious group of freshmen who followed the same discourteous rule: no need to knock before entering. So, when we heard a rapping at the door one Saturday afternoon, my roommate and I exchanged an apprehensive look.
Nevertheless, I answered. The young man at the door flashed me a toothy smile, introduced himself and hastily delivered his rehearsed pitch. He said something like, “I’m selling magazine subscriptions to earn a college scholarship. For each subscription I sell, I get more scholarship money toward my education.” And with that, he handed me a list of magazines and subscription prices.
Ordinarily, I dole out a curt “No, thank you” to solicitors. Perhaps it was empathy for the aspiring student, or maybe I was attracted by the idea of anything filling my post office box. But that day, I relented, and chose a subscription to Spin. A couple of thank yous later, he and my $20 were gone.
In a few weeks, I expected my first issue. I waited and waited. It never arrived. To this day, I am Spin-less.
The incident nearly evaporated from my memory. But more than six years later, as I found myself about to embark on a career in the magazine industry, I got curious. Who was at fault for my missing subscription? Was it a bureaucratic snafu? The postal service surely didn’t lose all of those magazines. Was the young man a thief? Or was the company he worked for to blame? I set out to find answers.
Three months of digging revealed that I am far from the only consumer who has been fleeced by a door-to-door magazine salesman. Worse yet, I discovered that the young people pushing magazines are themselves the victims as much as they are the victimizers. They are part of a coast-to-coast underground economy that one public interest group, the Child Labor Coalition, calls the “sweatshops of the streets.”
My pursuit began in February 2004. I started with random Internet keyword searches, punching in words like “magazine scams.” Eventually, I stumbled onto Baddealings.com and Complaints.com, online forums where the defrauded vent their stories. Typical opening lines read “I just got scammed” and “I, too, was conned.” I decided to write to the complainers. “I tried to get back the full $200+ that the magazine sales guy had taken from me,” Stephanie Kunce explained to me in an e-mail, but “they said they had no record of me paying $200, and that the sales guy shorted me on the receipts.”
Reading Kunce’s story, I took fleeting comfort in knowing I wasn’t alone—until it dawned on me that lots of suckers are worse than one. Next I contacted the Better Business Bureau. I learned that traveling magazine sales crews operate under a variety of names, use toll-free numbers and change their home-base city. Probing into “reliability reports” turned up only a handful of door-to-door subscription firms with “satisfactory” BBB ratings— United Family Circulation Inc., of Sugar Hill, Georgia, for one. Far more numerous were companies with “unsatisfactory” records.
All-Star Promotions, Inc., of Pilot Point, Texas, has a history of “non-delivery of magazine subscriptions, non-receipt of refunds and misleading selling practices.” Another company, Subscription Services, Inc., of Glendale, Arizona, recently vanished into thin air. Leaving behind hundreds of unanswered complaints, they disconnected their telephones, and mail to the company was “returned as undeliverable.” And last year, the Better Business Bureau’s board of directors actually revoked the membership of one company, Supreme Community Services, Inc., of Atlanta, Georgia, for ignoring the grievances against them. This, from a member company of the National Field Selling Association, a Philadelphia-based trade group “committed to promoting consumer confidence in direct sellers.”
Scouring campus newspapers, I soon uncovered a quiet avalanche of information on magazine scams. In November 2003, the University of Arizona told students they were being targeted. Three months later, the campuses of Western Kentucky University and the University of North Carolina were reportedly invaded by magazine peddlers.
It became abundantly clear that my college experience isn’t isolated; rather, it’s being replicated on a daily basis.
Here’s how today’s door-to-door industry works: Clearinghouses contract with magazine publishers to sell subscriptions for them. The clearinghouses turn around and contract with subscription subagents, who are the traveling crew operators. Operators then hire the teenagers and young adults who knock on doors in neighborhoods, college campuses and even military bases, across the nation.
In March, I spoke with a former door-to-door magazine salesperson. (Her real name has been withheld for fear of retaliation by her former employer. In this story, I call her Megan Jones.) “I scammed people for a living,” said Jones. In May 2000, at age 19, she joined the Mountville, Pennsylvania company Atlantic Circulation, Inc. “We charged an astronomical amount for the magazines, and the extra money didn’t go to P & H [postage and handling charges]. That money went to the managers and owners. They make really good money and the agents get $20 a day.”
Subscriptions promoted this way are routinely sold at prices double those one would pay directly through the publisher. After pounding the pavement for ten to twelve hours a day, youngsters turn their earnings over to managers who in theory keep them “on the books” and deduct expenses like food and hotel fees from each seller’s “account.” Frustrated by the flimsy cash flow, Jones admitted that after peddling —from a list of about 150 titles, including Harper’s Bazaar, Glamour, Us Weekly, Reader’s Digest, Psychology Today, Nickelodeon and Disney—she and others turned over checks, but secretly pocketed some of the cash.
Beyond such unlawful practices that violate the buyer, Jones says in her four months selling magazines, she witnessed a long list of illegal activities within the crew itself—including drug use and prostitution. Her very first day of work, Jones said her manager instructed her and another young saleswoman to sneak onto an Air Force base in Spokane, Washington. In a matter of hours, the two wound up in jail for soliciting without a license. Jones later realized that such runins with the police were part of the job. Licenses that most municipalities require of solicitors can cost up to $50 per person and she said her higher-ups never sported the money to buy them.
“I’ve hidden in cornfields, under cars, in parking garages and in between Dumpsters,” she said, all to sell five to seven magazine subscriptions on a “high-sell day.” After getting back to the hotel, the teens would party with the crew managers. “We did mushrooms, some acid, smoked pot,” Jones said. Some agents, however, had night jobs, too. Jones said agents “put people over,” a euphemism for the practice of paying veteran crew members to sleep with new recruits. She explained: “People tend to stay if they think they are dating somebody.”
Jones, who now lives in Billings, Montana, ultimately left after getting pregnant by her crew manager. “A crew is no place for a baby,” she said.
Another former seller I spoke with, Curtis Borders, began working on a “mag crew,” which began two years ago when he spotted an ad in the local paper: “Fun in the sun … travel the U.S.A.” Newly 18 and eager to roam beyond the confines of his Northern California hometown, Chico, Borders convinced a friend to interview with him at a nearby hotel. When they arrived, his friend left saying, “Something just didn’t seem right.” But the promises of parties and easy money persuaded Borders to sign on.
For a year, he traveled by van selling magazines door-to-door in forty states. While he acknowledges that the companies he worked for, Subscription Services, Inc., and Palmetto Marketing Inc., never instructed him to steal money and fix prices on receipts, Borders claims that the harsh working conditions on crew drove sellers to dishonesty.
“Either you don’t eat, or you rip someone off. It’s not really a decision at the time,” Borders told me via telephone. “It just gets to a point where you justify it to yourself. Those people put their trust in me, and they’ll never see a magazine.” He said while on crew in Florida, a manager punched him, breaking his jaw. “The police asked me if I wanted to press charges, but I was alone, I was thousands of miles from home and I was too scared.” When I asked Borders if he would ever recommend the job to anybody else, he replied, “No. Definitely, no.”
But Borders was only one agent in a network of thousands. I grasped the vast scale and evasive history of the industry—one pocked by roving, unregulated groups—when I met Earlene Williams. She is the founder of a New York-based nonprofit watchdog group called Parent Watch.
In the summer of 1982, Williams’ son, Mark, landed a summer job traveling the country with a magazine sales crew. She felt uneasy, but Mark joined the crew, reassuring her he would stay in touch by telephone. When he failed to call, Williams hired a private investigator to help her comb motels and hotels in the New Jersey area where she believed he was working. After three terrifying days, she eventually located him and managed to get him out of the crew. “The day we got him back, I promised I would do something to help the other kids out there,” she said.
Twenty-one years later, she is still keeping that promise. Today, she is the Ralph Nader of the traveling sales crew industry—publicizing labor abuses the way Nader once crusaded against unsafe cars.
The mission of Parent Watch, founded in 1983, is to shed light on the mistreatment of youth working in the door-to-door traveling sales crew industry. Williams won’t divulge many details about her organization’s size and makeup so that her opponents won’t “know what they’re up against.” But she will say that Parent Watch members are spread throughout the nation, largely composed of former sales crew members and their parents.
The group’s reach and influence is easily evidenced, though, at its Manhattan headquarters, where file cabinets are jammed with two decades’ worth of letters from kids and parents. Some are accompanied by photographs of victims, often young and physically abused.
“The industry targets men and women between the ages 18 to 25,” she said. She estimated that on any given day, 30,000 young people hit the streets just to hawk magazine subscriptions. In most cases, they are enlisted through newspaper ads that merely list a phone number and first name of a recruiter without detailing the type of work or identity of the company. Recruitment is heaviest during spring and early summer months, as the school year winds down.
Williams’ network has documented magazine sales crews selling in all fifty states. Hiring for sales crews rises during periods of economic downturn and high unemployment. “The road crews business is on the upswing,” she said, based on the thirty-five to forty pleas for help weekly—more than usual—that Parent Watch has recently started receiving. For she and her fellow watchdogs, this spike means longer workdays and added vigilance.
Although the number of those who have had traumatic experiences working on traveling road crews is large, many are reluctant to talk—either scared of previous employers, or protective of friends working on the crews. That’s why Cindy Fajardo started a Web site called magcrew.com, where literally hundreds of former salespeople, parents, and even former crew operators have posted anonymous messages. Scrolling through the stories is a horrifying experience. Typical entries include “I’ve seen girls get raped in hotel rooms” and “Many times I tried to leave, but they wouldn’t let me.”
In the midst of my investigation, “Inside Edition” on February 3, 2004, aired a segment on Pitts Sales, one of the country’s largest magazine sales companies, headquartered in Coral Springs, Florida. Using hidden cameras, the show revealed teens being physically abused and verbally harassed by their employers as well as smoking marijuana and drinking alcohol after hours.
Crew life can be more than abusive. For a crew traveling by van in Janesville, Wisconsin, it proved fatal. On March 25, 1999, their van was involved in a highway crash that killed seven of them and seriously injured five. One was rendered a quadriplegic; another suffered permanent brain damage. The Janesville crash was one of the most tragic events in the history of door-to-door magazine sales. Yet the incident is hardly isolated.
A February 2000 crash near Redding, California, killed two teens working for All-Star Promotions after their Ford Explorer plunged over an eighty-foot cliff; and a Minneapolis, Minnesota, van crash in October 2001 killed a member of Atlantic Circulation, Inc. and injured seven others in its crew.
“It’s a really dangerous environment for young people,” said Darlene Adkins, vice president of public policy for the National Consumers League. Each year, the Washington, D.C.- based consumer advocacy group ranks traveling crews among the top five worst teen jobs in the country. Its criteria includes reports of abuse, injuries and death.
“They are out in all kinds of weather, unsupervised and in neighborhoods they’re not familiar with,” Adkins said. Of the traveling crews, she added, “They are the kind of business that state departments of labor can’t stand … even if they are reported, once the police get there, they’ve already moved on.”
If law enforcement is aware of the traveling crews’ poor reputation, why haven’t they been able to thwart them?
“They leave no paper trail on who they hire,” she said. “They operate out of P.O. boxes.”
Pinning them down is difficult because they are always on the move. “Now we’re reaching out to consumers to tell them not to trust the product,” she added. “People need to know it’s not a charity. It’s a forprofit enterprise that’s exploiting children.”
Industry leaders are often flummoxed by such accusations. Most say they are running above-board businesses. They consider stories of exploitation to be untrue or largely exaggerated.
“It’s like any industry. There’s always a small percentage of bad people doing bad things,” said Belo Kellam, 61, owner of Fidelity Reader Services. His Naples, Florida, clearinghouse operates six traveling crews.
Kellam has been working in the door-to-door business since 1969. He is a board member and one of the founders of a leading trade group, the National Field Selling Association. In his experience, there are obvious explanations for his trade’s murky reputation.
“Seventy-five percent of complaints are sour grapes,” he said. “A person can’t go home and say they’ve failed, so they report all these terrible things. I have heard of some of these problems, but I’ve never had any of them personally.”
But on January 30, 2004, Frankie Lee Schmidt, 20, was arrested for stealing a watch from a customer’s house while on the job for Kellam’s Fidelity Reader Services. Another contracted seller for Fidelity was arrested two years ago. That seller, Nicolas Kuhlman, is serving prison time for exposing himself to a 6-year-old Arkansas girl. When I questioned Kellam about these cases, which took place within his own company, he ultimately acknowledged them , and said that he was “making an effort to do more background checks.”
Nevertheless, Kellam said his business has “never been better.” “There are [magazine] publishers out there really hurting for circulation,” he said, “and they don’t even want a percent of the profit from me. They just say, ‘Give me the numbers.’”
The Child Labor Coalition estimates that peddling crews bring in as much as $1 billion annually in untaxed sales revenue. The Magazine Publishers of America, a trade organization representing 240 companies that publish nearly 1,400 different magazines, acknowledged that the magazine industry does make money off traveling crews—albeit 1 percent of total profit. The rest of the revenue comes from other modes of magazine subscription sales such as online and direct mail campaigns.
Michael Pashby, an executive vice president for consumer marketing at the MPA, calls door-todoor salespeople “unauthorized selling agents.”
“A lot of publishers have no clue that their magazines are being sold this way, and they would be shocked,” Pashby said. When I asked him how publishers can attack this burgeoning problem, he said, “Publishers now have a tool with which they can track how their magazines are being sold.”
He declined to give specifics on this tool but suggested that publishers seek out details from the MPA and “individually track this information” and “terminate contracts with unlawful agents.” No so-called blacklist of troublesome contractors exists, however, because of what Pashby called “antitrust reasons.”
When I took it upon myself to tell some of these publishers what I had learned, I didn’t exactly get the kind of appreciation I was looking for. Here’s a typical reaction: The director of public relations for Hearst Magazines, Jessica Kleiman, said she was reluctant to discuss how Hearst gleans subscriptions. “It’s a really competitive field, and that’s proprietary information we would not want our competitors to have.”
Publishers have yet to publicly admit and formally address their industry’s underbelly, and the government has yet to enact federal legislation that specifically addresses traveling crews. Meanwhile, the scams and the abuses go on.
This is a problem that starts and ends with the consumers. Had I known when I opened my door to that young man, I would not have been afraid to say “No.” Because chances are, I wasn’t helping that fasttalking teenager by buying into his act. Sadly, I did just the opposite.
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