FTC issues warning about ‘freebies’

     The Federal Trade Commission (FTC) has issued a consumer alert for ads featuring such claims as “free,” “low cost” or “PC’s for $199.”
     The FTC warns that free does not always mean free, and the public should always check under what condition they are receiving free items.
     Often, conditions and restrictions that are found in the fine print of advertisements for free or low-cost PC’s can turn a so-called good deal into a big-ticket item.
     Someone shopping for a computer may have been attracted to ads offering free or low-cost PC’s that often require bundle Internet service contracts, lasting up to three years.
     Sometimes, signing up for Internet service, one gets as much as a $400 rebate on the computer purchase.
     Some offers may be good deals, but many are not as affordable as they seem. Frequently, important details can be left out of the advertising or buried in the fine print, the FTC points out.
     Buying a low-cost PC may mean paying full cost up front, that is, paying full price without any rebates.
     If the PC costs $199 after rebates, the purchaser may have to pay $599, plus any sales tax and shipping charges and then send in for a $400 rebate.
     When one buys a free or low-cost computer, he/she often has to sign up for three years of Internet service at $20-$30 a month. That monthly fee can result in a total cost of up to $1,000 for three years.
     If the consumer decides to cancel the service for any reason, chances are he’ll have to pay back some, if not all, of the rebate he received. He may also be charged a cancellation fee of $50 or more.
     If the PC offer requires the purchaser to sign-up for Internet service, one should ask the retailer and the ISP for the Internet access phone number closest to his home.
     Then one should check with the local phone company to determine whether one would have to pay long distance rates to use those numbers.
     The consumer may want to consider another offer if the deal being considered requires calling long distance or paying a fee to access the Internet.
     It is possible the cost of the monitor or other crucial system components may not be included in the PC offer under consideration. Advertisements may not be clear about what’s included, and a monitor could cost another $150
     When considering one of these deals, one should ask the retailer about up-front costs, rebates, essential components, Internet access costs, long-term commitments, cancellation policies, local or long distance phone access and any other important details.
     Anyone who thinks he has been misled about a free or low-cost PC offer should contact the Federal Trade Commission at 1-877-FTC-HELP (382-4357); online at ftc.gov (click on Complaint Form) or by mail at Consumer Response Center, Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, DC 20580.