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What You Never Knew About The Better Business Bureau


The Better Business Bureau (BBB), formed in 1912, has become synonymous with consumer protection.  Most people believe that the BBB is a government watchdog organization.  That is what I believed for many years myself.  Although the organization is a non-profit, their executives seem to do very well financially (see the Dateline video below).  Despite using the name bureau, they are not affiliated in any way with any government agency.

From The Los Angeles Times:

Top Better Business Bureau Executive At L.A. Branch Earns More Than $400,000

When I started my first business more than twenty years ago, the BBB came knocking at my door asking me to join.  I don't remember what the exact cost was but it was more than I could afford to shell out as a new business owner.  I remember the sales pitch being very ominous.  In essence, if I did not join, my business would not have any official listing with the them and I would likely lose a great deal of potential customers, etc...  That really left a bad taste in my mouth and years later even when I could afford to join I never did. 

Checking Out The BBB With My Own Consumer Complaint

We hired a contractor to do some work at our home a few months ago.  The centerpiece of his sales pitch was his A rating with the BBB (which I did verify with the BBB website).  This did not play a vital role in my decision but I did file that information away.  He had good references and displayed a license on his website.  He provided a professional bid proposal.  He agreed to work for 50% payment in advance and the remainder upon completion.  All went well with the project until we found out that he did not pay one of the material providers and we ended up with a lien on our house for $1,200.  I also contacted our City and learned that he had not completed the final inspection and we were not in compliance with code.  So, I was in a mess.

As you can imagine, he unfortunately picked the wrong guy to do this to.  While pursuing complaints with various government organizations, I thought I would report him to the BBB and use my experience as the basis for a future article.  Here is an outline of what has happened so far:

  • He was immediately sent a certified letter by the BBB giving him 14 days to respond.
  • He did not respond.
  • They sent him a second certified letter giving him another 14 days to respond.
  • He did not respond to the second letter.
  • The BBB contacted me by e mail to ask if the contractor had contacted me to work out the problem directly.  I replied that he had not.
  • At the 36 day point he still has an A rating with the BBB and his profile says no customer complaints.

I contacted the BBB just yesterday and they said they were still hoping to hear back from him so that he could give his side of the story.  They were very defensive with me when I shared my disappointment about what little they had done.  I was told that they are not a government organization and have no authority to make the contractor finish the job.  When I asked them why he was still enjoying an A rating, they said that his A rating will "eventually" be reduced at some point due to my complaint.  I really did not expect very much from the BBB but even with my very low expectations, I was still disappointed.  If this individual simply responded to one of the letters and denied my accusations, the matter would be dragged out for weeks, perhaps months.  In the end, the most I could have expected was a voluntary mediation at some point well down the road.  The mediation would be non-binding on the contractor, so in my view would be meaningless anyway.


From Wikipedia -

In 2010, 20/20, an ABC network news magazine, reported in a segment titled 'The Best Ratings Money Can Buy' about the irregularities in BBB ratings. They reported that a man created two dummy companies which received A+ ratings as soon as he had paid the membership fee. They also reported that business owners were told that the only way to improve their rating was by paying the fee. In one case a C was turned to an A immediately after a payment and in another case a C- became an A+. Chef  Wolfgang Puck said that some of his businesses receive Fs because he refuses to pay a fee. Ritz Carlton, which does not belong either, also receives Fs for not responding to its complaints.


The Better Business Bureau Does Not Perform Even The Most Basic Due Diligence

A company can be listed with the BBB without proper licensing.  In my own case, the individual did not have a license to do work in my city but was licensed in other locations (something I should have been more careful to check).  The BBB told me that they do not verify the licenses of individuals listed on their website and that this was solely the responsibility of the consumer.

How To Really Get Help With A Complaint Against A Licensed Business

I did recently get the lien released with help from a local government agency which is now threatening legal action against his license if he does not finish the job.  If you have a dispute with a licensed professional in virtually any trade, the best course of action is to go directly to the government organization(s) that issued their license.  In my own case, I worked both angles and found no help whatsoever from the BBB.

My advice would be to only use the BBB as a secondary line of attack when you have a dispute with a business.  I would consider my experience with them a complete waste of time, other than the fodder it provided for this article.

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James L. Paris
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