In the age of the internet, companies have to constantly worry about angry consumers telling the world their troubles. I'm thrilled that the internet has given consumers a voice. Previously, companies could do as they wished with their customers, and the chances of anyone finding out were slim. Now that's not the case as blogging is a tool available to anyone with access to a computer.

Companies need to be more careful in how they deal with customers, especially if their customers have a very large platform from which to shout about their experiences. Imagine what happens when a Washington Times columnist gets cheated by multi-level marketing company Pre-Paid Legal....

Kate Tsubata had a Pre-Paid Legal membership at one time, but quickly canceled it when she and her husband realized it didn't cover any of the things they needed and believed were covered. 20 months after canceling their membership, they realized that they had been charged $12.95 a month for a Pre-Paid Legal service they didn't sign up for.

PrePaid Legal Services and companies like it sell plans that are billed as "legal insurance." These plans supposedly help the average consumer received "free" legal services in many cases, and discounted services in other cases. They're often marketed as offering help to the "little guy" who might otherwise not be able to afford a lawyer.

The truth? These plans offer very little real help to consumers. Many types of cases are excluded under the plans, so you won't be receiving any "free" services related to them. If you do happen to qualify for services, you'll find out quickly that the services are very limited and are mostly only for time spent on trial. Many hours of legal services will be needed prior to the trial, but most of this is excluded from the plans, and plan participants will have to pay out of their pockets for those services.

More details in this video. (Disclosure: I was paid by Fraud Discovery Institute to help research the issues raised in this video.)



Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.

Probably the worst part about pursuing a legal remedy to a problem is hiring a lawyer. It's not that they're not good. It's not that they don't help you win your case. It's that they're so darn expensive for the average person. With billing rates in the hundreds of dollars per hour, the cost to have an attorney go to court for you can rise quickly.

But companies with deep pockets find attorneys expensive too. Just as Sun-Times Media Group (formerly Hollinger International), the parent company of the Chicago Sun-Times and several smaller newspapers. The company reported numbers for 2007, and they weren't good.