The Bait & Switch Scam: How to Recognize It and What to Do If You’ve Been Targeted

Published on June 12, 2020 by the FairShake Team

Picture this: You’re perusing the Sunday paper over breakfast, when you see an advertisement from a local sporting goods store.

“Fancy Brand Running Shoes for Just $20!” the ad proclaims. “Sunday Only!”

“Well shoot,” you think to yourself. “Better head to the sporting goods store to take advantage of that screamin’ deal.”

Only when you arrive there and ask a sales associate where you can find the Fancy Brand running shoes from the ad, they instead show you a different product entirely: Extra Fancy Brand running shoes, on sale — today only — for $120 a pair. And then they start giving you a sales pitch, putting on the pressure, telling you about how Extra Fancy Brand shoes are so much better than Fancy Brand shoes, you’d be a fool not to buy a pair at this price. 

As you keep asking where you can find the Fancy Brand shoes you came for, the sales associate keeps turning up the heat, pressuring you more and more about buying a pair of Extra Fancy Brand shoes. It slowly becomes apparent that the store doesn’t want you to get that great sales price they advertised in the paper — they just used that to get you in the door so they could use a high-pressure sales pitch to sell you a much more expensive product.

You’ve just been hit with a bait and switch.

Before you walk out of the store totally frustrated and vow never to read the Sunday ads again, you should know that the type of “bait and switch” the sporting goods store pulled off in this hypothetical example would violate advertising laws. It’s illegal for stores to act like this, and if you ever see it happening, you have rights. 

Want to know how to spot these scams in the wild, and how to get justice if you’re ever taken advantage of with a bait and switch? Read on.

What Is a Bait and Switch?

Just like in the fictional example above, a ,“bait and switch” is a type of fraudulent advertising. It occurs when a company or store advertises an item at an incredibly low price, but with the aim of convincing shoppers to buy something else when they arrive.

How a Bait and Switch Scam Works

The scam starts when the seller advertises an item for much, much lower than its market price. For this example, let’s say a company is advertising a top-of-the-line, touchscreen laptop for $50. No brand new, modern laptop costs $50, so it’s pretty clear the price is too good to be true. Regardless, people fall for the ad and head to the store to buy their $50 laptops.

Once a customer arrives at the store, the second part of the scam can take a few different forms:

  • A sales representative might say that the advertised laptop is out of stock, but there are other, similar laptops available for a much higher price. 
  • They might also offer a choice between a similar laptop to the one advertised that costs much more than $50, or a different $50 laptop that’s far inferior to the one in the advertisement.
  • The advertised laptop might be available, but for a higher price. In this case, the sales representative might make excuses for the price discrepancy, like saying the available laptop has better features or works better than the one in the ad. They might also claim that the low price in the advertisement was only available to a set number of customers, and now that the offer is sold out, the laptop is back at its market price.

The goal of a bait and switch scam is to get customers to either purchase a more expensive item, or buy a cheaper, inferior item at the advertised price, to avoid leaving empty-handed once they’ve made the trip to the store. Unfortunately, it often works. But that doesn’t make it any less illegal.

When Is It Not Bait and Switch?

There are some scenarios that might seem like bait and switch scams at first glance, but they’re actually not. Still, there are people who mistake these for bait and switch, and report them. Here’s when you know it’s not a bait and switch scam.

  • When the store or seller makes a genuine pricing error. These are one of the most common complaints that get incorrectly classified as bait and switch. If the vendor made a genuine mistake and listed an item at the wrong price, they can refuse to honor the mistakenly listed price, and cancel any sales that were made at the incorrect price (with refunds to the buyers, of course). 
  • When there are actually just a few units available. It’s OK for retailers to run a sale where they offer an item at a steep discount — but only for a select number of shoppers. However, in order for this to be above board, the retailer must clearly state in the advertisement that the deal is only for the first number of shoppers to make the purchase, and list the price the item will be sold at after those promotional units sell out. Then, the retailer needs to honor what’s written in the ad, and sell that number of discounted units. As long as the seller clearly provides all the terms and conditions of the sale and then honors them, it’s not bait and switch.

Is Bait and Switch Legal?

The short answer is no. Businesses that use bait and switch tactics to get shoppers into their stores are breaking the law.

Here’s the longer answer: Bait and switch is a type of false advertising, which is prohibited under the “truth in advertising” rules in Section 5 of the Federal Trade Commission Act, which was passed in 1914. The law prevents all kinds of false advertising, and bait and switch scams represent just one small part of what’s illegal according to the FTC Act. 

According to the law, consumers should be able to report bait and switch scams and at least get stores to stop using them. They may also be able to recover money if they’ve been taken advantage of with a bait and switch, but more on that later.

What to Do if You See a Business Using Bait and Switch

If you see a business trying to use bait and switch tactics to scam customers, there are things you can do to stop them.

Since false advertising rules are outlined in the FTC Act, it’s up to the FTC to enforce them. That means, if you’re going to report a bait and switch, your first step is submitting a consumer report to the FTC, which you can do by filling out an online form.

The FTC will investigate the complaint and take action against the seller if they find evidence that bait and switch tactics were being used. The actions the FTC might take range from issuing a warning and asking the seller to stop, to charging them a fine, to suing them in court

How to Prove a Bait and Switch

Generally, once you report a business to the FTC, they’ll do their own investigation and look for evidence that the business was using false advertising. You can submit any evidence you do have along with your complaint, and that may help the FTC along.

However, if one of your goals is to get money back or some other form of justice from a company that scammed you with a bait and switch, you may be required to prove that the company was intentionally trying to mislead customers with its advertising. That can be extremely hard to do.

Make sure to keep copies of the business’s advertisements. You can screenshot them if they’re online or in another digital format, and clip copies if they’re in print. After experiencing what you believe to be a bait and switch, write down everything you remember about what happened at the store while it’s still fresh in your mind. If you’re able to get photos and videos that help prove the business never had the item in the advertisement, that can help your case — just keep in mind that businesses are private property and you can be asked to stop taking photos or videos, or asked to leave the premises if you attempt to do so.

If You’ve Been Scammed, You Can Get Justice

While the FTC can punish companies for false advertising, your recourse against a company that scams you is often dependent on your state’s laws related to Unfair and Deceptive Acts and Practices.

One avenue for justice that you may want to consider is consumer arbitration. Arbitration is a type of conflict resolution between businesses and consumers. You and a representative from the business will both present your side of the dispute to an arbitrator, who is a specially trained, neutral third party. The arbitrator can decide who is in the right, and can order the business to compensate you if that’s the resolution they think is appropriate. Arbitrators’ decisions are legally binding, and usually can’t be appealed, making the process similar to a lawsuit, but often faster and less expensive.

And if you’d like to pursue arbitration but aren’t sure how to get started, we can help. FairShake will help you with all the paperwork to start your arbitration claim, and then offer expert guidance at every step of the process. Learn more to see how you can get your fair shake today.

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