Summary of Action

TINA.org investigated one of the world’s largest penny auction websites — DealDash, Inc., a Finnish company with offices in Minnesota — and determined that the company is engaged in deceptive marketing, as well as an illegal gambling venture.

Specifically, TINA.org’s investigation revealed that DealDash:

  • advertises incredible savings on auctioned items won without adequately disclosing the true out-of-pocket cost for obtaining the products;
  • uses consumer testimonials touting atypical savings on products won without clearly and conspicuously disclosing that DealDash customers typically lose money on the auctions;
  • promotes a perpetual sale on the purchase of bid packs;
  • fails to disclose its material connection to certain products that are advertised and auctioned on DealDash.com; and
  • promotes a 100% money-back guarantee refund policy without adequately disclosing the significant restrictions of the policy.

TINA.org found that DealDash uses these deceptive marketing tactics to lure consumers to its website with promises of easily won bargains, but fails to disclose that DealDash is operating a form of gambling whereby consumers are paying the company for chances to win products.  This practice — charging for chances to win — is illegal.

As a result of these findings, TINA.org sent a warning letter to Deal Dash on May 25, 2017 alerting it to the issues and requesting that the company immediately remedy the deceptive and illegal practices.  However, the company did not make any noticeable changes to its campaign, website, or mobile app.  Accordingly, on June 5, 2017, TINA.org filed complaint letters with the Federal Trade Commission and the Attorneys General of Minnesota, New York, Connecticut, Pennsylvania, Massachusetts, and the District of Columbia urging each of the agencies to take action.  TINA.org also notified the BBB, which, as of June 2017, gave DealDash an A+ rating, of the company’s deceptive and illegal marketing and business practices.

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