Feb. 6, 2009 at 8:00 AM ET
Ed McMahon once traveled the country telling lucky families they'd won a huge cash prize through a sweepstakes. On Super Bowl Sunday, he told viewers they can turn old jewelry into money by sending it to a company named Cash4Gold.
But one blogger who's critical of the firm McMahon is touting has recently discovered that sometimes words can be more valuable than gold.
Web satirist Rob Cockerham stumbled into the bizarre and sometimes aggressive world of search engine optimization recently after he published a blog entry that criticized Cash4Gold; the firm then offered him money if he'd remove the site.
A few months ago, Cockerham posted the tale of a man who claims he sent $180 worth of gold to Cash4Gold only to receive a lowball offer of $60. The item was read and linked to by so many Web users that it quickly climbed the rankings at search engines like Google. That caught the attention of Cash4Gold, a Pompano Beach, Fla. company.
Just a few days before the Super Bowl – and the airing of McMahon's Super Bowl ad -- Cockerham revealed that a Cash4Gold representative had sent him an e-mail offering him "a few thousand" dollars to take down his critical Web site.
"I'm still marveling over it," Cockerham said. "They sent me a bribe e-mail."
Cash4Gold is one of several companies that have emerged in recent months offering to exchange old jewelry for cash. The process is simple; consumers contact the firm, receive a special envelope in the mail, send in their jewelry items and receive a check. Consumers can either cash the check if they accept Cash4Gold's offer or reject it and ask that their jewelry be returned. Cash4Gold customers also have the option of receiving payments instantly and electronically, bypassing the negotiating step.
A lowball offer?
Cockerham's blog alleging that Cash4Gold made the lowball offer included detailed documentation of the transaction provided by a consumer named Brent Kutz.
"I had some gold I was going to sell anyways so I was thought I would keep track of the details for insurance in case of loss and to give (Cockerham) the information for one of his articles," Kutz said. So before he mailed the jewelry to Cash4Gold, he took it to a local pawn shop and received an offer of $180. "I really didn't think I would have a problem with the amount before I did it. I was more looking at it from what I could get locally and then from Cash4gold as they advertise paying higher amounts," he said
Kutz said Cash4Gold sent him a check for $60. When he called and balked at the offer, it was increased to $180. He then sent the evidence to Cockerham.
"This tells me (consumers) should never accept Cash4Gold's first offer," Cockerham said.
Most customers satisfied, company says
Cash4Gold CEO Jeff Aranson didn't dispute Cockerham's account, though he said he no specific knowledge of the transaction because his company processes thousands of requests each day. But he suggested that Brent may have "bullied" a telephone operator into increasing the firm's offer for his jewelry.
He added that his company does not aim to compete with pawn shops. Instead, it allows consumers to liquidate their unwanted jewelry with ease and privacy. And he said jewelry can often be sold at five or six times the "melt" value, so wide price discrepancies in appraisals can be common. In other words, a pawn shop might get a higher price for old jewelry after cleaning it than Cash4Gold would get by melting it down.
Cash4Gold has sent checks to 500,000 consumers in the past 12 months with only a handful of complaints, Aranson said.
"I view us as the world's largest appraisal service," he said. "Only one-tenth of 1 percent complain that they are not happy."
'Aware of what was going on'
Aranson confirmed that Cockerham was offered financial compensation for removal of the negative Web site. But he said the e-mail was written by an employee of a third-party company who was acting independently, and that employee is no longer associated with Cash4Gold.
"We had no idea it happened at the time," he said. "I wouldn't have done it and I don't endorse it."
The man who sent the e-mail, Joe Laratro of marketing firm Tandem Interactive, challenged Aranson's account.
"Everyone (at Cash4Gold) was well aware of what was going on," he told msnbc.com.
Laratro said his company provided search engine optimization for Cash4Gold, a field in which tactics can range from simply adding keywords to a Web site to improve search engine performance to creating fake Web sites so a competitor or critical blogger is pushed off page of Google results.
Laratro also denied that the offer was intended as a bribe, saying it was meant to be a part of a chatty negotiation.
"Anything within reason we would have done," he said, adding that companies regularly contact consumers who have posted negative information on Web sites and try to satisfy their complaints. "This was about what we could do to make this guy happy." He even suggested the firm would make a donation to Cockerham's "favorite charity."
Cockerham, however, would have none of it. Instead, he posted Laratro's e-mail on his Web site, alongside the rest of the saga.
Cockerham regularly pulls such "gags" on his blog, Cockeyed.com. Many are designed to embarrass companies he feels are misbehaving. One such stunt earned him an entry in the Red Tape Chronicles two years ago, after he ripped up a credit card application, taped it back together to simulate the behavior of dumpster-diving identity thief and then mailed it to the bank. A few weeks after he returned the disheveled application, he received a credit card.
But Cockerham said in a recent entry, titled "Cash4Gold would like to melt down and recast their reputation," that in his relatively long history as a critical blogger, "This was the first time someone else was trying to buy me out of their Google search results."
The offer, he said, wasn't the sort of reward he was looking for.
"This is my declaration of not selling out. I think it will work out better this way, don't you?"
Leave a comment below or become a member of the Red Tape Raiders and be a consumer advocate!