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How to resolve a complaint against the Better Business Bureau (BBB)

While the Better Business Bureau’s core goals are laudable, a growing number of media and online reports reveal serious problems in the structure and practices of individual branches, and perhaps the entire organization. Reported problems include conflict of interest, aggressive marketing practices, bad ratings for good businesses or good ratings for bad businesses, and uneven application of rating criteria.

The BBB was founded in 1912 to combat marketplace fraud; its stated mission is “to be the leader in advancing marketplace trust.” For decades it functioned well as an organization for industry self-regulation—so well, in fact, that consumers have come to think of it as a government agency. It is not.

The BBB is essentially a franchise business, with a sales force that solicits membership. As a non-profit it pays salaries of its choosing but cannot have shareholders. It asks both member and non-member businesses to address complaints regarding transactions and decides whether the response is reasonable. Some complaints are outside the Bureau’s scope, for example complaints about policies, pricing, landlord/tenant disputes, or professional procedures. The BBB also creates and publishes business reviews based on complaint resolution and other factors, awarding businesses grades ranging from A+ to F.

If your business reputation has been damaged by an unfair review, or if you believe that a BBB review misled you or a complaint was not properly handled, you can take action to resolve your complaint.

Many BBB franchises are ethical, diligent and helpful. However, differing franchise and compensation structures mean that practices and standards of professionalism can vary widely from branch to branch. PeopleClaim ratings of BBB branches range from A+ to F.

As popular consumer review and complaint sites continue to grow rapidly, the BBB’s new and old practices have increasingly generated complaints. Some companies complain that their business has been damaged by a particular BBB office’s capricious, competitive or subjective tactics. Equally, some consumers complain that they’ve been misled by ratings.


Complaints about the BBB’s operations increased dramatically in 2009 after it changed its rating system from “acceptable/unacceptable” to a controversial A+ to F grading system. Questions multiplied when an ABC 20/20 investigation and a number of news articles spotlighted a system cracked by serious ethical breaches. Some BBB franchises didn’t conduct basic checks into the businesses they were rating—Hamas and white supremacist group Stormfront received A ratings once membership fees were paid; complaints against real businesses ‘went away’ with a paid-up membership.

"If I'm paying for a grade,” one business owner asked 20/20, “then how are the customers supposed to really trust the Better Business Bureau?"

Common Complaints about the BBB

  • Inconsistent application of grading criteria: Each BBB branch is independently owned and has a certain amount of autonomy. Businesses have complained that they’ve been given an F grade after a single complaint—or been downgraded despite a very low complaint rate, based on a subjective ‘advertising review’ or ‘failure to disclose’ information that in some cases was available on the company or charity’s website. The BBB has also determined that some businesses will never be able to earn more than an F, not because of the company’s own practices but simply because of the BBB’s experience of the ‘business type.’ Some accredited businesses have retained an A+ rating despite government action against them, and/or despite red flags raised by other BBB branches. (See here for a Beaumont Enterprise story about this.)
  • Overstepping: Businesses have complained that Better Business Bureaus unilaterally demand information about marketing, operations, and customer lists, even in the absence of consumer complaints. Although a business is not legally required to comply with fishing expeditions by another business, refusal to do so may result in a downgrade. Such grades do not reflect actual marketplace problems but can damage reputation.
  • Subjective criteria for grading resolution of complaints: The BBB decides what counts as a ‘reasonable’ or ‘unsatisfactory’ response. See what The New York Times’ Haggler, David Segal, has to say here and here, including “...critics of the Bureau have also contended that, in recent years, membership buys a business what could politely be called the benefit of the doubt.”
  • Inherent conflicts of interest; failure to maintain neutrality: The BBB makes its income from business accreditation fees, from BBB sponsored listings websites, and, according to Smart Money’s “Is the BBB Too Cozy With the Firms It Monitors?”, from selling customized consumer data collected during the complaint process.

    The ‘request a quote’ link, through which consumers can contact an accredited business, is a membership benefit that could be considered a form of advertising or endorsement, although the BBB disagrees with this perception.

    Accredited business descriptions in a BBB review may include non-neutral statements. For instance, one BBB business review states, “This company provides both business and individual clients a strategic, ethical and highly-effective approach to solving tax debt issues,” just below the accreditation and rating information.

    PeopleClaim - Business description, or commercial message?
    Above: Business description, or commercial message?

    Some consumers have complained that complaints against accredited businesses are not properly handled.

  • Misleading consumers: According to former Connecticut Attorney General Richard Blumenthal, “There are clear, practical and logistical limits to the BBB’s ability to accurately and fairly implement a full ratings system for businesses. Extensive resources are necessary to verify the self-reported information that the BBB receives from businesses. This information includes compliance with state and federal licensing and registration requirements, outstanding lawsuits, time in business and financial stability. My understanding is that the BBB does not have the resources to verify all self-reported business information.”

    Blumenthal strongly criticized the BBB after a business that had won the Torch Award, the BBB’s award for the highest ethical standards, allegedly defrauded people while touting the award.

  • Non-response to complaints and failure to correct false or misleading information: The BBB might not investigate, or respond to, complaints about itself. Some businesses have noted that disputing a grade has led to a further downgrade.
  • Aggressive marketing techniques: Businesses have complained that they feel undue pressure to become BBB-accredited. Jan Fletcher notes on the Intuit Small Business Blog that the BBB “will only review the validity of complaints if those businesses are accredited.” When FeeFighters wrote a blog post about complaint review incentives (see here) they lost their accreditation (see here).
  • Public confusion over the BBB's status and authority: For instance, a BBB-accredited A+ rated business continues to refer to the BBB as a ‘government agency.’ The BBB is not a government agency and has no legal authority, but public perception may lead consumers to place undue trust in its grades. It could also cause businesses to feel undue pressure to buy membership when contacted, or provide information that need not be publicly disclosed.
    PeopleClaim - Confusion – Is it, or isn’t it? (It isn’t.)
    Above: Above: Confusion – Is it, or isn’t it? (It isn’t.)

So…what to do?

If you have a business:

Say a customer calls and asks you to explain your F rating. You’re mystified. You’ve never even heard from the BBB, or you’re concerned that the grade is connected to a BBB sales call, or you’ve apparently ‘earned’ a lousy grade even after a very small number of complaints. Now what?

1. Respond courteously to complaints filed about your business—that should be a given—and provide a copy of the terms that the customer agreed to, if appropriate. Review complaints seriously. Does the consumer have a point, and should you change a practice? But also ask to file a publicly viewable rebuttal if the BBB does not consider your response reasonable.

And some, but not all, BBB offices will allow you to post clarification of common issues, e.g. a return policy, or preferred methods of contacting your company prior to complaining to the BBB. (The BBB says that “BBB’s strongly encourage consumers to first contact the business.”)

2. Ask for corrections.If the BBB displays incorrect contact or personnel information for your company, or other incorrect information, ask the office responsible to correct it. Failure to do so may be a bad sign.

If the BBB’s review of your business contains incorrect, false, or misleading information or if you believe that a grade is arbitrary, notify the franchise responsible in writing.

3. No response? Notify the CBBB (Council of Better Business Bureaus) in writing. Though each BBB office is independently owned, the BBB national organization needs to be aware of issues involving its franchisees and the public perception of the BBB brand if it is to exert any influence correcting situations at the local level.

4. File a formal, structured complaint through for the price of your lunchtime salad. PeopleClaim doesn’t publish the names of claimants, but in order to challenge any negative content the BBB is putting out you should use your business name frequently within the body of the complaint. Tell your side of the story.

We’ll deliver it by email and/or mail—certified mail if you like—and the BBB will have the opportunity to respond. If the franchise doesn’t resolve your complaint, the complaint will post publicly after the negotiation period.

How does this help? It’s important if, say, the BBB really doesn’t understand your business and hasn’t taken the time to learn about it before deciding you didn’t make a good-faith response. There’s a good chance that anyone researching your business will find your SEO-optimized claim, too, and read what you have to say. You can post your unresolved complaint to your Facebook page, and otherwise share it.

You can also invite communication from people who’ve had issues with the same BBB franchise, and from lawyers who may consider taking action—they can contact you privately or publicly via the PeopleClaim system.

5. Notify regulators. Take it further—the FTC, your state’s Attorney General, and other regulators all monitor patterns of complaints and intervene when appropriate. PeopleClaim can even forward your complaint to appropriate regulators if you choose.

6. If you end up having to file a lawsuitas Incorp did—see here—your PeopleClaim documents your attempt to resolve the problem.

If you’re a consumer:

You saw that the BBB gave a company an A+ rating and accreditation, so you went for the offer. But it turns out the business review contained gamed or inaccurate information, and some patient people now have lots of YOUR money. Or maybe the BBB just didn’t get your complaint resolved—and you’re not convinced they even tried. What now?

1. Do your diligence and avoid problems. Don’t rely solely on BBB ratings—that information may be incomplete or incorrect. Research widely on as many sites as possible. If an unresolved complaint has been published on, read it. Think carefully about what the claimant says, and how the business responded after it was notified. If you look at Yelp, make sure you read reviews caught in the filter (there’s a tiny grayed-out link at the bottom of the page). Rely on your own brain—what could go possibly wrong if you do business with this company? Could you afford to lose the money? Check licensing, any security bonds, and common complaints about similar businesses, or issues noted by your state’s Attorney General. Read ALL Terms and Conditions before you agree to them.

2. Understand the limits. Not every complaint is going to be resolved. If you agreed that you’d return a package within 10 days in order to cancel, and you didn’t, then the company you’re complaining about may have the right not to refund your money—even if you didn’t read the Terms and Conditions. If you wired money to the Caymans for a timeshare deal offered over the phone, you may not get it back. But you can check that your complaint was properly reviewed and documented, and given a full and fair hearing.

3. Rate the ratings. The BBB has been known to give great companies lousy ratings (the Ritz-Carlton, Starbucks and Wolfgang Puck all got Fs) and bad companies great ratings. If your experience with an F-rated company is terrific, or an A-rated company lets you down, tell the BBB responsible for the grade. Challenge those ratings at the source.

4. If you were misled by an undeserved rating, file a PeopleClaim. . Document exactly what happened, when, why, and how much you lost. The BBB will understand that you’re serious. And if they don’t resolve your comlaint, your claim will serve to warn other people if you choose to have it publicly posted. Other people with similar complaints or attorneys will be able to contact you via the PeopleClaim messaging system, too.

The BBB can be a very valuable resource. But it’s not a perfect one, and it’s not, as commonly believed, a government agency—it’s a business. As such, it has to make money like every other business and, like any business, it makes mistakes. You have a right to complain about those.

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