Smith & Merritt: Scam Your Way To Wealth?

I called it.

I don't mean to toot my own horn, here, but back almost a year ago, when Smith & Merritt were endlessly assaulting my ears with their inane slogan, “Spend your way to wealth”, on the Howard Stern Show, I said this:

They don’t seem to have any “products” for sale—except a “Free Report and Consultation,” which has to be some sort of loss-leader designed to get you to buy the “real” (and no doubt “real expensive”) stuff, whatever that is.

Shortly after I wrote that and the post following it, the Smith & Merritt advertising contract with the Stern Show ended, and they promptly dropped off my radar screen.

I gave them no more thought, until recently, when the number of hits to my blog via Google searches for “Smith and Merritt” started spiking. Then the comments started trickling in. Most painting an incomplete picture of some sort of high-pressure sales scam designed to bilk people out of $9,995 (or $3,895... I'm not sure which) with the promise of “materials” and/or coaching sessions.

Now, think about this for a second. People are coming to S&M for some sort of financial education, which, presumably, they need because they aren't doing so well, financially, right? So what's the likelihood that these people are going to have $9,995 in ready cash to spend on the S&M program? Undoubtedly, “But I don't have that kind of money” is a common objection, and it seems S&M have a ready “solution” - something that, based on the comments in this post, they dubbed a “student loan”. Apparently they counsel their clients to do a balance transfer from their credit cards to their checking accounts, after which S&M withdraws the money from checking. I may be wrong about this, but I believe that such a setup makes it more difficult to dispute the charge if you feel you've been ripped off - otherwise why would S&M go through the trouble?

A check at the BBB website for S&M or the deceptively named “College Partnership” (their other company?), reveals a number of unresolved complaints that seem similar to the ones people have been leaving on Die Eigenheit. I'd like to quote at length from a very detailed comment left today:

When we signed up for this program, we understood that we would get sound financial advice. Being this was our first experience with financial coaching & the cost of the program, we had no other reason to assume we weren't going to get financial advice. The salesman used high-pressure sales tactics & a needless sense of urgency in selling us the program stating that even if we wanted coaching there was a chance we wouldn't get "accepted". From the sales call (we have detailed notes of the call) he stated we'd have "unlimited access" from the best people in the business which implied financial advisors, yet he NEVER told us that we would NOT get coaching from financial advisors or planners. Had we known this, we wouldn't have signed up for the program. We purchased on Aug 7, 2006 for $3895 for 3 months of coaching. Even though we had 72 hrs to cancel after purchasing we hadn't started any coaching to determine that our coaching was just a professional form of cheering rather than financial advising. The first two sessions focused on our abundance statement and not finances! We realized especially after the 3rd session (around the beginning of September 2006) that this was not the service we expected. Besides calling us late, our coach hadn't even reviewed our financial reports we had emailed to her & after talking with our coach on the phone she informed us that she was not LICENSED to give us financial advice & we discovered that she didn't have a strong financial background! We were then assigned another coach because he used to sell insurance & had a "strong" financial background, yet after tolerating 2 sessions with him, we made the decision to seek a refund. We contacted the head of coaching and explained our concern & over the course of a few weeks or so she kept meeting with a "committee" giving us the impression that a decision would be made as to our refund. However, we eventually received a letter from a "customer care" lady stating that we should continue coaching & later another letter that we were to continue with 6 more sessions due to "contractual responsibilities" (whatever that means) & then they would reevaluate our complaint. Knowing that the coaching does not advise like we originally understood, this is an unreasonable request. She mentioned in the letter that we needed to file an "official withdrawal" from the coaching program & other pertinent information, yet when we have called the SLC office to receive further instruction to get the form or other information, we have had no response. We have made numerous attempts to talk the salesman regarding the sale & others regarding a refund & neither has returned our calls. We filed a complaint with the BBB on March 1, 2007 & the information was sent apparently to California & was returned with a correspondence stating that he wasn't in charge of refunds. We filed a complaint with the SLC office. That BBB complaint came back unanswered.

If it wasn't clear before that Smith & Merritt is a company to avoid, it seems quite clear now.