Get a free restaurant dinner and find out what some prominent doctors and major medical centers have known for years! The pitch: by increasing blood circulation, “magnetic field therapy” would relieve pain, aid sleep, relieve swollen joints – maybe, some claimed, even stop hair loss and cure sexual dysfunction.
The spiel drew customers across the country to restaurants, where they paid for magnetic mattress pads, magnetic pillows, magnetic seat cushions and magnetic insoles from Georgia-based Bene-Fit Health Products. From 2005 to 2013, the company pulled in about $7 million a year.
Kingsland-based Bene-Fit might have gotten away with it for years more, if it hadn’t been so successful. But by 2011, it couldn’t keep up with orders, and customers started complaining that they didn’t get products they paid for and couldn’t get refunds.
That drew the attention of the Governor’s Office of Consumer Protection, which found just a few things wrong with Bene-Fit’s business model.
For one, it solicited business by using robo-calls to people who hadn’t agreed to the messages. That violates the law, the office said.
Two, it took orders for merchandise it knew it couldn’t fulfill. Georgia considers that a deceptive trade practice.
And three, the claims it made about health benefits of magnets were false, the Governor’s Office of Consumer Protection determined.
It slapped the company and owners Dennis Lovett and Richard Perkins with a proposed penalty of almost $2.4 million for unfair or deceptive practices.
The company, though, had one last pitch. It appealed to the Office of State Administrative Hearings. It found that the consumer protection office had proved its case and that Lovett and Perkins were each individually liable. But the administrative law judge, in a recent ruling, lowered the civil penalty by a million dollars.
Reasons: The company was shut down, so it had limited ability to pay. Lovett and Perkins also pleaded poverty, although the judge noted that they presented little evidence to support their claims.
No word on whether customers – many of them over age 60 – will see any of the $1.38 million the men are ordered to pay.