Agressive Selling - How to Protect yourself


Case story

Mr Timothy Chew received a call from a telemarketer of a bank promoting an insurance policy that would help him pay off the outstanding balance in his credit card should anything untoward happen to him. The telemarketer spent half an hour telling Mr Chew about the benefits of the product and persuaded him to sign up for the product. Despite the telemarketer's efforts, Mr Chew told the telemarketer that he was not interested in the policy.

Two weeks later, Mr Chew was puzzled to receive a letter from the bank confirming that he had purchased the insurance policy and that they had charged the premiums to his credit card account. There was a clause in the policy stating that should he wish to cancel the policy, he would have to write to the bank. He immediately contacted the bank to find out what had happened. The bank investigated and found that the telemarketer had been overzealous in wanting to close the deal and had gone ahead to process Mr Chew's application despite having been told that he was not interested. The bank apologized to Mr Chew for the incident, cancelled his policy and refunded him the premiums.

What is aggressive selling?

Aggressive selling occurs when sales persons use high-pressure sales tactics to make that quick dollar out of you. There is often a high degree of persistence and sales talk amidst the financial advice that is given.

What are the tell-tale signs?

Below are some common phrases used. Learn to identify their techniques to protect yourself.

  • "You can get the latest camera for free if you sign up!"
    The financial product often comes bundled with an irresistible free gift to win
    you over.
  • "You can get a 10% annual return and enjoy many other benefits."
    The benefits and high returns of the product are emphasized while the risks and fees are only briefly mentioned.
  • "This product is offered at a special rate now, for a limited period. You'll be missing out on a good opportunity."
    This plays on your fear of missing out on the opportunity to make more money.
  • "Many people have signed up for this. What are you waiting for?"
    The "majority is always right" concept is used to make you feel more assured.

 

MoneySENSE offers some tips on what you can do to protect yourself from becoming a victim of aggressive selling:

With telemarketers,

  • Ask for identification such as the caller's name, contact details, company and their purpose in calling. These details will help if you need to lodge a complaint later.
  • If you do not need the financial product, tell them firmly that you are not interested and end the conversation promptly.
  • If you do not have sufficient information about the product, do not sign up for it over the phone. Emphasize that you have not agreed to sign up. Instead, ask for a product brochure or make an appointment with a financial adviser to find out more.

In general,

  • Never make a hasty decision without understanding what is being recommended. Seek independent advice from trusted persons who are more knowledgeable.
  • Beware of sales persons who only promote the benefits of the product. Read the fine print and ask as many questions as you need, e.g. about the risks, fees and charges.
  • Deal with your own emotions. Do you really need the product? If not, learn to say "No" and walk away.

What are your rights as a consumer?

  • If you have been sold a financial product that you did not sign up for, or the telemarketer calls you at inappropriate times or harasses you with numerous calls, lodge a complaint with the financial institution that the telemarketer represents.
  • Banks are allowed to disclose your identification and contact information to other financial institutions for purposes of cross marketing of financial products and services. If you object to this, you have the right to ask your bank not to divulge your contact details.

If you have been sold a financial product that you did not sign up for, or the telemarketer calls you at inappropriate times or harasses you with numerous calls, lodge a complaint with the financial institution that the telemarketer represents.