MARTIN SLOANE | Supermarket Shopper Internet coupons come under attack

I recently received an e-mail from Becky McCarney, who said supermarkets in her area of Pennsylvania were no longer accepting the manufacturer coupons she downloaded from grocery brand Web sites and coupons that look like they were printed from a computer or a copy machine. I called the Sparkle supermarket in North Huntingdon, Pa., and was told that the store had been warned to be on the lookout for counterfeit Internet coupons and had decided not to accept them.
That warning came from Virginia-based Coupon Information Center (CIC), which says counterfeit coupons are beginning to flood the market. CIC asked retailers to post a sign in their stores: "We Do Not Accept Counterfeit Coupons -- Attempting to redeem counterfeit coupons may lead to criminal prosecution."
CIC also published a list of approximately 150 well-known counterfeit coupons. The coupons on that list were not ordinary cents-off coupons. Almost all of them are free product coupons, including free Fab, Fresh Step, Duncan Hines and Stouffer's!
What they said
While CIC did not specifically call them Internet coupons, it said they were being circulated on the Internet through auctions, message boards and by e-mail. Many manufacturers issue free product coupons in connection with their mail-in offers. After you mail in the required proofs-of-purchase, what you receive is a free product coupon. These coupons are usually printed in one color on one side of ordinary paper. A counterfeiter who obtains one of these free coupons can reproduce it on a copy machine.
The bogus coupons look like manufacturer free-product coupons. At the checkout counter, the bar codes function normally to ring up the free products. This type of fraud is not new. It has been around for decades. What is new is the distribution of the counterfeits on the Internet.
On one Web site bulletin board, I found this message: "Pay $4.99 by credit card and receive $30 in free groceries coupons." In some cases the coupons are sent to the buyer by e-mail. This is the reason these counterfeits are now being labeled "Internet" coupons.
Several weeks ago, in Atlanta, shoppers began to appear with bunches of the counterfeits and loaded their carts with the free products. One shopper reportedly tried to use $150 of these coupons. A store manager took notice and refused to accept them. Alarm bells began to ring! The Georgia Food Industry Association sent a warning to its retail members. "This new scam is the biggest of its kind to hit Georgia in 14 years," said Kathy Kuzava, the association's president.
In short order, the Florida-based Publix notified its stores in Florida and Georgia not to accept Internet coupons. Kroger did the same with its Georgia stores. On Aug. 18, the North Carolina-based Harris Teeter instructed all of its stores in the Southeast not to accept "home made" coupons printed from the Internet.
Are these supermarkets confused? Charlie Kingery, vice president of Cool Savings, thinks they are. Cool Savings is one of several companies that provide grocery manufacturers with the system for printing coupons from their Web sites. "Our company and the dozens of manufacturers who are using our system are not offering any free-product coupons on their Web sites," says Kingery. "It is unfair and unwise for retailers to treat our coupons in the same way as the counterfeits."
In fact, when I discussed the ban with a Harris Teeter spokesperson, she was not aware the coupons on the brand Web sites were just cents-off coupons.
"This problem is not about Internet coupons," said Steven Boal, president of Coupons, Inc., which provides online coupon systems to major grocery manufacturers, including General Mills, Kimberly-Clark and Nestle. "Our Internet coupons are being unfairly dragged into a situation where a few counterfeiters are using the Internet to distribute their bogus coupons. We looked at 160,000 coupons auctioned on eBay and only 20 had been printed from grocery brand Web sites."
I think Kingery and Boal are right. The problem isn't the Internet cents-off coupons. The supermarkets that seem to be panicking and blindly banning "Internet" coupons are throwing the baby out with the bathwater.
Suggested solution
Instead, supermarket cashiers should be on the lookout for free product coupons and should be checking them against the CIC counterfeit list (and, if necessary, asking for I.D. and writing names and numbers on the coupon).
Effectively spotting the frauds and publicizing them is an important part of the solution. The other part is having manufacturers end the distribution of one-color, one-sided -- i.e., easy to counterfeit -- free-product coupons.
United Feature Syndicate