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This article by Peter J. Mladineo was published in U.S. 1 Newspaper on July 15, 1998. All rights reserved.
NCRB: Red Carded
In the tight U.S. 1 office market, here's a new vacancy: The National College Registration Board, based at 251 Wall Street. The firm sold an innovative debit/discount card for college students that may have been too innovative.
For a fee of $25, students would get a "Campus Card" that entitled them to discounts on many national brands. The card also had a purported debit function that would allow "parents to set aside funds specifically for their students' essential college living needs."
However, the debit function didn't work and the firm succumbed to pressure from the United State Postal Service, the New Jersey Division of Consumer Affairs, and 34 state attorneys general, who alleged that NCRB, with its official-sounding name, promotional materials, and use of university logos, deliberately intended to mislead students into believing that they were required to buy the cards. In the end, the NCRB agreed to return $67,025 to 2,700 people.
The company was founded by three recent Penn alumni, Matthew Levenson, Chris Cononico, and Mike Vaughan. Their firm claimed that the Campus Card gained students discounts on meals, books, airline tickets, copy centers, pharmacies, and hair salons, and it marketed the cards nationally as a way for parents to make sure college children have money for meals, books, and essentials. Campus Cards, they contended, could also be used as a "federally insured and fully refundable" debit card if extra money is deposited, said Levenson (U.S. 1, April 29).
The three-year-old Consumer Affairs Cyber Fraud Unit scans the Internet daily for fraudulent schemes. It discovered NCRB's offer in April. "I'm proud of our cybercops. They get an A-plus for flunking Campus Card," says Mark S. Herr, director of the state consumer affairs division.
At that time, the 23-year-old Levenson had said he was angry at the card being called a scam: "We've been working four years on this project. It's really our blood, sweat, and tears."
On May 8, after the daughter of a United States postal inspector received a flyer from the NCRB, the postal service started holding back mail addressed to the NCRB. So far, it has nabbed 5,000 letters containing an estimated $125,000 in checks.
On June 8 the postal service issued a final cease and desist order against the company and the principals. Among other prohibitions, they may not falsely represent that they are affiliated with colleges and universities.
-- Peter J. Mladineo
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