Stung by complaints and inquiries nationwide, the second major company offering free gas and grocery vouchers in the Tampa Bay area began terminating workers and suspended sales as the business continued to unravel.
Consumers in 40 states have filed complaints against BBZ Resource Management, a Mesa, Ariz., company that has been offering the vouchers to Tampa Bay area residents through businesses such as a Comcast cable retailer, Ashley Furniture and Hyundai of New Port Richey.
As a result of the growing complaints, the Oregon Attorney General's Office said Wednesday that several attorneys general are investigating BBZ. And the Better Business Bureau issued a warning Wednesday to consumers, brokers who sold the vouchers to retailers and businesses against involving themselves with the company.
"Essentially there are three groups being misled in this scenario, the business, consumer and the broker," Matthew Fehling, the bureau's president and chief executive officer, said in a statement.
"It's unfortunate that honest businesses have gotten caught up in this situation and in turn are losing the trust of their customers," Fehling said. "It's equally as frustrating for the consumers who thought they were making a purchase to redeem gas or groceries and end up empty-handed."
BBZ became the leader in distribution of gas vouchers after the state shut down Largo-Clearwater based Tidewater Marketing Global Consultants for deceptive business practices, fraud and failure to deliver the promised product to consumers.
Tidewater owes consumers some $10 million in unfulfilled free gas cards. It is unclear how much BBZ owes, though about 100,000 cards are owed going back to January, according to a former business partner.
"There was too much volume to handle," said Austen Ericksen, who worked for BBZ two months before quitting June 17. "There was not enough workers to be processing the letters. … We probably had over 5,000 e-mails that we hadn't gotten to.
Then Ericksen, 23, who lives in Tempe, said he got a stream of calls from former co-workers who were laid off Monday.
Michael Pouls, the former business partner with BBZ, said he, too, got the news of the layoffs. Pouls filed suit against BBZ last week, accusing the company of running a "Ponzi scheme."
Justin Elenburg, president of BBZ, calls Pouls' claims false and on Wednesday announced a temporary suspension of sales of the certificates while the company evaluates the impact of his allegations.
Fay Waldo, a lawyer representing BBZ, said in a statement that Pouls' departure created hardship for the company and described his actions as a "breach of contract."
"BBZ will address the wrongful actions of Kidz Idz and Mr. Pouls at the appropriate time and in a proper forum," Waldo said. "BBZ is working with outside professionals to assess its current situation and to develop a plan for meeting its current challenges and fulfilling its obligations to those consumers who are entitled to a rebate."
Waldo initially denied reports of layoffs but confronted with reports about them did not comment.
Retailers offered the gas or grocery vouchers, which come in denominations as high $500, as incentives to customers to buy tires, furniture, cars and electronics as well as gifts for visiting the store or testing a product.
Consumers who received the vouchers "redeemed" them by registering with BBZ and Tidewater, which often required a $5 to $10 fee; then by sending $100 worth of receipts for gas or groceries from a specific retailer each month. BBZ and Tidewater then promised a $25 gift card each month until the consumer received the full value of the voucher.
But tens of thousands of vouchers have gone unfulfilled.
Numerous retailers across the country offered BBZ's vouchers despite warnings in February from a court-appointed lawyer charged with reviewing Tidewater's operations not to get involved with the voucher programs.
Among them was Ashley Furniture, which used both BBZ's and Tidewater's vouchers and is facing a class-action lawsuit for distributing the vouchers to consumers; and Saveology, a Comcast retailer that has BBZ's vouchers listed on its Web site as an incentive for Florida residents in Tampa, St. Petersburg and several other cities across the state.
A spokeswoman for Saveology, a Fort Lauderdale company, said that she was unaware of complaints about the vouchers but that the company would ensure consumers were compensated.
Ashley declined to comment about the pending lawsuit because it had not been served.
Ivan Penn can be reached at firstname.lastname@example.org or (727) 892-2332.