Purplebricks challenged over whether adverts made it clear that it charges a fee

Purplebricks has had yet another brush with the Advertising Standards Authority – with the latest complaint being informally resolved.

A complainant challenged whether two radio adverts for Purplebricks made it clear whether the agent charged a fee for its service.

A spokesperson for the ASA said the ads are no longer being aired and that Purplebricks gave its assurance that it will ensure the information is clear in future adverts.

On EYE’s numbers, we believe that there have been six formal rulings on Purplebricks by the ASA, of which one complaint was not upheld, and three complaints where more than one issue was investigated and were upheld only in part.

The complaint which was formally investigated but not upheld related to the use of the word ‘local’. The ASA said that Purplebricks was using the word correctly to describe their agents’ local knowledge, regardless of where they were physically based.

In the partially upheld complaints, one – brought by 37 challengers –  that was not upheld was that Purplebricks suggested in its TV adverts that it did not charge a fee. The ASA dismissed this, saying that consumers would understand that Purplebricks was a commercial organisation which would charge for its services.

In addition to the six formal rulings, by our tally there have additionally been nine informal resolutions, not counting today’s, from the first complaint which was in October 2015.

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61 Comments

  1. AgencyInsider

    ‘The ASA dismissed this, saying that consumers would understand that Purplebricks was a commercial organisation which would charge for its services.’

    You know what ASA, that’s where you are SO wrong.

    I have had four separate, intelligent, rational, adult home owners say to me ‘Purplebricks don’t charge commission so how do they make their money?’. And I have had to explain that they charge a payanyway fee.

    OK. So it’s just four people in my small world and no doubt dompritch and cyberducky will be utterly dismissive of it. But now multiply that out by some unquantifiable number across the country who have been exposed to the PB propaganda and it would probably become a significant number who really don’t understand the charging structure.

    But, up in their ivory tower, the ASA are of course clueless.

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    1. Bless You

      With purplebricks taking more property on with click bait adverts it seems only Australia care about their consumers.

      If banks acted like this it would be another scandal.

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    2. cyberduck46

      >I have had four separate, intelligent, rational, adult home owners say to me ‘Purplebricks don’t charge commission so how do they make their money?  
       
      So 4 out of how many customers?
       
      How many normal homeowners didn’t ask the question?  
       
      Presumably the majority of tyical homeowners realise that PB are going to charge them for their service. You can’t just focus on those that don’t.    

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      1. PeeBee

        “So 4 out of how many customers?”

        Four too many, ducky – simple as.

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        1. cyberduck46

          PeeBee,
           
          Tons of things wrong with your industry. In your own words you’ve said that the majority of Agents are @rseholes and suggested that they will tell you what they think you want to hear.
           
          Yet you spend all your time on twitter and here focusing on one company. A nice easy target perhaps to endear you to those who’ve had to bring their fees down to compete?
           
          Now it’s revealed you’ve taken a job with a company selling its wares to those very people you think are @rseholes and will mislead people. 
           
          And yet you say “Four too many”.
           
          What a complete hypocrite & fraud.
           
           
           
           
           

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          1. PeeBee

            So, ducky…
             
            Yet again, you take one sentence out of statements with a very different message to those isolated words that suit your agenda – and parade them like it’s my head on a pike.
             
            Sorry – it hasn’t left my neck and I stand by my original statements IN THEIR ENTIRITY.
             
            Okay – in the spirtit of fairness – here are two statements made by you. 
             
            COMPLETE statements.  No cutting… chopping… trimming away the bits that water it down or change its’ meaning.
             
            “Just watched some of the PB TV ads. First time I’ve seen anything other than the one with the two “brothers”. I can understand why the industry is upset but misleading people without actually saying anything factually incorrect is what marketers do.”
             
            “Just sold my shares. Out of the 191 “new” listings for the last 24 hours only 140 of them were actually new. Thanks for being patient with my skepticism. “
             
            Please, now – let’s discuss hypocricy and fraud.  Seems that they are your ‘Specialist Subject’ – so there’s your starter for ten.

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          2. Property Pundit

            Pretty clear you’re the biggest @rsehole on this forum.

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            1. PeeBee

              I’ve been called worse…

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              1. Dom_P

                So I asked my dear mother what she thought she would be charged if she sold with Purplebricks. Her exact words were “Isn’t that the one that sells for free?”.

                Now, my mother isn’t the sharpest tool in the shed at times (sorry mum!) but she is far from ignorant in these matters, and having a son in the industry she has a natural interest, but even then she was unaware of the charges levied by PB in the case of not selling.

                I appreciate my mother is one out of thousands, however I think it is a good litmus test as to whether the adverts are clear or not.

                *spoiler* They’re not.

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              2. Property Pundit

                Not you PeeBee!!!!!

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                1. PeeBee

                  PHEW!!!

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  2. Moveaside01

    I’ve taken numerous properties off Purple Bricks and quite a few (especially elderly) clients were at a loss that they’d have to pay PB in order to change agents? I guess more fool them for not reading the contract or were they mid-led? but they literally had no idea they’d still have to pay over a thousand pound to a company that failed to sell their house?

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    1. Thinker89

      We’ve seen on of these “contracts” – a huge bundle of paper with very small text printed on it. Most of it is the terms of the credit agreement you are agreeing to and very little is about selling your house. It’s no wonder people who instruct them can misunderstand by the ‘no commission’ thing.

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  3. ArthurHouse02

    “Consumers would understand” – really???? I showed a couple round a house last week, lovely retired couple. As they were leaving they asked me “how have Purplebricks effected you?” A little i said, but they dont sell much in our area. “How do they make any money, the lady”, the lady then posed. What do you mean? i replied….”They sell your house for free dont they?” !!!!!!

    Whatever anyone may think reading this, this is a true conversation, one i have had a few times over the last couple of years. By claiming they dont charge commission, PB are desperately trying to hint that they do it all for free. The constant failings of the ASA and such awful ruling bodies are pathetic and allow these companies to constantly push the boundaries of what is acceptable.

    How many times must they have their wrist slapped before a backbone is grown? Where is the motivation for them to get their house in order if they know that they wont be punished?

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    1. AgentV

      Had the same conversation with more than a few people over the last few years, some of whom have effectively said ‘won’t be calling them then, now I know that’.

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      1. AgentV

        BSOS23PC

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  4. Robert May

    “The complaint which was formally investigated but not upheld related to the use of the word ‘local’. The ASA said that Purplebricks was using the word correctly to describe their agents’ local knowledge, regardless of where they were physically based”   This is the nonsense of ASA; without any understanding of the industry they can rule white is black and because there’s no means to challenge a decision, what the case handler decides is deemed fact.
    Case law demands a duty of care and skill from any agent acting for a principal. It is not possible to comply with duty of care and skill for more than one local area unless the agent is dealing with a  niche property type [equestrian,coastal, landed etc] For run of the mill residential property a single local area has flats, houses, bungalows  sub divided by connection [detached, semi, terraced] Within a local activity centre typically 6 agents cover the  variety of property being sold in the locality. Broadly speaking there are about 10 individual categories and price ranges within a  local area. Each defined  category has about 50 applicants actively looking at any one time,giving a typical register of about 500 applicants per branch. There are about 3500 local activity centres. 
    What ASA are saying is  an agent operating nationally with 700 listing reps, each agent is able to have enough knowledge of 5 local areas, 50 property categories and 2500 individual applicants. One person can do the work of 28 agency branches (20,000 branches in 3500 activity centres) or 77 staff members…. and still comply with their legal obligations of care and skill.
    The ASA won’t be bought to account, there is no process for escalation of complaint, they have no master so  we have to put up with unsatisfactory and unsound rulings.  

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    1. cyberduck46

      >“The complaint which was formally investigated but not upheld related to the use of the word ‘local’. The ASA said that Purplebricks was using the word correctly to describe their agents’ local knowledge, regardless of where they were physically based”   This is the nonsense of ASA

       

      What’s nonsense about that?

       

      That’s the correct way of looking at it. If somebody is an LPE for area A, has knowledge of area A but has their office where they live 20 miles away from area A in area B then it is completely appropriate to say they are an LPE for Area A.

       

      This is actually what the ASA said “In that context we considered that the word “local” would be generally understood to refer to an individual’s expertise and knowledge of the area that they served, rather than their physical location.”

       

      Not too difficult to understand for most people.

       

       

       

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      1. Robert May

        The nonsense is it is not possible to have enough knowledge of 5 areas and the 10 sub categories  of each distinct area to  be classed as an expert.

         

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        1. ArthurHouse02

          The nonsense for me is not this specific issue but the constant issues. The more they get their wrists slapped you would have thought the harder the wrist slapping would be.

          When a driver runs a red light, they get points, then they get caught speeding they get more points, then get stopped using their mobile phone they get more points, then they get banned and fines along the way. The points and the potential ban are they to encourage drivers to obey the law and consider others.

          What is their to “encourage” these companies to toe the line?

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          1. Robert May

            The problem is business protection regulation seemingly don’t need to apply to people who will be naturally ostracised for working on behalf of their client.

            Agents prevent people having what they want at a price they want to pay, there is resentment of agency. Sadly my experience of both Which and ASA have demonstrated that personal agenda is allowed to dictate the course of a conversation and outcome, there is a failure of the objectivity which ought to be present in both organisations.

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        2. cyberduck46

          Robert, the problem is you haven’t understood the decision.
           
          The ASA weren’t deciding whether every LPE was local or an expert, they were deciding whether PB were misleading by using the term LPE. They were satisfied that on the whole the standard and locality of the LPEs was satisfactory.
           
          You will go looking for an exception, as with the scenario you point out, but the decision comes down to percentages. Just like with comment “‘The ASA dismissed this, saying that consumers would understand that Purplebricks was a commercial organisation which would charge for its services.’” which seems to have got everybody upset.
           
          I’m sure there are Estate Agents who aren’t any good but this doesn’t mean it is misleading to use the job title Estate Agent does it? They’re an Estate Agent, just a bad one. 
           
          So in your example, they’re an LPE just one that isn’t local enough or expert enough.
           
          That’s probably gone right over your head.
           
           

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          1. Robert May

             I have understood  the decision enough to know ASA are not right, the way they reach decisions is flawed and their lack of an escalation process is an embarrassment.
             

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  5. Shaun77

    There are plenty of commercial organisations that don’t charge a fee to the consumer – take Rightmove and Zoopla as examples. Why would consumers naturally assume that a fee wound be charged when there are other heavy advertising, national brands that they can use for free?

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  6. JonnyBanana43

    Zzzz. Purple Bricks are over. It’s a Ponzi style scheme and the reps are the ones who are holding the thing together.

    When they go the whole thing will fall to bits.

    Share price will crash.

    Over.

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    1. gardenflat

      Share price already showing signs of sub £2 imminent.

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    2. Ostrich17

      Someone has just offloaded nearly 7 million shares !

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      1. cyberduck46

        And somebody else bought them!
         

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        1. Ostrich17

          In the last four months the share price has collapsed – as the supply of “greater fools” dries up.

           

           

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    3. dave_d

      Shares aren’t an indication of how well a company is performing

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  7. Chris Wood

    Eat, sleep, mislead, repeat.

     

     

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  8. 70GJ

    Just wondering whether anyone has tried the model of charging the buyer not the seller?

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    1. gardenflat

      Seems to work okay for auctions

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      1. Ostrich17

        And that nice chap Henry Pryor

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        1. ArthurHouse02

          Henry Prior as we know is engaged by the buyer to act for them, so that is completely different. When acting as the selling agent, in my opinion it is wrong to charge the buyer a fee as then surely there must be questions raised on who you are acting for. Our job is to do the best by the vendor at all times, though if the buyer is paying your fee, then surely you are going to look after their interests, perhaps above what is best for the homeowners?

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          1. Ostrich17

            Exactly, a dog cannot serve two masters.
            You act for the client – whether that is the vendor or the buyer, not both.

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    2. localagent735

      I am sure its called sale by tendor or sale by informal tendor? a local agent where I am based tried it a few years ago but didn’t work. buyers don’t want to pay a fee and like already mentioned surely the buyer is then the client as they are the ones that the agent makes the money from.
      If a buyer has to pay the agent £5k (for example) they will just reduce the offer by this. and if it effects there deposit and loan to value it could be more. not sure why anyone would try this…… have more luck selling using the dreaded PB

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  9. man perero

    Are WE as agents doing enough to educate the public? We are faced with an organisation that repeatedly dances around ASA rulings and has the firepower to advertise on the radio, TV and on Billboards.As high street firms with massive experience and a great service to offer clients I do not believe we are marketing ourselves at all. Why are we not clubbing together at a local level to take a page twice a month in your local paper to highlight our USP’s to the public? We do not need to attack any other organisation , merely highlight why the public should use a traditional High St agency. The message should be repeated on sales details , window displays ,stationery and on our web sites. We need to start pushing ourselves rather than winding each other up about this new breed of company.

     

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    1. AgentV

      Totally agree……we are starting to do this in our local area as a precursor for a launch of ‘Collective Marketing’. Contact us if you are interested.

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  10. CountryLass

    And yet a Costa advert appears to have been removed, as 2 (TWO!) people complained that by telling people to have a bacon roll rather than an avocado, they were telling people not to eat fruit and vegetables.

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    1. GeorgeHammond78

      However, bacon does cause cancer whereas purple bricks only causes financial loss…..

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      1. smile please

        Stress adds to cancer ….. Dealing with PB is stressful ……. just leave that there 😉

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      2. CountryLass

        What? Bacon causes cancer now?? Is there anything that doesn’t cause cancer??Seriously though. Bacon? I mean, it’s bacon… You just grill it an add it to a salad.. If it’s just been fed vegetables and stuff it’s practically a vegetable… and therefore it’s healthy. Like chocolate is made with cocoa beans and milk, so it’s dairy and vegetables in one. Healthy.

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        1. GeorgeHammond78

          And sausages…

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        2. wardy

          Bacon is healthy:   Confirmed.

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          1. PeeBee

            Thank goodness wardy arrives to rescue the thread!

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            1. davehedgehog

              I smoke 40 a day, eat bacon by the bucketload and never use factor 50 when sunbathing and i’m still here

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  11. Richard Copus

    Garden Flap: “seems to work alright for auctions”.  Like Purplebricks, only at the moment.  That model is currently being investigated because charging buyers £5,000 plus and sellers nothing changes the legal duty of care from seller to buyer and sellers are not being told this and are not being informed that such a high buyer’s “premium” is reducing the maximum amount that the buyer can pay for the auctioned property.  Look at the many comments online to see what prospective bidders think of the system.  It’s interesting how many said they bid less than they would otherwise have done and particularly interesting to see how many said it discouraged them from bidding at all. 
    Re ASA  –  report them to the PropertyOmbudsman!

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    1. Robert May

      A complaint to  a redress scheme (or trade association) will be dismissed as “agents’ gripes”. That is the cover all, get out of jail card for not getting involved in disputes between agencies.

      The ASA do not like to be challenged, once a case handler decides something the complaints escalation process stops dead with their supervisor.

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    2. AgentQ73

      If its “modern method” surely taking 5k + from a buyers deposit will affect their buying power. I can well imagine cases where buyers would have gone for it if marketed normally but not if “modern method”. Anyone had any experiences ?

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  12. dannymagix79

    The amount of smoke and mirrors with PB is unreal, and like other commentators on here, i have been asked the question numerous times of how do they make money. I advised they charge whether it sells or not so you can buy a lottery ticket if you like and hope for the best that you hit a price you want, or leave it to a personalised agent,who will try and achieve you more (and probably usually does).

    The representative for my area has left PB and i know there are several others on their way out, they don’t seem to realise that staff is what gets you where you are and if you cant incentivise them enough (when they realise what it really is all about) then they leave, simples.  I have had a couple of their ex representatives contact me, unfortunately all the good lessons they had learnt when high street has been forgotten and they are left without a place in the industry – such a shame.

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  13. PeeBee

    “The ASA dismissed this, saying that consumers would understand that Purplebricks was a commercial organisation which would charge for its services.”
     
    Prima facie proof – again – that @ASA_UK IS UNFIT FOR PURPOSE.
     
    Their entire reason for being is to protect ‘consumers’ – EVERY ‘consumer’ – from misleading advertising.
     
    Like others above, I have spoken to many people who do not understand the PB model and are confused by their advertising and in particular their charges.
     
    One of these people is a solicitor.
     
    What is needed is to get the Government to accept the basic uselessness of this company – that trades under the guise of an official body – and to resolve the issue for the benefit of the public.
     
    But of course NOT INFORMALLY…

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    1. PeeBee

      The appropriate person at Westminster appears to be Kelly Tolhurst, MP – Parliamentary Under Secretary of State, Minister for Small Business, Consumers and Corporate Responsibility.
       
      I have Tweeted her on the subject
       
      twitter.com/Agent_PeeBee/status/1047425351260000258
       
      and would ask others either to RT or to do your own thing to try to bring about necessary change  – not only for the benefit of homesellers, but any member of the public whose decision to part with money is influenced by potentially misleading advertising.
       
      Thank you.

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      1. Dom_P

        Your tireless championing of this industry is commendable Mr. PeeBee, good on you for taking the time to do this 🙂

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        1. PeeBee

          Thank you, Sir.

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    2. cyberduck46

      >“The ASA dismissed this, saying that consumers would understand that Purplebricks was a commercial organisation which would charge for its services.”  
       
      They don’t work on the assumption that everybody will understand. You should know that.
       
      Do you take into account all those who do understand that a commerical organisation normally charges for their services? Of course you don’t because you can’t identify these people.
       
        >One of these people is a solicitor.   What exactly didn’t they understand about the model? Surely they understood that they didn’t offer their service for free?    

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      1. localagent735

        well clearly cyberduck46 people are not understanding that there is a fee. I have had clients and also friends that have asked why they do it for free.

        take off your PB clouded glasses and accept that people find it missleading

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        1. PeeBee

          localagent735
           
          ducky accepted it is misleading LAST MARCH – see post #6 above.

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      2. Quags

        Baring in mind most agents are no sale, no fee, then having PB bang on about no commission to pay, I would say it’s extremely likely a lot of people don’t realise.  You can’t assume everyone is as intelligent, or understands how companies make their money.

        But we all know the real score ducky, they’re trying to gloss over that.

        Interestingly I spoke to a viewer yesterday who said he’d been “lured in” by the hype and marketing of PB and had nothing but problems since to the point they’ve refunded his full fee and he’s considering court action.

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      3. Thomas Flowers

        Would you call PB’s actions in this case an absolute disgrace Cyberduck?
        https://www.allagents.co.uk/review/307071/
        Do you believe that this LPE should have referred this elderly lady to a no sale, no charge, full-service agent who would be better placed to look after her needs and who would not have charged her £1,283 for a poor attempt to sell her ‘undervalued’ property?
        Do you consider that PB ought to reimburse her money in this case?  

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  14. ArthurHouse02

    Unfortunately i have also come across this. Last year i was dealing with a solicitor i have known for many years, someone i regard to be a friend as much as anything else. He asked me exactly that….how do Purplebricks make any money when they dont charge commission? He was dumbstruck when i explained how they work and that the do charge a fee, He assumed they were like Facebook and made their money through advertising! To say i was speechless is an understatement.

    This was someone in the industry, someone who (you would think) would have known the score. If this chap didnt know, how many  thousands of vendors dont know?

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