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Calls from 'chamber' lead to state inquiry

The owner of an unregistered Longwood company says it's all a misunderstanding.

By SCOTT BARANCIK
Published February 11, 2005

The Florida attorney general's office is making inquiries into a startup accused of contacting small-business owners and demanding they pay delinquent dues supposedly owed to their local chamber of commerce.

Spokesman Bob Sparks said Thursday the agency had assigned assistant attorney general Allison Finn to learn more about the Florida Regional Chamber of Commerce, an unregistered Longwood company owned by a felon who says it's all a misunderstanding and that he's simply trying to build his own membership.

Allegations about the Regional Chamber surfaced Feb. 2, when the Florida Chamber of Commerce, a Tallahassee nonprofit founded in 1916, sent an e-mail warning its more than 120 affiliated chambers about the alleged ruse.

Greater Tampa Chamber of Commerce CEO Kim Scheeler sent an e-mail to bay area companies two days later.

"The businesses around the state are being scammed into thinking that it's (the Regional Chamber) a legitimate chamber," said Leon Cassels, an executive vice president at the Florida Chamber. "People trust that name."

Tom Jordan, a sales associate at Cornerstone Technologies in Lutz, said he received an automated call Tuesday claiming his company was "delinquent" in its dues and should contact "David" at the Regional Chamber. Wary, he contacted the Greater Tampa Chamber instead.

Brian Beavers, owner of Jerry's Appliances in Zephyrhills, said he was repairing a Maytag washing machine Wednesday when a Regional Chamber representative called to encourage him to become a member. Beavers bought a three-month membership for $49.95 with his credit card after being promised benefits ranging from free movie passes to free advertising. He assumed the caller was affiliated with the Zephyrhills Chamber of Commerce.

"He said that they had some inquiries about me, about my business, people calling in, and he wouldn't be able to actually tell them anything unless I joined," Beavers said. "That's kind of what sold me on it. ... Even if I get only one (sale) out of it, that's not a bad investment."

In interviews this week, Regional Chamber owner Jake Wood, 27, denied the allegations and accused the Florida Chamber of trying to quash a legitimate competitor.

"We're able to offer these businesses better benefits at a lower cost, and they (the Florida Chamber) don't like that," he said. "Thankfully, Florida is an equal opportunity employment sector in this country, and everybody has the right to generate revenue. ... That's why you see MCI and AT&T fighting each other with low rates."

According to its Web site, the Regional Chamber charges $49.95 quarterly for an associate membership and $408 annually for a "full business charter."

The Florida Chamber of Commerce recommends businesses with between five and 49 employees pay $1,000 to $3,000 per year but will accept less.

Wood said this week he fired a marketing staffer named David whose calls to businesses weren't "nice." Wood described the ex-employee's voice as deep and intimidating. "But I don't think anywhere he stated that you would lose your benefits, or that we had any affiliation" with the Florida Chamber.

The Regional Chamber claims to offer many benefits, including negotiated discounts with Office Depot and payroll administrator Paychex Inc.; advertising space in a welcome mailing sent to new members; and, eventually, the ability to network with Regional Chamber members across the United States.

Wood's holding company, Chamber of Commerce Inc. of Wilmington, Del., has registered Web addresses not only for its Florida subsidiary - www.myFloridaChamber.com - but for New York, Tennessee, Alabama and other states.

Though the mission statement on its Florida Web site says "our members can band together to be a powerful lobbying force in Albany (sic) or Washington," the Regional Chamber won't hire a lobbyist until it has built a larger membership, Wood said. He said it has somewhere between 50 and 80 members in Florida.

But some of the defenses offered by Wood, whom public records show pleaded no contest in 1997 to a third-degree felony charge of passing worthless checks, do not fully pan out:

Wood said the reason that neither Chamber of Commerce Inc. nor Florida Regional Chamber of Commerce is properly registered with the state is because he forgot to sign an application submitted in December.

But there is no record of the rejected filings, said Brenda Tadlock, registration section administrator for the state's Division of Corporations.

Wood said his 1998 arrest for violating probation occurred because he had moved to a new city without telling the probation staff.

But Sherry Clark of the Seminole County Sheriff's Office said he was rearrested for allegedly passing more worthless checks. He said the original arrest was for a bookkeeping mistake he made at age 18 and should have no bearing on people's perception of the Regional Chamber.

Wood is not the only member of his team who has brushed up against the law. Anthony Arrigoni, who Wood said designed the Regional Chamber's Web site and has been contracted to design Web sites for members who want to buy one, signed an agreement with the Federal Trade Commission in 2001 after the agency sued him for "deceptively marketing vacation travel packages."

Under the agreement, Arrigoni agreed to never again misrepresent a consumer product or service, while the FTC agreed to suspend a $4-million judgment against him. Wood said he was unaware of Arrigoni's litigation with the FTC.

Allegations against the Regional Chamber go beyond accusations of deception.

Robert Recker of the Orlando Area Chamber of Commerce said one member agreed to have his credit card billed $49.95 but instead was charged $445.95.

Cassels, the Florida Chamber official, said a company accused the Regional Chamber of making two deductions from its bank account rather than the agreed-upon one, both times for more than was discussed.

Wood said he will take steps to restore faith in his organization. Most critically, he said the Regional Chamber would stop pitching memberships to Florida business owners until its incorporation status with the state is resolved.

Times staff researcher Caryn Baird contributed to this report. Scott Barancik can be reached at barancik@sptimes.com or 727 893-8751.

Business owners or consumers who think they might be victims of fraud can contact the Florida attorney general's office toll-free at 1-866-966-7226.

[Last modified February 11, 2005, 00:51:12]