Beware Yelping Customers

I am reading the book, The Greatest Show on Earth, By Richard Dawkins.  Dawkins is a noted atheist and evolutionary biologist.  He has helped to clarify my thoughts on solving the U.S. immigration problem.  In a previous post, I espoused using a basic algebra test to qualify people for U.S. citizenship.  My proposal now includes testing all eighteen year olds.  Pass the test, and you become a legal adult with all rights and privileges attached.  Fail the test, and we ship your ass right out of the country.

This test would apply to everyone even if you are related to both George Washington and Abe Lincoln.  Every ten years, we would all be retested until age seventy.  Then you get to retire in total mathematical ignorance.

Around the world, anyone who shows up at a U.S. embassy and passes the algebra test gets a free ticket to the U.S and citizenship.  This is true social evolution and survival of the fittest - at least in terms of math ability.  My name is Frank Stitely, and I approved this message.

Last week, after I returned from my California conference, I had a phone message from a doctor looking for a forensic accountant for an arbitration case.  A forensic accountant reviews transactions looking for fraud.  Since we don't provide forensic accounting services, I referred him to a competitor, who does provide these services.  When I returned the doctor's call, I didn't have the phone number of my referral available.  So I told the doctor, I would e-mail him the number as soon as I could find it.

I fired up my Google machine (Tony Kornheiser's term) and searched for the name.  The  very first reference for this CPA came from 2002, so much for Google's vaunted relevance algorithm.  The reference was a complaint against the CPA.  I decided to research the complaint.  On Google, there was another reference down the page from yelp.com with another complaint.  I felt I needed to do some due diligence before making the referral.

Please keep in mind that I view a competitor the way I view toilet paper.  It is something I smear with shit and flush.  Nonetheless, I took a look at the complaint from 2002.  It was from a person, who had accepted the CPA's free consultation offer.  The man was disappointed that the CPA would not redo his tax return for free at the meeting.  He seemed to think that a free consultation involved free services.

We offer free consultations as well.  So I have a lot of sympathy for the CPA.  After all, just because you can walk into a car dealer's showroom for free doesn't mean you can drive away in a car for free.  The guy, who wrote the complaint wanted free service.  I don't blame him for asking, but the CPA biz is a business.  We get paid for what we do.  I filed a rebuttal to the complaint, but the site doesn't really allow for outside comments on the situation.  You have to be one of the parties to the complaint.  By law, the CPA involved couldn't respond to the post as it would reveal confidential client information just by responding.

I then checked into the second complaint.  This complaint was from person complaining on yelp.com about having to pay for two amended tax returns that had been prepared originally by the CPA.  If you know nothing about the income tax preparation business, you might conclude that paying for an amended return is unfair.  After all, the CPA should have prepared the return correctly in the first place.

However, I know differently.  Every year, we get notices from the IRS for clients where the IRS has information we were never given when we where engaged to prepare the returns.  Obviously, if you don't give us the information, we can't put it on the tax returns.  If we have to file amended returns in this situation, we bill for them.  Of course, if we screwed up the returns, we prepare the amended returns for free.  Again, legally, there was no way for the CPA to legally respond to this complaint.

From reading these two complaints, you might reasonable conclude the CPA is real jackass.  However, there are three problems with these sites for complainers.  First, the sites are inherently biased by something known in statistics as the nonresponse bias.  This bias arises from the tendency of customers to complain about services, but not post when they are satisfied.  Thus, seeing four complaints about a business but only one praising the business does not mean that 80% of the company's customers are dissatisfied.  Statistically, it means nothing at all.

Second,  many if not most businesses, cannot reveal the details behind a customer's complaint.  Thus, you see one side, almost always biased, of the dispute.  Do you want your service providers to post details of your purchases on the internet?  If you bitch, you should be fine with full disclosure.  Likely you are not fine with it.

Third, complaint sites, such as yelp.com, reserve the right to not publish posts, both good and bad.  They explain that they are trying to sift through false complaints posted by competitors and fake compliments posted by companies.  While they are correct that both fake complaints and compliments occur, what this really reveals is a basic lack of validity in their results.  The sites are statistically useless.

What makes the two jackasses mentioned above brave enough to post ridiculous online complaints is the lack of any personal risk.  What we need is a site called www.suckassclients.com.  Service providers, who have been ripped off by idiot customers, could blacklist the customers here.  If you bitch to Yelp, you just might get blacklisted and not be able to find another service provider, who will take you as a customer.  That would provide some balance to the complaint process.  Yes, my attorney friends, I am aware of the inherent legal problems with such a site.  So if you see such a site, it wasn't me - really.  I know you don't believe me.

By way of full disclosure, I must note that we have had one complaint on Yelp and one positive comment.  I would love to provide the full story behind the complaint, but I cannot for the legal reasons mentioned above.

Here's what you should conclude from this post.  Complaint sites are useless at anything beyond making you feel good about complaining.  You can take two really effective actions against a bad vendor.  First, just don't go back.  Second, tell your friends.  I don't mean your friends on Facebook and Twitter.  I mean your friends in the real world.  When I see someone complain on Facebook, my view of the complainer  goes down.  Complain two or three times publicly, and we all know you are a serial complainer - like me.

If someone offered you $12K for your vote in the presidential election, would you take the money?  This is the question I posed to my wife, Laura, at dinner tonight.  I estimate that the reelection of President Obama will cost us approximately $12K in additional taxes in 2013 and likely considerably more than that in the years beyond 2013.

Thus a vote for Mitt Romney is essentially the same as being paid $12K for my vote.  The valuation professional in me is screaming that the real amount is the present value of all the increased future year taxes I will pay.  I'm not in a math mood tonight.  So I am not going to calculate this exactly, but the number is somewhere around $70K.  I'm taking the money.

Thanks for reading!  As always, for real tax and accounting advice, please visit our main S&K web site at www.skcpas.com.  Until next time, let's do it to them before they do it to us.