Balance Transfer Day is not what it seems. The seemingly grassroots movement, which piggybacked on the success of November's Bank Transfer Day, is operated by a man who is paid to consult and write for both Credit-Land.com and BestCreditOffers.com, websites that make money when consumers successfully apply for credit cards.
Michael Germanovsky, 35, set up a Facebook page in November urging people to transfer their credit card balances to low-rate cards. On the page Germanovsky wrote, "Why don’t we beat the banks at their own game and demand the same 0% interest rate that they receive from the federal government?"
But Germanovsky isn't an activist working against big banks. He's a paid consultant and writer for Credit-Land and its sibling site BestCreditOffers, two so-called lead generator websites that push customers to products, in this case credit cards, via ads and special offers. (On his LinkedIn page Germanovsky claims to be editor-in-chief of Credit-Land, though in an interview he said it's "just a title.") Credit-Land and BestCreditOffers make money when consumers successfully open a new account.
On Monday after reporters from The Huffington Post and other outlets questioned his relationship with Credit-Land and BestCreditOffers, Germanovsky amended his Facebook page to include mention of his affiliation with Credit-Land. Previously the Facebook page made no mention of his involvement, and Germanovsky did not disclose his relationship to reporters. Germanovsky claims that Credit-Land and BestCreditOffers do not directly benefit from Balance Transfer Day and that it is an independent venture.
However sites such as Credit-Land and BestCreditOffers do stand to benefit from an increase in web users searching for such terms as "balance transfer." The term triggers sponsored Google ad links from BestCreditOffers.
"Our site is not benefiting from Michael's [Germanovksy's] initiative," said Roman Shteyn, founder and CEO ofAcclaimDomains, a private company that manages
Credit-Land, BestCreditOfffers and other lead generation sites, including FreeCreditReport.com and AutoQuoteNow.com.
Shteyn said he liked the idea of Balance Transfer Day, but told Germanovsky to keep Credit-Land's name out of it. In retrospect, Shteyn said, the Facebook group should've mentioned his affiliation. He said that as of yet, Germanovsky's effort has not resulted in increased traffic to the company's websites.
The timing of Balance Transfer Day is no coincidence. As more people are expressing anger and frustration with banks, more companies are trying to capitalize on that emotion. This fall credit unions saw a rise in membership as customers turned away from big banks -- most notably on November 5, dubbed Bank Transfer Day. Now lead generator sites may be trying to capture some of the antibank traffic.
While there's nothing illegal in lead generation sites, some consumer advocates are concerned that these sites aren't interested in shoppers best interest. Someone may think they're getting the best offer available, but actually get pushed to a less-than-stellar deal, said Ed Mierzwinski, director of consumer programs at U.S. PIRG, a nonprofit group that takes on consumer issues for the public good. "I have long been concerned that lead generator sites sell you to the highest bidder." --Emily Peck contributed to this story
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