I first found out about Merchant Circle through my colleague, Ryan May, who runs Restaurantica. Restaurantica is a site that allows people to write and post reviews of the restaurants they've visited. A simple idea, really, but powerful. Working with Ryan on how to improve Restaurantica, we've discussed how we might make Restaurantica work for the restaurants as well as for the patrons, but we're always sensitive to the fact that whatever services Restaurantica might provide the restaurants themselves, the integrity of the review system can't be compromised.

Not everyone appears to be so scrupulous.

Consider Merchant Circle. It is a database of businesses, each with its own unique page, like MySpace. The site is prepopulated with business pages created without the permission of the businesses, presumably using information scraped from public sources like online phone directories. The linkage between the pages of the site can help rank the pages higher up in the search engines. Consumers can post reviews.

So far so good. The merchant hasn't spent a dime, but then he hasn't asked for this service.

Now here's the kicker. A bad review is undesirable, of course. But a business can deal with it. By buying a membership, a business can remove bad reviews from the database:

MerchantCircle does things differently that everyone else. No qualms about it.

Other sites give complete control to customers and their reviews. We give complete control to you, the business owner. Don't like a review? Delete it. Want to customize your business listing? It's yours. Upload pictures, blog about your business, build coupons, share tips... whatever you'd like.

We want to make sure that the web isn't a scary place for you to navigate, but we also want to make you aware that customers are writing reviews about your business on the web. We want to show them to you and many times those reviews aren't flattering. Don't take it personal with us. We just want to let you know so that you can manage your online reputation.

Now think about it.

That's a nice website you've got here. It would be a shame if anything were to happen to it. Buy a subscription, and we can make sure the reviews are all on the up and up. Capisce?

I mean, if I needed to improve revenue this month, I could write a few dozen bad reviews, and then tell the business that they had better buy a membership in order to engage in some reputation management.

Or I could just suggest that a bad review was written. The only way to be sure is to buy that subsciption.

A phone dialer is apparently used to deliver the bad news:

On March 28, 2006, MerchantCircle used a robot (with no recourse to a human) to call my phone and deliver an ad, in violation of both the Telephone Consumer Protection Act of 1991 and the federal Do-Not-Call list.

Then, on September 16 and 26, a “member merchant” outside my area, whom I never heard of, and who is certainly no customer of mine sent me two e-mails urging me to join MerchantCircle (or MerchantCircle “borrowed” his registration information and sent them to me “on his behalf”). On September 16, I responded by entering a negative review on his MerchantCircle listing and denouncing him as a spammer (I ignored the message of the 26th).

Then on the 27th, I received the following message on my voice mail from 866-849-3243:

http://wordengardens.com/scam/merchantcirclespam.mov

Like the other people, I found that nobody had entered any ratings for me at all. Refusing to “activate my account” just to see if I had any ratings, I instead entered two positive testimonials for neighboring businesses that I use, businesses who also had not “activated their accounts,” and I saw that when ratings were actually present, they appeared whether or not the “owner” had activated his account. Since my own listing was devoid of ratings, that means that MerchantCircle flat out lied to me.

I made the above recording available online in response to a blogger who had the temerity to suggest, “But were the automated calls even placed?” Yes, they were placed. No, this isn’t an “organized smear campaign.” And yes, MerchantCircle are frauds and spammers, and I’ll be damned if I ever deal with them. I hope they die a nasty, smelly, public death in the marketplace.

I don't know that Merchant Circle is engaged in this sort of thing. Other people, on the other hand, are very sure that Merchant Circle is engaged in this sort of thing. But I do know that even as we try to design new features for Restaurantica, we are acutely aware that every feature might have unintended consequences. Some might be relatively minor, like skewing the ratings one way or the other. But others might create some sort of coupling between the restaurants and the patrons through the review system, and that is something that can be horribly abused.

But then we're not trying to create that circumstance. Merchant Circle certainly seems to have been designed with that in mind.