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Mike walks through the process by which Intelius customers are offered "$10 CASH BACK!" for vague information-related services only to be socked with a $20 charge on their credit cards each month in perpetuity. Presumably all this is disclosed somewhere, in some fine print, but it's not hard to see why customers are complaining.

Intelius's defense, articulated so far only by Naveen's son, is that lots of other companies pitch similar "offers," such as VistaPrint and Buy.com. And that's probably true. But that doesn't make Intelius a quality company or this an admirable business practice. In fact, if the majority of Intelius's growth really is coming from a single dubious deal like this, potential investors should run away screaming.

I have had some history with Naveen, having blown myself to smithereens by buying into his Infospace story back in the bubble days--and, later, having been accused of fraud by dissing his stock (and him) in email while still rating it Buy.* Infospace was far from the only stock I stayed with too long that year--AOL Time Warner and Yahoo jump to mind--but the combination of INSP's blow up with Naveen's gale-force hype made the experience particularly galling, especially after some of the allegations about his personal business practices appeared.

I don't know what the truth about those personal business practices is, and I look forward to hearing Naveen himself respond to the TechCrunch story. In the meantime, a hat tip to Mike for some excellent detective work.

*Why did I maintain the rating? In short, because having ridden the stock all the way down, I didn't want to compound the disaster by downgrading at the bottom. (At the time, I am embarrassed to say, I still believed in Infospace's wireless story. In the fall of 2000, when that story finally began to show cracks, we cut the stock. I wish this were the only call I made in 2000 that I feel like an idiot about.)