Source: http://insurance-education.org/articles/consumer_action_insider_january_2017
Timestamp: 2019-04-19 12:24:30+00:00

Document:
Cremations have surpassed burials in the U.S., according to the National Funeral Directors Association, which projects that 71 percent of all survivors will choose cremation for a deceased loved one by 2030. There are many reasons why consumers choose cremation, including lower costs, environmental concerns, fewer religious prohibitions and a growing acceptance of the practice. While this might be one topic you’d rather avoid until the time comes, if you are interested in researching options, we encourage you to visit the Funeral Consumers Alliance to learn more. The non-profit’s step-by-step guides provide unbiased information about funeral homes, cemeteries, burials, cremation, organ donation and legal rights.
In recent months, Consumer Action has submitted amicus briefs in several important court cases that impact consumers.
Connor v. First Student. Plaintiff Eileen Connor sued the school bus transportation provider First Student, which bought out the company she worked for, for violation of two California laws—the Consumer Credit Reporting Agencies Act and the Investigative Consumer Reporting Agencies Act (ICRAA)—alleging that the notices First Student gave her regarding its intent to conduct background checks failed to comply with the laws. Connor said that the firm did not obtain her written authorization to conduct a background check. The trial court granted summary judgment for First Student, holding that the ICRAA is unconstitutionally vague in its application. The Court of Appeal for the Fourth Appellate District reversed that decision, finding that California's two principal consumer reporting statutes were not unconstitutionally vague just because there happened to be some circumstances in which both applied to the same conduct. Instead, the appeals court said, in those circumstances an employer must comply with both laws. Consumer Action joined an amicus brief on behalf of Connor, asking to uphold the appeals court decision because overlapping laws are numerous in the California Code, and people and businesses should not have the right to avoid following a law simply because another law may also apply. Additional parties filing the amicus brief include the California Reinvestment Coalition, Consumers for Auto Reliability and Safety, Housing and Economic Rights Advocates, National Association of Consumer Advocates, National Employment Law Project, National Housing Law Project and Public Good Law Center. Find the brief here.
Jaime Gonzales, et al. v. Owens Corning. A number of consumer organizations, including Consumer Action, filed an amicus brief in an appeal of a consumer class action against the global building and roofing company Owens Corning. The nationwide class action alleged defective roof shingles. Unfortunately, the Western District of Pennsylvania rejected the class action, a decision that the consumer groups argue is erroneous because, whether the product in question is a washing machine, shingles or other goods, consumer cases are uniquely suited for class actions. Furthermore, if the district court's view that consumer complaint cases should be brought individually were upheld, it would be the end of consumer class actions (in general), which benefit consumers greatly. Find the brief here.
U.S. Department of Justice v. American Express. Consumer Action and U.S. Public Interest Research Group (PIRG) urged the U.S. Court of Appeals for the Second Circuit to review its September decision in favor of American Express, which was sued by the government for antitrust violations related to its contract provisions prohibiting merchants from steering customers toward other credit card networks. The groups filed a joint brief in late November stating that AmEx’s anti-steering rules are anti-competitive because they cause merchants to pay higher fees to the credit card company on each transaction. Furthermore, merchants are not allowed to let customers know about how the fees compare to other card networks. The groups argued that barring merchants from discussing cards with lower transaction fees raises retail prices for all consumers, including people who pay with cash. The brief can be found here.
Federal Trade Commission (FTC) v. AT&T Mobility. Consumer Action joined a dozen consumer groups in an amicus brief urging the Ninth Circuit to review its dismissal on appeal of the 2014 FTC wireless data-throttling suit against AT&T Mobility LLC. The coalition joined the FTC in challenging the dismissal of its suit under Section 5 of the FTC Act, brought because AT&T did not adequately inform unlimited data customers that it would reduce internet speeds if customers exceeded a certain data threshold in any given billing cycle. The court dismissed the suit, saying that AT&T fell under the Federal Communication Commission’s decision to reclassify broadband providers as common carriers and therefore was not under the jurisdiction of the FTC. The consumer group brief argued that, "If the FTC is not on the beat, there will be no one on the beat. No other federal or state agency has sufficient jurisdiction, resources and expertise.” In addition to Consumer Action, groups filing the brief include Consumers Union, Consumer Federation of America, Consumer Federation of California, National Association of Consumer Advocates, National Consumers League, Center for Digital Democracy, Center for Democracy & Technology, Electronic Privacy Information Center, Benton Foundation, Common Sense Kids Action and Privacy Rights Clearinghouse. The brief can be found here.
Expressions Hair Design v. Schneiderman. In September, the U.S. Supreme Court agreed to consider the argument at the heart of this long-running case—that New York state’s ban on credit card surcharges violates retailers’ First Amendment free speech rights. The case highlights the fact that New York retailers are allowed to charge separate prices for cash and credit card customers but that they can’t refer to the price difference as a “credit card surcharge.” Instead they must call it a “cash discount,” which is essentially the same thing. (Credit card issuers support state anti-surcharging laws because they believe that allowing merchants to recoup the costs of accepting credit cards in the form of customer surcharges would discourage the use of credit cards.) The case was first filed in the U.S. District Court for the Southern District of New York by a group of small businesses. The businesses claimed that New York’s credit card surcharge ban violated their constitutional right to free speech because it kept them from telling customers about the fees they paid credit card networks in order to get the networks to accept cards. The district court initially found in favor of the merchants, but its finding was reversed on appeal by the Second Circuit, which said that New York’s law was an economic regulation with no bearing on the First Amendment. In November, Consumer Action and the National Association of Consumer Advocates (NACA) submitted an amicus brief arguing that by restricting merchants’ rights to free speech, the law in turn deprives consumers of crucial information about the cost of various payment options and drives up prices across the board for non-credit card users. The brief can be found here.
Apple v. Federal Bureau of Investigation (FBI). In early March, eight consumer organizations, including Consumer Action, signed an amicus brief written by the Electronic Privacy Information Center (EPIC) arguing that an order to compel Apple to undo encryption features in order to enable the FBI to access data on an iPhone used by a shooter in the 2015 San Bernardino attack would place millions of mobile phone users at risk of criminal hackers, identity thieves and others. The brief was filed in the U.S. District Court for the Central District of California (Eastern Division). A short time later, the U.S. Department of Justice said it had found another way to gain access to the attacker’s iPhone data and the case was dismissed. The brief can be found here.
Many mobile internet users have limited data plans that allow them to use a specific amount of data each month, such as two or four gigabytes (2GB or 4GB). If users exceed their allowances, additional charges apply. In the last couple of months, we heard from consumers complaining about additional data charges and saying they had no idea why they were going over their allowances.
We encourage consumers suffering from unexpected overages, sometimes called “bill shock,” to contact their carriers immediately. The billing may be in error, fraud may have occurred or there may be ways that the consumer can control the overages. If you have tried to resolve a billing issue with your carrier and cannot reach an acceptable resolution, you can complain to the Federal Communications Commission (FCC) at 888-CALL-FCC (225-5322) or file a complaint online.
Consumers have had help avoiding bill shock since 2011, when major U.S. wireless service providers signed onto a voluntary consumer code for wireless service sponsored by the non-profit industry trade group CTIA. These carriers, who serve approximately 97 percent of wireless customers across the country, agreed to send free, automated text messages to their mobile customers with limited plans when they are approaching their data limits. (Wireless customers do not need to take any action to receive the alerts.) The alerts also go to those consumers without an international plan who may be in jeopardy of incurring additional “roaming” charges while traveling abroad.
Data usage management tools help you to avoid exceeding your data allowance. It’s a good idea to regularly monitor your usage because the amount of data used by new devices, apps and activities will vary. Generally speaking, text files use relatively small amounts of data, graphics and music files use larger amounts of data and video files use very large amounts of data.
You can track your usage by using mobile apps (from your carrier or third-party app developers) that alert you if your data usage reaches a certain level. To find these kinds of apps, check your carrier’s app store.
All major carriers—AT&T, Sprint, T-Mobile and Verizon—make it possible to check your usage at any time on the carrier’s website or receive usage information via text message. All major carriers also offer parental controls. These services vary, but typically allow parents to set limits on their children’s downloads and data usage.
Whenever possible, shut off your carrier’s mobile data and use Wi-Fi. You can connect to your home broadband, or (with caution) use public Wi-Fi available in places like cafes and restaurants.
Your device settings contain features to help you save mobile data. For example, opt to have mobile apps update automatically only if your phone is connected to Wi-Fi, not mobile data. Adjust automatic updates and “push notifications” in your app management settings.
In the Apple iPhone operating system, go to Settings > Cellular and scroll down to see a list of apps under “Use cellular data for.” Turn off non-essential services.
Editor’s note: Since late August, reporters at the Cleveland Plain Dealer have been investigating a huge spike in consumer complaints about mobile data overages, most with Verizon but also with AT&T. The investigation found that data was being used when consumers' phones were turned off and even after one phone's owner had died. The companies say they are helping individual consumers, but they apparently have not been able to give a definitive answer as to why this is happening.
Having a high-speed (broadband) internet connection at home has become indispensable for so much, from applying for jobs or establishing a home office to doing schoolwork and banking or paying bills. But according to the Pew Research Center, 33 percent of U.S. households lack this essential tool.
Consumer Action partnered with Comcast to create a free, multilingual educational guide to let those who can’t afford a standard monthly service plan know that they still have options for a high-speed home internet connection. “Getting up to speed: Broadband internet for low-income households” lays out the many benefits of broadband internet and gives an overview of available low-income broadband adoption programs that can help consumers in many parts of the country get online for $10 or less per month. The guide is available on our website in mobile-friendly and printer-ready PDF formats (in Chinese, English, Korean, Spanish and Vietnamese). A free packet of companion flyers, in English, provides detailed descriptions of specific programs that offer low-income households affordable access to the internet, including Comcast’s Internet Essentials, CenturyLink’s Internet Basics, Access from AT&T and Connect2Compete.
Click here to access the “Getting Up to Speed” guide and companion flyers.
Paying a bribe may be a common way to access government services in one’s home country, so when approached with that same fraudulent practice here in the U.S., it may seem familiar to immigrants who are told to pay exorbitant (albeit bogus) fees for citizenship documents or legal advice. The Federal Trade Commission (FTC) hosted a full-day workshop in December on the nation’s changing consumer demographics and the need to use different approaches to reach out to and prevent fraud in these more diverse populations.
Consumer Action’s Ruth Susswein was a panelist during the session on Strategies to Protect Diverse Consumer Communities. Susswein spoke about the need to partner with community-based organizations (CBOs) to alert them to the latest scams and scandals and to learn what problems are plaguing individual communities. Consumer Action has often acted as a liaison between ethnic communities and government agencies, alerting them to the latest on-the-ground scams. Susswein also works in coalition with other national consumer groups to urge industry and government agencies to make language access in financial services a greater priority to meet the needs of a growing limited-English-speaking population.
Consumer Action’s extensive in-language outreach has helped forge partnerships through our offering of free financial education training sessions and materials in five languages (Chinese, Korean, Vietnamese, Spanish and English). Consumer Action also regularly conducts interviews with ethnic media in Chinese and Spanish, and offers a free complaint hotline with assistance in Spanish, Chinese and English.
The latest issue of Consumer Action News, which will be available online later this month, will feature government, private and non-profit resources devoted to consumers with limited English proficiency.
In November, Consumer Action’s Joe Ridout testified at an oversight hearing convened by California’s Senate Banking and Financial Institutions Committee. The chair of the committee, Steve Glazer, invited diverse voices to speak out about California’s response to the widespread Wells Fargo fraud. California was disproportionally affected by the fake accounts that bank employees opened; an estimated 897,972 of the approximately two million bogus accounts originated in the state.
Along with Ridout, other speakers at the hearing included Michael Bostrom from the city attorney’s office in Los Angeles (which first uncovered Wells Fargo’s crimes), Aeisha Mastagni from the California State Teachers’ Retirement System, two other consumer advocates: Rosemary Shahan of Consumers for Auto Reliability and Safety (CARS) and Sean Coffey of the California Reinvestment Coalition, and a number of corporate governance experts.
Bostrom discussed his office’s 16-month investigation into the fraud. During the investigation, the city attorney’s office interviewed about a thousand customers and ex-employees, and also used the Consumer Financial Protection Bureau’s (CFPB) searchable complaint database to build its case.
Shahan then gave her testimony, stressing the dangers of pushing consumers into arbitration when their rights are violated. Despite public outcry and backlash from advocates, Wells maintains their right to force the consumers wronged in the scandal into arbitration, which will take away their right to go to court and launch them into a parallel justice system, where arbitrators are often paid by the corporations with which the consumer is in dispute and rulings are secret. Perhaps not surprisingly, consumers lose 94 percent of the time under forced arbitration.
“Thank you Chairman Glazer and distinguished members of the committee for this opportunity. My name is Joe Ridout, speaking on behalf of Consumer Action, a non-profit consumer advocacy organization based in San Francisco.
I want to first relate some of the complaints Consumer Action has received through our multilingual hotline (from individuals harmed by the account fraud), and then recommend steps that we believe should be taken in order to mitigate potential copycat scams that could target Californians in the future.
One of these victims, a San Francisco woman who speaks only Cantonese, told us that she "went to open one Wells Fargo account but they opened twenty accounts."
Another consumer, relaying her experience from July 2012, applied for a home equity loan with Wells Fargo. Although she was turned down for the loan, the bank secretly opened a checking account in her name. Since this was not a free checking account, she only learned of its existence once it had gone to collection with a $90 negative balance.
Another woman, whose account wound up in collections after the bank re-opened a previously closed account, told us, "When Wells Fargo re-opened my account, I was not notified. The account never showed up on the Wells Fargo website."
It bears repeating that this constitutes organized identity theft by a powerful corporation. Had any of the two million cases of identity theft occurred outside of a bank, this would invite criminal prosecution and possible jail time. We should treat this no less seriously simply because it happened inside a bank.
Incredibly, at the same time that Wells Fargo was committing this organized identity theft, it was also selling a product called "Wells Fargo Identity Theft Protection" for $12.99 a month, which, needless to say, did not disclose when the bank itself was in the process of stealing a customer's identity.
We would recommend that any bank that has engaged in identity theft be prohibited from selling identity theft protection products. To allow this is akin to a team of arsonists selling fire insurance or a ring of burglars selling home security systems that they can circumvent whenever it facilitates their crimes.
Wells Fargo was also invited to the hearing, but new President and CEO Tim Sloan not only failed to appear, he also neglected to provide a company representative in his stead. Chairman Glazer checked with the Senate historian and found that on only one other occasion had a company ever blown off an oversight hearing. That company was Enron.
The Consumer Financial Protection Bureau (CFPB) took action against three reverse mortgage companies for misleading consumers and deceptively advertising their loan products. The companies are American Advisors Group, Reverse Mortgage Solutions and Aegean Financial.
“These companies tricked consumers into believing they could not lose their homes with a reverse mortgage,” CFPB Director Richard Cordray said.
A reverse mortgage allows homeowners (62 years and older) to borrow money based on the equity built up in their home and to repay the loan when the house is sold or when the owner moves out or passes away.
According to the CFPB, American Advisors Group (the largest reverse mortgage lender in the country), along with the other two lenders, falsely told customers that they would have no monthly payments and would be able to pay off all debts. In actuality, those who take on a reverse mortgage continue to have a debt and must make payments (on taxes, insurance and property maintenance). Furthermore, they can default on the loan and lose their home if they fail to comply with the loan terms.
In its Spanish language ads, Aegean Financial also implied it had a connection with the U.S. government, which was false.
The CFPB has required the companies to make clear and truthful disclosures in their advertising and pay a combined $800,000 in fines.
For helpful information on reverse mortgage advertising, see the results of a 2015 CFPB study on the topic.
Despite the availability of safer, more affordable accounts, many campus bank accounts continue to include hidden, costly fees that hit college students hard.
About one in 10 students with college-sponsored bank accounts incurred 10 or more overdraft fees a year, costing $196 on average, according to a new CPFB study. The CFPB analyzed about 500 marketing deals between colleges and big banks and found no limit on the overdraft fees, out-of-network ATM fees and monthly maintenance fees that the banks could impose on students.
The U.S. Department of Education (DOE) finalized a “cash management” rule last year that requires campus banks with accounts that accept financial aid payments to offer students free ATM withdrawals and to issue a ban on overdraft fees. Although the rule does not apply to all campus bank accounts, all are supposed to consider students’ “best financial interests” and disclose the terms of the agreements online.
The CFPB’s report is the first review of college-sponsored accounts since the DOE’s rule went into effect. The CFPB’s study revealed that Stetson University negotiated a student prepaid account with Fifth Third Bank that contained no overdraft fees and that UC Berkeley/Bank of the West offered refundable out-of-network ATM fees. In contrast, PNC Bank and Wells Fargo failed to offer “baseline protections” against high fees on some campus accounts.
The CFPB advises students to carefully review campus bank account costs and features and shop around. It recommends that schools enter into agreements that include free ATM access, deposit insurance and extra error resolution protections, and that they prohibit overdraft fees on student accounts.
Student loan complaints to the Bureau showed the greatest increase (up 108% for the same period this year over last), and prepaid card problems showed the biggest decrease (down 51%).
Debt collection, credit reporting and mortgage complaints continue to top the CFPB’s list, representing about 65 percent of complaints filed.
Other common financial services complaints involved debt settlement and debt relief. Consumers reported problems with upfront fees for debt relief, particularly on student loan debt.
Consumers also complained of upfront fees with no relief and no refund from credit repair companies and money order issuers.
Class action settlements involving Telebrands “As Seen on TV” corporation and automaker Nissan were among nine new cases added to the Consumer Action Class Action Database during December.
This month we highlight a major class action filed by the Federal Trade Commission (FTC) against DeVry University (“DeVry”). The FTC brought the action against DeVry under the Federal Trade Commission Act, which prohibits unfair or deceptive acts or business practices. The FTC charged DeVry with deceptively advertising the employment rate of its graduates as 90 percent within six months of graduation in their chosen fields. According to the FTC, DeVry also falsely claimed that one year after graduation, its graduates would earn an income 15 percent higher than that of other college graduates. DeVry agreed to a $100 million settlement.
$20.25 million in debt cancellation for tuition, books and lab fees owed to DeVry by eligible students.
Additionally, DeVry must notify eligible students that they will receive debt relief and inform the credit bureaus and collection agencies of the debt forgiveness. The settlement also forbids DeVry from continuing to misrepresent the employment rate and income of its graduates.
The FTC will contact eligible consumers about the refund program. To get more information on the status of the refunds, call the FTC’s refund administrator at 844-578-2645 or check here. All debt relief/forgiveness will occur automatically.

References: v. 
 v. 
 v. 
 v. 
 v. 
 v. 
in fine