“It is no surprise that auto sales and repair are the number one complaint category, now for the seventh year in a row,” said Erin Witte, Director of Consumer Protection. “Consumers rely on cars to get to work, school, doctors’ appointments and more, and these agencies serve a critical role to help consumers when they have suffered harm at the hands of dealers and repair shops.”

Home repairs and contractors jumped to the number two category, and landlord/tenant complaints fell to fifth place. The report is based on information from 36 agencies in 25 states. Agencies responded to a survey from CFA asking for their top ten complaint categories and their greatest achievements for the year, and agencies also provided real life examples of complaints from consumers.

The top ten complaint categories made to agencies in 2022 are:

1 – Auto Sales & Repair

2 – Home Improvement Repairs and Contractors

3 – Consumer Debt & Credit

4 – Retail Purchase Issues

5 – Landlord Tenant

6 – Frauds and Scams

7 – Healthcare/Wellness

8 – Home Furnishings & Appliances

9 – Utilities

10 – Travel & Moving

Agencies reported a wide variety of successes in 2022, including the creation of a consumer protection education website hub for foster youth by the Los Angeles Department of Consumer & Business Affairs. The San Francisco District Attorney’s Office helped resolve a $300,000 cryptocurrency scam, and the Florida Department of Consumer & Agriculture Services resolved nearly $1 million in travel-related complaints alone.

Agencies in Florida reported internal successes, including Pinellas County Consumer Protection’s development of new technology to analyze financial records, and handling more cases and more refunds by the Broward County Consumer Protection Division.

Several agencies were able to shut down bad businesses for good, including a tech support scammer where the Montana Department of Justice obtained over $96,000 of relief for consumers, and New Jersey Bergen-Passaic Division of Consumer Affairs removed a home improvement contractor’s license whose shoddy work caused a home to collapse.

The full 2022 Consumer Complaint Survey Report is available here.

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At the press teleconference, CFA will announce:

• The top ten consumer complaints made to state and local consumer protection agencies
• Changes in trends from years past
• Examples of agency successes
• Consumer complaint stories

Event:             Press Tele-conference: Release of CFA’s Annual Consumer Complaint Survey

Date:               Wednesday, May 24, 2023 at 1:00 PM ET

Call In #:        800-225-9448, use the passcode CFACALL (2322255)

Speakers:       Erin Witte, Director of Consumer Protection, CFA

In addition, on hand for the teleconference to help answer reporters’ questions will be representatives from:

• Broward County, Florida Consumer Protection Division
• Georgia Attorney General’s Office
• New York City Dept. of Consumer & Worker Protection
• Maryland Attorney General’s Office

 THE REPORT IS AVAILABLE ON AN EMBARGOED BASIS

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“For the sixth year in a row, the number one consumer complaint to agencies involves deceptive conduct in the sale of new and used cars as well as complaints about auto repair shops,” said Erin Witte, Director of Consumer Protection. “It is clear that auto sales and repairs are a longstanding problem and that consumers rely heavily on these agencies for assistance when they have suffered harm.”

Many agencies also reported an increase in landlord-tenant complaints in 2021, the year during which the federal eviction moratorium ended, and states and localities decided whether to enact extended tenant protections.

Twenty-three agencies from fifteen states responded to a survey from CFA asking for their top ten complaint categories, the worst and most common COVID-related complaints and their greatest achievements for the year, and agencies also provided examples of complaint narratives from consumers. Collectively, these agencies handled over 208,000 complaints, secured over $119 million in monetary relief and provided unique non-monetary relief and assistance to consumers across the country.

The Top Ten complaint categories made to agencies in 2021 are:

• Auto Sales & Repair
• Landlord Tenant
• Home Improvement Repairs and Contractors
• Retail Purchase Issues
• Consumer Debt & Credit
• Frauds and Scams
• Utilities
• (TIE) Healthcare/Wellness & Robocalls/Telemarketing
• Professional Services
• Travel & Recreation

“Each year, we are delighted to work with the dedicated public servants at each participating agency and learn about their efforts,” Witte said. “Their responses give us insight about what is happening in the marketplace and which strategies have been particularly successful.”

The Report highlights the agencies’ achievements in the year 2021, including enforcement actions by the San Francisco District Attorney’s Office against gun manufacturers and sellers for deceptively selling “ghost gun kits” without disclosing legal requirements or prohibitions (p. 35), and by the Ohio Attorney General’s Office against an internet provider for excessively charging consumers for internet speeds it knew could not be reached (p. 20).

Agencies also successfully resolved large-scale matters, including the Virginia Attorney General’s Office settlement with ticket reseller “Tickets On Sale,” resulting in over $180,000 in restitution for failing to honor its “100% buyer guarantee” or refund consumers for cancelled events (p. 34). The Maryland Attorney General’s Office also successfully mediated with a major state university that refused to let students back out of their off-campus housing leases after the university made most classes remote. Through mediation, the Attorney General obtained a reduced fee for the tenant students (p. 28).

Agencies also navigated administrative changes during a time when complaints have been at an all-time high. The Florida Department of Agriculture and Consumer Services has managed its consumer complaints despite its staff members handling four times their normal caseload (p. 37). Similarly, the Tennessee Attorney General’s Office successfully implemented a new internal complaint system and an updated user-friendly consumer complaint form (p. 42). Its complaints nearly doubled in the second half of this survey period after these procedures were implemented (p. 33).

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Consumer advocates have created a list of urgently needed reforms that Congress can undertake to expand DOT’s authority, disincentivize unfair and deceptive conduct, and hold airlines accountable, including:

• Minimizing flights cancellations and delays by requiring industry-wide reciprocity for passengers, requiring carriers to maintain a percentage of on-time flights per month, and requiring public airports to post notices about compensation rights.
• Reforming airline fees, seating and rewards by prohibiting unreasonable and disproportionate fees, prioritizing family seating requirements, establishing basic standards for air travel (including maintaining a customer service phone number with minimal wait time), requiring up front and transparent fare pricing, ending the excise tax exemption for ancillary service fees, establishing a minimum passenger seat size, and requiring reasonable notice before devaluing frequent flyer miles.
• Enabling stronger enforcement of passenger protections by permitting state attorneys general to enforce DOT consumer protection laws, establishing a private right of action for passengers, and directing the Government Accountability Office to examine the DOT’s failure to complete prior mandates from Congress in past FAA reauthorization bills.
• Prioritizing consumer voices by renewing the charter for the Aviation Consumer Protection Advisory Committee, requiring airport authority government boards to have at least two consumer representatives, and establishing the creation of new airports.

“Congress has an opportunity and an obligation to respond to the air travel crisis by enacting meaningful reforms to strengthen consumer protections,” said Erin Witte, CFA’s Director of Consumer Protection. “CFA is committed to ensuring that urgently needed reforms are included and that consumer voices are prioritized throughout the FAA reauthorization process.”

Contact: Erin Witte, 202-569-9807

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While promises of “No Credit Needed!” “90 Days Same as Cash!” “No Interest Financing!” sound great, what do they really mean? This may not be clear, especially when the terms are presented on a handheld device or laptop computer, requiring consumers to scroll through multiple screens to read them. It’s tempting to simply hit “I agree,” but people may be in for a costly surprise if they don’t understand the agreement they’re making.

“No Interest Financing” and “Same as Cash” generally mean that consumers can avoid interest charges by paying the full purchase price within a certain period of time. If they don’t, a high rate of interest may be applied for the entire period, which could double or even triple the cost of the item.

“No Credit needed” is aimed at people who aren’t eligible for the no-interest deals.  These may be a rent-to-own or lease agreement rather than an outright purchase. Consumers’ payments will add up to much more than the original purchase price, and if they miss a payment, the item can be repossessed.

“Easy financing” may mean a loan offered at the time of sale to help consumers pay off the purchase over time. However, these loans often have annual percentage rates as high as 188 percent, even in states with strong interest rate caps. This type of financing can be found on a variety of different consumer goods including furniture, auto repairs, and even pets.

The financial world is constantly evolving, with the promise of providing consumers with more services tailored to their particular needs. But the aim of providing in-store financing is mainly to lock consumers into making purchases before they change their minds, not necessarily to give them the best or most affordable deal.

When considering in-store financing, consumers should resist pressure from pushy salespeople, read the document carefully even if that takes time, ask questions to make sure they understand the terms and true cost (things like finance charges and late fees increase the annual percentage rate), and be sure to get a copy of the agreement in a form that they can easily access (for instance, a printed copy if they prefer that or don’t have a way to deal with an electronic version). It would be great if retailers that make financing available were required to give consumers the equivalent of the Schumer Box, the simple table that credit card issuers must provide showing the interest rate, fees, and other information that’s necessary to comprehend and compare the cost of credit cards.

The Consumer Financial Protection Bureau explains how special promotional financing involving store credit cards work, and the Federal Trade Commission provides information about the differences between rent-to-own, leasing, and other financing options. For many consumers, the best decision may be to put the items they want on layaway (though it’s important to know the cancelation and refund policy for layaways) or to simply save up for what they want to buy.

Consumers who believe they were misled about the terms or cost of financing retail purchases should contact their state or local consumer agencies for advice about to do.

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Thirty-four city, county and state consumer agencies from 18 states participated in the survey, which asked about the complaints they received last year, their biggest achievements, and new consumer protection laws enacted in their jurisdictions.

Top Ten Complaints in 2020

1. Auto: Misrepresentations in advertising or sales of new and used cars, deceptive financing practices, defective vehicles, faulty repairs, car leasing and rentals, towing disputes.
2. Home Improvement/Construction: Shoddy work, failure to start or complete the job, failure to have required licensing or registration.
3. Landlord/Tenant: Unhealthy or unsafe conditions, failure to make repairs or provide promised amenities, deposit and rent disputes, illegal eviction tactics.
4. Credit/Debt: Billing and fee disputes, mortgage problems, credit repair and debt relief services, predatory lending, illegal or abusive debt collection tactics.
5. Services: Misrepresentations, shoddy work, failure to have required licensing or registration, nonperformance.
6. Utilities: Complaints about gas, electric, water and cable billing and service.
7. Retail Sales: False advertising and other deceptive practices, defective merchandise, problems with rebates, coupons, gift cards and gift certificates, failure to deliver.
8. Travel: Misrepresentations about cost, amenities or other aspects of travel packages, failure to provide promised services, disputes about refunds.
9. (Tie) Health Products/Services: Misleading claims, unlicensed practitioners, failure to deliver, billing issues; Internet Sales: Misrepresentations or other deceptive practices, failure to deliver online purchases.
10. (Tie) Pandemic: price gouging, refunds for canceled events and travel, financial issues, problems getting repairs and other services, “self-help” evictions, scams, and other complaints stemming from the pandemic; Fraud: Bogus sweepstakes and lotteries, work-at-home schemes, grant offers, fake check scams, imposter scams and other common frauds; Household Goods: Misrepresentations, failure to deliver, repair issues in connection with furniture and major appliances.

This ranking is based on the categories that appeared most frequently in the consumer agencies’ “top ten” complaint lists. Collectively, the 34 agencies that participated in the survey handled 280,413 complaints and recovered or saved more than $262,973,073 for consumers in 2020 through informal mediation, administrative action, and lawsuits.

COVID-19 also significantly changed the way state and local consumer agencies operated. Most had to switch to working entirely remotely. Some agencies provided staff with cell phones and laptops and set up secure systems to enable them to work entirely from home. Others sent small numbers of personnel into their offices on a rotating basis to handle the phones and mail. Their staffs sometimes fielded calls about problems totally unrelated to consumer protection because people were unable to get through to other state or local agencies. Forced to rely on technology more heavily than ever, agencies encouraged consumers to communicate with them via email and used online platforms for administrative hearings and educational events that would normally be conducted in person. “State and local consumer agencies had to turn on a dime to change how they worked,” observed Grant. “They continued to provide vital information and assistance to the public without missing a beat.” The “Consumer Agencies Biggest Achievements” section of the report describes how agencies resolved consumers’ problems, improved their operations, and reached out to the public even as the pandemic raged.

Examples of Pandemic Complaints

• Wedding Fireworks Fizzled. A young couple had planned a river boat fireworks cruise as part of their wedding. Because public gatherings were restricted to 10 people and they had invited 60, they asked to cancel the cruise. The business refused to cancel without penalty. The couple were given a choice of losing 25 percent of their deposit if they canceled by a certain date or 100 percent if they waited longer to cancel. With the help of the District of Columbia Attorney General’s Office, they were able to obtain a full refund of $1,750.
• The Price Wasn’t Right. A consumer complained to the New York State Division of Consumer Protection that a local restaurant was adding a surcharge when customers paid by credit card. The restaurant insisted it was following the law and said its credit card processor had assured it that the practice was acceptable. However, the agency explained that under New York law, businesses that charge differently for credit cards must publish their prices to reflect the higher credit card amount. A business can offer a discount to cash-payers but cannot add an extra charge for paying with a credit card. The restaurant provided that information to the credit card processing company, which quickly adjusted its software to eliminate the surcharge and notified all of its clients of the change.
• Pasty COVID Cure. Investigative work by the Los Angeles County Department of Consumer and Business Affairs in California helped the Los Angeles City Attorney resolve a case against a local company, Insan Healing, and its CEO, Angela Oh, for allegedly advertising and selling radish paste as “a must-have product for the protection and prevention of the COVID-19.” The settlement provided for full restitution to consumers, a broad injunction, and a $20,000 civil penalty.
• Landlord Goes Too Far. After a landlord allegedly used physical violence against one tenant and attempted to have another tenant deported by ICE to remove them from their apartments, the Massachusetts Attorney General’s Office went to court to seek emergency injunctive relief to protect the tenants and witnesses in the case from any further harassment.
• Gym Member Gets Exercised. When a gym closed in March 2020 due to the pandemic, a customer was told he could freeze his membership so he wouldn’t be charged. However, he was charged $43.14 for the month of June. When he took it up with the gym, he was offered a 50 percent credit instead of a full refund. In disgust, he canceled his membership and was charged a fee for doing so. The New Mexico Attorney General’s Office got his money back.
• Ticket in Paradise. It was a lovely evening in Florida, and a woman parked her car in a lot at a beach to go for a stroll. When she attempted to put money in the meter, the screen was frozen. A resident who lived nearby informed her that people were not being charged for parking due to the pandemic. When she returned to her car, however, there was a $75 ticket from the private company that operates the lot. She filed an appeal, which was denied without explanation. The woman called and emailed the company multiple times, with no response. She filed a complaint with the Broward County Environmental and Consumer Protection Division, which got the ticket withdrawn.
• Masked Robbery. More than 2,300 price gouging complaints were filed with the North Carolina Attorney General’s Office last year. The agency sued Stephen Gould Corporation, a New Jersey-based business that allegedly offered millions of N95 masks to the North Carolina Emergency Management Unit of the North Carolina Department of Public Safety, UNC Health, Duke Health, and the Charlotte Chapter of the American Red Cross at a markup of more than 100 percent. If the sales had been successful, the company would have profited more than $30 million per transaction. In addition to winning a $150,000 judgment, the agency obtained an order permanently barring the company from engaging in unfair and deceptive practices or selling personal protective equipment at unreasonably excessive prices.
• Deep Freeze. Last winter an elderly couple who suffered from numerous disabilities and had another older woman living with them in their home asked the Arkansas Attorney General’s Office for assistance. Their HVAC unit, which was under warranty, had stopped functioning in August 2020. The business that sold it to them sent several subcontractors to try to repair it, but they were unsuccessful. The consumers had been using space heaters for months to keep warm. It soon became clear that the necessary parts were not available due to the pandemic. The business agreed to resolve the problem by replacing the HVAC unit.
• Smelly Situation. Fairfax County Department of Cable and Consumer Services in Virginia received 41 complaints involving trash companies in 2020. Due to workers’ exposure to COVID-19, trash companies struggled to maintain service. Consumers complained that their trash or recycling were not picked up as scheduled, nor were alternate arrangements made. They also complained that while their service had been reduced, their rates had increased. With the help of the agency consumers received credits for missed service, got reduced rates in some cases, and were provided with more timely service.
• No Home Away From Home. A woman asked the Consumer Assistance Council in Massachusetts for help when her request for a refund for a home she rented in Oak Bluffs for a week in August last year was denied. She explained that she could not travel to Massachusetts because of the requirement to self-quarantine for two weeks and the limited heath care facilities on the Cape. She was especially concerned about the potential for contracting the COVID-19 virus and bringing it home to her elderly mother, for whom she was the sole caregiver. The real estate broker agreed to rebook the house and refund the woman’s deposit, minus a small fee.

One thing that became clear in reviewing the complaint stories is that the usual terms of service and cancellation policies don’t take into account the unusual circumstances consumers experienced last year. For example, in one complaint, a mother put a prom dress on layaway for her daughter and when the prom was canceled, the retailer refused to return her money. “Since it wasn’t the consumer’s fault that the prom was canceled due to COVID, she understandably felt she shouldn’t have to pay for a fancy dress that her daughter, stuck at home, had no place to wear,” explained Grant. Often consumer agencies were able to persuade businesses to make exceptions to their regular cancellation and refund policies, but not always. They generally had a stronger basis to argue that consumers should be able to cancel with no penalty and get their money back when the pandemic prevented businesses such as party venues and sports promoters from being able to provide the promised services. Even then, however, consumer agencies sometimes found it difficult to resolve the problems. For instance, some childcare providers that were forced to temporarily close insisted that parents continue to pay their fees in order to “save” their children’s slots when the facilities reopened.

The “Pandemic Complaints” section of CFA’s survey report provides other examples of COVID-related complaints. There are Ten Tips for Navigating the COVID-19 Pandemic (and Other Disasters) in the report and separately at here.

State and local consumer agencies also continued to receive complaints last year about issues unrelated to the pandemic. Examples of these are provided in the “Real-Life Complaints” section of the report. There are tips for consumers throughout that section and collected in Appendix B.

The full 2020 Consumer Complaint Survey Report is available here.

Contact: Susan Grant, 202-939-1003

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Auto

If you’re considering buying a car, shop around and don’t commit to anything until you have read the contract and the finance agreement carefully to make sure you know the terms and cost of the deal. Don’t be rushed or pressured, ask questions, and if there is anything you still don’t understand, show the paperwork to someone you trust before you sign. When you buy a new car, state law protects you if there are problems that substantially affect your ability to use it, but not all problems make a new car a “lemon.” Ask your state or local consumer agency about your lemon law rights.

At http://www.ialla.net/law_contacts.htm the International Association of Lemon Law Administrators provides information about how to reach the government agency that oversees the new car lemon law in your state. It also offers tips for consumers on issues such as how to prepare for lemon law arbitration hearings.   

Thinking about trading in a car that you still owe money on? Since it’s frequently cheaper to repair a car than to replace it, you might be better off financially if you wait until you can pay off your existing car loan before you buy another vehicle. But if you can’t delay, get the dealer’s promise to pay off the loan on your trade-in in writing and follow up with your lien holder within 30 days of signing the contract to confirm that the promise has been kept. If you’re buying a used car, don’t take it from the dealer’s lot until you have all of the paperwork you need to register it in hand.

Only do business with auto repair shops that you know and trust or that have good reputations based on other people’s experiences. Be sure to get an itemized receipt for the work. If you have any doubts about the diagnosis of your car’s problem, bring it to another shop for a second opinion.

If you’re considering buying an RV or any other type of vehicle, get any promises the dealer makes in writing in case there are questions later about the terms of the deal, such as whether your deposit will be refunded if the financing falls through.

Don’t do business with car dealers or auto mechanics who are operating in parking lots or other locations that are not their regular places of business. They may not be licensed or in compliance with other legal requirements that apply to them, and they could be hard to find if you have problems later.   

Have a problem with an auto repair shop? Give the owner or manager a chance to resolve it, but if that fails, contact your state or local consumer agency for advice and assistance.

Purchasing a car “as is” doesn’t always mean that you’re out of luck if something goes wrong. You may be able to hold the dealer responsible. But the best way to protect yourself is to have the car checked out by a mechanic you trust before buying it to look for problems that might not be obvious to you. Buying a used car long-distance is especially risky since you may not be able to test drive it or have a mechanic examine it before you pay, and shipping it back if it’s not satisfactory could be expensive. 

Auto repairs may take longer than expected because the shop has trouble getting the right parts or the mechanic discovers that additional work is needed. Keep in touch with the shop and make notes about the dates of each conversation, who you talked to, and what was said. Don’t pay before the work is done. If you think that you’re being strung along, ask your state or local consumer agency for help.

New car defects can be more than inconvenient –they can be dangerous. Contact the National Highway Traffic Safety Administration at www.nhtsa.gov or by calling 800-424-9153 to get information about auto recalls, check for complaints from other individuals about the same problem, and report safety defects.  If there are problems with your new car that substantially affect your ability to use it, ask your state or local consumer agency about your lemon law rights.

Review the auto sales contract carefully before signing. If there is something in it that doesn’t match what is on the vehicle or what the salesperson told you, beware! You may want to steer clear of the deal.

Just as with buying a car, it’s a good idea to research the make and model of the boat you’re considering as well as the reputation of the dealer. Check online boat reviews and sources of complaint information such as the Better Business Bureau, https://www.bbb.org/. If there are any problems after the sale, keep records of what they are, when you contacted the dealer, how long the boat was in the repair shop, and what repairs were made. Contact the manufacturer if the problems persist.   

Business Services

Buying equipment for your business? Ask potential suppliers if they have experience with providing machinery for the specific work you’ll be doing. Be sure that the bill of sale includes a description of what the equipment is intended to be used for in case there are any issues later about its suitability for the job.

When you agree to provide services for a company, there should be a written contract that clearly spells out the terms, including how you will be paid and the grounds for termination. Not all state or local consumer agencies handle business-to-business disputes, but they may at least be able to provide advice.

You have a great idea for a new product or service, but how do you get started? There are many companies that promise to evaluate, develop and market people’s inventions, but they may be more interested in getting your money than in promoting your idea. A legitimate invention promoter will tell you how many inventions it has evaluated, how many of those inventions got positive or negative evaluations, its total number of customers, how many of those customers received a net profit from the promoter’s services, and how many of those customers have licensed their inventions due to the promoter’s service. And it will get paid through royalties if your invention is a success, not by charging you a large fee in advance. For more information about how to protect yourself go to https://www.consumer.ftc.gov/articles/0184-invention-promotion-firms.

Communications

Problems with the quality of your internet service? Speak up! Keep notes of when outages or other service problems occurred, who you spoke to at the company and on what dates, and what they said. If you don’t get satisfaction, contact your state or local consumer agency for advice. In addition to getting the problem fixed, you may be entitled to a bill adjustment.

If you’re going away for an extended period of time, you may want to make special payment arrangements with your telephone and utility suppliers. Keep a record of when you contacted them, the names of the people you dealt with, and the specific terms of the agreement. Ask them to send confirmation of the arrangement in case there are any questions or problems when you return. 

Check your phone bill carefully before paying it in case there are any mistakes or unauthorized charges. If you have a billing problem and can’t resolve it, ask your state or local consumer protection for help.   

The Federal Communications Commission is working to rein in excessive rates and egregious fees on phone calls from jails and prisons. For information about caps on allowable calling rates and fees go to https://www.fcc.gov/consumers/guides/telephone-service-incarcerated-individuals.

Credit/Debt

When you’re financing a purchase through a retail store for furniture, appliances, or other expensive items, take the time to carefully read the agreement before signing, no matter whether it’s a document on paper or on a computer. Don’t be pressured, and ask questions if anything is not clear. Some financing arrangements can add significantly to the cost of the merchandise. You might want to consider other options, such as lay-away. For more information go to https://www.consumer.ftc.gov/articles/rent-own-lease-own-layaway-and-buying-over-time.

The Consumer Financial Protection Bureau offers information about how to calculate the amount you can afford to borrow to buy a car, the different ways that you can finance the loan, and what your lending rights are. See https://www.consumerfinance.gov/consumer-tools/auto-loans/.

Debt mix-ups can happen when people have the same names, account numbers are entered incorrectly, or other mistakes occur. If you’re contacted about a debt you don’t believe you owe, don’t ignore it! Your credit could be damaged and you may be sued. Contact your state or local consumer agency for advice. For more information about debt collection go to https://www.consumerfinance.gov/consumer-tools/debt-collection/.

Reverse mortgages typically require homeowners to keep their payments for property taxes and insurance current. Failure to do so can lead to foreclosure. As part of the loan agreement, the mortgage servicer may automatically withdraw money from your bank account to make those payments for you. If you have such an arrangement, check with the tax collector and your insurance company to confirm that the payments were made when they were due. For information about reverse mortgages go to https://www.consumerfinance.gov/consumer-tools/reverse-mortgages/.

Many states limit fees for debt settlement services. While there is no federal fee cap, federal rules prohibit debt settlement and other for-profit debt relief services from charging fees until they’ve actually obtained a satisfactory solution for consumers. There are some exceptions; see information at www.ftc.gov/bcp/edu/pubs/consumer/credit/cre02.pdf.

There are many ways to finance higher education. Unfortunately, some for-profit schools exploit students by pushing them into high-cost loans they may not be able to afford. Learn about student loans and how to avoid the pitfalls at https://www.consumerfinance.gov/consumer-tools/student-loans/.

Payday loans are very expensive and can trap you in a never ending cycle of debt. Even worse is being dunned for a payday loan that you never took out. You have the right to dispute a debt you do not owe. See https://www.consumerfinance.gov/consumer-tools/debt-collection/. New rules from the Consumer Financial Protection Bureau about the frequency of debt collection calls may be coming soon.

Employment

Workers are legally entitled to get the wages they are owed. If you believe that you are being shortchanged by your employer, don’t be afraid to stand up for your rights.

Whether you are an employee or a contractor, you are entitled to be paid for the work you do. Ask your state or local consumer agency where to go for help.

Fraud

Common danger signs of fraud include: promises of sudden riches with no work or risk; unexpected demands for money to avoid something bad happening; popular items offered online at incredibly low prices; and requests to send payment for something using a money transfer service or gift cards. Protect yourself by checking with your state or local consumer agency before you take the bait.

 Online dating sites, social media sites and other forums on the internet make it possible to meet people from all over the world. But they’re also places where scammers lurk, waiting for someone to come along who wants to be friends – or maybe something more – and building a fake relationship with the person until the time is ripe to ask for money. Once you’ve sent the cash, you can kiss your “sweetie” goodbye.

Dishonest immigration consultants can do more than just rob people of their money; if they fill out your application incorrectly they can damage your chance of success. Only licensed attorneys or nonprofit organizations that are authorized by the U.S. Citizenship and Immigration Services (USCIS) office can give you legal advice or represent you to obtain legal status. For more information go to www.uscis.gov/avoidscams or call 800-375-5283, TDD 800-767-1833.

No one from Medicare will ever call asking for your Medicare number or other personal information unless you’ve given them permission in advance, call to try to sell you something, enroll you in anything over the phone unless you called first, or visit your home. Learn more and report Medicare fraud at https://www.medicare.gov/forms-help-resources/help-fight-medicare-fraud.

You’ve heard the saying, “On the internet, no one knows you’re a dog.” It’s also hard to know if the person who is offering a dog for sale actually has it or if it’s a scam. One “tell-tail” sign is if you’re asked to send your payment via a money transfer service. Legitimate businesses don’t ask for payment that way, but fraudsters do because they can get the cash fast and it’s hard to trace them. Pet scams are so common even the International Pet and Animal Transportation Association warns consumers about them. See https://www.ipata.org/pet-scams.

Swindlers sometimes impersonate celebrities or even create totally fictitious ones to lure people into sending them money, and social media platforms enable them to reach millions of potential victims all over the world. Search online for the name the person is using plus “scam” to see if anything pops up. 

Tech support scammers use pop-ups and other forms of online ads, and also solicit victims by phone and email. Often pretending to be from well-known companies, they ask for money but don’t do any work. They may claim that there is a problem with your computer when there isn’t, and even worse, they may cause a problem with your computer and then demand money to fix it. If you need computer help, find a local vendor. Never let anyone who contacts you out of the blue have access to your computer. If while browsing on the internet, you receive a pop-up window warning you that your computer is infected or there is an “error” and you must call a number or click a link for tech support help, press Control+Alt+Delete, and use the Task Manager to close out the pop-up window. Do not click a link, call the number listed or attempt to use the “X” in the corner to close the pop-up. Learn about the “tech support scam” at https://www.consumer.ftc.gov/articles/0346-tech-support-scams.

Telephone companies are working on ways to block unwanted robocalls and stop fraudulent Caller ID spoofing. Ask your landline and/or wireless phone service provider what tools are available to you. For more information go to https://www.fcc.gov/consumers/guides/stop-unwanted-robocalls-and-texts.

Online shopping sites such as Amazon don’t contact people to tell them a big order has just been placed using their credit cards and ask them to call if they didn’t make the purchase. This is just another type of “phishing scam” designed to scare people into providing their passwords, credit card numbers and other sensitive information. See https://www.consumer.ftc.gov/blog/2020/07/hang-business-imposter-scams.

If you get a robocall from someone to whom you did not give permission to make those kinds of calls to you, don’t press certain digits on the keypad or call a number that’s provided. You’d just be confirming your number to a scammer. 

Does the price seem too good to be true? That’s because it’s a scam. Never send money to individuals through websites that don’t provide buyer protection. 

Health Products/Services

Use gift cards and gift certificates as quickly as possible, as businesses can close without warning and there is no guarantee that you’ll be able to get the unused value.

If you suspect there is a problem with a medical product, ask your state or local consumer agency where to report it.

Should you pay to subscribe to a service for help obtaining low-cost or free drugs from pharmaceutical companies’ patient assistance programs? Compare the monthly fee to the actual savings you might get. You can find the drug makers’ patient assistance programs yourself using Medicare’s directory at https://www.medicare.gov/plan-compare/#/pharmaceutical-assistance-program; some states also have directories, see https://www.medicare.gov/plan-compare/#/pharmaceutical-assistance-program/states. If the application forms are complicated, perhaps a trusted friend or someone from a social service agency can assist you. Another way to try to lower your drug costs is to consult with your doctor about generic drugs, which are less expensive than brand-name ones and may be as effective. 

Home Improvement/Construction

Get estimates from a few contactors and ask for referrals to previous customers so you can check on their reliability and the quality of their work. You may also find useful information about contractors from the Better Business Bureau and other sources by searching online.

Many states have enacted laws concerning solar sales and leases. Before you sign a contract, ask your state or local consumer agency about your rights and the company’s responsibilities. Be sure you understand the terms and what will happen if you decide to sell your home or no longer want solar power. Get a written contract that spells out everything you’ve been told. The Solar Energy Industries Association offers free guides at https://www.seia.org/initiatives/solar-customer-resource-portal.

If you’ve paid for home improvement work that was never even started, you may be the victim of a crime. Contact your state or local consumer agency.    

Pay only a small deposit when you contract for home improvement work; some state laws limit the percentage of the total price that can be requested upfront. Get a written contract that sets out the work and payment schedule. Payments should be proportionate to the work done and the supplies that have been ordered.

Some problems with home improvement work only become evident after the warranty has expired Contact the contractor as soon as you discover the problems. Take pictures and keep notes as documentation. If the issue is faulty materials or installation, it’s likely that other homeowners are having the same problem. Ask your state or local consumer agency for advice about next steps.

Be sure the home improvement contract specifies the date that the work will begin. While there may be legitimate reasons for delays, such as problems obtaining materials or other jobs taking longer than expected, the contractor should let you know and provide you with a new starting date. Contact your state or local consumer agency if the contractor is unresponsive.

If a contractor has left you without a roof over your head or the shell of a house, you may need to fire the company and hire a new one. In some states consumers can apply for reimbursement from a home improvement guaranty fund if they can’t resolve problems with their contractors, but to be eligible there may be a requirement that the contractor was duly registered or licensed – a good reason to ask your state or local consumer protection agency what you need to know before you sign on the dotted line for the work.

Before having a home constructed, consult with an attorney about whether a performance bond or other protections can be built into the agreement.

Never pay the full amount for home improvement work until the job is done. You have no leverage if the work is incomplete or unsatisfactory.

Home improvement can be one of the most costly investments consumers make in their lifetimes. It’s essential to get estimates and have a written contract that lays out the payments and total cost.

If contractors are regulated in your area, check with the government agency that oversees that program on whether there have been disciplinary actions against the contractor you’re considering. Be aware that subcontractors may be able to put liens on your property if the contractor hasn’t paid them. Don’t make the final payment until the contractor can confirm that the subcontractors have been paid for their work.

Even legitimate home improvement contractors can run into financial or supply problems that prevent them from completing the job. Protect yourself by insisting on a contract that sets a payment schedule that is proportionate to the work that is done and the materials that are delivered. If the contractor has gone out of business, contact your state or local consumer agency for advice and assistance.    

If the contractor is arranging for financing for the job, carefully read the loan agreement to make sure you understand the cost and terms.

Take pictures to document shoddy workmanship and any damage it has caused, and ask your local or state consumer agency for assistance if you can’t resolve the problem with the contractor.

Home Solicitations

If your phone number is on the federal or a state “Do Not Call” registry and you’re getting sales calls from companies that you don’t do business with, or you’re getting pre-recorded sales calls from a company that you never gave written permission to make those kinds of calls to you, it’s a violation of your telemarketing rights. Learn more about your calling rights and where to report violations at http://consumerfed.org/consumer_info/understanding-your-telemarketing-rights/.

Household Goods

Resist pressure to buy extended warranties. They usually have all sorts of exclusions and limitations and don’t provide much more protection than the manufacturer’s warranty that comes with the appliance.  Even if you buy an extended warranty, you may have to be persistent to get repairs or a replacement. Keep notes of your communications with the warranty company, including the dates, who you dealt with, and what you were told in case you need that information to make a complaint or take other action.

It’s aggravating when appliances break down and even more aggravating if you are being bounced between the manufacturer, the retailer, and the company that handles the warranty claims. Keep track of your communications as you try to resolve the problem and contact your state or local consumer agency if you need help.

If new furniture is defective, don’t take it lying down – insist that it be repaired or replaced. Take pictures of visible defects, and if necessary pay an independent repair shop to assess the problem and give you a written statement.

ID Theft

Most states require residents to be notified about data breaches, and in some cases, to be provided with certain types of assistance. Federal law now allows consumers to ask the credit reporting agencies to “freeze” their credit records, at no charge, whether they are ID theft victims or not, to make it harder for their personal information to be misused if it does fall into the wrong hands. For more information go to https://www.consumer.ftc.gov/articles/0497-credit-freeze-faqs.

Internet Sales

When you order something by phone, by mail, or online, federal regulations require the merchandise to be shipped by the time promised, or if no delivery date was specified, within 30 days. If the delivery is delayed, you must be notified and given the choice to wait longer or cancel for a refund. The retailer can cancel the transaction, however, if it had a reasonable basis to believe that it could make timely delivery when it accepted your order but later learns that it cannot.

A free trial offer doesn’t mean that you get something for free, no strings attached. Typically you’ll be charged unless you cancel before the trial period ends, and depending on the terms of the deal, the charges may go on and on every month indefinitely. Be sure you know exactly what you’re getting into if you agree to a free trial offer and report any problems to your state or local consumer agency.    

If you are thinking about buying expensive equipment online, check the seller’s reputation with the Better Business Bureau and on complaint websites. Make sure you know the terms of the deal and print the details of the transaction to keep in case any questions or problems arise later. If you can’t get clear answers for why there is a delay, or the seller doesn’t fulfill the contract in a timely manner but tries to intimidate you or charge you for canceling, contact your state or local consumer agency.

Buying perishable goods online can be risky if the seller doesn’t package it properly and deliver it promptly.

Using a credit card is the safest way to pay for online purchases because federal law gives you the right to dispute the charge within 60 days of receiving the first bill on which it appears if it’s for the wrong amount, you never got the merchandise, or what you got is different than what you were promised. If you don’t discover a problem with an order until after that 60-day window, you may have a legitimate beef with the seller, but your ability to get a chargeback (refund) from your credit card issuer will depend on its internal policies. For the strongest protection, look for online retailers that promise delivery sooner than 60 days. Contact your credit card issuer right away if there is a delay in shipping or other problems.

Landlord/Tenant

You may be entitled to a certain amount of notice before your landlord can unilaterally end your tenancy. If you’re unsure whether your landlord is treating you fairly, don’t suffer in silence. Ask your state or local consumer agency for information about your rights and how to enforce them.

Tenants are generally only responsible for damage or other problems they and their guests cause. If your security deposit has been wrongly withheld or isn’t returned to you in a timely manner, contact your state or local consumer agency.

Many states require landlords to ensure that their rental property meets certain safety and health standards. But tenants are generally responsible to treat the property respectfully and avoid causing damage. Your state or local consumer agency can give you information about your rights and responsibilities as a tenant and help to mediate disputes with the landlord. 

If you contact your landlord about health or safety problems with the property, you may want to follow up with a letter and keep a copy so you’ll have a record. The time limits for landlords to make repairs may depend on the seriousness of the problems. Your state or local consumer agency can give you information about the landlord’s obligations. If timely action isn’t taken to remedy the problems, contact the local inspector. Some state laws specifically protect tenants from retaliation for reporting health code violations. You may be able to break the lease if the house or apartment becomes uninhabitable because of the issues.

Moving

Always get a written estimate for moving services and be sure you know what is included in the price, including how compensation will be calculated if anything is damaged. You may want to purchase additional insurance if you have valuable furniture or other belongings. If your property is going to be in storage for a while, inspect the storage area first to look for signs of water and other potential problems.

Before you buy a pet from a store or a breeder, ask your state or local consumer agency about your rights if the animal turns out to be unhealthy. You can find information about dog breeders and buying dogs through the American Kennel Club, www.akc.org. For information about cats and cat breeders, visit the American Cat Fanciers Association at www.acfacat.com/. 

Real Estate/Timeshares

Tempted to buy a timeshare? Ask yourself: Can you afford it? How does the cost compare to what you normally spend on accommodations when you go on vacation? What happens if you can no longer use it? Resist pressure to purchase a timeshare, and don’t rely on the salesperson’s assurances. Get the total cost, including fees and finance charges, and all promises in writing, and read the documents carefully. Check the company’s reputation with the Better Business Bureau nearest to its headquarters (find it at https://www.bbb.org/bbb-locator/). Remember, once you sign, you may not be able to cancel.       

Selling real estate can be complicated. Have a lawyer review the paperwork and advise you on any requests for listing fees or other payments you’re asked to make.

It’s worthwhile to have a lawyer represent you when you buy or sell a home to make sure that the property is free of liens and there are no other problems that could come back to haunt you later.

Own a timeshare you don’t want or can no longer use? Avoid companies that ask for fees upfront to sell your timeshare, regardless of whether they succeed, and don’t believe them if they claim they have eager buyers waiting. Consult with a licensed real estate broker or agent who can tell you if there is a market for your timeshare and will only take a fee if it’s actually sold. For more information about buying and reselling timeshares go to https://www.consumer.ftc.gov/articles/timeshares-vacation-clubs-and-related-scams#avoid. 

Some timeshare companies are unscrupulous, using high-pressure sales tactics and lies to wear people down and get them to agree to make a purchase – or even to buy multiple timeshares. If you or someone you know was abused by a timeshare company, ask your state or local consumer agency for advice about what to do.

The board of directors of a homeowner’s association sets the rules owners must abide by and is responsible for collecting fees and enforcing the rules. The board is also responsible for ensuring that the common areas are well-maintained. In addition to the association’s rules, there may be state or local laws that apply. If you have a problem or question about your rights, your state or local consumer agency may be able to provide advice and assistance.

Retail

The products you buy should perform as you would expect them to for a reasonable period of time, whether they are covered by written warranties or not. If a product stops working repeatedly, you may have the right to insist on a replacement or a refund.      

A mobile home is a big investment. Before you buy one, make sure you have a place to put it, since there is no automatic right to cancel the purchase if your circumstances change.

Handling funeral arrangements can be stressful, but as with any major purchase, it’s important to get a contract that specifies what will be done and when, and to follow up with the seller if the products or services are not provided. Don’t pay the full amount before everything you were promised has been done. At https://funerals.org/ the nonprofit Funeral Consumers Alliance provides information about planning funerals and your legal rights.

Services

If you have reason to believe that a plumber, electrician or heating and air conditioning contractor is not competent to do the work properly, ask your state or local consumer agency where you should report the problem.    

Be cautious before entrusting valuable items for repairs or consigning them for sale. Get a written receipt that describes what will be done. Don’t make any payments until the repairs have actually been made. Commissions for sales are normally deducted from the proceeds. Be sure you know what will happen with your items if they do not sell.   

Paying for services with a credit card rather than a check gives you added protection because you can dispute the charges if they aren’t performed or are not done correctly.

Towing

If you believe that your vehicle was towed from private property unfairly, ask you state or local consumer agency for information about the laws that apply and what your rights are.    

Failure to obey the parking rules set by apartment complexes, condominium, and homeowners associations can result in a costly tow. If you believe a tow was improper or you were overcharged, pay the fee to avoid storage charges and contact your state or local consumer agency for advice.  

If you are parking a vehicle that you don’t own in your designated parking space at your apartment complex, you might want to let the management know to avoid confusion and an unnecessary tow. 

Travel

Many travel agencies and tour companies belong to the American Society of Travel Advisors (ASTA), whose code of ethics requires members to deliver the services they promised and make prompt refunds when they are due. See Traveler Support under Find a Travel Advisor on the website, https://www.asta.org/. The safest way to pay for travel is by credit card because you can dispute the charges if the services were never provided or the refund to which you are entitled wasn’t made.

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Since the survey focused on complaints and other activities in 2019, the report CFA released today does not reflect the impact of COVID-19. The work of state and local consumer agencies has not stopped during the pandemic, but it has changed. Agencies whose personnel are working remotely have had to set up call forwarding and secure connections to computer systems. Others have a limited number of staff members in their offices on a rotating basis to answer the phones and perform other functions. In some cases, volunteers who help mediate complaints have been sidelined because they lack the necessary internet service or technological skills to work from home. Walk-in assistance is not available at agencies that are closed to the public; services are provided by phone or online instead. Educational presentations are being conducted virtually. The pandemic has also spurred complaints about price-gouging and COVID-related scams.

Fortunately, many agencies implemented new technology or upgraded their data systems before the pandemic struck. These changes have made complaint intake and case management easier. In some cases consumers can provide all documentation and check the status of their complaints online. Many agencies have also beefed-up the information on their websites and increased their use of social media for public outreach. These operational improvements are helping consumer agencies fulfill their public protection mission in this challenging time.

Top Ten Complaints in 2019

These are the complaints most frequently cited as the top problems reported to state and local consumer agencies last year.

1. Auto: Misrepresentations in advertising or sales of new and used cars, deceptive financing practices, defective vehicles, faulty repairs, car leasing and rentals, towing disputes.
2. Home Improvement/Construction: Shoddy work, failure to start or complete the job, failure to have required licensing or registration.
3. Retail Sales: False advertising and other deceptive practices, defective merchandise, problems with rebates, coupons, gift cards and gift certificates, failure to deliver.
4. Landlord/Tenant: Unhealthy or unsafe conditions, failure to make repairs or provide promised amenities, deposit and rent disputes, illegal eviction tactics.
5. Credit/Debt: Billing and fee disputes, mortgage problems, credit repair and debt relief services, predatory lending, illegal or abusive debt collection tactics.
6. (Tie) Communications: Misleading offers, installation issues, service problems, billing disputes with telephone and internet services; Services: Misrepresentations, shoddy work, failure to have required licensing or registration, nonperformance.
7. Health Products/Services: Misleading claims, unlicensed practitioners, failure to deliver, billing issues.
8. Utilities: Complaints about gas, electric, water and cable billing and service.
9. (Tie) Fraud: Bogus sweepstakes and lotteries, work-at-home schemes, grant offers, fake check scams, imposter scams and other common frauds; Household Goods: Misrepresentations, failure to deliver, repairs issues in connection with furniture and major appliances.
10. Internet Sales: Misrepresentations or other deceptive practices, failure to deliver online purchases.

“Real-World” Consumer Stories

These complaint stories from the report illustrate just some of the problems that individuals ask their state or local consumer agencies for help with. Additional stories from agencies’ files appear in “Real-World Complaints” and “Biggest Achievements.” There are also tips for consumers throughout the report about how to protect themselves and resolve problems.

• A Car with a Mind of its Own. An Arkansas woman’s dream car turned into a nightmare when she discovered that the radio went on and off at will and the volume shot up or dropped down uncontrollably. The only way to deal with these problems was to shut the car off and wait for the computer to reset itself.
• Firefighter Sees Red. A volunteer firefighter in Montgomery County, Maryland was incensed when telephone calls to supposedly raise money for his fire station and others in the area were actually being made on behalf of a political action committee that was not distributing any of the proceeds to support local firefighters.
• Debatable Debts. A debt buyer allegedly purchased a portfolio of accounts from an unidentified seller on Craigslist who provided no supporting documentation demonstrating the ownership or validity of the debts and then threatened Georgia consumers with legal action if they refused to pay.
• Bad Deal. A company offered to provide veterans and retirees in Maryland with instant cash by purchasing the rights to their pensions or annuities. The lump sum payments consumers received, however, were treated as loans with highly usurious interest rates, locking them into making payments for many years into the future that would add up to far more than the amounts of money they got.
• The Sky’s the Limit. When the promoters of “lantern sky festivals” to be held in North Carolina were forced to cancel because their aerial lanterns were prohibited under the state fire code, they continued selling tickets and failed to provide refunds to people who bought them or to respond to consumer complaints.
• The Chinese Embassy is Not Calling. If you’ve received a pre-recorded call in Mandarin on your cell phone, it may be from fraudsters posing as Chinese embassy officials. They tell people they’re wanted for questioning because their families in China are involved in a major fraud investigation but that they can send money for “bail” to get out of the situation. Some San Franciscans emptied their savings accounts, mortgaged their homes, or borrowed heavily to wire the money overseas.
• Scooter Scam. A Massachusetts man with cerebral palsy, vision impairment and other health issues that prevent him from obtaining a driver’s license ordered a scooter from a company for $1,999.99 to help him get around. He was told that financing was available. A woman from the finance company called to say that she was emailing him the paperwork and asked him to stay on the phone until it appeared in his inbox. She then instructed him to skip to the last page and initial some boxes. When he received the completed contract he realized there would be 57 monthly payments of $92 and a $262 buyout at the end, making the total cost nearly $6,000.
• Twenty-five homeowners in Hillsborough County, Florida paid a contractor substantial amounts upfront to install pools in their yards. He dug the holes, poured the concrete bases, and then abandoned the projects. Not only were the consumers out the money, collectively more than $1.2 million, but subcontractors who had not been paid placed liens against their property. One couple, who spent $50,000 they received in a settlement following a car crash that killed their daughter, said, “We wanted that space to be able to go out and find the peace that we search for and so we were looking forward to it. We want him to know that he’s hurt us greatly.”
• Dead Dogs. A California man offered puppies for sale online for $350 to $1,400. Dozens of consumers reported that the puppies were extremely ill immediately or within days of arrival, requiring expensive veterinary treatment, and in many cases the puppies died. One consumer said that after notifying the seller that his puppy had died, he was sent a replacement, but sadly that puppy also died within days.
• Ants and Armadillos, Oh No! A Florida woman complained that there were armadillos living under the home she rented and carpenter ants in the walls. There were also several ant colonies in the yard. Her son was attacked by ants twice outside, resulting in anaphylactic shock, hours at the hospital, and days of steroid treatment. In addition, the armadillos had dug eight-inch holes all over the yard, creating a minefield. The landlord claimed to have treated the ants, which didn’t seem to solve the problem, and suggested that the woman try to catch the armadillos herself.
• Scorpions Be Gone. A pest control company solicited Connecticut consumers for expensive, long-term service contracts that included eradicating scorpions, which are not commonly found in the state.
• To Own or Not to Own, That is the Question. A company that buys foreclosed properties enticed New Mexicans to enter into lease-purchase agreements. It encouraged the consumers to make improvements to the homes by representing that they owned them, when in fact they did not. If the consumers weren’t able to obtain financing to purchase the homes or were late on their monthly payments, they faced quick eviction and losing everything they had invested in the property.

“Many complaints can be resolved through mediation, and some consumer agencies can also take formal legal action when that is warranted,” said Ms. Grant. “But when it comes to fraud, prevention is the key since the money and the culprits often disappear without a trace.” In a new trend reported by one consumer agency, scammers are instructing victims to stay on the phone while they go to the bank to withdraw funds or to stores to buy gift cards in order to make payment. “This enables the crooks to essentially hold the victims captive and tell them how to respond if a bank teller or cashier becomes suspicious and starts asking questions,” said Ms. Grant. “The public education that state and local consumer agencies provide is crucial for preventing fraud and abuse.”

The full 2019 Consumer Complaint Survey Report is available here.

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For example, there’s the story in the survey report about a disabled man in Massachusetts who wanted to buy a scooter for $1,999 to help him get around. The salesperson told him financing was available and arranged to have someone from the finance company call him. The woman who called said she was emailing the finance paperwork and told him to remain on the phone while it worked its way to his inbox. She then instructed him to skip to the last page and initial some boxes, which he did, and promised to email the completed contract to him. When he received it, he saw that there would be 57 monthly payments of $92 plus a $262 buyout at the end, making the total cost nearly $6,000. Alarmed, he called the finance company to ask what the interest rate was on the loan and learned, to his surprise, that that there was no interest because it was a lease, not a loan. He also noticed that his signature appeared on the contract, though he never signed it.

There’s also the story from San Francisco about people receiving pre-recorded calls in Mandarin that claimed to be “official communications” from the Chinese embassy and directed them to press a number to connect with an embassy employee. The person at that extension (an imposter, not a real embassy employee) said there was a message waiting for them and offered to open it while they stayed on the line. Of course they agreed. The message was that they were wanted for questioning about a major fraud investigation involving their families back in China. While still on the line, they were then connected to the “detective in charge of the investigation” (another imposter), who explained that they could get out if the situation by paying for “bail.” Sadly, people emptied their savings accounts, mortgaged their homes, or borrowed heavily to wire thousands of dollars overseas to the scammers.

Keeping consumers on the phone in this manner is a form of control. It prevents them from having time to think about what they’re doing, read what they’re agreeing to, or check with anyone else. Furthermore, giving consumers a series of instructions to follow is a way of “grooming” them to do what the caller ultimately wants them to do – agree to the deal, provide their personal information, or send money.

When the Massachusetts man jumped to the end of the document to initial the boxes while the woman from the finance company waited on the phone, he didn’t have a chance to look at the terms of the agreement. And the victims of the Chinese embassy scam were so intimidated by the end of the call that they didn’t question whether they should wire the money – something they probably wouldn’t have done if they had checked the credentials of the people who spoke to them.

In its survey response, the consumer agency in Cuyahoga County, Ohio reported an even more disturbing trend: some scammers are instructing consumers to stay on the phone while they go to the bank to withdraw the money or to stores to buy gift cards in order to make the payments. This essentially enables the crooks to hold their victims captive and tell them how to respond if a teller or cashier becomes suspicious and starts asking questions. It also prevents the consumers from checking the validity of the claims or demands the callers are making.

Here’s advice from CFA about how to protect yourself from these abusive control tactics:

• Take charge of the conversation. It’s up to you to decide whether to speak with someone who calls you, especially if the call is unexpected. If you don’t want to talk to someone, say so and hang up!
• Take a time out. If the call is about something you’re interested in or you think might be valid, ask the person to give you the information and tell them you’ll call back. If the caller won’t give you the time to look at something or verify what you’re being told, hang up!
• Read the contract before you commit. If someone sends you a contract by email or text, don’t initial anything or click on “I agree” until you’ve read the whole thing carefully. If you’re not sure what something means or the agreement doesn’t match what you were told, ask questions and don’t seal the deal unless you’re satisfied with the answers.
• Resist scare tactics. Many phone scams involve callers falsely claiming to be from law enforcement agencies. This is deliberately intended to strike terror in your heart and make you easier to control. Tell the caller you’ll get back to them and hang up! Then find the number of the agency the person claims to be from by looking online or through directory assistance, and call directly to ask if what you’ve been told is true. Don’t use the number the caller gives you or that shows on Caller ID, since it may just lead right back to a scammer.
• Get advice. When something seems like it might not be quite right, ask for advice from your state or local consumer agency, your lawyer, your accountant, or someone else you trust.
• Take care how you pay. Government agencies don’t tell people to pay money they owe by wiring it or buying gift cards. Neither do debt collectors, utilities, and other legitimate businesses. If you’re asked for payment by one of these methods, hang up! And if you realize you’ve been tricked into doing it, contact the money wiring service or the gift card issuer immediately to ask if anything can be done to stop the payment.

For more tips from our consumer complaint survey report about how to avoid fraud and other problems, click here.

The post Take Control of the Call to Avoid Scams and Abuse appeared first on Consumer Federation of America.

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We’ve also seen emails that look like they’re from the World Health Organization or other trusted sources with information about how to protect yourself, but when you click on the link or attachment it infects your computer with malware that steals your personal information or holds your computer for ransom. In another email scam, the message appears to be from the government offering money and asking for your banking and other personal details.

My electric company just issued a warning about imposters who are calling pretending to be from the utility and demanding payment. These scams aren’t new, but people who are struggling to pay their bills because they’ve lost their jobs due to the pandemic are especially vulnerable and may be unaware that many utilities are suspending collections during this emergency period. Investment scams are also common during times of financial stress. There is no such thing as a 100% safe investment.

While many scams rely on scare tactics, others are designed to appeal to your desire to help other people in need. The US Attorney for the Eastern District of Virginia recently warned that scammers are soliciting donations for individuals, groups, and areas affected by the virus.

Since scammers are endlessly creative, we’re sure to see more frauds related to COVID-19. Here are things you can do to protect yourself:

• Don’t respond to unexpected emails, texts, or calls from anyone you don’t know.
• Reject promises of miracle cures for the coronavirus – there aren’t any.
• Be aware that the government is not calling or emailing to offer you free money.
• Guard your personal information as you would your wallet.
• Only make purchases online from companies you know or have checked out with the Better Business Bureau.
• Avoid charity scams by following basic tips about how to donate wisely.
• If you are having trouble paying your utility bills, ask your state utility regulator if there is a program in place to prevent shut-offs and suspend collections.
• Get information about how to spot investment scams from your state securities regulator.
• If you have any doubts about an offer or request you receive, or suspect that something is a scam, contact your state or local consumer protection agency BEFORE you respond.
• Get your information about the virus from reliable sources, not posts on social media or sketchy news outlets. At https://USA.gov/coronavirus you’ll find information about what the federal government is doing in response to the virus and links to federal agencies and state health departments.

The post Protect Your Wallet and Your Personal Information from Coronavirus Scams appeared first on Consumer Federation of America.

We’ve also seen emails that look like they’re from the World Health Organization or other trusted sources with information about how to protect yourself, but when you click on the link or attachment it infects your computer with malware that steals your personal information or holds your computer for ransom. In another email scam, the message appears to be from the government offering money and asking for your banking and other personal details.

My electric company just issued a warning about imposters who are calling pretending to be from the utility and demanding payment. These scams aren’t new, but people who are struggling to pay their bills because they’ve lost their jobs due to the pandemic are especially vulnerable and may be unaware that many utilities are suspending collections during this emergency period. Investment scams are also common during times of financial stress. There is no such thing as a 100% safe investment.

While many scams rely on scare tactics, others are designed to appeal to your desire to help other people in need. The US Attorney for the Eastern District of Virginia recently warned that scammers are soliciting donations for individuals, groups, and areas affected by the virus.

Since scammers are endlessly creative, we’re sure to see more frauds related to COVID-19. Here are things you can do to protect yourself:

• Don’t respond to unexpected emails, texts, or calls from anyone you don’t know.
• Reject promises of miracle cures for the coronavirus – there aren’t any.
• Be aware that the government is not calling or emailing to offer you free money.
• Guard your personal information as you would your wallet.
• Only make purchases online from companies you know or have checked out with the Better Business Bureau.
• Avoid charity scams by following basic tips about how to donate wisely.
• If you are having trouble paying your utility bills, ask your state utility regulator if there is a program in place to prevent shut-offs and suspend collections.
• Get information about how to spot investment scams from your state securities regulator.
• If you have any doubts about an offer or request you receive, or suspect that something is a scam, contact your state or local consumer protection agency BEFORE you respond.
• Get your information about the virus from reliable sources, not posts on social media or sketchy news outlets. At https://USA.gov/coronavirus you’ll find information about what the federal government is doing in response to the virus and links to federal agencies and state health departments.

The post Protect Your Wallet and Your Personal Information from Coronavirus Scams appeared first on Consumer Federation of America.

Our nation’s comprehensive COVID-19 response must include a strong paid sick leave policy and protecting consumers by ensuring affordable access to communications services, preventing utility shutoffs, mortgage foreclosures, student loan defaults, negative credit reporting effects, overpriced insurance, and making sure that airline and hotel customers’ rights are protected in any financial bailout of these industries.

The Consumer Federation of America has identified critical consumer protection issues that must be addressed as part of a comprehensive response to this crisis. Many of these items are focused on protecting those hardest hit by the economic fallout. Doing so is not just a matter of economic justice; it is the best way to stabilize the economy.

CFA and it’s over 250 national, state and local organizations are committed to working with policymakers at all levels to implement a “Comprehensive Consumer Agenda to Address the COVID-19 Crisis”.  For the details behind the following agenda, please see our LINK March 20, 2020 letter to the President and Congress.

A Comprehensive Consumer Agenda to Address COVID-19

1. Create a comprehensive national paid sick leave policy to reduce the spread of the disease. Lack of paid sick leave encourages tens of millions of workers to continue working when they are sick, which can nullify the critically important benefits of social distancing.

2. Protect those hardest hit from economic hardship by:

• Providing forbearance to economically distressed mortgage borrowers. Any homeowner experiencing economic hardship because of the virus must have access to 180 days of forbearance on mortgage payments.
• Halting evictions and foreclosures. There must be a 180 day moratorium on evictions of tenants experiencing economic hardship because of the virus, with support provided to property owners who suffer rental income losses.
• Canceling student loan payments for the duration of the crisis. It is not enough to pause monthly payments, the government must make tax free payments on holder’s behalf so millions of Americans can continue to make progress reducing their student debt as the economy struggles.
• Suspending debt collection. Debt collection activities, including legal proceedings, garnishments, repossessions, and debt selling, must be prohibited during the state of emergency.
• Curtailing high-cost lending schemes: A rate cap of 36% must apply to high-cost credit, such as payday loans, refund anticipation loans, and car title pawns to ensure that vulnerable consumers aren’t trapped by overpriced debt.
• Placing a moratorium on negative credit reporting. To protect consumers’ credit records during the pandemic, there must be, at least, a four month moratorium on negative credit reporting.
• Maintaining consumers’ access to affordable communications services. As remote communications become critically important, service providers must abandon pricing practices that maximize revenues, suspend overcharges for “excess” data usage, terminate service cut-offs, and increase network availability to the public.
• Requiring big data platforms to promote the public interest. Big data platforms must remove misleading information. Their big microphones must promote the public interest, not the corporate bottom lines. Non-commercial pandemic information from public health, safety and governmental entities must be given a prime location on all screens.
• Preventing misleading advertising and price-gouging. Advertisers, and the media carrying ads, must ensure that claims related to the coronavirus are completely accurate. Online marketplaces must reject products and services making misleading claims or that offer basic necessities at unfairly inflated prices.

3. Ensure that consumers’ interests are protected as industries seek federal financial support by:

• Mandating fairness in the skies. Airlines must waive cancelation and change fees for all consumers during the federal state of emergency. As a condition of an airline bailout, Congress must require price transparency, make future fees for cancelations, changing flights, and checking bags proportionate to actual costs, lift state preemption, and provide consumers with private rights of action.
• Accommodate hotel customers. As organizations and individuals heed requests to limit non-essential travel and cancel events, some hotels have continued to charge consumers and organizations. As a condition of a hotel bailout, Congress must require hotels to honor requests for room and event cancelations without penalty and to refund deposits until the federal state of emergency is suspended or travel limit recommendations are lifted. Going forward they must provide full price transparency on charges and extra fees.
• Reduce auto insurance premiums to reflect reduced driving. Insurers should be required to offer discounts to people driving less due to COVID-19.  Miles driven, a key factor in claims costs, will drop dramatically as workers are laid off, switch to telework, or self-isolate. This should be a consumer benefit, not an insurer windfall. See CFA’s letter to Insurance Commissioners.

The post Government Must Protect Consumers’ Health And Pocketbooks During COVID-19 Crisis appeared first on Consumer Federation of America.

In one case, a Massachusetts woman paid $470,000 to move into an assisted living facility. When she moved out she was surprised to be informed that her money would not be returned until and unless her unit was resold. The Massachusetts Attorney General’s Office helped her get the money back immediately.

A woman in Maryland paid a $232,570 entrance fee to senior living facility with the promise that certain amenities would be forthcoming. When they failed to materialize, she left. Since she didn’t follow the required procedures for terminating her agreement, she was told that she would have to wait until someone else moved into her unit to get her money back. A year later, she was still waiting. The Howard County Office of Consumer Protection negotiated a full refund.

And in a complaint handled by the Maryland Attorney General’s Office, an 87-year-old woman quickly realized that the retirement community she moved into was not a good fit. She had constant maintenance and parking issues that made her very anxious. Through mediation the agency worked out an agreement to allow her to move out with payment for one month instead of the three months that would normally be required, and her entire entrance fee was refunded.

Just like buying a house, entering into a contract to move into an assisted living facility or retirement community is a major transaction. Before you commit:

Check the place out. Don’t make your decision on the basis of a glossy brochure or enthusiastic testimonials in advertisements. Visit the place repeatedly, speak to residents and staff, arrange for a thorough tour, and ask the sales department questions.

Read the contract. There is often a substantial entry fee required upfront, with the assurance that all or a certain percentage of it will be returned when you leave (or will go to your estate if you pass away). The terms should be spelled out in the contract. Read it carefully, and if you are not sure you understand it, have a lawyer review it before you sign on the dotted line.

Know your rights. Is there a state or local law that requires your entrance fee to be refunded within a set time after you leave even if your unit hasn’t been sold? Do you have to give a certain amount of notice if you want to move out? Do you have other legal rights or responsibilities? Do some research online, or check with your state or local consumer agency.

Get all promises in writing. Never rely on verbal assurances that your unit will be renovated to your specifications or that certain features or amenities are coming in the future. Get it in writing to document what you were told in case the promises aren’t fulfilled.        

This blog is one of a series of articles contributed by state and local consumer agencies in connection with the annual survey about consumer complaints conducted by Consumer Federation of America. The survey report provides “real life” examples of complaints and tips for consumers. Have a consumer problem or question? Find your state or local consumer agency at https://www.usa.gov/state-consumer.

The post Making the Move to a Retirement Community or Assisted Living Facility appeared first on Consumer Federation of America.

Then a man gets on the phone and says he’s holding her son until she pays $10,000.

The mom hangs up and tries to reach her son’s camp, but the lines are down. She drives to her local police station.

The angry kidnapper keeps calling. She keeps hanging up. At last, she reaches the police station. Officers there have to contact the Pennsylvania State Patrol to raise someone at the camp. And then, after what seems like forever, she hears her child’s voice. He’s safe and sound at camp. “It just gutted me,” the mom told our office after the ordeal had ended.

It’s hard for most people to imagine the elaborate stories scammers make up to try to panic people into paying them. But these gut-punch scams abound. People are told their bank accounts are about to be seized because their Social Security number was linked to a crime. Grandparents get calls from sobbing 20-somethings who sound just like a beloved grandchild, one asking for bail money after causing a crash after texting while driving. Or, in the kidnapping scam reported to our office, a scammer used computer-manipulated sounds of a crying child to try to ensnare a worried mom.

In the kidnap scam I described, the local police tracked the call to a disposable phone in Puerto Rico – nowhere near the mom or child. The call log showed the phone dialed numbers sequentially before someone answered. Like most scam calls, this one was just random, a story in search of a victim.

It can be hard to disengage from the intense drama scammers try to create. But people who avoided losing money to a scams – including this mom — often tell us that simply hanging up the phone gave them time to think critically about the call.

• Here are some strategies that you can use to avoid scams:
• Don’t answer or return calls you aren’t expecting. Scammers are pros at what they do. Don’t give them the chance to get their hooks in you.
• Use voicemail to screen your calls. Don’t respond to vague or ominous calls. That’s how scams start.
• Think about how you can independently verify information. If you accidentally pick up and hear something upsetting, hang up and call a friend, relative, police for a reality check.
• If a caller asks you to pay with retail or gaming gift cards, money wires or by mailing cash, hang up. Those are payment methods scammers prefer because they’re hard for law enforcement to trace.

Finally, if you do have a brush with a scammer, report it. The information you share could help protect others.

The post Kidnapping Scams and How to Spot Them! appeared first on Consumer Federation of America.

Many gym contracts contain precise terms regarding cancellation. Those terms are not always explained clearly when you start or maybe you did not read the fine print. Conditions may include requiring you to opt-out of an automatic contract renewal, mail a written cancellation request to a specific corporate address, and provide at least 30 days of advanced notice. In some instances, you may be charged an early termination fee for seeking to cancel a 12-month membership.

But don’t sweat it!

• Be proactive. The membership cancellation terms are detailed at the beginning of the membership period when the contract is signed. Keep an eye out for the specific cancellation terms during the initial review of your contract and be sure to ask questions.
• Be your own best advocate. If you want to dispute the charges or the terms of the contract, come prepared to strengthen your argument with relevant bank statements and documentation. Many gyms are part of a large network of gym franchises and your best approach will be to bring your dispute directly to the local owner or franchisee listed on your contract. No response? Consider involving the corporate “brand” owner or franchiser. You can find out how to contact them through a simple online search.
• Be educated about membership transfers. If the local gym closes, membership and dues may be automatically transferred to another franchise, usually within 20 miles, in lieu of membership cancellation. Always read your contract to verify whether it includes a transfer provision and remember that a membership transfer does not cancel the contract, and you are still required to make monthly payments. Depending on the laws in your state, you may be eligible for a refund if your membership was transferred without your consent. That is why it is so important to know your specific cancellation rights no matter what is written in your contract.
• Be persistent when terms change. Gyms may add or remove certain membership features, such as personal training sessions or Vinyasa classes, change their hours of operation, or move to new facilities across town. In some states, consumers have the right to cancel their contracts if gyms substantially change their services or locations. Find out what specific laws or regulations exist in your state to protect you before agreeing to any changes.

If you’re not sure that you can stick to your resolution of going to the gym frequently, don’t get stuck paying for a membership you’re not using. Look for gyms that will allow you to pay as you go or on a monthly basis without locking you in for a longer term.

This blog is one of a series of articles contributed by state and local consumer agencies in connection with the annual survey about consumer complaints conducted by Consumer Federation of America. The survey report provides “real life” examples of complaints and tips for consumers. Have a consumer problem or question? Find your state or local consumer agency at https://www.usa.gov/state-consumer.

The post Exercising Your Rights: Gym Membership Cancellation appeared first on Consumer Federation of America.

Top Ten Complaints in 2018

These are the complaints most frequently cited as the top problems reported to state and local consumer agencies last year.

1. Auto: Misrepresentations in advertising or sales of new and used cars, lemons, faulty repairs, auto leasing, rentals, and towing disputes.
2. Home Improvement/Construction: Shoddy work, failure to start or complete the job.
3. Retail Sales: False advertising and other deceptive practices, defective merchandise, problems with rebates, coupons, gift cards and gift certificates, failure to deliver.
4. Services: Misrepresentations, shoddy work, failure to have required licenses, failure to perform.
5.  (Tie) Landlord/Tenant: Unhealthy or unsafe conditions, failure to make repairs or provide promised amenities, deposit and rent disputes, illegal eviction tactics; Utilities: Complaints about gas, electric, water and cable billing and service.
6. Health Products/Services: Misleading claims, unlicensed practitioners, failure to deliver, medical billing issues.
7. (Tie) Credit/Debt: Billing and fee disputes, mortgage modifications and mortgage-related fraud, credit repair, debt relief services, predatory lending, illegal or abusive debt collection tactics; Communications: Misleading offers, installation issues, service problems, billing disputes with telephone and internet services.
8. Internet Sales: Misrepresentations or other deceptive practices, failure to deliver online purchases.
9. Home Solicitations: Misrepresentations, abusive sales practices, and failure to deliver in door-to-door, telemarketing or mail solicitations, do-not-call violations.
10. (Tie) Household Goods: Misrepresentations, failure to deliver, faulty repairs in connection with furniture or appliances; Fraud: Bogus sweepstakes and lotteries, work-at-home schemes, grant offers, fake check scams, imposter scams and other common frauds.

“Real-World” Consumer Stories

These complaint stories from the report illustrate just some of the problems that individuals ask their state or local consumer agencies for help with. Additional stories from agencies’ the files appear in “Real-World Complaints” and “Biggest Achievements” sections of the report. There are also tips for consumers throughout the report about how to protect themselves and resolve problems.

• Double Damage. Consumers complained that a Florida car rental company charged them for damage that the vehicles already had when they received it. In one instance, the consumer took a picture of the damage on the car after the company employee failed to note it on the contract as he had requested, which came in handy when he returned the vehicle and the same employee accused him of causing the damage.
• Adding Insult to Injury. A single mother in Massachusetts bought a used car on the basis of the dealer’s ad describing it as good quality, safe, and recently serviced. Shortly afterwards it broke down due to engine and transmission problems and she could not afford to fix it, so it sat parked on the street outside her home. The consumer agency negotiated with the dealer to take the car back, but before that could happen, it was towed because of a parking ban during a snow storm. The dealer retrieved the car, then claimed the woman had damaged it. A photo from the original ad, however, showed the damage was already there.
• Bad Deal. An elderly Arkansas man was coerced into signing a financing contract for a new $50,000 vehicle and trading in his old car, despite the fact that he could not afford the purchase, and it should have been clear to the dealer that he did not understand the terms of the agreement.
• With a Friend Like That. An Ohio woman took advantage of friends and acquaintances, falsely claiming that she was seriously ill or about to lose her home and asking them to lend her money. Her motive was apparently love – she was a victim of a romance scam, and instead of paying people back as she promised, she wired the money overseas to a man with whom she was communicating online. She was ordered to pay $641,908 in restitution to the victims.
• How Much is That Doggy in the Window? A Connecticut woman wanted a puppy but couldn’t afford the $1,200 purchase price, so the pet store owner offered to let her take it and pay in monthly installments of $100. She signed the contract, but later discovered that it was a lease, with a buyout charge at the end if she wanted to keep the dog. The payments, which included interest, would total $3,575.97.
• Woman Got Less Than She Bargained For. On a cruise to Cabo San Lucas, Mexico, an Arkansas woman followed the recommendation of a “shopping consultant” to visit a jewelry store during a shore excursion. She intended to buy earrings, but was pressured to buy a diamond ring instead for $5,800. Once back on the ship she told the consultant that she wanted to return it and was assured that she had 30 days to do so. When she contacted the store, however, she was told that there were no refunds for “buyer’s remorse.” An appraiser valued the ring at $4,500.
• Treemendous Charge. As result of two hurricanes and a brutal winter storm last year, there were hundreds of complaints in North Carolina about violations of the state’s price gouging law. One out-of-state tree service tried to charge a homeowner $14,500 for removing two trees without getting consent first to do the work. This came to a rate of $1,800 an hour per worker. After the homeowner refused to pay, the company placed the bill in the hands of a debt collector who engaged in misrepresentations and high-pressure tactics to try to get the money.
• Grievous Situation: A funeral home was operating in Washington, DC without the proper licenses and charging grieving families for services it never provided. Because it was unlicensed, it could not issue death certificates, preventing families from accessing the deceased’s financial accounts, beginning probate proceedings, and burying or cremating the bodies. It also misappropriated consumers’ funds; in one case it accepted an insurance payment of $53,000 for services that cost $5,767 and failed to give the beneficiary the balance.
• Pesky Roommates. A couple from New York rented an apartment in Paris for two months through Airbnb. Immediately upon arrival, they began to itch and discovered that the apartment was overrun by bedbugs. All of their belongings and their two dogs were also infested. They had to move out and get everything treated to eradicate the pests.
• Bus-ted. An American Legion chapter in Florida chartered a bus to transport members to Port Canaveral for $2,380. The agreement was that $500 would be paid upfront with the balance due when the trip was completed. The bus company debited the group’s bank account for the $500 deposit. Four days later, $1,000 was debited, followed by $1,380 the next day, even though the trip had not yet taken place. When questioned, the bus owner said it was a mistake and promised to return the money immediately. He didn’t; instead, he withdrew another $3,500, for a total of $5,880. A month later he sent a check for $1,000 as a partial refund, but it bounced.
• Second-Story Job. A homeowner in Maryland who needed more space for his family hired a contractor to add a second story to the house. There was no written contract, and no structural engineer. The contractor asked an interior designer, who was not an architect, to draw up the plans and pull the building permit in the homeowner’s name. After the consumer paid the agreed-on price, $180,000, in a series of checks, the contractor asked for $10,000 more, which he got. When he asked for still more, the homeowner refused. The contractor walked off the job and fled the country.
• Not Going to Take It Anymore. Residents of a senior living apartment complex in Virginia were tired of putting up with unresolved maintenance problems, including lack of air conditioning during hot weather, pipes bursting, and damage to drywall. Though the management threatened to evict them if they complained to anyone about the problems, they finally had enough and sought help.

“Dealing with the broad range of issues that are presented to state and local consumer agencies requires a combination of expertise and creativity,” said Susan Grant, CFA Director of Consumer Protection and Privacy. For instance, a mediator for one agency researched tribal law to successfully get a consumer released from a costly loan that the lender claimed was not subject to government usury laws because of tribal immunity. Another challenge is serving diverse populations, where language and disabilities can make consumers more vulnerable to abuse but also more difficult to assist. One example is the consumer agency that had to use an interpreter to communicate with a complainant who was profoundly deaf and also had trouble reading and writing. “State and local consumer agencies go the extra mile to try to help people resolve their problems, visiting the house to look at the incomplete renovation job, contacting the manufacturer when the retailer won’t replace a faulty product, even working out of a closed business to return people’s belongings to them,” Grant said.

The report provides information from the agencies about new problems consumers reported during the past year and new consumer protections that have been enacted in their jurisdictions. “Measures such as the new rules issued in New York City last year to combat predatory used car sales demonstrate why state and local laws are essential elements of the consumer protection framework in the United States,” said Ms. Grant. The report also highlights some agencies’ biggest achievements last year, from major enforcement actions, to streamlining operations, to developing computer games to teach high-school students about financial issues.

To see the full 2018 Consumer Complaint Survey Report go here. In connection with the report, CFA and several of the agencies that participated in the complaint survey have created blogs with practical advice for consumers. From July 30 through October 7, 2019 these blogs and accompanying infographics will be released twice a week and can be found here.

The post Nation’s Top Consumer Complaints appeared first on Consumer Federation of America.

Payment methods in fraud continue to evolve. This year we heard about crooks asking people to send them cash placed between the pages of magazines. Perhaps this because money transfer services, the most common payment method in consumer fraud, are stepping up efforts to stop scammers from using them to get money from victims. Payment via gift cards also continues to be a problem. As with money transfer services, it’s the equivalent of sending cash. And in one complaint story from Ohio, a woman was instructed to send money to a so-called psychic through PayPal and to say that it was going to a relative, which prevented her from successfully disputing the payments later. You might ask, “Isn’t that kind of weird? Why would anyone agree to do things like that?” But con artists are very skillful in clouding people’s judgement and making what they want sound reasonable.  Another story from Ohio illustrated how alert and well-trained employees can save consumers from losing their money to scams.

Takeaway #1. It’s crucial to prevent crooks from abusing payment services and to constantly remind consumers to stop, think and check it out before sending money. That’s why CFA supports bills in the Senate and House to create a Senior Scams Prevention Advisory Council, with members from government, retailers, financial service providers, and senior and consumer groups, that would develop  and promote more effective models for company training and consumer outreach about fraud. 

Rent-to-own is an expensive way to purchase a pet, or anything else. Rent-to-own has long-been advertised as an affordable way for consumers with limited incomes to buy furniture, appliances, electronics, and other goods. The fact is that rent-to-own is often much more expensive than buying something outright. This year we heard about a Connecticut woman who wanted a puppy but couldn’t afford the $1,200 purchase price, so the pet store owner offered to let her take it and pay in monthly installments of $100. She signed the contract, but later discovered that it was a lease, with a buyout charge at the end if she wanted to keep the dog. The total cost, including interest, would be $3,575.97, nearly three times the purchase price.

Takeaway #2: Renting something with the option to buy may be more affordable in the short-term but it costs more in the long-run. One could argue that leasing a pet could be helpful to determine if that cat or dog is the right one for you, but it’s a pretty expensive way to find out. The lesson here is to always look at the bottom line.  It’s better to save for what you want, or put it on layaway.

Buying energy from a competitive supplier can cost more, not less.  In many states consumers can now buy their electricity, and in some cases natural gas, from suppliers other than the companies that actually produce the energy. Concerns have emerged about competitive energy suppliers using aggressive, abusive and deceptive marketing practices, consumers ending up with higher bills when they were led to believe that they would save money, and the negative impact of these practices on low-income customers and communities. Past survey reports provided examples of these problems. This year we heard about a major enforcement action by the Massachusetts Attorney General’s Office against one electricity supplier and a report the agency issued documenting abuses and calling for the end of the competitive electricity supply market for residential customers in that state.

Takeaway #3: Consumers should be wary of claims for cost-savings by competitive energy suppliers and avoid making decisions to switch based on a telemarketing call or a salesperson appearing unexpectedly at the door. But that’s not enough. The National Consumer Law Center recommends that states protect consumers by prohibiting competitive energy contracts that lock them into variable rates, prohibiting automatic reenrollment, limiting cancellation fees, requiring better cost and other information to be provided on consumers’ utility bills, prohibiting aggressive and abusive marketing practices, publishing comparative pricing information, ,giving consumers easy ways to opt out of marketing and lock their utility accounts to prevent unauthorized switching, making information about complaints against competitive suppliers publicly available, limiting sales to low-income consumers, taking aggressive enforcement action, and assessing whether sales should be allowed in the individual residential market.

Predatory practices in used car sales target vulnerable consumers. Among the auto-related problems described in our report, there are several stories which highlight predatory practices in used car sales. For example, an elderly woman in New York bought a 7-year-old car with high mileage for $11,000, financed through the dealer at the exorbitant interest rate of 24.89 percent. To make matters worse, the finance agreement contained several hidden fees, the most egregious of which was a $5 fee added to the amount debited every month when she made her payments from her bank account via phone. After struggling for four years to keep up with her loan obligation and having paid more than $22,000 on the loan, she fell into arrears and began to get calls from the loan company threatening repossession. Other outrageous stories include the Massachusetts man with a cognitive disorder who was sold two cars when he only wanted to buy one, the Maryland woman who asked the dealer for help transferring the title of the car from her deceased husband’s name to hers and ended up trading it in and then repurchasing it with a new loan that cost her an additional $10,000, and the Ohio woman who was sold not one but three warranties for the used car she bought (which were useless anyway because the dealer failed to provide the documentation to the warranty company).

Takeaway #4: We need better used car sales laws. Last year New York City implemented new rules to protect consumers from predatory practices in used car sales. They require dealers to provide consumers with a financing disclosures form and a “Consumer Bill of Rights.” Buyers have a right to cancel within two business days. In addition, consumers must be provided with information in the language in which the transaction was negotiated to ensure they are aware of their financing options and understand the terms of the contract. State and local authorities should enact these types of requirements to protect vulnerable used car buyers. We’d also like to see more states adopt used car lemon laws so consumers won’t get stuck with vehicles that break down soon after driving them for the dealer’s lot.

Sales of solar and other energy-related home improvements continue to raise concerns. The complaints described in our report include a Massachusetts man who couldn’t get the lien on his parents’ home stemming from their leasing a solar system lifted after they passed away, an elderly woman in Massachusetts who had to move out of her bedroom because of roof leaks resulting from faulty installation of solar panels, and an elderly Florida couple who agreed to finance new windows and an air conditioner through the PACE program, which provides loans for projects to improve energy efficiency, and then found that there was a tax lien on their home for the windows even though they were never delivered. There is also the retired couple in Florida who relied on the salesperson’s assurance that the solar panels would not only produce enough energy to cover their needs, but that the excess energy generated would be purchased by their electric company, providing them with $30-$40 in income every month. Since their sole source of income was Social Security, this sounded like a wonderful opportunity. Unfortunately, they were misled and saddled with a financial burden they couldn’t handle. The system cost $24,000, which with interest would total $40,723. They belatedly learned that in addition to having to make the monthly payments for the next 27 years, they would also have to continue to pay their electric company.

Takeaway #5. Consumers must be protected from aggressive and deceptive sales practices and shoddy work in energy-related home improvements. Any liens that will result from that work should be clearly disclosed upfront and consumers should have the right to contest those liens when there are omissions of important information, false or misleading claims, or problems with performance of the work.

This blog is one of a series of articles contributed by state and local consumer agencies in connection with the annual survey about consumer complaints conducted by Consumer Federation of America. The survey report provides “real life” examples of complaints and tips for consumers. Have a consumer problem or question? Find your state or local consumer agency at https://www.usa.gov/state-consumer.

The post Five Key Takeaways from the 2018 CFA Consumer Complaint Survey Report appeared first on Consumer Federation of America.