Current Events in December 2004

December 16, 2004
The modern home is full of electric appliances like TVs, CD players, VCRs, phone chargers and lots of other things you just plug into the wall and forget about. But California energy regulators call those common products "energy vampires," because even when they're turned off they're sucking up valuable power.

In a move that it hopes will set new standards nationwide, the California Energy Commission has adopted new standards for electric appliances' power usage. The new standards will be phased in starting in 2006.

Presently, televisions and other electronic components can use two to 10 watts of electricity, even when they're turned off. California will be require them to use one to three watts.

"The result of today's 5-0 vote will be to slow electricity demand in the state and save approximately 100 megawatts of generating capacity every year," said Energy Commissioner Jackalyne Pfannenstiel, presiding member of the Commission's Efficiency Committee. "The energy savings are cumulative, so that in 10 years, because of today's new appliance regulations, we can avoid building three large power plants that would have to generate as much as 1, 000 megawatts."

The new energy standards regulate appliances such as incandescent lamps; audio and video equipment; residential pool pumps and portable electric spas; evaporative coolers; ceiling fans, exhaust fans and whole house fans; commercial ice makers, refrigerators and freezers; vending machines; commercial hot food holding cabinets and water dispensers, among others.

The new regulations also cover external power supplies, the small transformers that are used to power answering machines, cell and cordless phones, and a host of other small consumer products and small appliances. These devices draw electricity whenever they are plugged in to an electrical socket, even if the product they are powering is not in use.

"Power supplies can waste surprisingly large amounts of electricity around the house," said Energy Commissioner Arthur Rosenfeld. "Informally known as 'energy vampires,' their efficiency varies greatly. Some models draw only one-fifth of a watt to do the same job other models use three watts to do. These new regulations will prevent that sort of needless waste."

The Energy Commission estimates that the average California household has between 10 and 20 external power supplies that cost the homeowner as much as $75 in wasted electricity each year.

Several consumer and environmental organizations spoke in support of the new regulations. Noah Horowitz, Senior Scientist for the National Resources Defense Council, noted that "these standards will cut consumer and business electricity bills and reduce the amount of pollution emitted from our power plants. Once fully implemented, the standards will reduce power plant emissions of the global warming pollutant carbon dioxide by two million metric tons per year. This is the equivalent of removing 320,000 cars from California roads each year."

Citing utility industry support for the appliance regulations, Roland Risser, Director of Customer Energy Efficiency for Pacific Gas & Electric, said, "These standards will continue to help improve the environment and grid stability, as they reduce customer costs in the future. PG&E believes strongly in these standards and is committed to assisting in increasing them."

States are allowed to regulate appliances not covered by national standards. The federal government has already adopted energy efficiency standards for residential refrigerators, clothes washers, dishwashers and other appliances once covered by state regulation. None of the appliances in today's ruling are federally regulated.

Sprint and Nextel have announced approval by both company's directors to join forces in what they call "a merger of equals." The combination will create America's third largest wireless company, augmented by a global IP network that will offer consumer, business and government customers new broadband wireless and integrated communications services.

The new company, which will be called Sprint Nextel, also intends to spin off to its shareholders Sprint's local telecommunications business following the merger.

For customers, the merger combination will allow Sprint Nextel to:

• Offer digital wireless service in all 50 states, Puerto Rico and the U.S. Virgin Islands. Sprint Nextel and its affiliates and partners cover a total domestic population of 262 million.
• Provide consumers more choice through investments in wireless multi-media, web browsing, messaging, gaming and music on the go.
• Provide integrated wireless and IP-based wireline solutions to business.
• Improve customer service and sales performance through joint capabilities.
• Invest to deploy next-generation wireless data services.
• Improve wireless network quality and coverage.

The consolidation may not be over just yet. Published reports this week suggest Sprint itself is in play, with Verizon Communications Inc., the major stockholder in Verizon Wireless, interested in acquiring Sprint.

Sprint and Nextel currently have a combined total equity value of approximately $70 billion and serve more than 35 million wireless subscribers on their networks and 5 million additional subscribers through affiliates and partners. The two companies, along with their affiliates and partners, operate networks that directly cover nearly 262 million people, more of the U.S. population than any other carrier, the companies said in a statement.

A bogus e-mail has been raising cell phone users' anxiety level. The e-mail warns that cell phone directories are about to be provided to telemarketers, when in fact no such directory yet exists and it is illegal to make telemarketing calls to cell phones. And regulators are reminding cell phone users they can sign up for the Do Not Call Registry.

There is an effort underway by some cell phone companies to compile directories but they don't yet exist and even if they did, the 1991 Telemarketing Consumer Protection Act (TCPA) makes it illegal for solicitation calls to be made to wireless phone numbers without clear permission from the individual to whom a number has been assigned.

The Direct Marketing Association, which represents telemarketers, says that it continues to support vigorous enforcement of the absolute restriction on unsolicited calls to cell phone numbers for marketing purposes and urge federal and state authorities to prosecute those who may engage in this illegal activity.

The Federal Trade Commission reminds consumers that the National Do Not Call Registry has accepted personal cell phone and home phone number registrations since it opened for consumer registrations in June 2003. There is no deadline to register a home or cell phone number on the Registry.

To register a telephone number on the National Do Not Call Registry, or to file a complaint, consumers should visit www.donotcall.gov or call 1-888-382-1222 (TTY: 1-866-290-4236).

Consumers registering a phone number online will be asked to provide a valid e-mail address to which a confirmation of the registration will be sent. A registration is not complete until the consumer clicks on the link in this e-mail. Consumers registering by phone must call from the phone number they wish to register.

Blockbuster says it is eliminating late fees on games and movies as of Jan. 1. The giant movie-rental company portrays it as its gift to the American consumer but skeptics note the change is not without its fine print.

Instead of charging late fees, Blockbuster says that from now on, if customers don't bring a game or movie back on time, they'll be charged the purchase price less any rental fees they've already paid. Or they can return it within 30 days and pay only a "restocking" fee.

"Doing away with late fees is the biggest and most important customer benefit we've ever offered in our company's history," John Antioco, Blockbuster chairman and chief executive, said. "So as of the first of the year, if our customers need an extra day or two with their movies and games, they can take it."

"Blockbuster is a 20th Century business trying to survive for another few minutes while Amazon, TiVo and who knows what else corner the market on home entertainment," said James R. Hood, ConsumerAffairs.com president. "Every Blockbuster store I've been in lately has been deserted."

Meanwhile, Antioco assured Wall Street investors the company has tested the program and found that "increased retail sales" -- including the purchase of overdue movies -- more than make up for the loss of late fees.

Blockbuster has been estimated to make $250 million to $300 million on late fees annually.

The company has more than 4,500 company-operated and participating franchised stores in the U.S.

Continental Airlines has announced it has received approval from the governments of the United States and Nigeria to begin non-stop flights between New York and Lagos.

Continental expects to launch the service in the second quarter of 2005. It will be the only scheduled non-stop trans-Atlantic service to Nigeria and the only scheduled service to Africa by a U.S. carrier. With the start of the Lagos route, Continental will become the only U.S. airline to offer scheduled passenger service to six continents of the world.

Further details of the new service, including the flight schedule and launch date, will be announced later.

"We're proud to extend our network to Africa and to provide a unique link between Nigeria, Africa's most populous country, and the United States, its second-largest trading partner," said Continental's President and Chief Operating Officer Larry Kellner, who becomes chairman and chief executive officer at the end of this year.

"Our Lagos service will be highly attractive to Nigerian and American trans-Atlantic travelers, particularly executives in energy-related industries. They will be able to fly more quickly and easily between Nigeria and not only New York, but cities throughout North America, via our hub at Newark Liberty International Airport."

Continental Airlines is the world's sixth-largest airline with more than 3,000 daily departures throughout the Americas, Europe and Asia. Continental serves 151 domestic and 120 international destinations and nearly 400 additional points are served via SkyTeam alliance airlines.

A Colorado company that sells fabricated steel buildings has lost a consumer fraud case. In a 41-page ruling, Jefferson County, Colo., Chief District Court Judge Brooke Jackson found that General Steel violated the state's Consumer Protection Act.

"Beyond any legitimate question, General Steel for years engaged in sales practices that were riddled with misrepresentations and omissions," the judge wrote.

"The Court's clear and decisive ruling in this case sends a strong message about the consequences of deceptive sales practices in Colorado," Colorado Attorney General Ken Salazar said. "These defendants disregarded good business ethics and notions of fair and truthful advertising to line their pockets at the expense of consumers throughout the country. These practices will not be tolerated."

The state alleged during an eight-day trial in October that General Steel carried out a deceptive marketing and sales program designed to create the false impression that it was a manufacturer of steel buildings that had an inventory of buildings available to consumers at factory-direct sale or "clearance" prices.

The state also alleged that consumers, responding to national radio, television and other advertising, were falsely led to believe that only a limited number of such clearance buildings were available and that they had to act quickly to submit a substantial deposit to claim a building.

In his ruling, Chief Judge Jackson found that General Steel engaged in numerous false and deceptive sales practices, including:

• Misrepresentations that General Steel was a manufacturer;
• Misrepresentations that General Steel was selling existing buildings, when in fact it merely ordered buildings from suppliers only after consumers placed an order;
• Misleading use of the term "clearance buildings;"
• Falsely implying that its buildings were available at 50 percent off the normal price;
• Failing to disclose that the building being sold were simply "shells" and did not include doors, windows, or even opening for the placement of doors and windows;
• Misrepresentations regarding the non-refundable nature of the deposits; and
• Misrepresentations in the process of selling windows, doors and other components.

In its ruling, the court imposed the maximum allowable fine of $200,000 against General Steel's president, Jeffrey Knight. Four additional company employees were also fined by the Court $20,000 each. General Steel was also ordered to pay restitution to consumer victims who testified at trial in amounts ranging from $3,000 to $10,000 per victim. The Court also ordered General Steel to pay the state's costs and attorney fees for its investigation and prosecution.

The court entered a permanent injunction against all of the defendants prohibiting a continuation of the deceptive practices. General Steel also will remain subject to third-party monitoring of its sales practices. Finally, the court directed the parties to establish a proposal for resolving the state's restitution claims for other General Steel consumers injured by the company's deceptive practices.

Consolidation appears to be the buzzword in the mobile telephone industry. On the heels of Cingular's acquisition of AT&T Wireless comes word that Sprint and Nextel may be about to join forces.

A merger would create an entity of more than 38 million wireless subscribers, but it's not clear how that would affect customers of the individual companies.

Sprint is currently the number three U.S. wireless phone company and has recently invested heavily in infrastructure. The company has announced it will spend $3 billion over the next three years to upgrade its mobile network and develop high-speed Internet services.

Sprint has over 26 million subscribers and produces more than $26 billion in operating revenue.

Nextel boasts the largest all-digital wireless network in the country. It has just over 15 million subscribers, most of them businesses, which like Nextel's walkie-talkie "push to talk" instant connection feature. Sprint has also begun development of a walkie-talkie feature.

Sprint, on the other hand, has a nationwide wireless data system, something Nextel would have to spend billions to develop.

Nextel's management team is highly regarded, something that's never been said about Sprint's.

December 8, 2004
A study by the Government Accountability Office (GAO) finds that the 1-800-MEDICARE help line falls far short of meeting older Americans' needs. GAO said the line provided accurate answers to 61 percent of the 420 calls it made and inaccurate answers to 29 percent.

No answers were available for the remaining 10 percent of the calls GAO's investigators made. Most of these calls were not answered because they were transferred to other contractors responsible for processing Medicare claims that were not open for business at the time or the calls were inadvertently disconnected.

"There is a lesson for the Congress and the Administration in todays GAO report that less than two-thirds of people calling the governments Medicare information line received accurate answers," said Robert M. Hayes, president of the Medicare Rights Center, a not-for-profit advocacy organization.

"People with Medicare have been shunning the prescription drug discount card program in droves. Centers for Medicare and Medicaid Services trained counselors cannot provide useful information to millions of people confused by the new Medicare law. The drug benefit slated to begin in January 2006 will be even more confusing for older and disabled Americans," Hayes warned.

The 1-800-MEDICARE help line provides customer service reps (CSRs) with written answers - so-called scripts - that CSRs use during a call. When CSRs provided inaccurate information, it was largely because they did not seem to access and effectively use a script that answered GAO's questions, the report said.

CMS and its contractor do not routinely pretest the scripts to ensure that they are understandable to CSRs or potential callers, GAO found.

To improve the accuracy of the information the help line provides, GAO recommends that CMS:

(1) revise procedures so that calls are not transferred to other contractors that are closed,

(2) assess current scripts and pretest new and revised scripts to ensure that they are understandable,

(3) provide more testing of customer service reps' ability to accurately answer questions and use the results to target training efforts as needed, and

(4) monitor the accuracy rate for each frequently asked question and use the results to modify scripts or provide training, if necessary.

GAO said that the training for CSRs meets CMSs requirements, but it is not sufficient to ensure that CSRs are able to answer questions accurately on the help line. Before handling calls, CSRs must complete about 2 weeks of classroom training; accurately answer two simulated calls consecutively out of six; and score at least 90 percent on a written exam. In addition, all CSRs receive ongoing training.

However, GAO said the results of its study indicate that the testing and simulated call answering did not sufficiently measure whether CSRs were prepared to answer questions accurately.

Ever wondered whether the hi-test gas you were putting in your high-performance car was really hi-test? A gas station owner in Davenport, Iowa thought no one would notice if he put regular in all three pumps. He was wrong.

Station owner Ranbir Thakur must pay a $20,000 civil penalty to the State of Iowa as a result of a lawsuit alleging Thakur's Citgo gas station business placed lower-grade regular gas in tanks supplying pumps that sold mid-grade and super-premium gasoline.

The consumer fraud lawsuit filed by Attorney General Tom Miller's Office was based on an investigation by the Weights & Measures Bureau of the Iowa Dept. of Agriculture & Land Stewardship. The investigation determined that several gasoline tanker-truck drivers had been asked by Thakur to put 89-octane gas in tanks meant to hold 91- and 93-octane gasoline at the Citgo #578 gas station in Davenport.

Thakur and his business, Diwan, LLC, admitted the violation in a consent judgment and order entered recently by District Court Judge Gary D. McKenrick. Under terms of the order. In addition to the $20,000 fine, the station faces more frequent inspections by the Weights & Measures Bureau and will lose its license to sell gasoline in Iowa if there are similar violations in the future.

"This sends a clear message that gas retailers will be penalized sharply if they violate the law. Our Department's Weights & Measures Bureau inspects and licenses all commercial weighing and measuring devices, including gas pumps, and gas pump inspections are conducted unannounced annually throughout the year in order to protect consumers," said Agriculture Secretary Patty.

Online travel site Expedia has introduced three new online resources it says can help consumers research, evaluate, and choose their next hotel or destination activity by considering the amenities hotels offer.

Travelers will also have the ability to review new online "traveler opinions" that provide additional insight from customers who have stayed at that hotel. Expedia says it is also making it easier to book destination activities, attractions, and services by introducing a separate "activities" tab.

"Our focus remains on making it easier for customers to research, evaluate, and book travel," said Bill Bliss, senior vice president, product and customer experience. "With these new features, Expedia is giving customers additional ways to help them find the perfect hotel and destination activity for their trip. Also, our hotel and activity partners are given additional avenues to differentiate their products. It's a win-win situation."

The new resources include tools to help evaluate and select the right hotel for a trip -- including photos, virtual tours, maps, flexible rate calendars, and room layout views. The new hotel amenities filter allows customers to narrow down search results to show only those hotels with the chosen amenities.

Travelers can search for hotels in the chosen destination and then click on the "narrow search by choosing amenities" icon found at the top of the search results page. Travelers can select from a list of 13 hotel services and amenities, including high-speed Internet access, swimming pools, free parking, pets accepted, and more - and the resulting amenity -- filtered search results will make the decision of where to stay that much easier.

According to a recent Forrester Research survey, more than 56 percent of U.S. leisure travelers say that they typically seek out advice from friends or family when it's time to research a trip.

The Web site's new traveler opinions tab connects Expedia customers with reviews containing first-hand knowledge and insight from other travelers who have already experienced that particular hotel -- providing useful feedback during the hotel selection process.

The company says it has set up rigorous standards to ensure that traveler opinions posted on the site offer a legitimate and relevant viewpoint. As such, only travelers who have booked a stay at that particular hotel within the past six months can submit a review -- and all reviews expire after 12 months of being posted.

Expedia's hotel partners are also invited to respond to traveler opinions on the site, ensuring a blend of perspectives for the traveler to consider.

To read or submit traveler opinions, Expedia customers can simply click on the "traveler opinions" tab on the left-hand side of each hotel's information page. Initial trials of the Expedia traveler opinions have rolled out to every Expedia Special Rate hotel in San Diego, San Francisco, and Seattle, with additional markets being added in the coming weeks.

It's official -- China's largest personal computer maker, Lenovo Group Ltd, is buying control of IBM's PC-making business for $1.25 billion, completing IBM's retreat from the business it created in 1981.

Lenovo will become the world's third largest PC manufacturer, after Dell and Hewlett-Packard/Compaq. IBM will hold an 18.9% stake in Lenovo. Stephen M. Ward Jr from IBM will take over as the new Lenovo CEO.

The sale of IBM's PC desktop and notebook computer lines frees the company to focus on higher-margin businesses such as computer services, software, more powerful server computers, and storage as well as computer chips, analysts say.

Lenovo, formerly known as Legend, will take ownership of the IBM "Think" trademark family, including its ThinkPad notebook brand and its ThinkCenter desktop line. Lenovo will hire 10,000 IBM PC employees - including about 2,300 in the United States.

Founded in 1984, Lenovo was the first company to introduce the home computer concept in China, and since 1997 has been the leading PC brand in China.

Lenovo is entering treacherous waters. Dell's emphasis on cost control and aggressive direct marketing have swamped nearly every other major manufacturer in the U.S. Gateway has suffered major erosion in the last few years and many analysts expect Hewlett-Packard will exit the PC business within the next few years.

Texas has put the freeze on a "tax freeze" scam aimed at seniors. Penalties and fees totaling $23,838 were assessed against State and County Tax Reduction, which advertised fee-based filings for senior homestead tax exemptions.

Attorney General Greg Abbott said the company misled senior property owners last December by mailing misleading correspondence that appeared to be official government business alerting them about an available property tax freeze.

The correspondence urged seniors to take advantage of the services offered, but required a fee, a concealment scheme prohibited under the Texas Deceptive Trade Practices Act. Such filings are free at local tax offices, and such correspondence, by law, must clearly state that the offer is not official government business, but advertising for services.

Morgan and his business mailed thousands of solicitation letters to residents over age 65 under the guise of official government business. Last December the attorney general obtained a restraining order that stopped this practice, forcing Morgan's company to make refunds to any seniors who had mailed money as fees for services.

"I am pleased the court saw this business for the fraud that it was and applied the appropriate penalties for conduct wrongfully waged against senior citizens," Abbott said. "Property owners can rest assured my office will be on the watch for any similar schemes to bilk them of money they could just as well keep in their pockets this holiday season."

December 6, 2004
Exmark is recalling the Lazer Z EFI zero turn radius riding lawn mowers. A hole can develop in the fuel line, resulting in a leak that could present a fire hazard.

The 2004 Model Lazer Z zero-turn (ZRT) riding mowers with 60-inch and 72-inch decks are equipped with electric fuel injection engines as follows:

All products are equipped with a foldable roll-over protection bar. The model and serial number decal can be found on the frame below the seat.

Authorized Exmark dealers sold these riding lawn mowers nationwide from July 2003 to September 2004.

Consumers should stop using these Exmark riding mowers and contact their local Authorized Exmark Service Dealer to schedule a time to install a free replacement fuel line. For more information, contact Exmark at (800) 479-8379 between 8 a.m. and 5 p.m. CT Monday through Friday. Consumers can also visit the firm's web site at www.Exmark.com.

Exmark has notified registered owners directly.

The recall is being conducted in cooperation with the U.S. Consumer Product Safety Commission (CPSC).

December 6, 2004
About 5,000 Husqvarna Lawn Tractors are being recalled. The tractors can develop abrasions on the fuel tank because of the fuel line clamps location, possibly resulting in a fuel tank leak, which could pose a fire hazard.

Husqvarna has received four reports of fuel tanks leaking. There have been no reports of fire or property damage.

These Husqvarna 18.5 horsepower, hydrostatic transmission, 42-inch cutting deck, lawn tractors are gasoline-powered and are designed for residential use. The recall involves models LTH18542A and LTH18542B and includes all serial numbers. The model plate with the model number information is found under the seat.

The tractors were sold at Husqvarna dealers and distributors nationwide from November 2003 through July 2004 for about $1,500.

Consumers who have one of the recalled lawn tractors should contact an authorized Husqvarna service provider in your area, which will provide a free repair.

For more information or to locate a Husqvarna dealer, call Husqvarna at (800) 448-7543 between 9 a.m. and 5 p.m. ET Monday through Friday, or visit the firms Web site at www.usa.husqvarna.com

The recall is being conducted in cooperation with the U.S. Consumer Product Safety Commission (CPSC).

December 6, 2004
Scag Power Equipment is recalling about 16,000 Tiger Cub Lawn Tractors. Fuel can leak out of the carburetor, posing a risk of fire and burn injuries.

Scag is aware of 20 incidents, all of which involved fires and damage to tractors. Two consumers received minor burn injuries to their hands as a result of trying to put out the fires.

The recalled zero-turn-radius riding lawn tractors are Cats Eye Gold with black trim, and have a vinyl seat. The body of the tractor has Scag Tiger Cub written in red on the side and front of the tractor. The following model and serial numbers can be found under the seat, next to the hydraulic pump on the right hand side.

Authorized Scag Power equipment dealers nationwide sold the tractors from November 1999 through July 2003 for between $5,000 and $8,000.

Consumers should stop using these tractors immediately and contact a Scag Equipment dealer for a free repair. The company is directly notifying those consumers who completed and returned warranty cards.

Consumer Contact: For information on locating a dealer near you, contact Scag Equipment Customer Service toll-free at (866) 821-9208 between 8 a.m. and 7 p.m. ET, Monday through Friday and 9 a.m. and 5:30 p.m. ET Saturday.

The recall is being conducted in cooperation with the U.S. Consumer Product Safety Commission (CPSC).

More than two million credit-card customers of Home Depot and Lowe's could be eligible for $5 rebates under the terms of a $4 million class-action settlement regarding over interest charges on what were supposed to be interest-free purchases.

Lowe's and Home Depot were sued after customers discovered their monthly payments were applied to interest-free balances before regular purchases, which accrued interest charges.

The issuer of the credit cards, Monogram Credit Card Bank of Georgia, a unit of General Electric Corp. was also named in the suit.

Los Angeles Superior Court Judge Charles McCoy gave preliminary approval to the $4 million settlement and scheduled a final approval hearing for June 6, 2005.

The companies must notify their customers of the terms of the settlement, which gives every class member who lost money as a result of the payment allocations a $5 rebate on a purchase of $15 or more.

The lawsuit contended that customers were told they could defer interest charges for six months on certain store credit card purchases of more than $200. But they soon learned that payments were being applied toward the interest-free balance, while their regular purchases continued to rack up interest charges.

The companies also agreed to more fully explain to customers how their credit card payments are applied and to automatically apply payments against the interest-bearing balances first, unless customers choose otherwise.

ESPN is getting into the cell phone business. The all-sports cable channel's ESPN Mobile will make offer sports junkies instant access to scores and sports news. ESPN is mostly owned by Walt Disney Co., which is also planning a Disney-branded cell phone service.

ESPN Mobile will operated over Sprint's network. Sprint, the nation's third largest cellular carrier, also provides the underlying communications service for a number of other companies, including Qwest, AT&T (not AT&T Wireless, which has merged with Cingular) and Virgin.

ESPN's cable channel reaches nearly 90 million U.S. homes and the company's executives are betting many of them will want to switch to a cell phone service that puts them just a click away from scores and headlines.

Tightly-targeted cell brands may be the next big thing in wireless communications. Virgin Mobile is aimed at younger users, as is Nextel's Boost Mobile.

Although details of the Disney cell service aren't yet known, it will presumably be targeted to

Wal-Mart will implement new policies and procedures to reduce tobacco sales to minors in Wal-Mart stores throughout the nation, including all 46 Wal-Mart and Sam's Club stores in Massachusetts, under the terms of a multi-state agreement announced by Attorney General Tom Reilly and Attorneys General from 42 other states.

The assurance of voluntary compliance is the third of its kind to be reached as part of an ongoing, multi-state enforcement effort to keep cigarettes away from teenagers. Similar agreements are in place with the Walgreens drugstore chain and the Exxon Mobil Corporation, which operates a nationwide chain of gas stations and convenience stores.

"Every day more than 2,000 minors pick up a cigarette for the very first time and end up getting hooked for life," Reilly said. "It's important that retailers do what they can to keep kids away from tobacco and adopt policies and practices similar to the ones outlined in today's agreement with Wal-Mart."

The multistate agreement requires Wal-Mart to take the following steps:

• Train employees on state and local laws and company policies regarding tobacco sales to minors, including explaining the health-related reasons for laws that restrict youth access to tobacco. • Check the ID of any person purchasing tobacco products when the person appears to be under age 27, and accept only currently valid government-issued photo identification as proof of age. • Use cash registers programmed to prompt ID checks on all tobacco sales. • Hire an independent entity to conduct random compliance checks of approximately 10% of all Wal-Mart stores every six months. • Prohibit self-service displays of tobacco products, the use of vending machines to sell tobacco products, and the distribution of free samples on store property. • Prohibit the sale of smoking paraphernalia to minors.

Under the terms of the agreement, Massachusetts will receive approximately $9,000 for the Attorney General's Local Consumer Aid Fund. The attorneys general will monitor compliance with the agreement and have reserved the right to enforce future violations of the agreement as well as the laws governing sale of tobacco to minors.

The agreement is part of Reilly's ongoing effort to protect children from the health risks of smoking. Earlier this month, Reilly's Consumer Protection and Antitrust Division (CPAD) filed lawsuits against three out-of-state online cigarette vendors accused of selling cigarettes to Massachusetts teenagers without first verifying that they were at least 18 years old.

Studies have shown that the great majority of adult smokers started smoking before age 18, the legal age to purchase cigarettes in Massachusetts. A survey of Massachusetts high school students found that 74 percent of teen smokers had tried to quit but were unable to do so.

Tobacco is estimated to result in more deaths each year in Massachusetts than alcohol, cocaine, heroin, homicide, suicide, car accidents, fires, and AIDS combined. The agreement is considered a model for all drugstores and retailers committed to reducing the rate of sale of tobacco products to minors.