Current Events in July 2005

The news that the Transportation Security Administration violated the Privacy Act by collecting data on 250,000 Americans as part of a "study" for its new "Secure Flight" program is the latest in a string of incidents detailing how government agencies are using commercial data brokers to sidestep privacy laws, setting the stage for more problems in the future.

The Government Accountability Office (GAO) issued a report to Congress stating that "a TSA contractor, acting on behalf of the agency, collected more than 100 million commercial data records containing personal information such as name, date of birth, and telephone number without informing the public."

Although the contractor is not identified in the GAO report or the TSA's admission that it collected the data after promising not to do so, the scandal bears a striking resemblance to the JetBlue incident, wherein the data clearinghouse Acxiomsold thousands of its data records to another TSA contractor in order to test the reliability of "CAPPS II," the predecessor to the "Secure Flight" screening system.

Several laws mandating the creation of nationwide requirements for issuing state driver's licenses may require the usage of commercial data brokers such as ChoicePoint and LexisNexis to effectively implement.

This has aroused concerns among privacy advocates and opponents of the "Real ID" Act who believe that entrusting such a complex enterprise to companies that have already proven incapable of protecting the data they collect may lead to even more instances of identity theft.

The "Real ID" Act was passed in May 2005, attached to a bill authorizing funding for U.S. forces in Iraq. The act requires state governments to establish "minimum security standards" for issuing or re-issuing driver's licenses, including verification of Social Security Numbers and birth certificates.

The law is an "unfunded mandate," meaning that states will have to come up with the money to implement the new procedures themselves, which may lead to private data screening agencies offering technology and information databases to aid in the law's enforcement.

The Senate passed the Transportation Security Improvement Act as part of an extensive highway spending bill, on May 17th. The bill includes language authorizing the TSA to mandate that state motor vehicle authorities conduct background checks as "stringent" as Federal background checks for commercial driver's licenses. The bill is currently being reconciled in joint Congressional committee.

Opponents of these provisions maintain that additional security requirements are not only burdensome to implement and unnecessarily invasive, but offer a dangerous opportunity for "information broker" companies to hoard even more data.

Timothy Sparapani, associate legal counsel for the American Civil Liberties Union ), told The Washington Post that he "worried about the government expanding their use of background checks."

Although none of the major commercial data brokers have publicly admitted to lobbying for these laws, they also have been embroiled in recent scandals and may be actively looking for more government business.

ChoicePoint's loss of over 100,000 individual records to identity thieves in February 2005 opened the door to a flood of reports of identity theft and data loss. LexisNexis lost 32,000 data records to thieves in March 2005.

Acxiom itself was ahead of the identity-theft curve, as its servers were hacked by employees not once, but twice - first in March 2003 and again in July 2004. Both times, millions of aggregated data records were stolen and put up for sale on the "gray market" of identity theft rings.

A group of patients who once took the antidepressant drug Prozac accuse the Food and Drug Administration of covering up the drugs dangerous side effects for 14 years. As a result, they say hundreds of people have become victims of murder and suicide.

Bonnie Leitsch, founder of "Prozac Survivors Support Group," and Dr. Ann Blake Tracy, founder of the International Coalition for Drug Awareness, are calling for immediate federal action to warn the public that antidepressants not only can induce suicide in adult patients -- but also acts of violence.

They point to 30-year-old Indiana mother Magdalena Lopez, who last week was charged with murdering her two young sons. Lopez, they maintain, had been taking an antidepressant.

In June, the FDA issued its second warning that adults taking antidepressants should be monitored for suicidal ideation and worsening depression. Leitsch says that it is unconscionable that new mothers are being prescribed drugs that have been known to induce psychosis, violence and suicide for more than a decade.

"In 1991, there was evidence of 500 deaths associated with antidepressants presented to an FDA Psychopharmacological Drugs Advisory Committee hearing investigating Prozac," Leitsch said.

"The failure to issue the warning has led to more suicides, homicides, school shooters and mothers killing their own children."

PSSG says it has the original film footage from the 1991 FDA hearings, where dozens of testimonies were given by family members of those who had either killed themselves, or loved ones, or individuals who had attempted suicide which they directly attributed to taking an antidepressant. The group has lined up a number of health professionals who support their position on Prozac and other antidepressants.

"These are extremely dangerous drugs that should have been banned, as similar drugs were in the past. Federal investigations into the violence-inducing effects of these drugs are long overdue," Tracy said.

Tracy has been an outspoken critic of SSRI antidepressant drugs and has testified as an expert witness in numerous court cases involving such drugs.

"The scientific evidence behind this has been out there for decades. All anyone ever had to do was read it," she says.

The group says Magdalena Lopez is not the only woman who has murdered her children while under the influence of antidepressants known to cause violence, psychosis, and suicide in adults. They provided details of several other cases:

• Annie Mae Haskew smothered her 10-week-old son in October of 2002. Before the murder she had been diagnosed with postpartum depression and had been taking antidepressants.
• Andrea Yates drowned her five children, aged 6 months to 7 years in the family bathtub on Nov. 22, 2004, while taking two antidepressants Effexor and Remeron, both had been given at maximum dose.
• Dena Schlosser killed her 10-month-old infant daughter in November 2004 by severing her baby's arms. She had been diagnosed with postpartum depression, hospitalized and prescribed psychiatric "medication for depression" before the crime.
• Mary Ellen Moffitt suffocated her 5-week-old daughter and herself July 26, 2004. Before this she had been diagnosed with postpartum depression and had been taking the antidepressant Paxil.
• Emiri Padron smothered her baby daughter in her crib on June 22, 2004 and then stabbed herself twice in the chest. Emiri was receiving psychiatric treatment before the incident and investigators found the antidepressant Zoloft in the apartment where the crime took place.
• Mine Ener used a kitchen knife to cut the throat of her 6-month-old daughter on Aug. 4, 2003, after being diagnosed with postpartum depression and taking "medication" for the condition.

Leitsch says that the FDA's claim that it could take a year to review the suicide adverse effects of antidepressant drugs is negligent.

"They must warn the public that not only can the drugs include suicide -- but heinous acts of violence -- mothers killing their own children, or children killing other children, she said.

Late last year FDA directed manufacturers to add a "black box" warning to the health professional labeling of all antidepressant medications to describe this risk of suicide in children, and emphasize the need for close monitoring of patients started on these medications. FDA has also determined that a Patient Medication Guide, which will be given to patients receiving the drugs to advise them of the risk and precautions that can be taken, is appropriate, and is in the process of developing one.

According to Lietsch, 36 million Americans are taking the antidepressant drugs.

The New York City Department of Consumer Affairs (DCA) has filed suit in New York Supreme Court against three major wireless companies for pitching cell phones and services in deceptive advertisements that misled consumers.

The suit against Nextel Communications Inc., Sprint Spectrum L.P., and T-Mobile USA Inc. seeks maximum fines and compliance with New York City's landmark Consumer Protection Law.

"You can't promise a great deal in the headline and hide the true costs in the fine print," said DCA Acting Commissioner Jonathan Mintz. "If a cell phone company promises free long distance, consumers should get free long distance - period."

"Consumers rely on advertising as a shortcut through the often-confusing maze of wireless options" he said, "and the City's law provides protection to ensure those ads are truthful."

"While clamoring for competitive consumer attention, these major cell phone companies crossed the clear line between promotional gimmicks and deceptive advertising. It doesn't matter whether the business is selling cars, tax services, or cell phones, everyone has to follow the same rules," Mintz said.

The DCA also pursued claims against AT&T Wireless (since acquired by Cingular Wireless LLC), Cingular Wireless, and Verizon Wireless for deceptive advertising, but those companies settled and agreed to fully comply with the New York City Consumer Protection Law in their marketing.

Mintz noted, "Verizon led the industry in committing to comply with the Consumer Protection Law and settling claims, and we are pleased that others followed."

The DCA intensified monitoring the wireless industry advertisements in the fall of 2003 as part of a joint effort with the New York City Department of Information Technology and Telecommunications (DoITT) to track industry practices and cell phone service citywide.

After months of monitoring company ads, and despite numerous discussions with company representatives to correct and clarify the ads, DCA found the companies to be in violation of city law.

According to Consumers Union, information obtained from the Federal Communications Commission shows complaints filed about wireless phone service increased nearly 38% from 2003 to 2004, with cell phone marketing nearing the top of the list, and billing problems receiving the most complaints.

The New York City Consumer Protection Law broadly defines deceptive and unfair trade practices, in part, by requiring the type size used in print ads to be clear and conspicuous to the reader. It prohibits practices that have the capacity, tendency, or effect of deceiving or misleading consumers.

In its lawsuits the DCA charges:

• Nextel deceived consumers by advertising "ALL INCOMING CALLS ARE FREE" when in fact, a tiny, multi-line footnote at the bottom of the advertisement indicated "...an additional access charge of either $.10 per minute multiplied by the number of participants on the call...or a monthly flat fee," would be charged to the consumer if he or she signed up for the advertised calling plan.

• Nextel further deceived consumers by advertising "PLANS STARTING AT $10 PER MONTH," or "POWERFUL PHONES STARTING AT $24.99" without clearly describing different service plans or products, and without adequately disclosing either the highest price of the advertised plan, or an "average price," as required by law.

• Sprint deceived consumers by advertising "NATIONWIDE LONG DISTANCE INCLUDED. EVERY MINUTE, EVERY DAY" when in fact, a tiny, multi-line footnote at the bottom of the advertisement indicated a charge for long distance -- including the phrase "...an additional $0.25 per minute for long distance."

• Sprint further deceived consumers by advertising that "instant savings require in-store purchase and activation of a new line..." when a tiny footnote at the bottom of the advertisement stated "Requires in-store purchase and activation of two new lines of service on eligible plans."

• In the same ad, Sprint deceived consumers by advertising a "FREE" cell phone offer forcing consumers to look at the fine print footnote to find that in fact, the offer required "...a two-year Sprint PCS Advantage Agreement."

• T-Mobile deceived consumers by advertising "FREE LONG DISTANCE" and "FREE ROAMING" when in fact, a tiny, multi-line footnote at the bottom of the advertisement indicated, "Billing of roaming charges and minutes of use and services may be delayed" and "Call duration may be limited."

The decision by the California Air Resources Board is the first such regulation in the United States for heavy-duty trucks.

The California measure is likely to encourage the U.S. Environmental Protection Agency to approve a similar rule.

There are an estimated 1 million to 1.5 million big-rig trucks traveling on California highways, each emitting more than 5 pounds of nitrogen oxide a day, the main ingredient of smog.

A diagnostic plan would cost approximately $130 per truck. The standards would be phased in for big-rig engines beginning in 2010 and fully implemented in the 2013 model year.

If you're one of those unfortunate souls who've found unauthorized charges on your credit card from programs like AutoAdvantage - a "trial offer" that ends up being billed to your account repeatedly without your consent - then you may already be at least familiar with Trilegiant.

The Norwalk, Connecticut-based direct marketing firm has found itself the target of a lawsuit brought by the California Attorney General's office. The suit alleges that Trilegiant, along with Chase Bank, deceived hundreds of California consumers through fraudulent billing practices designed to confuse them into signing up for unwanted services.

Besides its "services," Trilegiant is heavily involved in the loyalty program industry, through its Trilegiant Loyalty Solutions division, based in Richmond, Virginia. The company's Web site boasts of selling its "Loyalty" as a product, with "25 billion [gift card] points redeemed since 2004 alone."

Trilegiant is an offshoot, subsidiary or affiliate (it's hard to tell which) of the Cendant corporation, a major player in the travel and real estate markets, and also involved in national security via the failed "CAPPS II" airline passenger identification system.

Travel offers, loyalty cards, airline fares - Trilegiant seems to be everywhere. And as is often the case, there is far too little in the way of public disclosure of what this company is actually doing with the information it collects.

What's In A Name?

Trilegiant, to the casual observer, is a straightforward enterprise with clearly obtainable business information, not to mention a very slick Web site. However, the company does or has done business under literally dozens of different names or promotions. Even tracing the links between Trilegiant and Cendant can bog the curious down in a mass of corporate doublespeak.

Trilegiant's direct marketing businesses include the aforementioned AutoAdvantage, GreatFun, IdentitySecure, and PrivacyGuard. (For a more complete list of Trilegiant's many aliases, visit ConsumerAffairs.com's Trilegiant complaint page.

The PrivacyGuard product is a suite of tools that consumers can ostensibly use to protect their credit, for a "low" monthly debit of $11.99. PrivacyGuard markets its solutions to numerous banks, institutions, and universities, while collecting subscribers' information to share among its many "preferred partners", many of which are also subsidiaries of Cendant.

In a properly ironic twist, Trilegiant hired con-man-turned-FBI consultant Frank Abagnale as its spokesman for PrivacyGuard.

Trilegiant is billed by Cendant's public relations department as a "successor" to its membership and marketing services, but it is still listed as a subsidiary or "branch" business on the main Cendant Web site. Press reports that discuss the Trilegiant/Cendant relationship variously characterize the companies as corporate parent and spinoff, independent business partners, or full-blown subsidiaries.

Cendant itself owns or has holdings in so many companies that it creates a dizzyingly vast web of partnerships to share information with. You can book a flight on Cheaptickets.com, rent your car from Budget, and stay at the Ramada Inn -- all Cendant brands or businesses, and all of which can leave customers open to targeted offers from the Cendant Marketing Group, which includes Progeny Marketing Solutions as well as Trilegiant.

In a 2004 press release from Progeny, Cendant reaffirmed its relationship with Trilegiant through "Cendant Marketing Group, a new entity to coordinate the activities of its two direct marketing units."

And what does Trilegiant do with your information once it's provided? That's where its "loyalty enhancement" programs come in.

Corporate Sin-ergy

Trilegiant takes great pride in its multiple methods of collecting consumer information for marketing and business purposes. Trilegiant's "Loyalty Marketing" division offers third-party solutions for businesses and retailers to build customer loyalty, including their "Discount Shopping" and "Buyer Reward" programs.

The company deliberately crafts marketing solutions for differing socioeconomic groups, ranging from the "sub-prime" (low-income) market to the most valuable "super-prime" (wealthy) customers. Interestingly, the company's marketing materials for their product line are exactly the same, making one wonder how it differentiates between customer groups when soliciting for new memberships.

Trilegiant's many partners include the major players in the credit and finance industry, such as J.P. Morgan Chase. Chase Bank prominently advertises several Trilegiant companies as "preferred services", including AutoAdvantage, ShoppersAdvantage and TravelersAdvantage.

In much smaller type at the bottom of each page, Chase states that "Chase Manhattan Bank USA, N.A. is not affiliated with or responsible for Shoppers Advantage or Trilegiant Corporation."

Each of these membership clubs offers a two-month $1 trial of its services, after which the user will be billed at an annual rate of $89.99 unless they call in and cancel the service during the trial period. However, direct mail solicitations from Chase did not explicitly state these terms.

Instead, Chase customers received checks as "rewards" for their loyalty in the mail, along with solicitations for Trilegiant's discount services. Cashing the checks would automatically sign them up for a regular membership with these companies unless they called to cancel the membership within 30 days - none of which was very prominently explained in the direct mail solicitation.

This same principle was applied to Trilegiant's partnership with the Experian credit reporting agency. Formed in 2002, Experian and its subsidiary company, ConsumerInfo.com agreed to share their credit reports, for use with Trilegiant's PrivacyGuard product, as well as "maintenance and hosting of all credit-related Web sites for Trilegiant."

ConsumerInfo.com's sites, such as FreeCreditReport.com, are notorious for advertising "free" trials of services, only to bill buyers at a regular rate each month unless they call and cancel.

Flying High

Trilegiant's most audacious gambit involved combining an airplane security solution with gathering market information.

In 2003, the Department of Homeland Security (DHS) came under intense scrutiny for its proposed "Computer-Assisted Passenger Pre-Screening System", or CAPPS II.

The system was criticized for collecting an exhaustive amount of information on potential airline passengers via computerized reservation systems (CRS), which could then be stored or sold without any restriction. The CRS system designed as the backbone of CAPPS II came from a company called Galileo International, a subsidiary company of - you guessed it - Cendant, and partner to Trilegiant.

As privacy advocate Bill Scannell put it, "Galileo can sell or trade your dossier to whomever they wish," with the leading candidates being Cendant's many travel-related enterprises. After a massive public outcry, DHS scrapped the CAPPS II program, but has since pushed to implement a similar initiative called "Secured Flight."

As for Galileo, it recently renewed a partnership contract with World Travel Service to provide, as the press release puts it, "development of technology solutions and vendor relationships essential to our success."

Where, it must be asked, does the consumer fit into this tangled web of "vendor relationships?"

Trouble In Paradise ... and Connecticut

On July 12th, California's Attorney General, Bill Lockyer, filed suit against Chase Bank and Trilegiant for their "deceptive billing practices" relating to the bundled offers to Chase customers. Lockyer accused the companies of preying on the elderly and customers with limited grasp of English, in order to continue their "unsavory schemes."

About the same time, after 500 complaints to their office and a reputed two-year investigation (plus nearly 2000 complaints to the Connecticut Better Business Bureau), Connecticut's own Attorney General, Richard Blumenthal, announced his office was launching its own lawsuit against the corporation in conjunction with the state's Department of Consumer Protection.

"Trilegiant uses 'Advantage' to name its clubs but the only real advantage goes to Trilegiant," Blumenthal said. "My office has intervened on behalf of hundreds of consumers, but Trilegiant persisted in its predatory enrollment practices over and over again. We're investigating involvement of other companies credit card issuers and national banks that may be knowingly aiding this scheme."

Trilegiant had already paid $400,000 to the state of Florida in March of 2005 to settle similar claims out of court, but its legal woes may be just beginning. Several law firms say they are compiling evidence to be used in class action lawsuits.

In a perhaps-not-unrelated development, Cendant has indicated that it plans to sell its marketing division (which handles Trilegiant and its "sibling", Progeny) "in order to focus on travel and real estate." Skeptics say this sounds similar to the many government and corporate executives who find themselves in dicey situations, then promptly resign to "spend more time with their families."

Whatever the true state of affairs, it would appear that Trilegiant's "loyalty solutions" do not extend to maintaining its troubled relationship with its corporate parent.

If the complex house of cards begins to wobble, there'll be few tears shed by consumers. As one ConsumerAffairs.com complainant put it: "[This is] a huge annoyance and [possible]credit card fraud. I want this corporation stopped. How many more people like me are out there and don't know that they are being scammed?"

In Sweden, just one beer or glass of wine can land a driver in jail for up to six months.

So when Volvo asked the Swedish government to waive the country's strict drunken driving laws to allow its test drivers to imbibe on the job, people noticed.

Volvo is in the midst of testing a new technology designed to allow a car to take control of steering when a driver's reaction time is slowed because of intoxication or fatigue. The new safety system is still at the development stage and the company will not provide additional details other than to say its all about preventing accidents.

If the request is granted, it would be the first exception to Sweden's drunk driving laws, which are among the world's toughest, the Swedish national broadcaster SVT reported.

The company promises to only allow its drunk drivers to take the wheel on a Volvo test track near the west coast city of Gothenburg if the Swedish government grants permission.

The special track is also the location of a Ford Motor Co. safety development facility. Ford owns Volvo.

Sweden has one of the best road-safety records in the world in part because of its drunk driving laws. The laws apply to private and public roads.

According to Stockholm Traffic Police, the most drivers could drink without risking a heavy fine is one beer. Drivers caught well over the limit can be sent to prison.

The popularity of different Integra models with thieves made Acura the most stolen make of 2004, followed by Hummer, Land Rover, Daewoo and Honda.

The top three vehicle segments with the highest rate of theft rates in 2004 were the full-size sport/utility Vehicles, such as the Cadillac Escalade; the upper midsize sedans, including the Integra; and the prestige luxury segment, such as Bentley and Mercedes Benz.

The top 10 list is rounded out by the 1991 GMC V2500 at No. 4, the 2002 Audi S4 at No. 5 and the 1992 Mercedes-Benz 600 at No. 10.

The theft data comes from CCC Information Services which tracks auto theft claims.

The experts think that a growing interest in street racing could be feeding the thieves demand for the Integra. The reason could also explain why the 2002 BMW M Roadster is the No. 2 car on the list, as well as why the 2004 Mercury Marauder comes in at No. 8.

"We cannot determine with absolute certainty the reason why thieves steal some vehicles over others, but we see trends in the data that provide interesting insight," said Carole Comstock, CCC's vice president of marketing and product management.

"For instance, our data suggests some cars are stolen for the value of their parts, which may explain why we often see a 'clustering' effect with same make and model vehicles from sequential model years."

Top 25 Cars Stolen in American Last Year

1. 1999 Acura Integra
2. 2002 BMW M Roadster
3. 1998 Acura Integra
4. 1991 GMC V2500
5. 2002 Audi S4
6. 1996 Acura Integra
7. 1995 Acura Inte

The Internal Revenue Service has revoked the tax-exempt status of four credit counseling groups and is continuing its investigation of several others accused of abusing their tax-exempt status, a senior IRS attorney said. She did not identify the organizations affected.

IRS attorney Debra Kawecki addressed members of the Association of Independent Consumer Credit Counseling Agencies, which held its annual meeting in Washington last week.

According to the IRS Web site, A Better Way Credit Counseling of Greenacres, Fla., and the National Center for Debt Elimination of North Huntingdon, Pa., no longer qualify to receive tax-deductible contributions, the Baltimore Sun reported. AmeriDebt, once a major credit counseling agency, is being liquidated in bankruptcy court and its founder, Andris Pukke, is being sued for $172 million by the Federal Trade Commission.

Kawecki was challenged by a lawyer who represents credit counseling firms. David Borinsky said the IRS should issue rules to give the agencies more guidance.

But Kawecki shot back that credit counseling is not rocket science and said rules weren't needed. "It's basic bread-and-butter tax-exempt law ... You help people, you don't hurt people," she said, according to The Washington Post.

Credit counseling became a growth industry in the 1990s, as scores of supposedly not-for-profit organizations were created, each claiming to help consumers manage their debt. But consumers and investigators say many of the agencies charged high fees, funneled money to for-profit affiliates and didn't provide the consumer education they promised.

The crackdown has taken on added urgency because of the new bankruptcy law which goes into effect in October. It requires that consumers undergo credit counseling with a government-approved not-for-profit before filing for bankruptcy.

The IRS has reportedly received about 40 applications from agencies hoping to qualify for tax-exempt status and so far has notified about half that they don't appear to qualify, a senior IRS attorney told a conference of credit counseling organizations.

Consumer advocates have criticized the IRS for being too lenient in granting tax-exempt status to credit counselors.

In April, IRS Commissioner Mark W. Everson told a Senate committee that the IRS identified 60 credit counselors for examination. He added that the IRS revoked or proposed to revoke the tax-exempt status of counselors representing more than 20 percent of the industry's gross receipts.

Xenadrine EFX contains, among other ingredients, green tea extract, yerba mate, and bitter orange. A 120-tablet bottle a one-month supply retails for approximately $40. Since its introduction in 2002, Xenadrine EFXs sales have topped $160 million.

According to the FTC, promoters advertised Xenadrine EFX heavily in print and on TV, including in such publications as People, TV Guide, Cosmopolitan, Glamour, Lets Live, Mens Fitness, and Womens World. They also disseminated Spanish language ads for Xenadrine EFX.

The advertisements claimed that Xenadrine EFX causes rapid and substantial weight and fat loss, such weight loss without the need to diet or exercise, permanent or long-term weight loss, and is clinically proven to work. The ads relied heavily on testimonials from supposedly satisfied customers, some of whom claimed to have lost over 100 pounds.

The complaint names Robert Chinery, Jr., Tracy Chinery, and their company, RTC Research & Development, LLC, alleging that the New Jersey-based Chinery defendants made false and unsubstantiated claims for Xenadrine EFX, including that it was clinically proven to cause rapid and substantial weight loss and clinically proven to be more effective than leading ephedrine-based diet products.

According to the complaint, Robert Chinery commissioned several studies of Xenadrine EFX, none of which showed substantial weight loss. The complaint alleges that in one of these studies, subjects taking Xenadrine EFX lost an average of only 1.5 pounds over the 10-week study, while a control group taking a placebo lost an average of 2.5 pounds over the same period.

The complaint also alleges that the defendants falsely represented that persons appearing in the ads achieved the reported weight loss solely by using Xenadrine EFX. According to the FTC complaint, consumer endorsers, in fact, lost weight by engaging in rigorous diet and/or exercise programs. The complaint alleges that the defendants also failed to disclose that the endorsers were paid from $1,000 to $20,000 in connection with their testimonials.

Another company controlled by the Chinery defendants, Nutraquest, was not named in the complaint; it is currently in bankruptcy and facing numerous product liability, class action, and advertising claims relating to an ephedra product, Xenadrine RFA-1.

In addition, the Commission has accepted a consent agreement with another group of entities, Cytodyne, LLC, Evergood Products Corp., and Melvin Rich, all of New York. They have entered into an administrative settlement with the FTC.

The consent order requires the respondents to pay $100,000 to the FTC. It also prohibits the Rich respondents from claiming that Xenadrine EFX or any other substantially similar product causes rapid and substantial weight or fat loss and prohibits the claim that any weight-loss product causes rapid and substantial weight loss without diet or exercise.

The settlement further prohibits the respondents from claiming that any weight-loss product, dietary supplement, food, drug, or device causes weight or fat loss, causes permanent or long-term weight loss, or causes users to lose weight or fat without diet or exercise unless they have competent and reliable scientific evidence to substantiate the claims.

It also requires that the respondents have competent and reliable scientific evidence for any claims they make about the health benefits, performance, efficacy, safety, or side effects of any such product and prohibits them from misrepresenting any test, study, or research for any such product.

In addition, the settlement prohibits the respondents from misrepresenting the experience described in any user testimonials for any weight loss product, dietary supplement, food, drug or device. It requires the respondents to disclose any material connection including monetary payments between the endorser and the respondents or any person or entity involved in manufacturing, marketing, or selling the product.

Although adults seem to be turning to diet drinks, the Center for Science in the Public Interest (CSPI) says that the data show teenagers are actually consuming more high-calorie soft drinks than ever -- and fewer diet drinks than in years past -- despite growing concerns about obesity.

"Just as the soaring rates of obesity have shocked Americans, so should the increasing consumption by teenagers of one of the causes of obesity," CSPI executive director Michael F. Jacobson said. "What was once a rare treat in a small serving is now served up morning, noon, and night, virtually everywhere Americans happen to be. How did a solution of high-fructose corn syrup, water, and artificial flavors come to be the default beverage?"

In a petition filed with the Food and Drug Administration (FDA), CSPI asked the agency to require a series of rotating health notices on containers of all non-diet soft drinks-carbonated and non-carbonated-containing more than 13 grams of refined sugars per 12 ounces. (The typical 12-ounce beverage contains 40 grams.) CSPI said that those messages could include:

• The U.S. Government recommends that you drink less (non-diet) soda to help prevent weight gain, tooth decay, and other health problems.
• To help protect your waistline and your teeth, consider drinking diet sodas or water.
• Drinking soft drinks instead of milk or calcium-fortified beverages may increase your risk of brittle bones (osteoporosis).

CSPI also said that caffeinated drinks should bear a notice that reads "This drink contains x grams of caffeine, which is a mildly addictive stimulant drug. Not appropriate for children."

"It is obvious to physicians who treat obese children that the extra 200, 300, or 400 empty calories kids get from soft drinks contribute to weight gain," said Dr. Caroline M. Apovian, director of the Nutrition and Weight Management Center at Boston Medical Center. "If you want to stop the epidemic of childhood obesity, curbing soda consumption is the place to start. Health messages on labels would certainly help parents and teens be aware of the risks."

In 2004, soft drink companies produced 37 gallons of carbonated non-diet soda-providing about 60,000 empty calories-for every man, woman, and child in the United States, according to Liquid Candy, a CSPI report first issued in 1998 and just re-released in updated form.

As high as that is, industry data show that per capita production of carbonated soda has dropped 7 percent since 1998. And because many adults have switched to diet soda, production of non-diet soda has declined 12 percent-the biggest decrease ever.

Nevertheless, despite that decline in overall production, soda consumption in kids has increased from the 1970s to the 2000s, as have their rates of obesity. Obesity has doubled in kids, and tripled in teens. Though the correlation is striking, recent studies have provided even more direct evidence implicating increased soda consumption with weight gain.

CSPI's new data show that one out of every 10 boys consumes 66 ounces-equivalent to five and a half 12-ounce cans, or about 800 calories-per day. One out of every 20 boys consumes the equivalent of 7 cans per day, or about 1,000 calories. The amount of refined sugars that soda-drinking teens get from soda exceeds the government's recommendations for their sugar consumption from all foods.

"Soda is bad not only for what is provides kids, but for what it takes away," said Lucy Nolan, executive director of End Hunger Connecticut!. That group recently lobbied successfully for legislation banning soda and other junk foods from schools only to see it vetoed by Governor Jodi Rell.

"Hardly any kids are getting enough calcium, vitamins, fiber, vegetables, or fruit. The more soda you drink, the less of those you get. If school systems spent half as much time trying to get more fruits and vegetables into schools as they did trying to keep soda contracts, our kids would be much better off."

Overweight or obese teens are increasingly at risk for type-2 diabetes, once called "adult-onset" diabetes and once rare in kids. And the decreased calcium intake that may accompany increased soda consumption can put people, particularly women, at greater risk for broken bones and osteoporosis.

CSPI's petition is supported by groups including the American Dental Hygienists Association, the American Society of Bariatric Surgeons, the Consumer Federation of America and the National Center for Health Education.

It is also supported by leading scientists and nutrition experts, including Gladys Block of the University of California, Berkeley, School of Public Health; George Bray of the Pennington Biomedical Research Center at Louisiana State University; Brian Burt of the University of Michigan School of Public Health; JoAnn Manson of Harvard Medical School; and Marion Nestle of New York University.

Besides health messages on labels, CSPI recommends requiring calorie labeling of beverages on chain restaurant menus and menu boards, and stopping soda sales in schools.

CSPI also says that states and local governments that levy small taxes on soda or other junk foods should consider earmarking those revenues for promoting health and fitness. A national 2-cent-per-can tax on soda would raise $3 billion annually-almost one thousand times as much money as the federal government spends promoting consumption of fruits and vegetables.

A study of of Australian drivers reports that the use of any cell phone, hands-free or otherwise, carries a four-fold higher risk of serious accidents. It's the latest in an accumulating body of evidence that finds cell phone user a major factor in highway accidents.

The study was conducted in Australia because American cell phone carriers refused to cooperate.

The increased risk was estimated by comparing phone use within 10 minutes before an actual crash occurred with use by the same driver during the prior week. Subjects were drivers treated in hospital emergency rooms for injuries suffered in crashes from April 2002 to July 2004.

The Insurance Institute for Highway Safety study, "Role of cellular phones in motor vehicle crashes resulting in hospital attendance," was published in the British Medical Journal.

"The main finding of a fourfold increase in injury crash risk was consistent across groups of drivers," said Anne McCartt, Institute vice president for research and an author of the study. "Male and female drivers experienced about the same increase in risk from using a phone. So did drivers older and younger than 30 and drivers using hand-held and hands-free phones."

Weather wasn't a factor in the crashes, almost 75 percent of which occurred in clear conditions. Eighty-nine percent of the crashes involved other vehicles. More than half of the injured drivers reported that their crashes occurred within 10 minutes of the start of the trip.

The study was conducted in the Western Australian city of Perth. The Institute first tried to conduct this research in the United States, but U.S. phone companies were unwilling to make customers' billing records available, even with permission from the drivers. Phone records could be obtained in Australia, and the researchers got a high rate of cooperation among drivers who had been in crashes.

Another reason for conducting the study in Australia was to estimate crash risk in a jurisdiction where hand-held phone use is banned. It has been illegal while driving in Western Australia since July 2001. Still one-third of the drivers said their calls had been placed on hand-held phones.

Hands-free versus hand-held

The results suggest that banning hand-held phone use won't necessarily enhance safety if drivers simply switch to hands-free phones. Injury crash risk didn't differ from one type of reported phone use to the other.

"This isn't intuitive. You'd think using a hands-free phone would be less distracting, so it wouldn't increase crash risk as much as using a hand-held phone. But we found that either phone type increased the risk," McCartt says. "This could be because the so-called hands-free phones that are in common use today aren't really hands-free. We didn't have sufficient data to compare the different types of hands-free phones, such as those that are fully voice activated."

Evidence of risk is mounting

The findings of the Institute study, based on the experience of about 500 drivers, are consistent with 1997 research that showed phone use was associated with a fourfold increase in the risk of a property damage crash. This Canadian study also used cell phone billing records to establish the increase in risk. The Institute's new study is the second to use phone records and the first to estimate whether and how much phone use increases the risk of an injury crash.

Taken together, the two studies confirm that the distractions associated with phone use contribute significantly to crashes.

Other studies have been published about cell phone use while driving, but most have been small-scale and have involved simulated or instrumented driving, not the actual experience of drivers on the road. When researchers have tried to assess the effects of phone use on real-world crashes, they usually have relied on police reports for information. But such reports aren't reliable because, without witnesses, police cannot determine whether a crash-involved driver was using a phone.

July 12, 2005
State officials are responding sharply to a study that suggests doctors are victims of price-gouging by insurance companies who continue to raise malpractice insurance premiums even as claims decline.

The data in the Annual Statements filed under oath with state insurance departments, which this Report discloses, call into question much of what the medical malpractice insurance industry has been saying publicly during the past several years, said Missouri Attorney General Jay Nixon.

There is no excuse for malpractice insurers doubling their rates while their claims payments decrease.

According to the study, released by the Consumer Federation of America, Public Citizens Congress Watch and U.S. PIRG, medical malpractice insurance rates for doctors have skyrocketed in recent years even though claim payments are down.

The numbers underscore the need for much tougher, more aggressive oversight to prevent and punish profiteering, Connecticut Attorney General Richard Blumenthal said. Federal and state regulators should thoroughly scrutinize recent rate increases and take appropriate corrective action.

Affordable medical malpractice insurance is critical to public health. Expensive insurance rates become a matter of life and death when they drive doctors out of business - as is happening in Connecticut and nationwide. Insurance company greed can be hazardous to our health.

Michigan Office of Financial and Insurance Services Commissioner Linda A. Watters said she was "definitely disturbed" by the numbers in the report, which offers "evidence that doctors may be paying excessive premiums."

"In the market competition study that we recently issued, we considered loss ratios below 50 percent as patently excessive. If these carriers truly have loss ratios that that are this low and yet they are still increasing rates, one has to wonder if they're gouging, Watters said.

July 11, 2005
The Food and Drug Administration has issued a nationwide warning to consumers against drinking unpasteurized orange juice products distributed under a variety of brand names by Orchid Island Juice Company of Fort Pierce, Florida, because they have the potential to be contaminated with Salmonella Typhimurium and have been associated with an outbreak of human disease caused by this organism.

Salmonella Typhimurium is a germ that can cause serious and sometimes fatal infections in young children, frail or elderly people, and others with weakened immune systems. Otherwise healthy individuals may suffer short-term symptoms such as high fever, severe headache, vomiting, nausea, abdominal pain and diarrhea. Long- term complications can include severe arthritis.

To date there have been reports of 15 cases of a matching strain of illness directly linked to a history of consumption of Orchid Island Juice from mid-May to June in Michigan, Ohio and Massachusetts. In addition, at least 16 other states have reported cases of Salmonella Typhimurium infection that match this specific strain. Further investigations are underway to determine if these infections are also related to these products or not.

"FDA is working with the U.S. Centers for Disease Control and Prevention (CDC) and our state partners to identify the source of the problem and its scope," said Dr. Robert Brackett, Director of the FDA's Center for Food Safety and Applied Nutrition. "It is important to note, however, that the vast majority of orange juice sold in stores is pasteurized and safe to drink."

The unpasteurized product comes in a variety of containers distributed to retail stores and restaurants under various brand names. The products are identified on the labels as freshly squeezed or fresh orange juice. The following labels are involved: Nino Salvaggio's, Westborn Market, and Natalie's Orchid Island Juice. Orchid Island Juice bottles products under other brand names that have not yet been provided to FDA by the company.

The FDA says these products do not bear a warning label that the juice is unpasteurized. Such warning labels do appear on many unpasteurized juice products, so consumers should not assume these products are safe to consume simply because they do not bear the "unpasteurized" warning label.

Individuals who believe they have become ill as a result of drinking this un-pasteurized juice should consult their health care provider and contact their local health department.