News in June 2006

Three years after the preliminary results first were presented at a scientific meeting and drew wide attention, University of Utah psychologists have published a study showing that motorists who talk on both handheld and hands-free cell phones are as impaired as drunken drivers.

"We found that people are as impaired when they drive and talk on a cell phone as they are when they drive intoxicated at the legal blood-alcohol limit" of 0.08 percent, which is the minimum level that defines illegal drunken driving in most U.S. states, says study co-author Frank Drews, an assistant professor of psychology.

"If legislators really want to address driver distraction, then they should consider outlawing cell phone use while driving."

Psychology Professor David Strayer, the study's lead author, adds: "Just like you put yourself and other people at risk when you drive drunk, you put yourself and others at risk when you use a cell phone and drive. The level of impairment is very similar."

"Clearly the safest course of action is to not use a cell phone while driving," concludes the study by Strayer, Drews and Dennis Crouch, a research associate professor of pharmacology and toxicology. The study was set for publication June 29 in the summer 2006 issue of Human Factors: The Journal of the Human Factors and Ergonomics Society.

The study reinforced earlier research by Strayer and Drews showing that hands-free cell phones are just as distracting as handheld cell phones because the conversation itself not just manipulation of a handheld phone distracts drivers from road conditions.

Human Factors Editor Nancy J. Cooke praised the study.

"Although we all have our suspicions about the dangers of cell phone use while driving, human factors research on driver safety helps us move beyond mere suspicions to scientific observations of driver behavior," she said.

The study first gained public notice after Strayer presented preliminary results in July 2003 in Park City, Utah, during the Second International Driving Symposium on Human Factors in Driver Assessment, Training and Vehicle Design. It took until now for the study to be completed, undergo review by other researchers and finally be published.

Different Driving Styles, Similar Impairment

Each of the study's 40 participants "drove" a PatrolSim driving simulator four times: once each while undistracted, using a handheld cell phone, using a hands-free cell phone and while intoxicated to the 0.08 percent blood-alcohol level after drinking vodka and orange juice. Participants followed a simulated pace car that braked intermittently.

Both handheld and hands-free cell phones impaired driving, with no significant difference in the degree of impairment.

That "calls into question driving regulations that prohibited handheld cell phones and permit hands-free cell phones," the researchers write.

The study found that compared with undistracted drivers:

• Motorists who talked on either handheld or hands-free cell phones drove slightly slower, were 9 percent slower to hit the brakes, displayed 24 percent more variation in following distance as their attention switched between driving and conversing, were 19 percent slower to resume normal speed after braking and were more likely to crash. Three study participants rear-ended the pace car. All were talking on cell phones. None were drunk.

• Drivers drunk at the 0.08 percent blood-alcohol level drove a bit more slowly than both undistracted drivers and drivers using cell phones, yet more aggressively. They followed the pace car more closely, were twice as likely to brake only four seconds before a collision would have occurred, and hit their brakes with 23 percent more force.

"Neither accident rates, nor reaction times to vehicles braking in front of the participant, nor recovery of lost speed following braking differed significantly" from undistracted drivers, the researchers write.

"Impairments associated with using a cell phone while driving can be as profound as those associated with driving while drunk," they conclude.

Are Drunken Drivers Less Accident-Prone?

Drews says the lack of accidents among the study's drunken drivers was surprising. He and Strayer speculate that because simulated drives were conducted during mornings, participants who got drunk were well-rested and in the "up" phase of intoxication.

In reality, 80 percent of all fatal alcohol-related accidents occur between 6 p.m. and 6 a.m. when drunken drivers tend to be fatigued. Average blood-alcohol levels in those accidents are twice 0.08 percent. Forty percent of the roughly 42,000 annual U.S. traffic fatalities involve alcohol.

While none of the study's intoxicated drivers crashed, their hard, late braking is "predictive of increased accident rates over the long run," the researchers wrote.

One statistical analysis of the new and previous Utah studies showed cell phone users were 5.36 times more likely to get in an accident than undistracted drivers. Other studies have shown the risk is about the same as for drivers with a 0.08 blood-alcohol level.

Strayer says he expects criticism "suggesting that we are trivializing drunken-driving impairment, but it is anything but the case. We don't think people should drive while drunk, nor should they talk on their cell phone while driving."

Drews says he and Strayer compared the impairment of motorists using cell phones to drivers with a 0.08 percent blood-alcohol level because they wanted to determine if the risk of driving while phoning was comparable to the drunken driving risk considered unacceptable.

"This study does not mean people should start driving drunk," says Drews. "It means that driving while talking on a cell phone is as bad as or maybe worse than driving drunk, which is completely unacceptable and cannot be tolerated by society."

The Food and Drug Administration says an antibiotic made by Sanofi-Aventis will carry a new warning on its label about possible liver problems associated with its use.

The label for the drug Ketek will warn consumers of reports of liver failure and severe injury associated with its use.

Ketek was approved for use in 2004. Doctors prescribe it to treat respiratory tract infections, bronchitis, sinusitis and community-acquired pneumonia.

Ketek is the first FDA-approved antibiotic of the ketolide class. The drug has been associated with rare cases of serious liver injury and liver failure with four reported deaths and one liver transplant after the administration of the drug.

Although it is difficult to determine the exact frequency of Ketek-associated adverse events on the basis of FDA's mandatory and voluntary reporting systems, the agency said it has concluded that the drugs' benefit to patients for the approved indications outweighs its risk, including the rare risk of liver failure, and supports its continued availability.

"We are advising both patients taking Ketek and their doctors to be on the alert for signs and symptoms of liver problems," said Dr. Steven Galson, Director for FDA's Center for Drug Evaluation and Research.

"Patients experiencing such signs or symptoms should discontinue Ketek and seek medical evaluation, which may include tests for liver function." The signs and symptoms of liver failure include fatigue, malaise, loss of appetite, nausea, yellow skin and dark-colored urine.

The warning, which Ketek's manufacturer is adding to the drug's labeling, results from reports gathered by FDA's adverse event monitoring system, which follows drugs after their market introduction.

The agency said the monitor system received some reports of serious liver problems in patients taking Ketek, including some cases of acute liver failure leading to death or requiring liver transplantation.

FDA said it will continue to evaluate Ketek-associated safety issues and take further actions if warranted.

In the battle over Americas expanding waistline, much of the emphasis is on diet and exercise. A new study suggests other potential causes, including too much air conditioning, should be studied as well.

The report, published in the International Journal of Obesity, said researchers found no link between obesity and the proximity of children to fast food restaurants. On the other hand, researchers cite biology to link the growing problem of obesity and the prevalence of air conditioning over the last three decades.

Mammals, they say, use up more energy to maintain their bodies at an acceptable temperature.

The more time humans spend in a climate-controlled environment, the less their bodies have to work. They also suggest people tend to eat less when theyre hot.

"If you lived in Alabama in the summer of 1960, without air conditioning in a car or restaurant, you probably wouldnt want to go to an all-you-can-eat buffet," said David Allison, a researcher at the University of Alabama at Birmingham.

Allison said other factors could also contribute to weight gain, such as over-medication. He said the widespread use of anti-psychotics, anti-depressants, mood stabilizers, contraceptives and antihistamines, all can cause users to put on pounds.

The researchers urged their colleagues to focus on some of the unexamined causes of obesity, and not so much on fast food and lack of exercise.

Even after a FTC scolding and several class action lawsuits, Mantra Films, the makers of "Girls Gone Wild," are still making it difficult for consumers to cancel their subscriptions, according to consumer complaints filed with ConsumerAffairs.com.

In July 2004 the FTC ordered Mantra to pay $1.1 million for "enrolling consumers who responded to Internet and television ads advertising a single video or DVD into "continuity" programs.

Once consumers were enrolled in these programs, each month the defendants shipped additional, unordered videos and DVDs on a "negative-option" basis, charging consumers' credit and debit cards for each shipment until consumers took action to stop the shipments."

Consumers then found it nearly impossible to cancel the continuity program.

As a result of that case, Mantra was forced to make it undeniably clear what the consumer was signing up for and also follow through with the late night TV ads' promise of, "cancel any time."

To enforce this ruling, the FTC forced Mantra to submit compliance records for 180 days after the case. The commission can also ask for more compliance records after that date if necessary.

Two years later, Mantra is still advertising all over late-night TV and the complaints file into ConsumerAffairs.com on a daily basis.

"I purchased 2 DVDs for $9.99 -- cancel any time," wrote Julian of Walnut Creek, Calif. "They began to send me 1 or 2 DVDs each month. I picked up on that quickly and tried to cancel my account. Over the course of several months I have called four times each time insisting that my orders be cancelled and that they stop billing me and stop sending me DVDs. Atrociously the DVDs continue to come despite all my efforts. They have taken over $250 from me."

Although it does seem clear from recent consumer complaints and the "Girls Gone Wild" website what a person is signing up for, almost every complaint is about Mantra's apparent disregard of its "cancel anytime" promise.

There's no telling whether the FTC is doing anything.

"I can't confirm or deny any investigation," Robert Frisbee, FTC assistant director said.

Mantra, based in Hollywood, Calif., appears to be safe from local authorities as the California Department of Justice has not filed any suit nor does it have any current investigations.

Frisbee did confirm that the FTC requested more materials from Mantra once, but would not share any more specifics. "Our correspondence is not really a matter of public information," he said.

The Food and Drug Administration has yet to make companies break the habit of marketing laser treatment smoking cessation, a therapy the FDA has never approved, and a therapy which some professionals believe to be ineffective.

Dr. Sidney Wolfe, Health Research Group director of the Public Citizen, a nonprofit consumer advocacy group, decried the procedure's continued availability and the FDA's inaction.

"Medical evidence, in the form of properly conducted clinical trials, demonstrates that its effectiveness is indistinguishable from that of a placebo," Wolfe said.

Public Citizen petitioned the FDA on June 22 to immediately stop five companies from "illegally marketing and promoting laser treatment for smoking cessation."

Freedom Laser Therapy (FLT), based in Santa Monica, Calif., has taken the most heat for its website and marketing procedures.

But Craig Nabat, FLT president told ConsumerAffairs.com that the procedure works. "The lower power lasers cause an endorphin release that tricks the mind and body," he said.

However, Nabat said that the laser is just the catalyst and that the person must take over-the-counter antioxidants and continue to watch videos that come with the procedure in order to quit smoking.

Nabat would not say what percentage of FLT customers have successfully quit smoking. He said he has hired a private research firm to document the procedure's results.

Nabat said FLT has been around since Sept. 2003 and that if it didn't work he would be out of business by now. "This procedure has been around for 30 years in Canada and Europe," he said.

Soon after the Public Citizen petition, FLT stopped all advertising and pulled down the great majority of content from its website.

"We want to make sure everything is compliant," Nabat said.

Wolfe said FLT has been targeted for its "considerable web and TV hype." Nabat believes that his company is under fire because it is "the most high tech."

Wolfe told ConsumerAffairs.com that this $349 procedure is harmful because people trying to stop smoking waste their money and often give up quitting after this "too-good-to-be-true" procedure doesn't work.

Wolfe said smokers trying to quit should use FDA-approved methods such as nicotine gum and the patch along with regular doctor visits. Wolfe said it's easier to tackle the mental portion of the addiction if there is someone, such as a doctor, coaching the quitter.

FDA spokeswoman Heather Howe did not return phone calls seeking comment.

Smokers who pay to be zapped by lasers in an effort to kick the habit are victims of fraud, according to the watchdog group Public Citizen.

Public Citizen has asked the U.S. Food and Drug Administration to stop five companies from promoting low-power laser therapy as a means to quit smoking.

The clinics -- Freedom Laser Therapy Inc., the Anne Penman Laser Therapy clinics, New Beginnings Laser Therapy, Laser Concept and the Stop Smoking Laser Center -- are marketing laser therapy as a safe and effective smoking cessation treatment despite the lack of FDA clearance or any evidence that it is effective, according to Public Citizen.

Laser therapy, also known as laser acupuncture, aims a low-power laser beam rather than needles at various points of the body. It is approved by the FDA for marketing only for the temporary relief of pain.

Public Citizen focuses on Freedom Laser Therapy (FLT), which has generated the most news coverage of its activities. FLT claims an 85 percent success rate for curing smoking addiction in just one 30-minute session.

The therapy program costs $399 for the single 30-minute session. According to the Public Citizen petition, the money would be better spent on treatments that have been proven to show some success: nicotine replacement therapy, physician advice, certain antidepressants and individual behavioral counseling.

FLT President Craig Nabat says he wants to open franchises nationwide despite solid evidence that the stop smoking program works.

Early attempts at following up with all clients proved laborious, expensive and ultimately fruitless, Nabat said. "We are not documenting exactly how many people are coming through -- how successful they are," said Nabat, adding that client referrals vouch for the program's effectiveness.

FDA regulations do allow the therapy to be used in investigational clinical trials or studies -- exactly what FLT said it is carrying out at its two locations, in Royal Oak and Santa Monica, Calif.

Dr. Norman Edelman, chief medical officer of the American Lung Association said that there is no evidence that the laser program works.

Public Citizen charges that that "despite a lack evidence supporting its claims, the company has launched an aggressive marketing campaign to recruit a wide audience of vulnerable clients who are looking to stop smoking."

"In all of its advertising, FLT presents laser treatment as a much more credible option than has been shown in the medical literature," Public Citizen claims.

DaimlerChrysler plans to sell its 60-mile-per-gallon two-seater Smart Car in the U.S. next year.

The little Smart Car is just more than 8 feet long and less than 5 feet wide and is small enough to fit in half of a typical parking space.

The three-cylinder turbocharged Smart Car can achieve up to 60 mpg, according to DaimlerChrysler.

The automaker hopes to broaden the market for Smart Cars, which have lost money since DaimlerChrysler's Mercedes-Benz unit launched the program in 1998.

Mercedes took a first-quarter charge equivalent to $1.5 billion, including costs associated with scrapping the slow-selling four-seat model of the Smart Car.

The decision comes as growing numbers of U.S. consumers are worried about rising gasoline prices and smaller more fuel-efficient vehicles are attracting their attention.

AT&T is unveiling its new privacy policy, saying it does not share customer information with third-party marketers, but may share the data with government agencies.

AT&T telephone customers can expect their calling records to be among those scrutinized for terrorist links. The company will also collect information about which Web sites its Internet customers visit, including what links they click on.

"While your account information may be personal to you, these records constitute business records that are owned by AT&T. As such, AT&T may disclose such records to protect its legitimate business interests, safeguard others, or respond to legal process," the company said in its new policy statement.

However, Congress may place limits on how government agencies can access this personal data. Sen. Hillary Clinton (D-NY). in a speech to the American Constitution Society, called for a "Privacy Bill of Rights."

"At all levels, the privacy protections for ordinary Americans are broken, inadequate and out of date. It's time for a new comprehensive look at privacy," Clinton said.

"We need consumer protections that are up to date with the technological and national security needs of our time, for a world in which we can be confident that our security and our privacy are both protected."

Clinton has said that she will introduce the Privacy Rights and Oversight for Electronic and Commercial Transactions Act of 2006, the PROTECT Act. Meanwhile, Congress is set to review actions of AT&T and other telecom companies for their reported cooperation with a National Security Agency program that scanned millions of phone records for terrorist links.

MySpace.com is being sued for $30 million on behalf of a 14-year-old Texas girl who says she was sexually assaulted by someone she met through the site.

The suit claims MySpace was negligent for not verifying the ages of users and for failing to prevent strangers from contacting users under 16.

The defendants are MySpace, its corporate parent News Corp., and Pete Solis, the 19-year-old accused of sexually assaulting the teen. The girl's lawyer said the damages requested reflect one percent of the site's estimated worth.

MySpace has been the target of criticism and legal actions lately by educators, parents and some state attorneys general who say the site isn't doing enough to safeguard its users.

It's not for lack of trying. MySpace has been trying to clean up its act for months and recently hired former Microsoft executive and onetime federal prosecutor Hemanshu Nigam as chief security officer as its chief security officer.

The site is expected to announce a series of new safety and security, including heightened measures for the 14-15 year old set, new options for privacy and age-approporiate advertising placement.

Published reports of the changes say that anyone over 18 who wants to contact members under 16 will need to know the first and last names or the email address in order to make the connection.

College students. They're young. They're impressionable. They're dirt poor. And they're perfect candidates for multi-level marketing (MLM) and pyramid schemes.

During my college days at St. Bonaventure University, I saw this with my own eyes and reported the sad story in the student newspaper. I saw how one man and his white board fooled six destitute young students into a system from which only he would profit. What started as making $7.50 triumphantly ballooned to hundreds of thousands of dollars. In his cookie cutter speech, the man never said the words "introductory fee" or "sales."

As one business professor I interviewed for the story said, "It looks like a duck. It walks like a duck. It is a duck."

That particular MLM was a notorious one called Quixtar, a/k/a Amway. It's just one of hundreds of companies profiting from the hunger on college campuses.

MLMs are technically legal while pyramid schemes are not. However, the fine line between the two is hardly visible. According to New York Attorney General Elliot Spitzer's website, what separates an MLM from a pyramid scheme is that a pyramid scheme requires investors at the bottom of the pyramid to invest in generally unwanted products and pay an initial introduction fee.

In a pyramid scheme, people are given direct commissions based on recruiting members. The people at the top of the pyramid structure make money from that original investment and not on the sale of products. MLMs use a pyramid structure but commissions are based more on sales than on recruiting.

The ConsumerAffairs.com database is filled with many sad stories of young students hoping to reverse their debt.

"I went to an interview (or so I thought) where I listened to a presentation in which a gentleman described how much money I could make and how controlling that corporate America really is," wrote Jennifer of Kansas City, Mo. "Needless to say I was young and insecure and fell easily into believing these people cared about me and my future."

"I was talked into buying $3000 worth of products within the first week, which was my entire savings. I was also talked into renting desk space, getting a phone line installed, going to training sessions all over the US every month, and to continue to buy products not only for myself, but to sell as well," Jennifer said.

"(They) made it appear that I could be rich within a year, they even tried telling me that I could move to San Diego to help start the 'new office' and that I would be the first in that market."

But it didn't turn out quite that way.

"After several months, all of my credit cards were maxed out, they had talked me into taking a leave of absence from my job, and I was barely paying the bills. I ended up spending over $14,000 on their promises of a better life. I had to file bankruptcy because I could no longer afford to live. Since then, not only did I lose money, I also lost credibility. I cannot get a decent car or home loan, I cannot get a credit card and I cannot move apartments for fear that when they check my credit report my application will be denied."

According to Spitzer's website, pyramid schemes are doomed to failure while MLMs may succeed -- for the people at the top of the pyramid that is. For more information read Spitzer's Don't get caught in a pyramid scheme. Also, attorney Joan Lisante reviews the pitfalls in her ConsumerAffairs.com story, Pyramids Belong in Egypt.

Attorney General Greg Abbott charges that while the chemical composition of the gasoline pill may well be top secret the pill is also a scam. Abbott says the pill is nothing more than the equivalent of a mothball.

With the price of gasoline reaching $3 a gallon, scammers are polluting the market place with gimmicks and products designed to take advantage of consumers beaten down by the high prices.

With drivers searching for alternatives to high-priced gasoline, a cottage industry is sprouting up claiming increased mileage with pills, powders, liquid additives and mechanical devices.

The little green BioPerformance pill is suppose to improve mileage by 30 percent when simply dropped into a gas tank. Abbot says the claim is nonsense and has filed a suit to shut down BioPerfomrance in Texas. Abbott recruited a University of Texas scientist to test the product and it turns out the pill is made of naphthalene.

Mothballs are also made from naphthalene.

The little pills are not the only scam on the market. Among the mileage rip offs are a set of magnets that can be attached to the fuel line so they can realign the gasoline molecules and create "vortex generators" forming small tornadoes inside the engine.

All the magnets really generate are profits for the people selling them.

The small green BioPerformance pills are advertised as completely harmless and non-toxic according to company claims. Naphthalene, however, can be quite toxic and is harmful if swallowed or ingested.

BioPerformance claims to have 4,500 sales people in Texas with $25 million in revenue since December 2005. But the company turns out to be more like a pyramid scheme. Dealers must come up with $300 to $500 to pay for start up costs.

New Jersey has filed suit against Royal Caribbean Cruises alleging that the company violated the state's Consumer Fraud Act by changing a cruise itinerary -- from Bermuda to ports of call in the Canadian Maritime Provinces -- without providing passengers with a comparable itinerary and failing to issue refunds due to passengers.

The state's complaint, filed by the Attorney General's Office and Division of Consumer Affairs, alleges that Royal Caribbean engaged in unconscionable commercial practices regarding a planned cruise to Bermuda in July, 2005.

The state is seeking restitution for consumers and civil penalties for each violation of the Consumer Fraud Act. The Division of Consumer Affairs said it received 53 complaints from the cruise passengers since July, 2005. Passengers were allegedly told if they did not board the ship, despite the change in plans, they would lose all their money.

"We allege that Royal Caribbean misled customers about a planned itinerary change and then failed to refund consumers the difference in cost between the trip they purchased and the trip they received," said Attorney General Zulima Farber. "We are prepared to take legal action whenever necessary to ensure that consumers get what they pay for or are compensated for any changes."

Specifically, the complaint includes the following allegations:

• Royal Caribbean alerted passengers arriving at Cape Liberty in Bayonne for a July 24, 2005 cruise to Bermuda that the ship, the Voyager of the Seas, would instead sail to St. John, New Brunswick and Halifax Nova Scotia;

• Royal Caribbean made no attempt to personally alert passengers of the change prior to the July 24 departure date despite having passenger contact information and despite posting a notice of the change on its website the previous evening;

• When they arrived at Cape Liberty, passengers were given a Royal Caribbean customer service number in Florida where a representative advised passengers that they would lose all of their money if they did not board the ship;

• A cruise to Canada is significantly less expensive than a cruise to Bermuda;

• Royal Caribbean offered only an onboard credit of $45.20 - the difference in port fees and taxes - to each passenger and stated that this was the only refund to be provided;

• The temperature in Canada was significantly cooler than in Bermuda and the weather was rainy, cloudy and foggy;

• Passengers were deprived of the use of many of the Voyager of the Seas' outdoor amenities that they planned to use when they booked a cruise to Bermuda including the pool, Jacuzzi and nine-hole miniature golf course;

• Passengers were denied the opportunity to engage in warm weather activities available at the Kings Wharf, Bermuda port including golfing, scuba diving, glass-bottom boat cruises, snorkeling, deep-sea fishing, beach excursions and catamaran cruises; and

• While onboard and upon returning home, passengers requested a cash refund for the difference in cost between the Canada cruise and the Bermuda cruise and Royal Caribbean refused to honor any such requests.

"It is unconscionable that consumers showed up for a cruise they paid for with their hard-earned money only to be sent somewhere they didn't want to go, without access to the amenities they paid for and activities they looked forward to, and were told there was nothing they could do about it," said Consumer Affairs Director Kimberly Ricketts.

"This type of egregious behavior will not be tolerated in New Jersey and that is exactly why we have filed suit against Royal Caribbean."

Treating prostate cancer with radiation may slightly increase a man's risk of developing rectal cancer.

Researchers studied 86,000 men diagnosed with prostate cancer who did not have rectal cancer. About 35 percent received radiation treatments -- usually with small beads placed in the prostate. Sixty-five percent of this group were treated sufficiently.

However, a decade later a small number of them -- 267 -- had developed rectal cancer. The rectum is near the prostate.

While this rate is low, people treated with radiation had a 70 percent greater chance of developing rectal cancer than the control group. Radiation did not cause cancer in other parts of the abdomen.

So, the millions of men who have prostate cancer each year should go over the pluses and minuses of surgery versus radiation with their doctors. While the risk of rectal cancer from radiation is extremely low and may not be a problem for most men, it is there and should be taken into consideration.

NHTSA rated 99 child safety seats for ease of use from 14 different manufacturers for 2006. Of the 99 seats rated, 85 received an overall score of A. In 2005, 74 percent of rated seats received an overall score of A. The agency uses a grading system of A, B, or C to denote how easy it is to use the safety seats. The top grade is A.

In addition to the overall rating, NHTSA also uses the letter grading system to denote how well the child safety seats perform in five individual categories: assembly requirements; clarity of labeling; clarity of written instructions; ease of securing a child and ease of installation in a vehicle. Clearer labels and instructions accounted for most of the improvements in 2006.

"Knowing what rating a child safety or booster seat has is the best way for parents to buy one that is safe, effective and easy to use," said NHTSA Administrator Nicole Nason.

NHTSA began its "Ease of Use" ratings for child restraint systems, including booster seats, in 2003.

The 2006 ratings represent approximately 95 percent of safety seats currently available to consumers. As in 2005, there were no safety seats that received an overall "C" rating; however, there were several "C" scores in some individual categories.

Three seats that were rated in previous years improved their overall scores from a B to an A. These seats were the Triple Play Sit N Stroll (formerly manufactured by Safeline), Evenflo Big Kid (HB), and Evenflo Discovery.

A number of redesigned seats that were re-rated maintained their A ratings. In most cases, improvements were seen within categories that they had formerly been assigned B or C ratings in. These seats were the Cosco Alpha Omega 5pt, Evenflo Big Kid (No Back), Evenflo Embrace, Evenflo Discovery, Graco Comfort Sport, and Safety 1st Surveyor.

The complete list of seats rates is available at www.nhtsa.dot.gov/CPS/CSSRating/Index.cfm.

The NHTSA survey also notes that LATCH (Lower Anchors and Tethers for Children), a system that makes child safety seat installation easier is required for most vehicles manufactured after September 1, 2002.

Cities and states are making a small fortune selling items confiscated from passengers at airports.

Such items as scissors, pocket knives, and cigarette lighters are collected by the Transportation Security Administration, which then turns them over to state and local governments. Instead of discarding them, many official agencies are selling them -- often via the eBay auction site.

Consider these examples:

• Maryland sells 50-pound boxes of confiscated items for $50 each to anyone willing to pick them up at its warehouse in Jessup;

• Pennsylvania sold a 39-pound box of Swiss Army knives for $595 through eBay;

• Boulder City -- the only Nevada city without legalized gambling -- earns $10,000 a month through eBay sales of confiscated items;

• The Arkansas state surplus agency collects materials from 60 airports in 20 states, donates whatever it can, then auctions the rest over a federal website operated by the General Services Administration -- splitting the profits evenly with the GSA.

Alabama, Kentucky, Maryland, and Oregon are also among the states that collect and sell airport-confiscated items.

The whole system smacks of a scam but the TSA insists it doesn't make a dime from the deal. The agency, created after hijacked planes were used in the terrorist attacks of Sept. 11, 2001, follows GSA regulations in discarding property it claims was abandoned "voluntarily."

According to the TSA's Yolanda Clark, passengers have choices when told to surrender items. They can exit the security area to place items in cars or bring them to post offices, give them to people not boarding flights, or give them up. Virtually all choose the last option because they are hurrying to catch their planes, she noted.

Total value of confiscated items stretches to seven figures, making it a booming business. In fact, the federal government pays a company called Science Application International $17 million under a five-year contract to dispose of confiscated items nobody wants.

Organizing those items for sale is no easy task, since the TSA bundles everything into boxes indiscriminately. Some of those boxes weigh 50-75 pounds.

Once organized, though, confiscated items quickly become a cash cow. Last December alone, Pennsylvania reported $17,000 in profits from the sale of confiscated scissors, tools, and pocket knives.

Whether the windfall will continue depends upon government policies - and whether they will change. When the TSA started allowing small scissors and tools through checkpoints last winter, state surplus agencies had fewer scissors to sell. But several agencies compensated by placing more listings on eBay.

The American Medical Association (AMA) is calling for a temporary moratorium on the advertising of newly approved drugs and guidelines for pharmaceutical companies to follow when preparing direct-to-consumer (DTC) advertising.

"A temporary moratorium on DTC advertising of prescribed drugs and medical devices will benefit both the patient and physician," said AMA President-elect Ronald M. Davis, M.D. "Physicians will have the opportunity to become better educated on the pros and cons of prescription drug uses before prescribing them, and will be better able to determine when they are best suited for their patients' medical needs."

In addition to the moratorium on newly approved drugs (the time interval for this moratorium will be determined by the Food and Drug Administration (FDA)), the AMA adopted additional guidelines for DTC ads, they:

• should provide objective information about drug benefits that reflect the true efficacy of the drug, as determined by clinical trials;

• should show fair balance between the benefits and risks of the advertised drugs by providing comparable time or space and cognitive accessibility, and by presenting warnings, precautions and potential adverse reactions in a clear and understandable way without distraction of content;

• should clearly indicate that the ad is for a prescription drug and refer patients to their physician for more information and appropriate treatment; and

• should be targeted for age-appropriate audiences; and

• should receive pre-approval from the FDA

The AMA also calls for additional research into the effects of DTC advertising on the patient-physician relationship, overall health outcomes and health care costs.

"The AMA will work with the pharmaceutical industry for universal acceptance of the guidelines so that physicians can help patients obtain appropriate medications," said Dr. Davis.

A credit counseling service and related companies and individuals have agreed to pay $926,754 to settle Federal Trade Commission charges that they made false claims about their debt management program and violated the FTC's Do Not Call Rule.

According to the FTC, Credit Foundation of America, Inc. (CFA), and its associates sold debt management services nationwide through unsolicited, recorded messages left on home telephones, falsely claiming that consumers were pre-approved for a program to consolidate their credit card debts to a single monthly payment at a much lower interest rate.

When consumers responded to the calls, they were encouraged to enroll in a debt management plan, regardless of their individual circumstances. Many enrollees were not appropriate candidates for debt management plans and lost the large enrollment fees the defendants charged.

"When it comes to debt-related problems, a 'one-size fits all' solution should raise a red flag," said Lydia Parnes, Director of the FTC's Bureau of Consumer Protection. "Debt management programs work best when they are tailored to consumers' particular circumstances."

In marketing its debt management program, CFA also intruded on the privacy of millions of people who did not wish to be called. The FTC says CFA solicited prospective clients primarily through auto-dialing equipment that delivered recorded messages, placing more than three million telemarketing calls each week.

Many of the consumers called had placed their names on the National Do Not Call Registry. Others had futilely requested to be placed on CFA's in-house do not call list.

According to the complaint, although CFA claimed to be exempt from the do-not-call requirements of the FTC's Telemarketing Sales Rule (TSR) because of its tax-exempt status with the Internal Revenue Service, CFA mainly generated profits for related for-profit companies and individuals. Therefore, it is subject to FTC jurisdiction and must comply with the TSR, regardless of the form of its corporate organization.

The complaint charges CFA with acting as part of a for-profit enterprise to generate substantial revenue from the fees paid by consumers, along with TTT Marketing Services, Inc., Sure Guard Credit Corporation, Inc., Anthony P. Cara, Todd A. Rodriguez, and Walter F. Villaume (CFA defendants).

The complaint also names CFA telemarketing agents Credit Defenders of America, Inc., Credit Shelter of America, Inc., Robert Brown, and Bryan E. Taylor. The complaint contends that the California-based defendants misrepresented that consumers were pre-approved for participation in a debt management plan with particular creditors or were guaranteed acceptance in a debt management plan at a particular interest rate or payment level by particular creditors.

It further states that the defendants misrepresented the benefits that consumers would receive, including that the interest rates consumers paid would be reduced to as low as zero percent; that the consumers would receive debt management services before their next credit billing cycle; and that the defendants' credit counselors would provide consumers with individualized credit counseling.

According to the complaint, the CFA defendants violated the TSR by calling consumers on the National Do Not Call Registry and by failing to place consumers' names on in-house do not call lists when requested. The complaint also maintains that they failed to pay for access to the Registry.

To resolve the charges, CFA, TTT Marketing Services, Inc., Sure Guard Credit Corporation, Inc., Anthony P. Cara, Todd A. Rodriguez, and Walter F. Villaume agreed to pay $250,000 in civil penalties and $606,754 in consumer redress.

Credit Defenders of America, Inc. and its owner, Robert Brown, agreed to pay $70,000 in consumer redress. Credit Shelter of America, Inc. and its owner, Bryan E. Taylor, agreed to a judgment of $102,540, which has been suspended due to their inability to pay. It will be imposed if they are found to have misrepresented their financial condition.

The DaimlerChrysler Jeep Grand Cherokee is facing a second recall in a week.

The National Highway Traffic Safety Administration reports that 131,441 of the SUVs from the 2000 to 2002 model years should be returned to dealers to repair the electric cooling fan because the plastic blades on the fan may separate and penetrate the fan shroud.

NHTSA warns that if the Grand Cherokee hood is open when the fan blades come apart, anyone standing near the engine compartment could be struck by a flying blade, possibly suffering serious injury.

Jeep dealers will replace the cooling fan module free of charge when the recall begins later this summer.

Earlier in the week, the Connecticut Attorney General warned federal regulators that they ought to investigate unintended acceleration in the Chrysler Jeep Grand Cherokee after a 52-year-old man was run over and killed by a Grand Cherokee in a Connecticut car wash.

Unintended acceleration is not a new problem with the Grand Cherokee. ConsumerAffairs.com has published reports of similar accidents since at least 2000, involving the Jeep Grand Cherokee and other Chrysler products.

NHTSA has also recalled the SUV this week because the front passenger seat in the 2003 and 2004 Grand Cherokee SUVs can become a smoldering hot seat and even catch fire as a result of a faulty seat warmer.

NHTSA is recalling 111,687 Jeep Grand Cherokee SUVs from the 2003 and 2004 model years equipped with heated seats.

Owners of a Jeep Grand Cherokee may contact Chrysler at 1-800-853-1403 or NHTSA at 1-888-327-4236.

By Martin H. Bosworth
ConsumerAffairs.com

June 14, 2006
Even as more states pass laws protecting their residents from identity theft and giving them more options to control their credit, a bill that could override all state laws for data breaches is slithering through Congress.

The House of Representatives may vote as early as this week on the "Financial Data and Security Act" (H.R. 3997), sponsored by Rep. Steve LaTourette (R-OH).

The bill, dubbed the "worst data bill ever" by Public Interest Research Group's Ed Mierzwinski, would preempt existing state laws that allow consumers to "freeze" their credit and prevent accounts from being opened in their name without permission.

The bill also preempts states from exerting any authority to investigate data breaches, and would only mandate companies notify customers of a data breach or fraud alert after they have performed a "reasonable" investigation themselves.

InfoWorld columnist Ed Foster said that the weakness of H.R. 3997 was due to the effects of heavy lobbying by banks, credit bureaus, and other members of the financial industry on Congress. "So we're talking about a lot of big companies with a lot of influence -- i.e., money -- that they can spread around our nation's capital."

Upstart credit protection company TrustedID has been aggressively campaigning against overturning any state laws. The company recently launched HandsOffMyCredit.com, a "consumer information" site designed to educate readers about the weaknesses of H.R. 3997.

"The credit bureaus -- and their Washington lobbyists -- are pushing a plan in Congress that will overturn more than a dozen state laws that now offer tens of millions of consumers crucial protections against identity theft and financial fraud," according to the site's mission statement.

If the "Financial Data and Security Act" becomes law, companies like TrustedID would not be able to market its credit freeze and monitoring products in any state. As it is, the company can only offer credit freezes in states that have passed laws allowing the practice.

The debate over H.R. 3997 comes at a time when many more states are passing laws that grant consumers stronger preemptive protection against identity theft. New York governor George Pataki recently signed a "credit freeze" bill into law for the state, as well as stronger rules for how businesses dispose of data they collect.

The state of Washington recently enabled veterans and active-duty military personnel who may have been affected by the theft of 26.5 Veterans Administration (VA) data records to put freezes on their credit reports.

Colorado passed a law enabling credit freezes that takes effect on July 1st. In discussing the law, Rocky Mountain News columnist Rex Nesmith noted that it doesn't protect victims of data breaches by government agencies.

"There was a loophole in the law that did not cover the banks or government, such as universities and state colleges," Nesmith said.

"The experience with [the Veterans Administration data breach] demonstrates thatlawmakers need to close that loophole and mandate notice whenever an unauthorized person has gained access to sensitive information about consumers - no matter what the institution."

Ironically, Rep. LaTourette invoked the spectre of the VA data breach when he claimed one of his constituents, a 33-year-old disabled veteran from Ashtabula, OH, might have been affected, as someone may have opened a bank account in his name.

When VA Secretary Jim Nicholson testified before Congress on the breach, LaTourette told him that the story was the "first instance" he had heard of veterans being affected by the breach.

The Connecticut Attorney General is telling federal regulators that they ought to investigate unintended acceleration in the Chrysler Jeep Grand Cherokee after a 52-year-old man was run over and killed by a Grand Cherokee in a Connecticut car wash.

The problem is not a new one. ConsumerAffairs.com has published reports of similar accidents since at least 2000, involving the Jeep Grand Cherokee and other Chrysler products.

Connecticut authorities have received several reports of Jeep Grand Cherokees suddenly accelerating out of car washes while changing gears to "drive" from "neutral," according to Attorney General Richard Blumenthal.

Blumenthal also urged the Chrysler group to release any information or history of Grand Cherokees suddenly or unexpectedly accelerating.

"The rate and severity of these sudden acceleration incidents suggest a severe structural flaw -- certainly more than simple coincidence," Blumenthal said.

"These incidents -- in one case killing a Connecticut man -- call for aggressive and vigorous action to prevent another needless, preventable tragedy," he said.

In a 2003 complaint to ConsumerAffairs.com, Beth of LaCrosse, Wisconsin, said her mother was driving her 1996 Jeep Grand Cherokee into her driveway and had just applied the brake to stop.

"Instead of the car stopping it accelerated and the brakes didn't stop her, she crashed through the yard, over patio furniture through a table and into a large maple tree."

Annette of Holdsville, New York, wrote: "My sister went to back my car our of her driveway. She had her foot on the brake, put car in reverse and it took off out of control smashing into a house and causing major damage."

Blumenthal held a news conference at a car wash in Milford, Connecticut along with Doug Newman who owns a chain of car washes in the state.

Newman claims to have seen the Grand Cherokee suddenly accelerate at his car wash chain on several occasions.

"I have been operating multiple car wash locations for almost 20 years. Over that period of time and the few million or so cars washed, I have had only four sudden acceleration incidents and all four of these incidents involved Jeep Grand Cherokees," he said.

Blumenthal warned that Chrysler should advise car wash owners, auto repairers and insurers about reports of sudden or unexpected accelerations by the Grand Cherokee. He also asked that any findings of sudden acceleration be reported to the National Highway Traffic Safety Administration using its online complaint form.

June 12, 2006

The Food and Drug Administration has ordered drug companies making cold, cough and allergy medication containing carbinoxamine, an antihistamine, to stop within the next three months. The agency says carbinoxamine is not approved for use in U.S. medicines, and could be a risk to infants and young children.

The FDA said as many as 26 companies currently produce about 120 medicines containing the unapproved substance. Carbinoxamine is approved for use in only two drugs, both made by Mikart, Inc.

The FDA estimates that there are several hundred different unapproved active ingredients in prescription drugs on the market. The agency estimates that less than 2 percent of prescribed drugs are unapproved.

"Right now, many unapproved drugs represent a public health threat because consumers wrongly assume that these widely marketed and available drugs are approved and have been found to be safe and effective by the FDA," said Acting FDA Commissioner Dr. Andrew von Eschenbach.

"While we want to ensure continued patient access to necessary treatments, as a physician I feel strongly that patients expect and deserve all their prescription medicines to be FDA approved. These unapproved drugs have bypassed the agency approval process through which FDA ensures, based on reliable scientific data, that marketed drugs are safe, effective, properly manufactured, and accurately labeled."

Many of the unapproved drugs affected by the FDA scrutiny are medicines that were developed and marketed before successive changes to the drug approval process that is established in the Federal Food, Drug, and Cosmetic Act.

FDA approval guarantees that a product has been reviewed and will be consistently monitored for safety, effectiveness and adherence with manufacturing quality standards.

"Unapproved drugs may not meet modern standards for safety, effectiveness, quality, and labeling. Clearly this is a problem we intend to fix," said Dr. Steven Galson, Director of FDA's Center for Drug Evaluation and Research.

How could so many unapproved medicines be on the market?

The FDA said health care providers are often unaware of the unapproved status of some drugs and have continued to unknowingly prescribe unapproved drugs because the drugs' labels do not disclose that they lack FDA approval. Often these drugs are advertised in reputable medical journals or are included in widely used pharmaceutical references such as the Physicians' Desk Reference (PDR).

What happens to those cases that slip through the cracks?

Take the case of Joan Carpenter. The Toms River, New Jersey, resident held her mortgage with financial giant Countrywide, and was shocked to receive a letter from her lender in December 2005.

According to Countrywide, one of their employees had "disclosed documents" relating to her mortgage. Although Joan's mortgage had been paid off, the company still held her records, which put her at risk of identity theft.

Carpenter used the toll-free number Countrywide provided to get some more information, but was unsuccessful.

"The first time I called the male rep who answered wasn't pleasant at all so I didn't bother with it," she said. "But then I called back a week later or so and spoke to someone else who told me that he didn't know when the breach occurred and making it sound like it really was no big deal."

Carpenter signed up for "Countrywide Credit Guard," a free credit monitoring service offered jointly by Countrywide and ConsumerInfo.com, the subsidiary of the Experian credit agency.

ConsumerInfo.com has been a frequent target of complaints by subscribers for poor service, and recently settled FTC charges that it had deceptive billed customers for services it claimed was free.

Several months later, Carpenter doesn't have any answers. According to Countrywide, she was the only letter recipient to inquire or complain about the theft.

Countrywide representatives who spoke to ConsumerAffairs.com said the same thing. One representative, who asked not to be identified, would not comment further, saying "we take our customers' privacy very seriously, and can't disclose details of a customer privacy issue."

At a meeting of the American Bar Association's Consumer Financial Services Committee in early 2006, Countrywide's privacy officer, Christine Frye, provided copies of the template for the breach notification letter, and outlined the "corporate" approach her company has taken to data security, such as designating one point of contact for e-mail queries, setting up toll-free numbers, and so on.

Even after a year, Joan Carpenter still isn't sure of what happened. But she knows that Countrywide could have done a better job of protecting her information and keeping her in the loop.

"I feel this breach was handled poorly by Countrywide and that sensitive data for current and non-current customers should be safeguarded and/or encrypted," she said.

The California Supreme Court has upheld an appeals court ruling which held that Pearle Vision Centers illegally provided eye examination services and sold eyeglassees and contact lenses from the same retail storefronts.

The ruling clears the way for a consumer protection lawsuit filed in 2002 by California Attorney General Bill Lockyer against Pearle Vision for alleged unlicensed practice of optometry, deceptive marketing and unfair business practices.

The complaint claims that Pearle Vision's advertising falsely promoted that the company provides optometric services, including eye exams, eye care, professional eye care advice and the services of optometrists.

Additionally, the complaint alleges the defendants falsely told consumers that the optometrists located in or near Pearle Vision retail outlets were independent. In fact, the optometrists are controlled and financially subsidized by Pearle Vision, according to the complaint.

"For decades Pearle Vision has flipped and twisted itself, trying to find a way through California law requiring economic independence between optometrists and those selling and dispensing lenses and frames," Lockyear said. "They thought they found a technical refuge but the court stripped away that shelter."

"Consumers have less protection when the firm selling eyewear also controls the doctor writing the prescription. Today's ruling upholds Californians' insistence that when it comes to their health, those with the credentials should make the decisions," Lockyer said.

California law prohibits financial relationships between optometrists and retail eyeglass sellers, and also bars retailers from advertising or providing the services of optometrists.

Pearle had set up a complicated structure that involved selling franchises to optometrists licensed in California. The California Association of Dispensing Opticians sued Pearle, arguing that the franchise program violated state law.

Pearle then shifted strategies, splitting its operations into two, with Pearle Viosion, Inc. selling eyeglasses and contacts and a separate company, Pearle VisionCare, employing optometrists to perform eye examinations.

But in its ruling, the Supreme Court unanimously rejected Pearle's arguments, which it said violated California's prohibition against the corporate practice of medicine except by licensed health care institutions.

Pearle Vision operates about 850 stores throughout the U.S., Canada and Puerto Rico.

A growing number of SUV owners unable to cope with rising gas prices are turning to arson to escape high car payments, according to published reports.

The trend was first spotted in California during the summer of 2005 as gas prices spiked. Arson investigators report that firefighters responding to a report of a vehicle fire arrived at the Los Angeles River Bed to find two SUVs burning at the same time.

According to police reports, the California arsonist would advise SUV owners to leave their keys in the ignition and $300 cash in the glovebox, Edmunds.com reported. An accomplice would then take the car to a remote location and set the SUV on fire. After the SUV fire, the owners would contact their insurance company and report the vehicle stolen.

California police launched a sting operation and an undercover officer posed as an SUV owner who wanted his vehicle burned. The vehicle was left at a predetermined location with cash in the glovebox.

There was also a camera installed is the SUV to videotape the arsonist. When he removed the money and started to drive away, investigators hit a kill switch and triggered the door locks, trapping the SUV torch inside.

Several SUV owners are under investigation or facing charges for insurance fraud as a result of the arson and the sting operation in California.

Vehicle arson has its humorous aspects as well. In Texas, two students were arrested after they torched their high school teacher's car in exchange for passing grades.

Vehicle arson is a widespread crime in the U.S. Nearly 20 percent of all arsons occur in vehicles and arson is the second-highest cause of vehicle fires.

A Branson, Missouri, man thinks that someone in his local post office shares his taste in films.

Robert Halamicek is one of two USPS customers in Branson who have reported that DVDs they rented from online video rental suppliers have arrived one or two days later than expected, with indications the package had already been opened.

"They are pushing the DVD off the sticky substance that holds it in place in the package," said Halamicek. "Then they are sliding the DVD out of a seam in the packaging." He added that lately whoever is previewing his movies has been steaming the package to make it easier to get at the DVD without tearing the packaging.

According to Halamicek, the thief or thieves make two small tears in the packaging to first peer inside and see if it's a movie they would like. Halamicek said he frequently receives DVDs on time that have been tampered in this manner.

If the movie bandit likes the movie, it will arrive one or two days later with the DVD no longer fastened in place in the package, he said.

After being passed from one department to the next, Robert put in an investigation with his local branch.

"We watched for his DVDs for a couple of weeks and found no sign of theft," said Branson Post Master Alex Tipton. "If anyone's stealing mail, it's not trivial. I take it pretty seriously."

"For two weeks it stopped," Halamecik said. "Now it's happening again."

Robert thought he was alone until one of his coworkers, a Blockbuster.com customer in Branson, shared an identical story.

"We have not had any other complaints," said Tipton who plans to resume Halamicek's investigation.

Netflix, which mails 1.4 million DVDs per day, has had almost no problems with mail fraud, Netflix spokesman Steve Swasey said.

"More than 90 percent of Netflix customers get their DVDs within one day," Swasey said.

USPS customers who are having this or similar problems should contact their local office by calling 1-800-ASK-USPS (275-8777), according to Patricia Armstrong, spokeswoman for the USPS Office of Inspector General.

Armstrong said if customers are having problems with someone at the local level, they should talk to the person' supervisor. "Everyone has a supervisor," she said.

Netflix customers can also file an e-mail complaint with Netflix, which works closely with the USPS, or call 1-888-NetFlix (638-3549), Swasey said.

Wendy's announced that its 6,300 U.S. and Canadian restaurants are scheduled to switch to the new blend of corn and soy oil beginning in August.

The Center for Science in the Public Interest (CSPI), a frequent critic of the fast food industry, applauded the move.

"Quite simply, Wendy's removal of artery-clogging partially hydrogenated oils from its deep-fryers will make its French fries and fried chicken healthier than similar foods at McDonald's, Burger King, KFC, and other competitors," said CSPI Executive Director Michael F. Jacobson.

"Wendy's deserves enormous credit for breaking the trans-fat log jam in the restaurant world. Its action proves that other restaurants, big or small, have no excuse for continuing to impair their customers' health by using partially hydrogenated oil. Indeed, chains whose fare is loaded with trans fat are at risk of being sued for marketing unnecessarily harmful foods and not warning patrons of the risk," Jacobson said.

Wendy's breaded chicken sandwiches, nuggets and strips will have zero grams of trans fat. Depending on the serving size, trans fats in French fry offerings will range from zero to 0.5 grams. Kids' Meal nuggets and fries will have zero grams of trans fat.

Wendy's also is working directly with its French fry suppliers to further reduce trans fats that occur as part of the par frying process at their facilities, with a goal of zero grams.

"This is the right thing to do," said Kerrii Anderson, Wendy's interim chief executive officer. "We're proud of our legacy of innovation in the restaurant industry, and these latest steps that enhance the nutritional profile of our food. We're the first national hamburger chain cooking with non-hydrogenated oil in the U.S."

The 2005 Dietary Guidelines for Americans recommend that individuals substitute mono and polyunsaturated fats for saturated fats, and consume as little trans fat as possible as part of a healthful diet.

Jacobson called on the Food and Drug Administration (FDA) to require other restaurants to follow Wendy's lead.

"To solve the trans-fat problem once and for all, the Food and Drug Administration, that sleeping watchdog, needs to act. The FDA has ignored CSPI's 2004 petitions calling for disclosure of trans fat in restaurants and a virtual ban of partially hydrogenated oil," he said.

What does a consumer need to do to get a fair loan around here anyway? Or better yet, how does one not get taken when searching for a new loan?

What covers the front pages of many newspapers or Web sites is a smattering of people who have lost their homes or otherwise suffered with an overpriced loan product -- everything from title companies profiting in a kickback scheme to lenders over-promising and under-delivering on closing costs and rates.

Let's lift the lid on the loan process to see what can be done about the mistakes people make. Just a note -- loan originators, loan officers and brokers all fit into one category that I call "loan salespeople." Their goal is to sell you a loan and, unfortunately, the polite MBAs are more dangerous then the loud and reckless "I-can-sell-a-loan-to-an-Eskimo" type.

Understandably, many people don't know much about the business of loans and loan salesmen are quick to sniff this out.

For Openers

The first question a loan salesperson may ask is, "How did you happen to hear about us?" Depending on your answer, and the questions that will follow, he or she will figure out that you perhaps are the kind of person who hasn't done much research, you will listen to someone who referred you, will not shop around and will react to Web pages with pretty pictures and to postive friendly conversations.

The questions may not be part of a well-rehearsed script, but you can bet that hidden deep inside a loan salesperson's head is a check-off list, and the salesperson is checking off the items on that list as you talk. I have interviewed many loan officers and sat with them when they take calls or meet with people and, believe me, they will always have an impression about the borrower after a few minutes, and the odds are that impression will be pretty accurate.

So while the opening conversation may seem to be idle chit-chat, rest assured -- it's not. Your unguarded comments will be used to the salesperson's advantage. There are training courses out there for lenders that teach them how to ask friendly questions.

For example, you tell the loan salesperson you want the loan to upgrade a room. He or she will ask you why, and you innocently will say that you want your daughter to have a nice new room. "Oh, really, what color?" asks the loan arranger. Purple, you say.

Rest assured, as the process moves along, the salesperson will keep you focused and will continuously remind you that your goal is to "paint a nice new purple room." The salesman seems to understand your deepest needs, to truly care that the room is done professionally to ensure your daughter's complete happiness.

It's easy to forget that your goal is not a purple room, it's a loan at the best price and terms possible.

The Application

After the initial chit-chat comes the loan application, another step down the flower-strewn path, during which you supply more information that will be used against you later in the loan process. Loan salespeople call it "beating up the customer."

Without practice, research or doing much homework consumers blindly answer questions as if they are filling out a humorous quiz from Cosmopolitan magazine. Have you gone on the internet and downloaded a copy of a blank loan application, looked at the questions and understood them before talking to a loan salesperson? You should.

When I was in the business, I had an Assistant Attorney General type a loan application with all the paperwork done like a professional. I was amazed, and because she was on top of it despite her hectic schedule, a divorce, outstanding bills, she got one of the best rates and beat me down on the closing cost. I absolutely loved her.

Get A Monitor

One of the best ways to help yourself get the best deal possible is to use a "loan monitor." This is not a person who is a referral from a cousin or a broker who talks "really gooood". They are not mentors because your goal is not to start a new religion or climb up the loan-career ladder. But they are people who have experienced what you will go through, and are willing to look at your paperwork, and show you theirs.

Your loan monitor can be mom or dad, or a friend who has already fought the battle. They must be near enough to you so you can show them the paperwork and ask questions. Remember to discuss their history of frustration and how they overcame it. Go over their paperwork, start asking questions, write down your own check list.

When you see your monitor's old Deed of Trust, Note, their Conveyance paper, or their first Truth In Lending, make notes about them. You will be getting the same paperwork.

Of course, the best loan monitors are those who are in the business but who promise only to give you advice, not to sell you a loan, profit from referrals or sell your info.

It would be like taking your friend who is a mechanic to another garage. What magical things would you think can happen? You would probably get the best and fastest service at a reduced price. And all the while you would know you were not being taken for a ride. That is what I and my fellow "mortgage geeks" do for borrowers at www.loantactics.com.

Proceed Cautiously

It is most important to realize that the loan industry is basically a big machine, just like the health care industry, the automotive industry or the legal system. Many loan salespeople are the products of a "sink or swim" training program. Most don't even own their own homes, yet they make decisions for you.

But the industry does have web sites, computers, software, advertisements, happy managers, lawyers, lobbyists, all intent on doing some sort of business with or to you. The industry makes billions of dollars, and it always wants more. So comparison shopping is a must, but that doesn't mean you go to one place, wait, then go to another person and wait.

Get a copy of the first loan application (known as a 1003) and then send that to another lender or lenders with all the paperwork the first one asked you for and then compare the results.

By the way, it is a myth that your credit will be hurt by submitting multiple applications. If you do it within 14 days increments, it may count less then 25 points against your FICO.

Other important points:

The Appraisal Don't be rushed into an appraisal. Loan salespeople want you to sign up for one immediately. Yes, you want to move fast and I have seen orders for appraisals take one day up to several weeks depending on the location and workload. Some 30% to 40% of loans do not get funded for various reasons with some mortgage companies. That means that you will have paid for something that will not help you.

The Commission Don't ask your loan salesperson to reduce his or her commission right away. You start that conversation and you will be locked into the game of, "Well you don't expect me to do it for free, you wouldn't work for free, would you?" comeback. Your strongest defense is having done your homework and putting the prices in black and white on a piece of paper. Then you can beat up on the salesperson.

Check Them Out Go to ConsumerAffairs.com's mortgage section or your state government web site, or your loan monitor, and check the background of these companies and/or their brokers. Google it if you want to, you will be amazed what you will find out. Do this for the title companies too. I found a broker in MySpace.com, and reading his lust for drugs and girls made me not recommend him to my clients.

Paperwork Ask for paperwork. What kind? In this order:

• copy of your credit report,
• appraisal,
• Good Faith Estimates,
• Truth in Lending,
• Loan Commitment,
• Lock Commitment,
• Preliminarys and HUD-1 (a day or more before closing).

You may not know what this pile of paper means, or how to use it to your benefit, but your loan monitor will.

Be Brave

Be ready for an emotional roller coaster. It really is true that your mortgage will probably be the most expensive transaction of your lifetime, so don't be surprised if it's emotionally draining.

It's important not to give up. I have seen it so many times -- people become frozen like a deer in the headlights. I can hear the silence on the phone or read the emotions between the lines in the emails. It is combination of information explosion and aimless direction that may kill your will.

Like sharks, the loan salesperson will smell your fear. And this is where "bait and switch" tactics are implemented, never in the beginning of your loan. It is a last-ditch effort to get the numbers on their side and extra dollars in their pocket.

You also need to remember that, according to Senate testimony on the Real Estate Settlement Procedures Act (RESPA), 83% of borrowers will get stuck with a higher closing cost and rate than promised. That should make your blood boil -- and, more importantly, it should make you vow that you will be ready and able to be among the 17% who get the deal they went after in the first place.

You can protect yourself. You can get the mortgage that's right for you, with a competitive interest rate, few to no points and low closing costs. But you have to work at it -- do your homework, get good help, pay attention and don't lose your nerve.

---

Dieter Brunner is a former mortgage broker. He is now a principal in the LoanTactics.com Web site.

Generic drugs could save U.S. consumers $24.7 billion this year alone, a report finds. The report examined the clinical potential for greater generic drug use in six major drug-therapy classes used to treat common conditions like stomach ulcers, inflammation, depression, high blood pressure and high cholesterol.

The report, issued by pharmacy benefit manager Express Scripts, was based on a random sample of approximately three million individuals projectable to the U.S. commercially insured population.

The $24.7 billion savings potential reflects the introduction this year of new generic drugs in two of the most widely-used classes -- the anti-cholesterol drug simvastatin (generic Zocor) and the anti-depressant drug sertraline (generic Zoloft). In 2005, Zocor and Zoloft had sales of $3.1 and $2.6 billion, respectively.

Thus, the biggest savings available this year are in the anti-cholesterol class at $10.3 billion. Generics, including lovastatin, pravastatin and ultimately simvastatin, are potent enough to fill 85 percent of all prescriptions for an anti-cholesterol drug, based on existing prescribing patterns.

On average, only 18.8 percent of anti-cholesterol prescriptions are currently filled with a generic. However, some health plans have already achieved generic utilization in the anti-cholesterol class exceeding 75 percent, according to published reports.

"We have a tremendous opportunity to conserve precious health care dollars by increasing our use of less expensive generic drugs and still achieve the same clinical benefit," said Dr. Ed Weisbart, Express Scripts chief medical officer.

The generic fill rate goals utilized in the report are based on an evaluation of clinical efficacy and market dynamics of branded and generic medications. In 2004 and 2005, failure to take advantage of the full potential of generic drugs in the six classes resulted in missed savings opportunities of $20 and $21.3 billion, respectively.

The Express Scripts report also ranked 2005 generic drug use and savings opportunities by state, revealing significant variations across the six drug categories.

Last year, California had the biggest absolute savings potential at $1.7 billion, but, on a per capita basis, Kentucky passed up the most savings at $163 per commercially insured life. New Mexico was best at capturing generic savings, leaving only $81 per capita unclaimed.

Using 2005 data as a guide, the states with the most to gain from greater use of generic anti-cholesterol drugs this year are Delaware, Michigan, West Virginia, Maryland, and Kentucky on a per capita basis. The leaders in absolute savings potential are California, Texas, Florida, Pennsylvania and Ohio.

In 2005, New Mexico and Massachusetts had the highest overall use of generic drugs at 60 and 59 percent, respectively, while New Jersey at 41 percent and New York at 43 percent had the lowest.

In addition to New Jersey and New York, four other states had generic fill rates of less than 50 percent: Florida, Louisiana, Maryland, and Texas. Neither Hawaii nor Alaska was included in the analysis.

The savings opportunity from increased use of generic drugs has never been greater. More than $50 billion worth of branded drugs will lose patent exclusivity over the next five years. This year alone, $14.3 billion in drug sales are expected to lose patent, with generic alternatives becoming available for at least 16 branded drugs.

A generic drug costs approximately 60 percent less than a brand name drug, on average. Consumers also pay a lower co-payment for generic medications, saving $15 or more per prescription on average compared to branded medications.

Weisbart outlined four steps consumers, health plans, health professionals and policymakers can take to increase the use of generic drugs:

• Increase awareness of the wide number of generic alternatives to brand drugs.

• Always assess if a generic drug would meet the clinical need; only consider using a brand drug when there is clear evidence that the brand drug provides an important clinical value not available with todays generic medications. This strategy would free up resources to meet other pressing health care needs and help preserve the pharmacy benefit as we know it without impacting quality.

• Adopt pharmacy benefit plan designs that encourage greater use of generic drugs and share the savings with patients. For example, use programs that provide for trying a generic drug before a brand. Express Scripts recently announced that 14 million members of pharmacy plans it manages are in such programs, a five-fold increase over 2.8 million in 2001.

• Enact state laws and regulations that support the use of chemically equivalent generic alternatives to brand drugs.

Whether it's to help their parents mow the backyard or a summer job to earn money, this routine task can be dangerous for children and adults alike if proper safety precautions are not taken.

In fact, more than 230,500 people -- approximately 20,000 of them children under age 19 -- were treated in doctors' offices, clinics and emergency rooms for lawn mower-related injuries in 2004, the U.S. Consumer Product Safety Commission reports.

To help prevent injures, the American Society for Reconstructive Microsurgery (ASRM), the American Society of Plastic Surgeons (ASPS), the American Academy of Pediatrics (AAP) and the American Academy of Orthopaedic Surgeons (AAOS) have teamed up to educate parents, adults and children about the importance of lawn mower safety during National Safety Month, June 2006.

"The power lawn mower is one of the most dangerous tools around the home, but many children view it as a potential toy -- resulting in thousands of debilitating injures every year," said ASRM President L. Scott Levin, MD, FACS.

"Lawn mower injuries often include deep cuts, loss of fingers and toes, limb amputations, broken and dislocated bones, burns, and eye injuries. Most of these injuries can be prevented by following a few simple safety tips," Levin added

The ASRM, ASPS, AAP and AAOS offer the following tips to help prevent lawn mower-related injuries:

• Children should be at least 12 years old before they operate any lawn mower, and at least 16 years old for a ride-on mower.

• Children should never be passengers on ride-on mowers.

• Always wear sturdy shoes while mowing -- not sandals.

• Young children should be a safe distance from the area you are mowing.

• Before mowing, pick up stones, toys and debris from the lawn to prevent injuries from flying objects.

• Always wear eye and hearing protection.

• Use a mower with a control that stops it from moving forward if the handle is released.

• Never pull backward or mow in reverse unless absolutely necessary carefully look for others behind you when you do.

• Start and refuel mowers outdoors -- not in a garage. Refuel with the motor turned off and cool.

• Blade settings should be made only by an adult .

• Wait for blades to stop completely before removing the grass catcher, unclogging the discharge chute, or crossing gravel roads.

"Though mowing the lawn can be a great form of physical activity, it can also cause harm if the proper precautions are not taken," explained Richard F. Kyle, MD, orthopaedic surgeon and AAOS President. "It's important that people take their time when mowing the lawn, and teach kids at an early age to stay clear of these machines when they are running."

Many lawn mower-related injuries require a team of physicians from various specialties to properly repair them. Often, patients must endure painful reconstructive operations to restore form and function.

"Physicians in plastic surgery, microsurgery, pediatric surgery, and orthopaedics are at the forefront in repairing these injuries and see, firsthand, how devastating they can be for children and their families," said ASPS President Bruce Cunningham, MD. "It is equally important for us to aid in the prevention of these injuries as it is to repair them."

"The sad thing is that so many of these tragic injuries are avoidable," said Eileen M. Ouellette, MD, JD, FAAP, President of the American Academy of Pediatrics. "A few simple precautions can protect thousands of children."

Now 1.3 million borrowers from Texas Guaranteed Student Loan Corporation have a new problem -- their personal data was compromised, leaving them vulnerable to identity theft.

The Round Rock, TX-based lender said files on 10 percent of its borrowers were downloaded to an unidentified piece of equipment belonging to an employee of Hummingbird, a third-party contractor Texas Guaranteed had hired to provide a document management system.

The files had been securely encrypted for transmission, but once the unidentified employee decrypted the files and downloaded them onto the device, he or she lost it.

The device itself was password-protected, according to a statement by Hummingbird president Barry Litwin.

It would be "extremely unlikely" that the data would be misused, he said. "The privacy of customer data is of utmost importance to us and we take our responsibility to safeguard it very seriously. We deeply regret that this incident has occurred."

The missing data included names and Social Security numbers only, according to Texas Guaranteed. No other information was lost.

TG has set up a special Web site and toll-free phone number to address concerns from potentially affected individuals.

The disappearance was first reported by the Hummingbird employee on May 24th, but according to Texas Guaranteed's press statement, Hummingbird did not inform Texas Guaranteed of the loss until May 26th.

Hummingbird announced on May 27th that it was selling itself to a conglomeration of U.S.-based private equity firms, in response to sluggish stock performance and competitive woes.

The move drew criticism from investors who felt that the $465 million deal was too low of an offer, and that the company should have engaged in more competitive bidding.

The Texas Guaranteed data loss comes at a time of rising concern about identity theft and data breaches, following the loss of records for 26.5 million veterans from the Veterans Administration (VA).

The news that the VA knew about the data theft for three weeks before informing the public has led to the resignation of Michael H. McLendon, the deputy assistant policy secretary who supervised the unidentified data analyst responsible for the loss.

The Texas Guaranteed data loss also points up the danger of employees taking home sensitive data on laptops, CD-roms, and USB drives. Not counting the VA incident, the number of Americans at risk of fraud or identity theft due to the loss of devices containing personal data exceeds half a million.

MSNBC reporter Bob Sullivan, commenting on the repeated incidents of laptop and USB drive thefts, made a "modest proposal" on his blog that "workers should leave the work, at work," and not risk security and privacy by taking their work home with them.

West Virginia has reached a settlement agreement with Cambridge Credit Counseling Corp. of Agawam, Massachusetts, that will result in refunds of $250,000 to hundreds of West Virginia consumers who were overcharged for the company's services.

Cambridge targets consumers facing dire financial circumstances and offers to help them make payment agreements with creditors, commonly known as "debt management plans."

Consumers seeking help with debt increasingly go to the Internet seeking solutions.

Online, consumers find an endless stream of companies with slick web sites providing little to no help for these cash-strapped consumers and charging exorbitant fees for services that they may or may not provide.

West Virginia Attorney General Darrell McGraw's office said it determined that Cambridge was providing a legitimate service that genuinely assisted consumers in making debt management plans with their creditors.

However, prior to October 2005, Cambridge charged consumers an up-front fee that was not used to pay off the consumer's debt and was also charging consumers a monthly service fee of 10 percent.

West Virginia's "debt pooling" statute that governs debt management plans prohibits companies from charging up-front fees and caps monthly service fees at seven percent of the consumer's monthly payment to the debt management plan.

"Despite concerns about Cambridge's practices in the past, Cambridge has demonstrated that it is now one of the 'good guys' in an industry that is coming under increasing scrutiny by state and federal regulatory agencies," McGraw said.

"My office plans to continue its vigilance over the debt relief industry to ensure that West Virginia consumers receive the genuine help they need and are not further victimized by companies that take their money and run."