Current Events in February 2008

If you take vitamin supplements in hopes of warding off cancer and other illnesses, you may not be doing yourself any favors. In fact, a new study suggests you might even be increasing your cancer risk.

"Our study of supplemental multivitamins, vitamin C, vitamin E and folate did not show any evidence for a decreased risk of lung cancer," wrote the study's author, Christopher G. Slatore, M.D., of the University of Washington, in Seattle. "Indeed, increasing intake of supplemental vitamin E was associated with a slightly increased risk of lung cancer."

Findings of the study of 77,000 vitamin users were published in the first issue for March of the American Thoracic Society's American Journal of Respiratory and Critical Care Medicine.

Similar warnings have been issued before but have received little attention.

In 2004, a British study found that not only do vitamin supplements not protect against gastrointestinal cancer, they may slightly increase the risk of cancer. If the findings are correct, 9,000 in every million users of such vitamin supplements will die prematurely as a result of taking something they think is good for them.

Last year, the Center for Science in the Public Interest called on the Food and Drug Administration to require manufacturers of dietary supplements that contain large doses of synthetic beta-carotene to warn smokers and people exposed to asbestos of an increased risk of lung cancer if they take the supplements.

"Though there is a lot of wishful thinking about antioxidants preventing cancer, the evidence connecting high-dosage beta-carotene supplements to increased rates of lung cancer in smokers is compelling," said CSPI senior nutritionist David Schardt.

CSPI says supplements with more than 5,000 IU, or 3 mg, should bear warning notices and that FDA should take enforcement action against companies that market the pills without the warnings.

CSPI noted a that a major report on diet and cancer by the World Cancer Research Foundation and the American Institute for Cancer Research found that the evidence linking beta-carotene to cancer in smokers is convincing.

Latest study

In the latest study, Slatore and colleagues selected a prospective group of men and women between 50 and 76 years of age in the Washington state VITAL study, and determined their rate of developing lung cancer over four years with respect to their current and past vitamin usage, smoking, and other demographic and medical characteristics.

Of the original group, 521 developed lung cancer, the expected rate for a low-risk cohort such as VITAL. But among those who developed lung cancer, in addition to the unsurprising associations with smoking history, family history, and age, there was a slight but significant association between use of supplemental vitamin E and lung cancer.

"In contrast to the often assumed benefits or at least lack of harm, supplemental vitamin E was associated with a small increased risk of lung cancer," said Slatore.

When modeled continuously, the increased risk was equivalent to a seven percent rise for every 100 mg/day. "This risk translates into a 28 percent increased risk of lung cancer at a dose of 400 mg/day for ten years," wrote Slatore. The increased risk was most prominent in current smokers.

The idea that vitamin supplements are healthy, or at the very least, do no harm, comes from the desire of many people to mimic the benefits of a healthy diet with a convenient pill, says Tim Byers, M.D., M.P.H., of the University of Colorado School of Medicine in an editorial in the same issue of the journal. However, he points out, "fruits contain not only vitamins but also many hundreds of other phytochemical compounds whose functions are not well understood."

The World Cancer Research Fund and the American Cancer Society recommend two servings of fruit each day, based on a study that previously found a 20 percent increase in cancer risk among people who ate the least amount of fruit.

This recommendation "would likely lead to a reduced risk for lung cancer, as well as reduced risk of several other cancers and cardiovascular disease," writes Byers. "However, any benefit to the population of smokers from increasing fruit intake to reduce cancer risk by 20 percent would be more than offset if even a small proportion of smokers decided to continue tobacco use in favor of such a diet change."

February 28, 2008    
About 24,000 cribs imported and distributed by Munire Furniture Inc. are being recalled because of a fall hazard. The cribs were sold under several brand names, including Majestic Curved Top and Flat Top Cribs, Essex Cribs, Brighton/Sussex Cribs and Captiva Cribs.

The cribs fail to meet the federal safety standards for cribs. The four support brackets on the mattress support spring are too long. The brackets prevent the spring from lowering to the full 26 inch minimum height in its lowest position, allowing children inside to crawl over the railing, posing a fall hazard.

The cribs are wooden. The recalled cribs include: Majestic Curved Top cribs with model number 9500; Majestic Flat Top cribs with model number 9000; Essex cribs with model number 7100; Brighton/Sussex cribs with model number 9100 and Captiva cribs with model number 5100. Only cribs with manufacture dates between November 1, 2005 and November 1, 2007 are included in the recall.

The crib model number is printed on the white label on the bottom inside of the right side rail. The crib manufacture date is printed on either the white label near the model number or on the white label located on the bottom of the headboard. Cribs with a green sticker on the mattress frame are not included in the recall.

The cribs were sold at specialty juvenile product stores nationwide from November 2005 through November 2007 for between $400 and $600. They were made in Indonesia.

Consumers should stop using the recalled cribs and contact Munire Furniture to receive replacement spring brackets.

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

The CPSC estimates that 66,400 children were seriously injured in the nursery in 2006, the highest total since 2002 when the agency estimated 67,000. It is a major increase from 2005, when the figure was 59,800.

The average number of deaths from 2002-2004 jumped only one to 81, compared to 80 during the years 2001-2003. However, those are not final figures and the totals are likely to rise because of a lag in reporting infant deaths from coroners and hospitals.

In other words, the 2001-2003 report is mostly complete while the 2002-2004 figures are still preliminary.

Alan Korn, director of public policy at the nonprofit Safe Kids USA, said he is concerned with the numbers.

Safe Kids is and has always been particularly concerned about the safety of cribs, playpens, bassinets and play yards because these are the only products that we can think of that either by design, by intent, by custom or practice, you leave your children unattended in them for long unsupervised periods of time, Korn said. So, if there is any environment on earth, or certainly in the home, that needs to be safe for child, it's those products.

Record recalls

The report did not include any statistics for 2007, which saw the record recall of 1,040,000 Simplicity cribs and bassinets, blamed for killing at least four infants.

An investigation by The Chicago Tribune found Simplicity and the CPSC knew for more than two years the faulty hardware and improper installation could leave babies vulnerable to suffocating in the cribs.

One of the things that concerned us with the Simplicity Crib recall was that there was a crib recall and within a handful of days, there was a bassinet recall, Korn said.

That tells me that you could've very well had people trying to do the right thing -- taking their kids out of cribs, putting them back in bassinets -- only to have the bassinet recalled within a handful of days. So parents are struggling finding a safe sleeping environment.

Korn does not blame the CPSC but said the agency could do more.

We believe that there should be extra special focus policing the marketplace for cribs, playpens, bassinets and play yards, he said.

Parents to blame?

The Juvenile Product Manufacturers Association (JPMA), the nursery manufacturers' lobbying arm, places blame with parents in a statement released today.

It is important to note that while nursery products were involved in these incidents, the incidents were not necessarily caused by the failure of the product, according to the statement. In many cases, injury or death were caused when the child was left unattended or caregivers misused the product or did not follow the manufacturer instructions or safety guidelines.

JPMA believes that instead of alarming parents, we should work together to educate them about the importance of the proper use and installation of juvenile products, the statement continued.

But Korn disagrees and says manufacturers could do much more to save infant lives.

What's wrong with companies implementing what's called passive prevention? That means designing your products in a fashion in which they are durable and can stay safe over time and also don't have unintended design hazards in them, Korn said.

In today's day and age, we're supposed to have safer products on the marketplace, parents are supposed to be as educated as they've ever been and companies are certainly more aware now than they've ever been about CPSC regulations, voluntary regulations and design products, Korn said. I'm disappointed that the numbers aren't going down.

What to do

According to a CPSC press release, the agency recommends:

• To reduce the risk of SIDS and suffocation, place baby to sleep on his or her back in a crib that meets current safety standards

• To prevent suffocation never use a pillow as a mattress for baby to sleep on or to prop babys head or neck

• Infants can strangle if their bodies pass through gaps generated between loose components, broken slats and other parts of the crib and their head and neck become entrapped in the space. Do not use old, broken or modified cribs and be sure to regularly tighten hardware to keep sides firm.

• Infants can suffocate in spaces generated between the sides of the crib and an ill fitted mattress; never allow a gap larger than two fingers at any point between the sides of the crib and the mattress

• Never place a crib near a window with blind or curtain cords; infants can strangle on curtain or blind cords.

• Properly set up play yards according to manufacturers directions. Only use the mattress provided with the play yard. Do not add extra mattresses, pillows or cushions to the play yard, which can cause a suffocation hazard for infants.

• Routinely check nursery products against CPSC recall lists and remove recalled products from your home

• Sign-up for automatic e-mail recall notifications at www.cpsc.gov

Korn also suggested parents bring their own playpens for their children to sleep in at hotels.

We've found that 25 percent of (hotel cribs) are recalled and the vast majority of them had some safety concern with them, he said.

After years of disastrous fires involving Ford vehicles, the National Highway Traffic Safety Administration (NHTSA) is strongly warning Ford, Lincoln and Mercury owners of fire hazards involving the faulty cruise control switches in recalled Ford Motor Company vehicles that have not been repaired.

ConsumerAffairs.com has been reporting on the problem for years, chronicling fires in vehicles parked outside homes, in garages and even at fire stations.

In a highly usual statement, NHTSA urged owners of the recalled vehicles to go to a Ford or Lincoln Mercury dealer as soon as possible and have the cruise control system disconnected.

The unrepaired Ford, Lincoln and Mercury SUVs, pickup trucks, vans and certain passenger cars contain a safety defect that could cause the vehicle to erupt into flames, according to the NHTSA statement.

"Failure to have the switch disconnected could lead to a vehicle fire at any time, whether or not the key is in the ignition, and whether or not owners use the cruise control system," NHTSA warned in the consumer advisory.

The safety agency said the fire danger is present regardless of the age of the vehicle, and could even occur while the vehicle is parked and unattended. Several dwelling fires have been attributed to the problem.

Many dealers will perform a short-term fix as a drive-through service so owners do not have to leave their vehicles at the dealership or schedule an appointment in advance, according to NHTSA.

NHTSA said it is issuing the unusual consumer advisory because of concerns that many owners have yet to respond to multiple safety defect recall notifications involving almost 10 million registered vehicles.

NHTSA reported that approximately five million vehicles have been repaired so far, leaving some five million passenger cars and light trucks with the faulty switches intact, and in danger of catching fire at any time without warning.

The drive-through repair is an interim safety measure but will eliminate the risk of fire while affected Ford and Mercury owners are waiting for final repairs from the company, NHTSA said.

Ford is in the process of re-notifying owners of the SUVs and other light trucks concerning the importance of having the switch disconnected.

The involved vehicles are:

1. 1993 2004 F150
2. 1993 1999 F250 (gasoline engine)
3. 1993 1996 Bronco
4. 1994 1996 Econoline
5. 1997 2002 Ford Expedition
6. 1998 2002 Lincoln Navigator
7. 1998 2002 Ford Ranger
8. 1992 1998 Ford Crown Victoria, Mercury Grand Marquis and Lincoln Town Car
9. 1993 1998 Lincoln Mark VIII
10. 1993 1995 Ford Taurus SHO with automatic transmission
11. 1994 Mercury Capri
12. 1998 2001 Ford Explorer and Mercury Mountaineer
13. 2001 2002 Ford Explorer Sport and Explorer Sport Trac
14. 1992 1993 and 1997 2003 Ford E-150-350 gasoline or natural gas vehicles
15. 2002 E-550 gasoline engine vehicles
16. 1996 2003 E-450 gasoline or natural gas vehicles
17. 1994 2002 F-250 through F-550 super Duty trucks (gasoline engine)
18. 2000 2002 Ford Excursion (gasoline engine)
19. 2003 F250 F550 Super Duty, Ford Excursion
20. 1995 2002 Ford F53 Motor home chassis
21. 2002 2003 Lincoln Blackwood

Latest fires

The firestorm of Ford trucks erupting into flames most recently struck in two more states, devastating Ford truck owners in Minnesota and California.

The Ford inferno hit a homeowner in Chisago City, Minnesota last month when her 2000 Ford Expedition started on fire parked in our attached garage. We have now lost everything we owned, wrote the Ford Expedition owner. The home we built not even 2 years ago burned to the ground, she said.

Aftermath of the Chisago City, Minn., fire

Neighbors of the burned-out Chisago City homeowners are helping their friends. "Rob and Gina's house burned," wrote a friend. "Fortunately, they got out of the house with their 2 daughters."

"The fire is being investigated, but it started in Gina's truck. Rob opened up the mudroom door and the entire car was engulfed in flames," he said. "Everything, including both their cars were torched."

"This will be a hard time for the children and for Rob and Gina. I am hoping we can get together and help their kids," the neighbor wrote to friends.

California fire

While the Minnesota fire is still under investigation, a second Ford truck went up in flames in Westminster, California on January 22. This home owner is fortunate. He lost only his Ford truck and not his house as well.

The California Ford owner had parked his truck in the driveway following a brief 20-minute drive.

Approximately one hour later, about 3:30 in the afternoon, the engine compartment was on fire and became engulfed within minutes, he said.

A neighbor's daughter saw the fire and her dad and a friend came to our house and helped put out the fire with a garden hose before it could catch fire to the front of our house, according to the ConsumerAffairs.com reader.

The fire department told the Ford truck owner that the origin of the fire was on the driver's side of the vehicle near and around the master cylinder.

That would place the origin of the truck fire in the area of the cruise control system which the Ford Motor Co. is struggling to recall.

Ford admits a parts shortage is preventing the automaker from repairing all of the recalled Ford cars and trucks recalled for a faulty cruise control system until sometime later in 2008. The automaker has no specific time table for completion of the recall.

As a short-term solution, Ford offers to disconnect the cruise control system in recalled vehicles until parts are available to complete the repair.

1.8 million at risk

More than 1.8 million Ford cars and trucks remain at risk 5 months after the automaker recalled an additional 3.6 million vehicles because of the fire hazard in the cruise control system.

A Ford spokesman insists the automaker is doing all it can to complete the fire hazard recall.

This was a large recall, and we're working with the supplier to meet the volume challenge as soon aspossible, said Ford's Dan Jarvis.

A Mississippi consumer has had it with Ford because of the confusion surrounding the recall.

My mother's 1988 Grand Marquis caught fire and was damaged and repaired with recall notice coming month later, he said. She now drives my 1997 Lincoln Town Car and there was a safety recall in July with parts due in November. Now we are told February, he said.

Ford would not offer an explanation for the recall delay to their Sumrall, Mississippi customer so he got rid of the Lincoln and bought his mother a Lexus.

The recall delay adds to an already troubling situation for many Ford consumers faced with the cruise control recall. The consequences are sometimes devastating.

Faced with continuing delays, some Ford customers are reluctant to go along with the automaker's interim solution to deactivate the cruise control system.

Some Ford dealers now require customers who decline to disconnect the cruise control system to sign a waiver of liability.

With just more than half of the fire-prone Fords repaired, the automaker insists the company is responding adequately in an effort to notify Ford customers to return their vehicles to a Ford dealership for repair of the fire hazard.

We have sent multiple mailings to customers, based on current vehicle registrations, asking them to bring in vehicles. I don't have an exact figure, but about half of the total have done so to date. We have one of the highest return rates in the industry, based on update registration info, and sending multiple mailings, Ford spokesman Jarvis said in an email response to ConsumerAffairs.com.

Ford, however, continues to deny any responsibility for fires caused by its trucks. It tells burned-out customers to talk to their insurance agents.

More Ford Fire Stories

Photos furnished by ConsumerAffairs.com readers

A U.S. investigator told Congress Wednesday that four companies that manufacture artificial hips and knees sought to bribe doctors with more than $800 million in royalties and fees in an effort to get them to use their implants.

The bribery scheme apparently lasted four years.

Gregory E. Demske, an assistant inspector general at the Health and Human Services Department, testified before Congress that four unidentified companies that control about three-quarters of the $9.4 billion market for hips and knees, made illegitimate payments so aggressively that it would now be nearly impossible to eradicate this practice.

The fees have enriched doctors and distorted the market by bolstering sales of lower-quality devices, said Demske.

The hearing was conducted following a probe of the orthopedic-device industry by U.S. prosecutors which was settled last September by the industry for an estimated $311 million. The government had alleged that the companies handed out excessive consulting agreements, lavish trips and other trips to reward surgeons who used their products.

This is not the first time that a section of the medical community has been accused of being greedy. Many doctors on a day-to-day basis have to fend off numerous eager sales representatives from pharmaceutical companies that try to influence them to sell their products or recommend their medications as prescriptions to patients.

The orthopedic-device companies that were party to the settlement were two Warsaw, Indiana-based companies: Zimmer Holdings and Biomet, as well as New Brunswick, N.J.-based Johnson & Johnson and London-based Smith & Nephew companies.

A legal counsel for one of the companies, Zimmer Holdings, even acknowledged in media reports that his company may have gone too far in its efforts to bolster its sales and may have used consultants too aggressively to push doctors to recommend their products.

Some other companies, however, are arguing that it's difficult to sort out which payments are unethical and are open to online disclosure forms that the public can access to get a better understanding of the business. But they are also saying that Congress should not target the big companies alone. Larger device makers are worried that physicians may now shift their loyalties to competitors who may not be coming under such scrutiny and could perhaps continue the questionable practices in various direct and indirect forms.

A spokesman for the Association for Ethics in Spine Surgery testified that efforts to curb questionable consulting fees have failed so far because the industry has colluded in such schemes and groups such as his are considered outcasts in such debates.

"Something from the outside needs to happen," said Charles Rosen who started the ethics association.

Ford Motor Company is recalling more than 400,000 model year 2005 to 2008 Mustangs because the passenger-side airbags may pose the risk of neck injury to small women or large children riding in the seat with the safety belt unattached.

During an air bag deployment, if a small female in the front passenger seat is not wearing the safety belt and has the seat in the full forward position, there may be an increased potential for a neck injury, according to a summary of the recall order posted on the Nation Highway Traffic Safety Administration (NHTSA) web site.

The test dummy in the front passenger seat during a NHTSA test of the Mustang was representing a fifth percentile female or a large child. A fifth percentile female is approximately five feet tall and about 108 pounds but also could represent others, including a larger child.

We use both the fifth percentile and fiftieth percentile male dummies in tests to make sure the results are representative of a range of occupants, a NHTSA spokesman said.

Doing a test with a fifth percentile female in full forward seating position would often represent worst case in terms of the potential for injury to the occupant. The combination is commonly used with airbag crash tests, among other things, he said.

Ford is recalling the Mustangs for failing to comply with one of the neck injury requirements of Federal Motor Vehicle Safety Standard 208,'Occupant Crash Protection,' according to NHTSA.

Described by Ford as a voluntary recall, Ford dealers will reprogram the Mustang airbag restraint control module free of charge.

The NHTSA Office of Vehicle Safety Compliance notified Ford of the air bag noncompliance on July 24, 2007. The automaker said that, After an extensive investigation, it was determined that the subject vehicles do not comply with the requirements.

Ford notified dealers of the recall February 22 and a recall was issued with a warning going out from Ford to Mustang owners February 27 and 28, 2008.

Ford also told dealers to stop demonstrating or delivering the Mustang until they are updated with new software for the constraint control module.

With the recall, the automaker plans to notify affected Mustang owners to take their vehicle to a Ford or Lincoln Mercury dealer for the software update. Ford will also instruct them to have all occupants wear their safety belts and move the passenger seat rearward away from the passenger air bag, according to a letter from Ford on file with NHTSA.

An owner can take these steps to eliminate any real world safety risk associated with this noncompliance, Ford told NHTSA.

Mustang owners may contact Ford at 1-866-436-7332 or NHTSA at 1-888-327-4236 (TTY 1-800-424-9153).

With many adjustable rate mortgage holders facing higher rates in the coming year, economists and lawmakers concerned about soaring foreclosures are hoping many of these consumers can refinance to lower, fixed rate loans.

The latest news from the Mortgage Bankers Association is not exactly encouraging.

The group's Refinance Index, a measure of the number of new mortgages taken out to replace old ones, fell 30.4 percent in the week ending February 22. Overall, mortgage applications were down 19.2 percent.

A bright spot in the survey showed an 8.4 percent increase in the Government Purchase Index, a measure of government-backed mortgages. Economists have encouraged ARM holders to refinance with FHA and other government backed loans since rates are often more attractive than conventional loans.

But at the same time, consumers continue to take out ARMs. The adjustable-rate mortgage (ARM) share of activity increased to 15.0 from 12.8 percent of total applications from the previous week.

Meanwhile, mortgage interest rates are going up. The average contract interest rate for 30-year fixed-rate mortgages increased to 6.27 percent from 6.09 percent, with points increasing to 1.15 from 1.10 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.

The average contract interest rate for 15-year fixed-rate mortgages increased to 5.77 percent from 5.55 percent, with points decreasing to 1.01 from 1.08 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year ARMs increased to 5.84 percent from 5.72 percent, with points decreasing to 0.86 from 0.91 (including the origination fee) for 80 percent LTV loans.

There are 51,590 of the Pacific SUVs with the 4.0 liter engine that might be at risk of erupting into flames under the hood.

The reports of smoke and fire are contained in 3 complaints to NHTSA and 25 complaints to the automaker, according to documents posted on the NHTSA web site.

Chrysler has also received 166 warranty claims related to the fire problem.

Complaints alleged that a fire erupted under the hood, near the front of the vehicle, according to the Office of Defects Investigation (ODI) at NHTSA.

Chrsyler, according to NHTSA, asserts that the alleged defect occurs only in the in the 4.0 liter engine and the consumer will experience a loss of power steering fluid or a noisy power steering pump before seeing any evidence of smoke or fire.

Chrysler also states, according to NHTSA, that a tube nut on the high pressure power steering line was discovered to be cross threaded during the assembly process and did not allow proper sealing of the o-ring.

Chrysler assembles the 4.0 liter engine used in the 2007 Pacifica. The 3.8 liter engine also used in the vehicle arrives at the Chrysler plant already assembled and apparently does not present a fire hazard.

Chrysler, according to NHTSA found it was possible to cross thread the tube nut on the high pressure line during attachment to the steering gear, thus creating an improper seal.

NHTSA reported on its web site that Chryslers has implemented assembly process changes to eliminate the possibility of cross threading and applied additional quality control measures to detect power steering fluid leaks.

Chrysler told federal safety regulators that the changes have minimized the cross threading problem but ODI reports that a review of the warranty claims indicates that the alleged defect has not declined.

ODI is began a engineering analysis February 21 of the fire hazard. The investigation could eventually lead to a recall of the 2007 Chrysler Pacifica.

Two interconnected companies -- BlueHippo Funding, LLC and BlueHippo Capital, LLC -- have agreed to pay up to $5 million to consumers who have filed complaints about the companies' computer layaway scheme, exposed in a January 2007 investigative series by ConsumerAffairs.com's Joe Enoch.

The payments are part of a settlement with the Federal Trade Commission, which charged that the companies violated federal consumer protection laws.

Several states have also taken action against Blue Hippo. In May 2007 Maryland's Attorney General extracted a $1 million settlement from the firm.

Blue Hippo offered to extend credit to consumers to finance purchases of personal computers and other consumer electronics with down payments of $99 to $124 and a year of weekly or bi-weekly payments ranging from $36 to $88. In nationwide television and radio commercials, and on their Web site, the defendants touted the ability of consumers with "less than perfect credit, bad credit, no credit" to finance the purchase of a computer. But in fact, many consumers who ordered products paid hundreds of dollars and received nothing in return, according to consumers who complained to ConsumerAffairs.com.

Automatic debits

According to the FTC complaint, Blue Hippo required consumers to agree to a series of automatic, periodic debits from their bank accounts to purchase their products, promising that they would deliver the product once the consumer made 13 weekly, or seven bi-weekly, payments.

In many instances, the defendants debited consumers' accounts without first disclosing that consumers could not get a refund even if they cancelled before delivery of the product, regardless of the reason for cancellation.

Consumers who ordered products by calling a toll-free number were told that they would receive a "shipping verification form" with sale terms and shipping information, and that they had to sign and return the form to ensure product delivery, the complaint says. The form contained terms that were not disclosed previously, including disclosures regarding finance terms.

The defendants often failed to provide the forms and revolving account agreements before they debited accounts, so the finance terms and refund policy were not disclosed before consumers started making non-refundable payments.

The FTC says many consumers did not receive the merchandise they ordered or refunds. The agency took action, accusing Blue Hippo of failing to clearly and conspicuously disclose their policy of not providing refunds before debiting accounts, in violation of the FTC Act, and giving consumers no opportunity to make a timely and informed decision about whether or not to risk the potential loss of advance payments.

The defendants also allegedly failed to deliver the products after consumers made 13 weeks of payments, as promised during the sales call, also in violation of the FTC Act.

Right to cancel

For good measure, Blue Hippo was charged with violating the FTC's Mail Order Rule by failing to ship merchandise in a timely manner or give consumers the right to cancel and receive a refund. They allegedly violated the Truth in Lending Act (TILA) and Regulation Z by failing to make certain written disclosures before a transaction is made under an open-end consumer credit plan, and they allegedly violated the Electronic Fund Transfer Act (EFTA) and Regulation E by conditioning the extension of credit to consumers on repayment by preauthorized electronic debits.

Under the proposed stipulated final order, the defendants are barred from misrepresentations in the marketing of consumer electronics or any product requiring four or more periodic payments before shipment.

They also are barred from misrepresenting refunds, cancellations, exchanges, or repurchases of products without disclosing clearly and conspicuously, before receiving payment, the terms and conditions, and any policy of not refunding all payments when a consumer cancels the contract before product delivery.

In addition, they are permanently prohibited from violating the Mail Order Rule, the TILA and Regulation Z, and from conditioning the extension of credit on mandatory preauthorized transfers in violation of the EFTA and Regulation E.

The settlement includes a monetary judgment of at least $3.5 million and up to $5 million. This money will be used to provide redress to consumers who entered into contracts with the defendants before March 2006, made payments, and did not receive the ordered products, refunds, or other restitution.

If valid consumer claims exceed $3.5 million, the defendants will be required to pay up to an additional $1.5 million to pay those claims. The settlement also requires the defendants to stop collecting money from purchasers who are entitled to redress, to stop furnishing derogatory information about such purchasers to credit reporting agencies, and to notify any agency to which they have provided such information that the person's account is in good standing.

-- Federal Courts have dealt a blow to BlueHippo Funding by dismissing the company's attempt to force all of its customers to take their complaints to arbitration, opening the door to class-action lawsuits.

The company, based in Baltimore, sells computers and other electronic goods on a layaway program.

It was the center of a January 2007 investigation by ConsumerAffairs.com and targets low-income individuals with bad or no credit and sells cheap computers for as much as five times the value and often never delivers any product, even after hundreds of dollars have already been paid, according to customer complaints.

"I heard about BlueHippo on the radio," Littia of Oakland, Calif. wrote to ConsumerAffairs.com. "They said they have helped thousands of consumers, regardless of their credit, to get a computer of your own. All I had to do was send a $100 check to them and they would take $53.32 out of my account each month."

"It's been seven months and I have been calling them on why I have not gotten any more information from them." Littia continued. "They can take money from my account, but I can not get my money back, only store credit. I want my $500."

Littia is one of 291 consumers who, as of this writing, have filed similar complaints with ConsumerAffairs.com.

Tuesday's decision by the 4th U.S. Circuit Court of Appeals in Richmond, Va. does little to aid consumers in the short term, but in the long run, it could "put BlueHippo out of business," said David Marshall, the attorney who filed class-action lawsuits against BlueHippo in Maryland and California.

BlueHippo secures its orders when customers call to inquire. After a few weeks of payments, the company delivers a contract to customers which states that they cannot enter a class-action lawsuit, but rather, must use a third-party arbitrator to settle any claims. Marshall said the arbitrator BlueHippo uses rarely settles in favor of consumers.

Many consumers never sign or return that contract, Marshall said. Despite that, BlueHippo has tried to force all dissatisfied customers into arbitration. Tuesday's decision held up that only customers who signed the contract could be forced into arbitration rather than enter a class-action.

Although the Maryland class-action lawsuit was unsuccessful, Marshall said with the federal court's decision, it bolsters his case in California where class-action waivers are not recognized.

California comprises about 15 percent of BlueHippo's customer base, Marshall said potentially enough to put the company out of business if the class-action is successful.

The company could appeal the court's decision but did not respond to a request for comment from ConsumerAffairs.com.

The company is also under investigation by the attorneys general in West Virgina, Florida and Illinois and settled with the Maryland attorney general in May.

As a result of that settlement, Maryland consumers who received nothing or overpaid for their BlueHippo products, will receive reimbursements starting in early 2008, attorney general spokeswoman Raquel Guillory, said.

The study, Killer Couches, was conducted by Friends of the Earth, an environmental group.

It tested a sample of 350 pieces of household furniture in stores and domestic residences and found that most of the furniture had high levels of toxic halogenated fire retardants. This analysis suggests that product contamination is widespread in California, exposing the states population to a significant and unnecessary risk.

Friends of the Earth is co-sponsoring a bill in California's General Assembly (AB706-Leno) that will mandate the phase-out of halogenated fire retardants in all residential furniture products, while promoting the use of less toxic, but equally effective, fire retardant methods.

Virtually all Americans have toxic fire retardants in their bodies, and this study suggests that one of the main causes is furniture in our homes and offices. Fortunately, safer alternatives are already used by some manufacturers. But a little-known regulation in California is penalizing those companies trying to do the right thing. If it passes, AB 706 will fix that problem, said Russell Long, Ph.D., Vice President of Friends of the Earth.

Earlier this month, the U.S. Consumer Product Safety Commission proposed new furniture flammability rules, but said companies would not have to use chemicals to comply with the proposed regulation.

Studies have shown that most Americans who undergo testing have halogenated fire retardants stored in their bodies, with babies and children showing the highest levels. Infants and children are the most vulnerable to the effects of halogenated fire retardant chemicals, which travel through the placenta and breast milk. Levels of these chemicals in breast milk have increased 40-fold since the 1970s.

The Killer Couches report confirms that the most toxic, bioaccumulative, cancer-causing, hormone-disrupting fire retardants are being used to meet an outdated California fire safety standard, said Assemblyman Mark Leno (D-San Francisco). Firefighters, burn victims advocates, and furniture manufacturers are all supporting AB 706 because they know we can achieve equivalent fire safety without the use of toxic halogenated chemicals.

Halogenated fire retardants are widely used to meet Californias strict flammability regulation, Technical Bulletin 117 (TB 117). The Polyurethane Association estimates that tens of millions of pounds of halogenated fire retardants have been used to meet TB 117 since the 1970s.

Groundwater, drinking water, ambient air, oceans and ecosystems have been contaminated by these compounds so that halogenated fire retardants are now detected in wildlife throughout the world -- as far away as the Arctic Circle. Some of the highest levels have been found in harbor seals and aquatic life in the San Francisco Bay. These compounds have also been found in dairy products, meat, poultry, and fish.

The full report can be found online.

An already contentious skirmish between the Federal Communications Commission (FCC) and Comcast over the cable company's blocking Internet access for some of its subscribers got hotter when Comcast blocked access to an FCC hearing.

The cable company admitted to paying employees and members of the general public to fill up seats in an FCC hearing in Cambridge, Massachusetts Monday.

Playing off a common Washington, D.C. tradition of lobbyists paying "placeholders" -- often poor people and supposedly starving students -- to hold spots in line for crowded Capitol Hill events, Comcast's spokespersons admitted it paid people to do the same for a hearing on the company's actions regarding its interference with peer-to-peer file-sharing services such as BitTorrent.

The placeholders not only held spots in line, but also crowded into the hearing itself, preventing more than 100 attendees -- many of whom had come to speak against Comcast -- from getting inside.

Tim Karr, campaign director of net neutrality advocacy group SaveTheInternet.com, said that "First, Comcast was caught blocking the Internet. Now it has been caught blocking the public from the debate. The only people cheering Comcast are those paid to do so."

"Clearly, Comcast will resort to just about any underhanded tactic to stack the decks in its favor," Karr said, "and yet Comcast still expects us to trust them with the future of the Internet?"

SaveTheInternet.com published an audio file on their blog of what they claimed was an interview with a man who had been paid to show up for the hearing, even though he had no idea what it was for.

The FCC convened the hearing after promising to investigate Comcast for violating the principles of net neutrality, the principle that all Internet traffic should be treated equally. FCC chairman Kevin Martin said that while Comcast has the right to engage in "reasonable steps to manage traffic, but they cannot arbitrarily block access."

"I keep saying that the time has come for a specific enforceable principle of nondiscrimination," said fellow commissioner Michael Copps. "This principle should allow for reasonable network management, but make crystal clear that broadband network operators cannot shackle the promise of the Internet."

"Don't let the rhetoric of some of our critics scare you," said David Cohen, executive vice president of Verizon, speaking on behalf of network providers, "Every broadband network is managed. Our customers want to fight spam or viruses, and they want us to manage network congestion so they can do what they want, when they want at acceptable speeds."

Massachusetts Democratic Congressman Ed Markey spoke in favor of net neutrality as a right of free speech.

"Let me underscore that the Internet is as much mine and yours as it is Verizon's, AT&T's or Comcast's," he said.

Markey, who tried unsuccessfully to pass several pieces of legislation in the previous Congress that would have enshrined the principles of a neutral Internet into law, introduced new legislation earlier this month that would task the FCC to investigate Internet service providers in order to ensure they were not blocking or discriminating against certain types of content.

Consumers aren't the only ones losing confidence in the economy.

The Federal Deposit Insurance Corporation (FDIC) is staffing up to handle what it fears may be a wave of bank failures as the subprime mortgage mess brings down lenders.

The Wall Street Journal reports that FDIC is trying to rehire at least 25 retired employees who are specialists in dealing with bank failures. Many of the retirees dealt with bank closings in the 1980s and 1990s, following the savings and loan crisis, the newspaper said.

The FDIC identified 76 banks as potential problems during the last quarter of 2007, 11 more than in the third quarter.

Problem institutions are put under closer scrutiny but the agency never discloses their identity, hoping to avoid mass withdrawals by depositors. A problem bank is generally one whose capital reserves may not be adequate to meet the bank's obligations while dealing with loan defaults and other liabilities.

Besides trying to lure back retirees, the FDIC is advertising on its Web site for employees with "skill in performing duties associated with a financial-institution closing, such as receivership management, resolutions and/or asset disposition."

The Minnesota family that recently sued a student travel organization for the wrongful death of their son has now taken their case to a federal consumer protection agency.

ConsumerAffairs.com has learned that Sheryl and Allan Hill recently filed a complaint with the Federal Trade Commission (FTC) against the Ambassadors Group and its People to People programs.

The complaint alleges the companies use unfair and deceptive trade practices to recruit students for their oversea trips and promote their safety record.

The complaint also names a company called docleaf, Ltd., which provided counseling services to the Hills after their son died.

The Hills' 16-year-old son, Tyler, died last summer on a People to People student ambassador trip to Japan.

In their lawsuit -- filed last month in Minnesota's Hennepin County District Court -- the Hills alleged that People to People's chaperones refused to take their son to the hospital when he requested medical attention.

Tyler had Type 1 diabetes and complex migraine headaches. His family disclosed his medical conditions before he left on the trip.

'Solid' safety record

The travel organization that touts its ties to President Dwight D. Eisenhower assured the Hills it had a solid safety record and a 24-hour response team that could handle any medical emergency.

That promise is the reason the Hills let Tyler join his friends on the trip overseas. It's also at the heart of their wrongful death lawsuit.

Now that promise is the centerpiece of the Hills' FTC complaint.

In that action, the Hill's allege the travel organization and its program engage in unfair and deceptive trade practices, including:

• People to People claims it will immediately notify parents if a child becomes sick during a trip. That did not happen in Tyler's case. The Hills allege the leaders on their son's trip did not call them until after Tyler was taken to a Tokyo hospital;

• People to People claims to have a "solid safety record." "One dead child is not a solid safety record," Sheryl Hill alleges. She also alleges other children have been injured and become sick on People to People trips and that one child died trying to jump a train on a trip in Europe;

• Students are led to believe they are "nominated" for these oversea trips. But People to People uses a commercial list rental service to obtain students' names and then "mass mails" invitation letters, the Hills allege. The company, they added, solicits more than 300,000 children each year;

• The company's invitation letters appear to come from the non-profit People to People International. But the Ambassadors Group, a for-profit company headquartered in Spokane, Washington, markets the People to People Student Ambassador trips and handles the travel arrangements;

• People to People has sent "invitations" to the parents of deceased children. It also sent "invitations" to the "parents" of a deceased cat;

• Consumers are led to believe President Eisenhower founded and chaired People to People. "President Eisenhower was never the founder or the chairman," the Hills allege;

• Anyone can nominate a child for a student ambassador trip on People to People's Web site. The Web site doesn't ask about a student's qualifications for the trip or even the name of the person making the nomination;

• Consumers are led to believe that People to People student ambassador programs are sanctioned by the government and part of the U.S. Department of State. This is false, the Hills allege.

Warning to parents

Sheryl Hill said her family filed the FTC complaint to warn parents about the organization's tactics.

"My job is to make sure families know this organization is lying and deceiving their kids," she told us from her home in Mound, Minnesota.

She reiterates that message in her FTC complaint.

"We wish to protect our future generations," she writes. "People to People Organizations, Ambassadors Group, Inc., and docleaf's unfair and deceptive acts of practice cost Tyler his life, and us our beloved son. These organizations send 28,000-50,000 kids on trips every yearplease don't let it happen again."

The Hills allege many of the same wrongdoings in their lawsuit.

Named in that action are the Ambassadors Group, People to People Student Ambassador Programs, People to People International, A United Kingdom organization called docleaf Limited, two of its employees -- Larry McGonnell and Dr. David Perl -- and the four delegation leaders on Tyler's trip: Susan Stahr, Pat Veum-Smith, Josh Aberle, and Angela Hanson.

In their lawsuit, the Hill's allege the travel organization and its delegation leaders refused to get Tyler the medical attention he requested - and that his June 29, 2007, death in Tokyo is the result of their negligence.

The Hills discovered that Tyler had become sick at least three times before he was taken to the Japanese Red Cross Medical Center in Tokyo.

One time, he became ill after eating bad food. He later vomited blood, fainted in the shower after an unsupervised trip to a hot springs, and his blood sugar became low.

People to People, however, never contacted Tyler's parents about these medical problems and allegedly failed to monitor his condition.

Mount Fuji climb

Tyler's health took a turn for the worse on June 26, 2007 -- the day he and his group hiked Mount Fuji. After that climb, Tyler asked his delegation leaders to take him to the hospital. He said he had altitude sickness.

"Ty was the catalyst and poster child for the FIT USA Foundation, a non-profit diabetes rehabilitation advocacy group," Sheryl told us. "He dominated his disease and he knew if he was sick."

But according to the family's lawsuit, People to People's delegation leaders refused his request for medical treatment. Instead, they told him to "work through it" and sent him to his hotel room with water.

The lawsuit also states that People to People again failed to contact the Hills about Tyler's illness.

Sometime around 4 a.m. on June 27, 2007, Tyler's condition deteriorated and he started vomiting blood.

Around 7 that morning, People to People's four delegation leaders learned about Tyler's failing health. But they again refused to seek any medical treatment -- even though he requested that attention "because he had been vomiting blood since four o'clock in the morning."

The delegation leaders also failed again to contact Tyler's parents, the lawsuit alleges.

Left alone

For the next ten hours -- from 7 a.m. to 5 p.m. -- People to People's delegation leaders allegedly left Tyler alone in his room -- without any medical attention.

The lawsuit further alleges that Tyler was placed under the "custody and care" of the one person the Hills specifically requested he never be left alone with -- delegation leader Pat Veum-Smith.

The Hills met Veum-Smith before Tyler's trip and expressed concerns about her abilities to care for their son.

"Pat Veum-Smith did nothing to assist him or obtain assistance for him, nor did she engage the 24-hour service center to contact Tyler's parents or medical doctors," the lawsuit states.

In fact, People to People's delegation leaders allegedly did not seek any medical attention for Tyler until he was found unconscious in his hotel room -- sometime around 6 p.m. on June 27, 2007. That's when the leaders finally called an ambulance, the lawsuit states.

A few hours later, Pat Veum-Smith notified the Hills that Tyler was in the Japanese Red Cross Medical Center. She also told them that Tyler's heart had stopped beating for more than an hour, that he had been resuscitated and was on dialysis.

Tyler died two days later.

"My son was killed," Sheryl told us last month, fighting back tears. "They (People to People) killed him. This was involuntary manslaughter, neglect, and abandonment."

The lawsuit echoes her sentiments.

"Tyler's death was caused because he was refused healthcare and left unassisted by the agents, employee, and representatives of Defendants Ambassadors Group, People to People, Susan Stahr, Pat Veum-Smith, Josh Aberle, and Angela Hanson, all of whom failed to notify Tyler's parents or medical doctors of his severe illness."

Doctors in Tokyo said Tyler would be alive today if he'd gotten medical attention sooner, Sheryl said.

That would have happened, she added, if someone had called her when Tyler first became sick.

Holding hands

The delegation leaders didn't hesitate to call Sheryl several days earlier when they caught Tyler holding hands with his girlfriend.

"Angela Hanson, one of the People to People leaders, phoned me from Japan the day after arrival with a reprimand call because Ty and Abbey were showing public displays of affection on the airplane to Tokyo," Sheryl said. "They were holding hands."

Hanson then put Tyler on the phone. The marked the last time Sheryl talked to her son.

"Ty said not to worry, that it wouldn't happen again and that I could be proud of him," Sheryl recalled. "I told him I already was. He told me it was great to hear my voice and that he loved me."

Sheryl will never forget Tyler's final message to her: "I love you so much too, Mom. Don't worry."

The unconscionable actions don't end with the organization's failure to contact the Hills when their son became sick or get him the medical attention he requested, the lawsuit states.

It also alleges that docleaf Limited and its employees -- which the Ambassadors Group hired to help the Hills with their grieving process -- invaded the family's privacy.

How?

By "providing confidential mental health records and reports" to the Ambassadors Group and People to People, the lawsuit states.

"Larry McGonnell (an employee of docleaf Limited who claimed to be a licensed psychotherapist) flew home with us from Japan," Sheryl told us. "He was good. He helped us focus and grieve. And we told him everything...he counseled us for two days."

Sheryl, however, said her family never gave McGonnell or docleaf permission to release their private medical and psychological records to anyone - including the Ambassadors Group or People to People.

Overtures rebuffed

Before initiating any legal action, Sheryl says her family tried to work with top officials at the non-profit organization People to People International -- headquartered in Kansas City, Missouri, -- and the Ambassadors Group.

The Hills' requests weren't motivated by greed or money. "No amount of money will bring our son back," Sheryl said.

They simply asked Jeffery D. Thomas, president and CEO of the Ambassadors Group, to change his company's Web site and stop touting that is has a stellar safety record.

"I told Jeff he can't continue to solicit students and brag about the company's safety records," Sheryl says. "I asked him to take this down (off the Web site). I also told him that he needs to change his company's safety standards. He told me that's my opinion."

Taking legal action against an organization that boasts about its ties to one of Tyler's heroes -- President Dwight D. Eisenhower -- also proved daunting for Sheryl and her family.

"Eisenhower was a supreme strategist who never fought on the battlefront," Sheryl said when asked why Tyler admired the former president. "Eisenhower also honored God and was responsible for putting 'In God We Trust' on our money, and the pledge of allegiance in the classroom."

She added: "Ty was born on the anniversary of D-day. He was diagnosed with diabetes at age five. He knew he could never serve in the armed forces, but believed he could make a positive difference by modeling after 'these great men.'"

Not founded by Eisenhower

During her investigation, though, Sheryl made a stunning discovery: People to People was not founded by President Eisenhower.

A New York Times story dated June 10, 1958, stated the People to People Foundation was formed to "implement a 1956 proposal by President Eisenhower to promote international understanding."

That non-profit foundation, the paper wrote, was organized in 1957 and President Eisenhower served as its honorary chairman. The 1958 Times article also stated the People to People Foundation had recently dissolved because "it had served its purpose."

ConsumerAffairs.com found records in the Missouri Secretary of State's office that reveal a non-profit organization called People to People International -- founded to "encourage and promote in every way possible contacts between citizens of the United States and people of other lands" - was incorporated on October 31, 1961.

President Eisenhower's name, however, is not listed on those records. They identify Alfred Frankfurter, Franklin Murphy, and Joyce C. Hall as the incorporators.

Sheryl said this is just another example of the ways in which People to People deceived her son - and her family.

"There is so much that we have discovered about this organization since Ty's death. I think Ty would be gravely offended by these discoveries."

In a written statement, the family added: "People to People and its associated organizations target children for their own financial benefit under the false pretense of being a non-profit established by President Eisenhower.

"Students are not nominated for this 'honor' (of going on a trip), but instead are solicited through mass mailing lists."

ConsumerAffairs.com has -- over the past two years -- repeatedly exposed examples of the misleading marketing tactics People to People uses to recruit students for its expensive, overseas trips.

Our stories revealed:

• The organization came under fire in 2005 by the Iowa Attorney General's office for sending a letter to a mother, which stated her son was named for a Student Ambassador trip overseas. Her son, however, had died in 1993. He was seven weeks old. Iowa officials did not take legal action against People to People. The organization later donated $5,000 to Iowa's SIDS Foundation and $20,000 to Blank Children's Hospital in Des Moines;

• The organization has twice -- in recent years -- sent recruitment letters for its overseas trips to the parents of a deceased baby girl in Florida. The couple's daughter died from multiple birth defects in 1992. She was 18 days old. People to People said it was "absolutely devastated" this happened and blamed the company that compiled its mailing lists for the errors;

• In 2006, the organization sent a recruitment letter to the parents of an Earl Gray in Arkansas. Earl Gray, however, was the couple's white, one-eyed, cat. He died ten years earlier and is buried in the family's back yard. He was 14-years- old;

• Parents across the country have filed complaints with ConsumerAffairs.com about the misleading marketing tactics People to People uses to recruit students for its trips abroad. Parents say the letters led their children to believe they were "specially chosen" or nominated for these trips. Parents later discovered the travel company obtained their child's name from a mailing list.

ConsumerAffairs.com contacted Jeff Thomas and other officials with the Ambassadors Group and People to People International about the Hills' FTC complaint. No one returned our messages.

We previously left messages for Thomas and Mary Eisenhower, CEO of People to People International, about the Hill's lawsuit. Neither returned those calls, either.

The Ambassadors Group, however, issued this statement shortly after the Hills filed their lawsuit: "We are deeply saddened by the death of Tyler Hill last summer and the entire People to People Ambassador Program organization continues to grieve for his family."

KXLY-TV in Spokane, Washington, recently interviewed Thomas and his wife, Peg. She is president of People to People Ambassador Programs.

No responsibility

During that interview, Peg Thomas said her organization accepted no responsibility for Tyler's death.

"Absolutely not. Again, our hearts go out to this family. And being parents our hearts go out to that family and that entire community and our entire organization is continuing to grieve for that family. But our review of the incident does not match the allegations and the lawsuit brought forth by the Hill family," she told KXLY.

During that same interview, the Thomases admitted that another student died on a People to People trip. That child, they said, died trying to board a moving train.

Back in Minnesota, Sheryl Hill hopes her family's legal action will force the Ambassadors Group and People to People to be accountable for their actions -- and false claims that Tyler died because he stopped taking his insulin.

The family's lawsuit also seeks $6,750 in restitution for Tyler's trip, $30,000 for his funeral expenses, attorneys' fees, and damages in excess of $50,000.

Sheryl also hopes her efforts will protect the thousands of children who participate in People to People and other student travel programs each year.

Her family has worked on a bill that would require safety protocols for students on these of trips. The measure is called the "T-Hill Safety Standards Bill."

The Hills will meet next week with Minnesota Congressional leaders in Washington D.C. about this bill.

The family has also set up the Tyler Hill Web site , which has more information about their safety initiative.

Meanwhile, Sheryl said she and her husband continue to grieve the loss of their oldest son -- an honor student at Mound Westonka High School who was known as a humble teen who made friends easily and reached out to the new kids on his team or classmates.

Their youngest son, Alec, is also struggling with the death of his brother.

"Ty was very easy to talk to," Sheryl said. "He and his brother built a special 'fort'... he and Alec could spend hours down there talking about whatever brothers talk about."

She added: "When a child dies, all these connections to 'his community' die too. You miss his friends, his school, his teachers, and you especially miss him."

When asked what she wants people to remember about her son, Sheryl said: "Ty was recognized at Mound Westonka High School last year for singularly reporting a bomb threat that others were to afraid to bring forward. Ty always made the right choices even though they weren't the popular choices. He will be remembered as the kid who knew how to love.

"You should be proud that he wanted to represent America in Japan. We are."

More about People to People

Reed Elsevier, the London-based corporate parent of the Lexis-Nexis search service, announced plans yesterday to purchase infamous data broker ChoicePoint for $4.1 billion, creating a super-sized information brokerage with access to millions of records on individual citizens.

While the deal promises to reap huge corporate windfalls for both companies, the implications for the privacy and safety of Americans' personal information is much less clear.

Reed Elsevier made the announcement in tandem with its plan to sell its Reed Business Information print division, including magazines such as Variety and Publishers Weekly, and focus more on online services and information gathering.

"The combination of ChoicePoint's highly regarded data and analytics assets with LexisNexis's market leading technology can be leveraged to create greater opportunities in addressing the growing risk information and analytics needs in insurance, financial, legal, screening, law enforcement, public safety, healthcare and other sectors," the company said in a statement.

"Since 1997, ChoicePoint has been a leader in our industry," said ChoicePoint Chairman and Chief Executive Officer Derek V. Smith. "We developed innovative products that helped our customers be successful. We created wealth for our shareholders. We built a workplace culture and a respect for personal privacy that is recognized as among the best in our industry and all US-based businesses."

In addition to creating wealth for shareholders, the Reed Elsevier buyout promises to create great wealth for Smith and chief operating officer Derek Curling. Smith would earn $149 million for his shares in ChoicePoint, while Curling would earn $51 million. Details were scarce as to what the combined corporate entity would call itself or if any layoffs would come as a result of the merger.

Privacy advocates expressed concern over the implications of the merger. The Electronic Privacy Information Center (EPIC) said that "Consumer privacy will be seriously affected if the merger is approved without any privacy safeguards." Ed Mierzwinski, head of the U.S. Public Interest Research Group (PIRG), said that the merger represented the latest of "threats to privacy posed by the new relationships between private data vendors collecting commercial data and selling it to government agencies."

"Unless subject to rigorous privacy scrutiny, this union will exacerbate that threat," Mierzwinski said.

The Information Trail

Both companies control a dizzying number of smaller products and divisions designed to investigate personal records for the benefit of insurers, law enforcement, employers, and government agencies.

Lexis-Nexis is the well-known database archive of newspaper, journal, and periodical articles, while ChoicePoint sells services such as its CLUE database of insurance information records to evaluate insurance claims, and the Bridger Insight tool, which helps banks verify identities of new account applicants in compliance with the PATRIOT Act.

And both companies have come under scrutiny in recent years for how easily their treasure troves of data could be compromised.

ChoicePoint became notorious after a ring of Nigerian criminals posed as businessmen and bought the personal records of 163,000 Americans in late 2004. ChoicePoint did not disclose the breach until February 2005, triggering a national outcry over data breaches and information selling, as well as a $15 million settlement with the Federal Trade Commission (FTC) over the breach.

ChoicePoint also paid $500,000 ChoicePoint Settles With Attorneys General Over Data Breach brought by the Attorneys General of 44 states over the data breach, and another $10 million to settle a class action lawsuit brought by victims of the breach. Smith and Curling were targets of a Securities & Exchange Commission (SEC) investigation of their sale of stock after the 2004 breach, but were exonerated.

ChoicePoint later underwent a very public makeover, hiring a new privacy officer and "consumer advocate," as well as drastically reforming its practices and agreeing to submit to regular audits of its affairs by federal authorities.

Lexis-Nexis, meanwhile, was hit with a data breach of 32,000 records in March 2005, not long after the ChoicePoint breach was disclosed.

Previous studies have shown that dietary salt intake increases fluid consumption in adults. But researchers at St. Georges University of London, England, are the first to examine whether the same is true in children.

Sugar-sweetened soft drinks are a significant source of calorie intake in children, said Feng J. He, M.D., lead author of the study. It has been shown that sugar-sweetened soft drink consumption is related to obesity in young people. However, it is unclear whether there is a link between salt intake and sugar-sweetened soft drink consumption.

Dr. He and colleagues analyzed data from the National Diet and Nutrition Survey (NDNS) in Great Britain, conducted in 1997 in a nationally representative sample of more than 2,000 people between 4 and 18 years old.

Among the participants, more than 1,600 boys and girls had salt and fluid intake recorded using a seven-day dietary record, with all food and drink consumed weighed on digital scales.

We found that children eating a lower-salt diet drank less fluid, said Dr. He, a cardiovascular research fellow at St. Georges. From our research, we estimated that 1 gram of salt cut from their daily diet would reduce fluid intake by 100 grams per day.

The researchers also found that kids eating a lower-salt diet drank fewer sugar-sweetened soft drinks. From their research, they predicted that reducing salt intake by 1 gram each day would reduce sugar-sweetened soft drink consumption by 27 grams per day, after considering other factors such as age, gender, body weight and level of physical activity.

If children aged 4 to 18 years cut their salt intake by half (i.e., an average reduction of 3 grams a day), there would be a decrease of approximately two sugar-sweetened soft drinks per week per child, so each child would decrease calorie intake by almost 250 kcal per week, Dr. He said. Not only would reducing salt intake lower blood pressure in children, but it could also play a role in helping to reduce obesity.

In previous studies, researchers found that a modest reduction in dietary salt intake lowers blood pressure in children, and a low-salt diet during childhood may prevent the development of high blood pressure later in life.

The new research suggests that reduced salt intake also could help decrease childhood obesity, through its effect on sugar-sweetened soft drink consumption.

Both high blood pressure and obesity increase the risk of having strokes and heart attacks, Dr. He said. It is, therefore, important for children to eat a low-salt diet to reduce their risk of having a stroke or a heart attack later in life. All physicians should give their patients appropriate advice on how to reduce salt in their diet.

Dr. He recommends that parents check labels, choose low-salt food products and not add salt during cooking and at the table. She also urges consumers to challenge the food industry to make a gradual and sustained reduction in the amount of salt added to childrens food products that have added salt.

In most developed countries, about 80 percent of salt intake is from salt already added to food by the food industry. Reducing salt would not necessarily affect food taste, she said.

Small reductions in the salt content of 10 percent to 20 percent cannot be detected by the human salt taste receptors and do not cause any technological or safety problems, Dr. He said.

Before the ink was dry on legislation to provide economic stimulus rebate checks to taxpayers, scammers were playing on consumers' eagerness to receive their money.

The Tax Rebate Direct Deposit Scam, one of the first out of the gate, is showing up across the country, according to law enforcement officials.

In Oklahoma, Attorney General Drew Edmondson says many elderly residents of the state have become targets. They report receiving a phone call from someone who says they are with the Social Security Administration. They ask for the victim's bank account information so the funds can be direct deposited to their account.

"The spouse of one of our employees has received repeated calls from someone claiming to be with the SSA's Tax Refund Department," Edmondson said. "The caller is asking for checking account information that could be used to steal her money."

"The Social Security Administration does not contact people in this fashion," said Larry Jones, a spokesman for the Social Security Administration. "Citizens who want to have their benefits directly deposited into their bank accounts generally elect to do so upon filing their original claim for benefits, so that information is already on file. Even if it wasn't, the SSA does not have anything to do with mailing consumers' tax rebates."

Edmondson joined other law enforcement agents warning consumers against providing any personal or financial information, including bank account, credit card and Social Security numbers, to unknown callers.

It's also worth noting that to get your tax rebate, you have to file a tax return, even if you're not normally required to do so.

More Scam Alerts ...

If the government and electronics industry don't work harder to educate consumers about the impending switchover from analog television signals to digital on February 17, 2009, 11 percent of American households, or 23 million people, may not have any television service at all after the transition.

That's the conclusion of a new report by Consumers' Union, which studied the different regions that will be affected by the DTV transition, as well as the results of efforts to educate consumers about the switch.

According to the consumer group, Western and Midwest states such as Texas and California will be hit especially hard by the switchover, as they have large population groups that are reliant on over-the-air television signals via "rabbit ear" antennae.

"Over 20 percent of homes with televisions in both Dallas and Houston rely solely on free over-the-air broadcasts," said Joel Kelsey of Consumers Union."The programming that people rely on everyday to stay informed or for entertainment may not be there for nearly 1.5 million Texas households after February 2009."

The greater Los Angeles area had 958,030 households with access to over-the-air service only, the largest single concentration in the country. Salt Lake City, Utah, had the largest percentage of consumers with over-the-air access in major cities, with 23 percent of all of its TV households, or 203,290 homes, using broadcast signals only.

The report also detailed the lack of comprehensive knowledge about the transition. "33 percent of Americans in households that will have no functioning television after February 17th 2009 were completely unaware the transition is coming," the report said.

Although the government has scrambled to build awareness of the DTV transition and has publicized its offering of vouchers to buy converter boxes for digital signals, 73 percent of Americans are unaware of the program at present.

Consumers' Union charged electronics retailers with taking advantage of the lack of information surrounding the DTV transition in order to market expensive equipment that consumers may not need.

"A combination of low consumer awareness, technological complexity, and financial incentives to sell more television and related services create a fertile environment for confusion," the report authors said. "For vulnerable populationssuch as the elderly or lowincome householdsthe potential for being misled intentionally or unintentionally, is significant."

What to do

The following sites have more information about the analog-to-digital transition: * Our Dawn Carlson provides a thorough overview of what you need to know. * Visit the FCC's official DTV site to get more information. * Apply for a converter box coupon at the NTIA's converter program Web site.

Consumer groups are pointing to the settlement of a class-action suit against Sears to support their argument that the U.S. Consumer Product Safety Commission (CPSC) moves too slowly to effectively protect consumers from injury.

Sears agreed to fix as many as 3.9 million ranges by bolting them to a floor or wall, to prevent them from tipping over. The settlement covers every range Sears has sold since 2000 and could cost the retailer as much as $526 million.

It's estimated that 15 to 20 million kitchens in the United States are equipped with a range that can tip over and crush, scald or burn whoever is standing in front of it. The problem is caused by the use of lightweight material in modern stoves, which makes them top-heavy and thus prone to tip over when the oven door is open.

None of this is new. Public Citizen, U.S. PIRG and the Consumer Federation of America have been warning for years that the tip-over hazard exists in most brands of electric and gas ranges used in households throughout the country.

20 years

According to documents obtained last year from the Consumer Product Safety Commission (CPSC), manufacturers and the government have known about this danger for more than 20 years.

Since the early 1980s, manufacturers of ranges began using lighter-gauge steel to reduce costs, even though they quickly learned that this resulted in a tendency for the lighter-weight appliances to tip over when weight was applied to the oven door.

After receiving numerous reports of severe accidents caused by tipping stoves, industry-standard organizations Underwriters Laboratories (UL) and the American National Standards Institute (ANSI) both developed national, voluntary safety standards that require electric and gas ranges manufactured after 1991 to remain stable when 250 pounds of pressure is applied on the oven door for five minutes.

The standards also require sellers to install the anti-tip brackets that manufacturers agreed to supply, but the retailers rarely install the brackets.

While the retailers are all aware of the safety hazard, the delivery people they contract with often are not equipped or trained to perform the installation service, and the sales people rarely mention the issue to the buyer. As a result, most homeowners who purchase the ranges do not know that the units are not secure and are unaware that the brackets are necessary for stability.

Sears suit

The Sears suit settlement, recently approved by an Illinois judge, requires Sears to install safety brackets in the ranges it sells over the next three years, and to fix existing ranges by bolting them to the kitchen wall.

CPSC's role

While it's true that CPSC has not ordered a recall to fix the hazard, the agency's spokesman said that CPSC has mentioned the problem several times in consumer advisories. Scott Wolfson said the agency was also concerned about furniture and other objects tipping over.

There have been several recalls of entertainment consoles in recent years.

Public Citizen President Joan Claybrook said the CPSC's inaction illustrates the weakness of the legislation under which the agency operates. The House and Senate are considering bills that would strengthen the agency but acting head Nancy Nord opposes the Senate version, which provides for harsher penalties and more openness than the House version.

Children, Elderly at Risk

"There have been more than 100 reported cases of death and injury from scalding and burns due to hot foods and liquids spilling from the stove top, and from the weight crushing anyone in the path of the tipping ranges," Claybrook said. "Considering the lack of consistent reporting and the millions of homes with these ovens, we believe the numbers of those maimed or killed by ranges tipping over are much greater."

This design flaw has particularly affected children and the elderly.

CPSC accident reports include cases of a 24-pound toddler who stood on an open oven door, tipping the range so that boiling chicken soup spilled over him, causing severe burns; a 3-year old who climbed onto the range door and was killed when the stove fell over on him; and an 88-year old woman who slipped as she was cleaning her range and grabbed the oven door for support -- which caused the oven to flip over and crush her in her own kitchen with her upper body wedged into the hot oven in which she had just finished baking cookies.

When Did CPSC Know?

Sears, one of the largest retailers of gas and electric ranges, admitted in an internal memo in 1996 that the brackets were installed for only an estimated 5 percent of ranges sold -- and possibly as low as 2-3 percent.

In a 1999 letter to Sears, Underwriters Laboratories informed the retailer that it expected the ranges with the UL Listing Mark to be installed with the anti-tip safety brackets supplied by the manufacturers. Sears gave a misleading response to UL in 2000 that implied the company was in full compliance with the UL standard.

"When companies fail to take simple steps to save lives, and the CPSC fails to act on a well-known and preventable problem that leads to horrible burns and deaths, something's very wrong," said U.S. PIRG Consumer Program Director Ed Mierzwinski. "It's time to fix the stove tip-over problem that's been ignored for too long."

The CPSC was aware of the oven-tipping problem since at least 1984, and received reports detailing numerous deaths and serious injuries, mostly involving children --some as young as 12 months old -- and the elderly. It never took any steps to require notification to owners, the installation of the brackets or the redesign of the ranges in the future.

Consumer representatives objected to the CPSC consistently failing in its mission to protect American consumers.

"Retailers should notify consumers of this safety hazard immediately and take steps to comply with the voluntary standards, including retrofitting all freestanding stoves with the necessary safety bracket and installing new stoves properly," said Rachel Weintraub, director of product safety and senior counsel for Consumer Federation of America.

Action Needed

To avoid any more preventable injuries, the consumer groups have called on the sellers of ranges to notify all owners of the danger of tipping stoves and the need for safety brackets, and to install the brackets for any existing owners of the stoves.

"American consumers are being killed and terribly injured by companies who are cynically refusing to make their ranges safe and by the agency established to protect them," said Claybrook. "Action to fix this preventable hazard will come far too late for the many people who have been maimed and killed, but we hope it comes in time to save countless others."

The Missouri Attorney General's Office has reached an agreement with two companies that sell health-related products through TV infomercials featuring Kevin Trudeau.

Under the agreement, Missouri consumer will receive almost $1,100 in refunds. The companies also agreed to change their business practices.

Missouri Attorney General Jay Nixon reached the agreement on Wednesday with Natural Cures, which also uses the name ITV Global Inc. The settlement resolves complaints that the companies repeatedly charged consumers for products they did not order.

Natural Cures uses infomercials to sell books that claim to promote healthy lifestyles.

But many consumers who purchased the books said they also received a subscription for a newsletter they did not order. Consumers then received repeated bills for that newsletter.

ConsumerAffairs.com has received scores of similar complaints.

"I ordered a book from Kevin Trudeau (Weight Loss Cures)," wrote John C. of Indianapolis, Indiana. "They tried to sell me several other items while we were on the phone, but I told them I just wanted the book. This was in March of 2007."

John said ITV Global then charged his credit card $5.95 a month for the next several months.

"When I called them, they said this was for a newsletter," John told us. "I told them I did not order this and wanted the charges removed. Without even researching to see if I ordered this, they refused to credit all my money back.

"I did not order this product, nor did I receive a newsletter. The billing practices used by this company should be criminal," John said.

Some consumers are being charged even more for the newsletter.

"In July 2007 I ordered 3 books from a TV commerical," said Chuck of Franklin, NC. "When I placed my order I was persuaded to receive a monthly newsletter at $9.95 per month with the provision that I could cancel at any time.

"Before the 30 days was up, I called numerous times trying to reach someone to cancel the newsletter. Finally, I reached someone who stated that it would be canceled. I also sent an email on August 15, 2007, which I have a copy of, to cancel the newsletter," he said. "I did receive one newsletter but I have not received any more since I canceled it in August 2007, however the Company keeps billing my bank each and every month."

ConsumerAffairs.com also received complaints that Natural Cures refused to refund consumers' money even after they returned the weight loss book.

"I sent the books back after speaking with a customer service representative, who assured me that I would receive a full refund," wrote Jean R. of Lemon Grove, California. "I have never been given a refund."

Instead, the company continues racking up charges on her credit card.

"I cannot stop this monster from trying to get more and more money from me," Jean said. "I have been charged over limit fees. This and all the other fees charged to my credit card have wrecked my credit. It is absolutely ridiculous that this man can continue to destroy so many lives with no penalties."

Legal action may be the only way to stop these outrageous business practices, Jean said.

"I think there is more than substantial evidence that this is a consumer scam and the public should be protected and compensated for these actions by Trudeau."

Consumers in the Show-Me State -- at least -- should be protected from such unscrupulous tactics.

Under the settlement Missouri officials reached this week, Natural Cures agreed to stop:

• Charging consumers for items they did not request;

• Billing consumers' bank or credit cards for unauthorized products;

• Charging consumers more than the amounts advertised;

• Delaying delivery of consumers' products.

More Scam Alerts ...