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    Mars Extends Pet Food Recall

    Salmonella found in more pet food samples

    Mars Petcare US is extending a recall of dry pet food after the U.S. Food and Drug Administration (FDA) reported finding Salmonella in additional samples of the company's SPECIAL KITTY Gourmet Blend cat food.

    The earlier recall, issued October 27, was for cat food produced at Mars' Allenton, Pa., plant on August 11, 2008. The recall is now being extended to cover all dry pet food produced at the plant with a "best by" date between August 11, 2009 and October 3, 2009.

    The recall affects only products sold at BJ's Wholesale Club, ShopRite Supermarkets, and Wal-Mart locations in Connecticut, Delaware, Massachusetts, Maryland, Maine, North Carolina, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Virginia, Vermont, and West Virginia. No other customers and no other states are affected.

    Retailers have been notified of the recall and asked to remove the products from their shelves. The recalled pet food should not be fed to pets and should be handled carefully by consumers. Consumers should wear disposable gloves and wash their hands carefully when handling any food product thought to carry Salmonella.

    Mars makes a variety of pet foods, including Nutro dog food, which has been the target of hundreds of complaints from angry pet ownes who have written to ConsumerAffairs.com.

    Eric of Lowell, Mass., said his dog became ill when he switched to Nutro.

    "We rushed him to the vet who initially thought it might be leptospirosis, but those tests came back negative," Eric said. "After four days at the vet, with IV's, a negative Lepto test, and multiple medications, he was sent home and seems to be doing much better."

    "Bottom line? He became sick after eating Nutro. He got better after stopping eating Nutro," Eric said.


    Salmonella can cause serious infections in dogs and cats, experts say. People can also be infected if they handle the tainted food. Children, the elderly, and those with compromised immune systems are especially vulnerable.

    Symptoms of Salmonella infection in humans include nausea, vomiting, diarrhea or bloody diarrhea, abdominal cramping and fever. Salmonella can, in rare cases, cause such serious illnesses as arterial infections, arthritis, muscle pain, and urinary tract symptoms.

    Pets infected with Salmonella may be lethargic and have diarrhea or bloody diarrhea, fever, and vomiting. Some pets, however, may only have decreased appetite, fever and abdominal pain.

    Pet owners whose cats ate the recalled food and have these symptoms should contact their veterinarian.

    Mars said it was trying to get ahead of the problem.

    "We are continuously monitoring and updating our processes to be at the forefront of product quality, innovation, customer responsiveness, and manufacturing efficiency. In recent months, we have invested tens of millions of dollars in plant upgrades, new testing protocols, advanced associate training, and a new state of the art testing facility that will open in mid-2009," the company said in a statement.

    For more information about the recall, pet owners can contact the company at 1-877-568-4463.

    More about pets ...

    Mars Extends Pet Food Recall...
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    Texas Sues Online Retailers

    Companies hoodwinked customers into expensive new deals

    Two online digital camera and electronic retailers used deceptive tactics to dupe consumers into buying overpriced and, in some cases, used products, according to a lawsuit filed today by Texas Attorney General Greg Abbott.

    Abbott's office charged Broadway Photo, L.L.C. and Starlight Camera & Video Inc., both of Brooklyn, N.Y, with conducting unlawful bait-and-switch sales schemes.

    According to state investigators, those companies hoodwinked consumers by offering the lowest retail prices on price-comparison Web sites.

    Once consumers bought merchandise and made credit card purchases on the companies' Web sites, they were told their orders had been processed. Despite those notifications, consumers were later told to call and confirm their orders.

    "Rather than use the calls to confirm customers orders, the defendants instead initiated aggressive, high-pressure sales pitches promoting over-priced accessories, including memory cards and batteries," Abbott's office said in a written statement. "The defendants' telemarketers insisted these upgraded accessories were needed in order for the customers' confirmed merchandise to function normally."

    When consumers refused those offers, the companies told them their merchandise was "substandard and lacked warranties," Abbott said.

    "The defendants' telemarketers encouraged customers to purchase different, more expensive products," Abbott said. "If customers refused, the defendants canceled the orders, claiming the products were indefinitely back-ordered. When the defendants actually did ship orders, customers who intended to purchase new merchandise often received used or refurbished products."

    Abbott's office is seeking restitution for consumers, injunctions to stop the companies' action, and civil penalties of up to $20,000 per violation of the Texas Deceptive Trade Practices Act.

    Texas consumers taken by the companies' schemes can file complaints on the Attorney General's Web site.

    More Scam Alerts ...

    Texas Sues Online Retailers...
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    FDA Finds Melamine in U.S. Infant Formula

    Agency insists amounts were "minute" and do not pose an immediate danger

    Melamine -- the chemical blamed for the deaths of four infants in China and countless pets in the United States -- has been found in infant formula, the U.S. Food and Drug Administration (FDA) said, according to The Wall Street Journal.

    The newspaper quoted FDA official Stephen Sundlof as saying the finding is "no cause for concern." He said the chemical was at very low levels and was probably the result of contact with melamine during processing or packaging. Sundlof said the agency also found minute amounts of melamine in products such as nutritional and medical supplements made by five U.S. manufacturers of infant formula.

    Melamine is a chemical used to make plastic and fertilizers. It is not allowed in human or pet food, although in the late 1960s or early 1970s, the FDA approved melamine as a "food contact substance," Sundlof said.

    Sundlof said the discovery was part of a testing program that went into high gear after melamine in Chinese infant formula sickened tens of thousands of Chinese infants and killed four. Samples tested by FDA came not only from ethnic markets but also from products produced by the five major U.S. infant formula manufacturers.

    Animal tests are now being conducted to determine melamine safety levels, he said.

    Imports detained

    Earlier this month, the FDA announced that it was detaining scores of products imported from China, including some pet food, because of possible melamine contamination.

    Under this action, dozens of Chinese-imported items that contain milk products will be held at the border -- and not allowed to enter the U.S. -- until the importers can prove the items are not tainted with melamine or are not made with milk or milk-derived ingredients.

    The products listed in the import alert -- a precautionary measure designed to keep food tainted with melamine from entering the country -- include candy, cereals, snack foods, cheese, ice cream, soft drinks and baby food products.

    "We've continued to get information from others in the international community, and reports from China, about (melamine contamination) moving into different commodities," Steve Solomon, a senior FDA enforcement official, told The Associated Press. "Most of the products we are talking about are finished products like cookies, cakes and candies. The impact will be for various ethnic communities looking for specific products."

    "The (infants') illnesses involved the formation of kidney stones and crystals and related complications," the FDA wrote in the import alert. It added that some 13,000 infants were hospitalized after drinking the tainted formula.

    "The milk used in the infant formula has been implicated as the source of the melamine contamination." The FDA learned that melamine was added to the infant formula to increase the nitrogen content and falsely inflate the protein content.

    The melamine contamination, however, isn't limited to infant formula.

    "FDA analyses have detected melamine and cyanuric acid in a number of products that contain milk or milk-derived ingredients, including candy and beverages," the agency wrote.

    And those products were shipped to consumers around the world.

    More than 13 countries -- including Asia, Europe and Australia--have discovered melamine in a variety of products made with the tainted milk ingredients from China, the FDA said. Those products include candy, yogurt, frozen desserts, biscuits, instant coffee, milk tea products, and other beverages.

    FDA Finds Melamine in U.S. Infant Formula...
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      Mississippi Still Dealing with Katrina Repair Fraud

      Three years later, victims still being taken advantage of

      Three years after Hurricane Katrina devastated the Mississippi Gulf Coast, the state is still investigating home repair fraud complaints and making arrests.

      In the last few weeks Mississippi Attorney General Jim Hood says his office has made three more arrests for home repair fraud in cases being worked by its Consumer Protection Division. The arrests are the Attorney General's 95th, 96th and 97th since Hurricane Katrina.

      Randy Lee Davis, age 36, living in Stone County, turned himself into the Consumer Protection Division on Tuesday November 18, 2008 on a charge of felony home repair fraud. Davis, who had been living in Saucier, is accused by a Saucier resident of failing to build a new home in Saucier after the homeowner lost a home in Pass Christian to Hurricane Katrina.

      Edward William Callison, age 62, of Fort Worth Texas, was arrested on November 17, 2008. Callison had moved to South Mississippi in late 2005 and opened a model home/modular home sales lot on Highway 49 in Gulfport, under the name Becky Sue's Gallery of Homes. He then moved back to Texas, closing the business after July of 2007. In late 2007 and early 2008, the Consumer Protection Division began to receive complaints.

      In one complaint, a Hancock County resident paid for a home that was never delivered. In two other complaints, homes were delivered but the homeowner's had numerous problems with the installation not being completed.

      Edward Callison's wife, Becky Sue Callison, age 51, of Fort Worth Texas, was arrested on November 6, 2008 and charged Felony Home Repair Fraud and Felony Embezzlement.

      "We are nearing 100 arrests for home repair fraud since Katrina," said Hood. "We will keep at it as long as the cons continue to operate."

      Mississippi Still Dealing with Katrina Repair Fraud...
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      BMW Recalls 2008-09 M3s with Double Clutch Option

      November 24, 2008
      BMW is recalling about 2,500 M3 vehicles from the 2008-2009 model years with an optional double clutch transmission.

      The problem involves the double clutch gearbox. In a situation of rapid deceleration, the transmission software may perform a multistage downshift. At low speeds, it is possible that the engine could stall, increasing the risk of a crash.

      Dealers will reprogram the engine and transmission electronic control unit free of charge. The recall is expected to begin in November.

      Owners may contact BMW at 1-800-831-1117.

      Consumers may contact the National Highway Traffic Safety Administration (NHTSA) at 1-888-327-4236 (TTY: 1-800-424-9153) or at www.safercar.gov.

      BMW Recalls 2008-09 M3s with Double Clutch Option...
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      Honda Recalls 2001 Accord, Civic to Fix Air Bag Inflator

      November 24, 2008
      Honda is recalling about 4,000 model year 2001 Accord and Civic vehicles. The driver's air bag inflator could produce excessive internal pressure, possibly causing it to rupture upon deployment.

      The rupture could permit metal fragments to pass through the air bag cushio material, possibly causing injury.

      Dealers will replace the inflator free of charge when the recall begins in late December.

      Owners may contact Honda at 1-800-999-1009.

      Consumers may contact the National Highway Traffic Safety Administration (NHTSA) at 1-888-327-4236 (TTY: 1-800-424-9153) or at www.safercar.gov.

      Honda Recalls 2001 Accord, Civic to Fix Air Bag Inflator...
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      An Upside to the Down Market: A Lower Tax Bill

      Investors use tax loss harvesting to their advantage

      Did you know there was actually an upside to this down market? Just as the pilgrims gave thanks for their harvest, it may be fitting this Thanksgiving to give thanks to something called "tax loss harvesting." It's a little known strategy that some investors plan to use this year to take advantage of losses in the stock market to offset any capital gains and even some ordinary income tax liability.

      All you have to do is sell those losers in your investment portfolio by the end of the year and you can use any losses to cash in on an equal amount of investment gains tax-free. You can even use those losses to offset up to $3,000 of ordinary income and carry over excess losses into future years.

      Although you need to check with your accountant before you try to apply this strategy to your own situation, here is a short general course in a legal tax loophole that the rich have been using for years.

      Tax loss harvesting

      Before you can understand tax loss harvesting, you have to try to understand our complex tax laws. As written, the current tax laws allow you to "realize" losses to offset gains "realized" with other investments. Realize is just a short hand way of saying that when you sold your stock you either "made or lost" money depending on whether the sale price was higher or lower than what you paid for it. Using financial lingo, "realize" stands for that gain or loss.

      In better times, logic would often dictate that when a stock price is lower than what you paid for it, you would want to hold on to it until the price goes up and then sell it so you actually make money. Granted you have to pay taxes on what you make (which is called a capital gains tax) but you still gained and thats usually better than a loss.

      But these are unusual times, when stock prices are more likely to continue going down instead of up, and when taking a loss might prove to be a gain around tax time. And taking or "harvesting" a loss becomes a prudent way of offsetting not only capital gains but up to $3,000 in ordinary income.

      Short and long-term gains

      To make things even more complicated, the IRS divides capital gains and losses between short-term and long-term and taxes each one differently. Short-term capital gains and losses occur when you sell a security you've owned for less than one year. Short-term gains are taxed at the same rate as your ordinary income, which means whatever tax bracket you're in, and the maximum rate is now 35 percent, that's the rate you'll pay for short term gains.

      On the other hand, long-term capital gains and losses, those held for longer than one year, are currently taxed at just 15 percent.

      If you sold securities, stocks, bonds or mutual funds that resulted in a long or short term capital (which means money) gain earlier in the year, you can now sell those securities and take losses in order to offset any previous gain. Long-term losses will offset long-term gains. Short-term losses will offset short-term gains. And net losses in either category will then offset gains in the other category.

      If the net result is an overall loss in capital, the excess loss can be used to offset ordinary income dollar-for-dollar up to a maximum $3,000. Any excess capital losses can be carried forward indefinitely to reduce capital gains liability and ordinary income in future years. As an investment strategy, this process is known as tax loss harvesting.

      "Wash Sale" rule

      There, however, are some rules and restrictions. For example, the IRS will not let you take a tax loss deduction from the sale of a stock or security, if the same or a substantially identical stock or security (I'll explain this later) was purchased within 30 days before or after the sale, which adds up to a total of 60 days. This is known as the "wash sale" rule. However, any loss could be added to the cost of any new securities purchased so that when youve finally moved outside of the wash-sale window period of 61 days, that loss would be calculated into the selling price of the security.

      Substantially identical securities

      The Wash-Sale rule doesn't really spell out or define what it means by the term "substantially identical." When it comes to stocks, this term doesn't really apply since stocks are shares in a particular company and each one is different. Bonds on the other hand tell a different story. Financial experts say bonds that have different issuers or there are substantial differences in either maturity or coupon rate would not be considered substantially identical. But, if an investor finds a replacement bond with a similar coupon, duration and maturity and credit rating, yet with a different issuer, the actual composition of the portfolio would be virtually unchanged.

      Preparing for future higher tax rates

      Under current tax law, the maximum tax rate for long-term capital gains is 15percent, and the maximum tax rate on income for individuals is 35 percent. According to the Tax Policy Center, these rates are expected to move higher under the new Obama administration. For those in the top two income brackets, a new maximum capital gains rate of 20 percent may be created. For ordinary income, the top two income brackets may return to their 1990's levels of 36 percent and 39.6 percent.

      Consult your tax advisor

      You should consult with your tax advisors as to whether there are potential benefits of harvesting tax losses now versus what can be carried forward for use in the future when capital gains and ordinary income is expected to be taxed at higher rates for some individuals. Keep in mind that the administration's tax proposals must be approved by Congress. There may be state and local taxes that have to be considered. Then there also all those transaction costs, such as brokerage fees, that may apply if you are buying and selling securities. So make sure youve considered the complete field of pros and cons of tax-loss harvesting before reaping this crop.

      Fred Yager, a veteran AP and CBS News journalist, was formerly president of Merrill-Lynch Broadcasting.

      An Upside to the Down Market: A Lower Tax Bill...
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      Industry Troubles Cloud LA Car Show

      Attendees burdened by failing economy, weak sales

      The Los Angeles Car Show is normally a time of back slapping, smooth sales pitches and wide smiles. It seems a little different this year, according to attendees who have wandered the exhibit hall filled with shiny chrome.

      "October was the worst month for U.S. auto sales in 25 years," said Carlos Ghosn, CEO of Nissan and Renalt. "Nothing is moving. The decline is not confined to the U.S. market; most of the mature auto markets, including Europe, Japan, are also down significantly, with slowdowns in the emerging markets as well."

      If the Japanese carmakers are gloomy, who can just imagine how the contingent from Detroit feels. GM canceled its events but still has cars on display. It scratched plans to showcase a new Buick LaCross sedan and a new Cadillac model. Instead, it will lift the veil on those models in Detroit in January.

      Chrysler has only a minimal presence at the show as well. Ford, on the other hand, is showing off a new Mustang model, as well as a restyled Fusion hybrid.

      With hybrids in demand for much of the year, when gas prices were north of $3 a gallon, you might expect every carmaker to be going green. There were plenty of gasoline-electric hybrids to see, but not that many all-electric cars, the next-generation of green transportation. Honda is displaying the FC Sport, which is powered by a fuel cell, and BMW is displaying the Mini E, a battery-electric model.

      Many of the hybrids on display have improved fuel economy and more power.

      There's power to spare in the Mazda Kann, winner of the Los Angeles Auto Show's 2008 Design Challenge. The Mazda Kann is an electric race car that has a patented electronic tire system to reach 250 mph with no harmful emissions. It was chosen for how well it integrated a high level of innovation and technology into the design.

      The Los Angeles Auto Show opened Friday and runs through November 30.

      Industry Troubles Cloud LA Car Show...
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      Humane Society Accuses Petland of Supporting Puppy Mills

      Retail pet store denies claims, insists it treats animals well

      An eight-month investigation by The Humane Society of the United States (HSUS) claims that Petland stores nationwide sell puppies they obtain from puppy mills--despite statements by the company that its dogs come from reliable breeders.

      HSUS officials announced those and other findings from its largest puppy mill investigation during a press conference on Thursday.

      The HSUS's findings come just days after Petland assured ConsumerAffairs.com that it buys its puppies from expert breeders licensed professional pet distributors, "who have years of experience in raising quality pets."

      Petland reiterated those comments today and called the HSUS's investigation "sensationalism at its best."

      But HSUS officials said their investigation uncovered evidence that shows Petland's main sources of puppies are puppy mills -- mass commercial breeding operations that churn out two to four million puppies each year.

      Those puppies are raised in deplorable conditions and often have health problems, genetic defects, and behavioral issues, according to the HSUS.

      During its investigation, HSUS investigators visited 21 Petland stores nationwide. At each of those stores, employees told HSUS investigators that its puppies came from reliable, USDA breeders.

      HSUS investigators also tracked the sale of nearly 17,000 puppies sold at Petland stores across the country and found nearly every one of those dogs was shipped hundreds of miles from puppy mills in the Midwest.

      Most of those breeding operations had numerous violations with the United States Department of Agriculture (USDA), the federal agency charged with inspecting dog breeders.

      "Petland is perpetuating the abusive puppy mill industry, where dogs are treated not like pets, but like a cash crop," said Stephanie Shain, the HSUS's puppy mill expert and director of its Stop Puppy Mills Campaign. "They know that consumers won't stand for the cruelty inherent in mass-breeding facilities, so they make outrageous claims to hide the reality that the dogs came from puppy mills. People have a right to know exactly what they are buying, but the real victims are the breeding dogs who are confined to life in a cage for as long as people are duped into buying their puppies."

      The HSUS made the following claims from its investigation:

      • Many Petland puppies come from massive commercial breeders in Missouri and other Midwestern states, where hundreds of breeding dogs are packed into cramped, cages--often for their entire lives -- with no socialization, exercise, or human interaction. But Petland's employees--and even its corporate Web site-- claim the company knows its breeders and deals only with those who have "the highest standards of pet care."

      • 35 of the large-scale breeding operations linked to Petland stores that HSUS officials visited were puppy mills. "At many, investigators saw appalling conditions: puppies living in filthy, barren cages reeking of urine, with inadequate care and socialization," HSUS officials said.

      • Petland buys many of its puppies from "middle men" -- large-scale pet distributors that are often called brokers. "The company may not even know who the breeders are or what their standards of care may be like," HSUS officials said. Investigators also learned that some of Petland's brokers also buy from puppy mills.

      • Petland buys some of its puppies from an online pet auction Web site. "Many Petland stores are not screening breeders as the company's Web site claims," HSUS officials said. "In fact, in some cases it may not even know the breeder's name until after purchase."

      • Petland often tells consumers that it uses "USDA licensed" breeders -- and use that claim as a shield to hide the truth. But HSUS investigators reviewed the publicly available USDA inspection reports and state reports for more than 100 Petland breeders. They found more than 60 percent of those reports listed serious violations of basic animal care regulations. "Many USDA breeders exhibit a long history of substandard care and yet remained licensed," HSUS officials said. "While USDA regulations are minimal, some of the Petland breeders are not even complying with these basic animal welfare standards."

      • Some of Petland's breeders and suppliers had numerous USDA violations. For example, they were dirty, had unkempt enclosures, inadequate shelter from the cold, poor veterinary care, and housed many dogs in cages that were too small. Some breeders also had sick or dead dogs in their cages.

      "We are nation of dog lovers," said Michael Markarian, executive vice-president of the HSUS. "And people are going to be shocked by what we foundthey won't stand for this."

      Markarian called on Petland--a company HSUS officials describe as the No.1 retail supporter of puppy mills -- to stop selling puppies in its stores.

      He also urged the company to join other pet retailers, like PETCO and PetSmart, which let animal shelters hold animal adoptions in their stores.

      "As we lead into the holiday season, when many people think about getting a puppy, we wanted to let them know about the dark side of this (pet) industry," Markarian said. "And we are calling on Petland to be socially responsible."

      "Sensationalism at its best"

      Petland spokesperson Lacey Clever defended the company's practices.

      "At Petland, healthy, happy, well-socialized pets within our care are our number one priority as they have been for 41 years," Clever said. "We do not support substandard breeding facilities and we provide each Petland store with "Humane Care Guidelines," that were developed in conjunction with the USDA to assist with breeder facility inspections as it pertains to pet selection."

      Clever also criticized the HSUS's investigation, and the timing of its release.

      "Reports such as those posted on the HSUS Web site surface every year around the holiday season in conjunction with their annual fundraising efforts," she wrote. "Unfortunately, we were not interviewed or consulted nor were we a part of any of the editing process.

      "This is sensationalism at its best," Clever added. "HSUS has a history of publicizing false information in an effort to raise money. They do not operate a single pet shelter or pet adoption facility anywhere in the U.S. To the contrary, over the last 10 years, Petland has adopted out more than 270,000 homeless puppies and kittens nationwide."

      During an interview earlier this week with ConsumerAffairs.com, Clever echoed many of those sentiments.

      She also told us that Petland representatives inspect their distributors' and breeders' facilities.

      "In addition, these facilities are licensed and inspected by the federal government (USDA)," she said. "We require that our franchisees buy only from Petland, Inc. associated facilities. We even encourage our franchisees to visit facilities for themselves."

      Petland, she said, even has a "Do Not Buy List" of breeders that operate substandard facilities.

      And the company encourages its customers to adopt from local animal shelters. "We have an Adopt-A-Pet program that enables our stores to partner with local shelters and rescue groups on whatever level works for them," Clever said. "Some stores have fundraisers and donation drives for their local shelters while others have a more intense partnership, providing kennel space for shelter animals."

      Petland, she said, is also taking action to put substandard breeding operations out of business.

      "(We) want to be part of the solution in regards to substandard facilities, which is why we are out there inspecting facilities and making sure that our puppies come from happy, loving environments," Clever said. "As an industry leader, we hope that others follow this example and soon these facilities will no longer be in business."

      "Don't be fooled"

      "We're calling on consumers to not be fooled by the assurances they hear from Petland," said the HSUS's Markarian. "If they tell you that they only get their dogs from the best breeders, don't be fooled. We found that in many cases they are buying puppies from middleman and brokers -- and they may not even know who the breeder is."

      HSUS officials said they will continue their investigation and determine in any charges can be filed in connection with their findings.

      Consumers can learn more about the HSUS's Petland investigation -- and view a video about its findings -- on the organization's Web site.

      Humane Society Accuses Petland of Supporting Puppy Mills...
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      Bankruptcy "Reform" Fails to Deliver

      Tough new laws don't prevent rich or poor from filing

      When Congress passed bankruptcy law reform in 2005, it was supposed to provide greater protection for the poor, while forcing the more well-off to pay their debts. It's done neither, according to a new study co-authored by University of Iowa Law School professor Katherine Porter.

      Porter and her co-researchers documented that the incomes of bankruptcy debtors in 2007 were statistically indistinguishable from those who filed bankruptcy before the change in the laws, in part because there were so few high-income debtors to begin with.

      The findings are the result of a study by Porter and six co-authors from the Consumer Bankruptcy Project, who collected and compared nationwide data on families who filed bankruptcy in 2007 with similar data collected from families filing before the laws were changed. Their newly released study suggests that bankruptcy reform did not deliver its intended effect.

      The new bankruptcy law used an income-based screen called a "means test" to push "abusers" out of bankruptcy altogether or to force them to repay their debts in chapter 13 repayment bankruptcy cases. But the researchers suggest that the complications and costs associated with the means test may have discouraged hundreds of thousands of people from bankruptcy even when they needed help.

      At the same time, the researchers found little evidence that people who could afford to pay their bills - a group specifically targeted by the reforms in an effort to combat abuse of the protection - actually filed for bankruptcy.

      The researchers also discovered that families filing for bankruptcy were more deeply in debt than their counterparts who filed before the laws changed. In 1981, the typical household in bankruptcy owed debts that equaled about 17 months of their income. By 2001, that figure had risen to more than 30 months of income.

      By 2007, the typical bankrupt household faced debt obligations that would require them to use all their income for 39 months to pay their creditors. Much of this growth has been in credit-card debt.

      "Over the past 25 years, household debt loads have been rising, but families now wait until they are in much more trouble before they file bankruptcy," Porter said.

      Researchers also found that debt collectors may not be providing accurate information and appear to be telling people that bankruptcy may not be available as an option when in fact it is. Nearly a quarter of those who filed said that debt collectors discussed bankruptcy with consumers and warned the debtor that they would not qualify, or that the IRS would audit them if they declared bankruptcy.

      The study, "Did Bankruptcy Reform Fail?" will be published in a forthcoming issue of the American Bankruptcy Law Journal. It's the first major paper from Phase IV of the Consumer Bankruptcy Project, a joint effort of legal scholars, sociologists and medical school professors. It reports on the first nationwide random sample of people filing for bankruptcy, collecting data from interviews, surveys, and court records of people who filed bankruptcy in the first part of 2007.

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      Researchers Suggest Fast Food Ad Ban to Attack Obesity

      Study suggests removing TV ads would cut down on bad messaging

      Three decades ago the government banned cigarette ads from the airwaves in a bid to reduce smoking-related illness. Now, some health experts say its time to take similar action against ads for fast food restaurants.

      Researchers at the National Bureau of Economic Research say such a ban could reduce the number of obese children in the U.S. by as much as 18 percent. Economist Shin-Yi Chou of Lehigh University in Pennsylvania says the study is the first empirical research to make the connection.

      The research team used data from the 1979 Child-Young Adult National Longitudinal Survey of Youth, commissioned by the U.S. Labor Department. They measured the rate of child obesity against the number of hours of fast food restaurant ads viewed in a given week.

      "Our results indicate that a ban on these advertisements would reduce the number of overweight children ages 3-11 in a fixed population by 18 percent and would reduce the number of overweight adolescents ages 12-18 by 14 percent," the authors write.

      Approximately 30.3 percent of U.S. children, age 6 to 11, are overweight and 15.3 percent are obese. Among adolescents, ages 12 to 19, 30.4 percent are overweight and 15.5 percent are obese, according to the U.S. Centers for Disease Control and Prevention. These numbers are even more dramatic when compared to Mexican American children of whom 39.3 percent are overweight and 23.7 percent are obese, the agency notes.

      In speculating on the possible reasons for the explosion in childhood obesity, the CDC says "there has been a surge in the amount of time children are spending watching TV and playing video games instead of playing outside."

      The Institute of Medicine reported in 2006 that there was compelling evidence linking food advertising on television and increased childhood obesity.

      TV can be a negative influence on children's health, whether the message is in English or Spanish, according to research led by pediatricians from the Johns Hopkins Children's Center.

      Latino children, who make up one-fifth of the U.S. child population, also have the highest obesity and overweight rates of all ethnic groups. A report on the study, funded by the Robert Wood Johnson Foundation, was released earlier this year.

      "While we cannot blame overweight and obesity solely on TV commercials, there is solid evidence that children exposed to such messages tend to have unhealthy diets and to be overweight," said study lead investigator Darcy Thompson, M.D., M.P.H., a pediatrician at John Hopkins Children's Center.

      Past research among English-speaking children has shown that TV ads influence food preferences, particularly among the more impressionable young viewers.

      Researchers Suggest Fast Food Ad Ban to Attack Obesity...
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      eHarmony Agrees to Launch Same-Sex Dating Site

      Online dating site promises to treat all match-seekers fairly

      To settle a suit brought by a New Jersey gay man, eHarmony.com says it will launch a Web site that will begin providing same-sex matching services in 2009.

      The company also agrees to ensure that same-sex users are matched via the same or equivalent technology as that used for heterosexual match-seekers, agrees to charge same-sex users the same fees, and agrees to offer the same service quality and terms of service as heterosexuals.

      "I applaud the decision of eHarmony to settle this case and extend its matching services to those seeking same-sex relationships," said New Jersey Division on Civil Rights Director J. Frank Vespa-Papaleo.

      eHarmony, Inc. entered into the settlement agreement after a discrimination complaint was filed by McKinley against the on-line matchmaker in 2005, triggering a Division on Civil Rights Investigation and Finding of Probable Cause in 2007. Under terms of the agreement, the complaint is dismissed, and neither the company nor its founder, Dr. Neil Clark Warren, admits to any liability. Under the settlement agreement, eHarmony, Inc. can create a new or differently-named Web site to provide same-sex matching services, but the new Web site's home page must identify it as an affiliate of, or a site provided by, eHarmony, Inc.

      The company does, however, reserve the right to post a disclaimer noting that eHarmony's compatibility-based matching system was developed solely on the basis of research focused on married heterosexual couples.

      As part of the settlement, eHarmony, Inc. will provide a free, one-year membership to Eric McKinley, whose sexual-orientation-based discrimination complaint against the company led to the Division on Civil Rights investigation. In addition, the settlement calls for eHarmony, Inc. to pay McKinley $5,000, and to pay the Division on Civil Rights $50,000 to cover investigation-related administrative costs.

      Additional terms of the settlement include:

      • eHarmony, Inc. will post photos of same-sex couples in the "Diversity" section of its Web site as successful relationships are created using the company's same-sex matching service. In addition, eHarmony, Inc. will include photos of same-sex couples, as well as individual same-sex users, in advertising materials used to promote its same-sex matching services.

      • eHarmony, Inc. will revise anti-discrimination statements placed on company Web sites, in company handbooks and other company publications to make plain that it does not discriminate on the basis of "sexual orientation."

      • the company has committed to advertising and public relations/ marketing dedicated to its same-sex matching service, and will retain a media consultant experienced in promoting the "fair, accurate and inclusive" representation of gay and lesbian people in the media to determine the most effective way of reaching the gay and lesbian communities.

      It's not just gays and lesbians that have had complaints about eHarmony's strict screening process in the past. In fact, dating site Chemistry.com features in its ad campaign singles who had previously been rejected by eHarmony.

      More about online dating ...

      To settle a suit brought by a New Jersey gay man, eHarmony.com says it will launch a Web site that will begin providing same-sex matching services in 2009....
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      Budget Holiday Shopping Without Being a "Scrooge"

      Tips for gift-buying without breaking the bank

      Unemployment is up and consumer confidence is down heading into the holiday shopping season, so many consumers will be trying to stay on a budget this year. It's possible to celebrate on a budget, experts say, but it requires some thought and planning.

      Jan Brakefield, assistant professor of consumer sciences at the University of Alabama, says one of the most important rules is to make a spending plan and stick to it. She also says how you pay for gifts is important, too.

      "Pay cash. Credit card users typically spend twice as much money as others," Brakefield said. "Use the 'envelope method.' Prepare one envelope per person, placing money in each envelope. When the envelope is empty, you are finished buying for that person."

      When you shop is also important. For example, don't shop when you're tired, as that may effect your resolve to stay on a budget.

      "Holiday spending will put a big dent in most people's budgets because when they budget annually for such gifts, they usually don't reserve enough for the December timeframe," said Caroline Fulmer, who is also an assistant professor of consumer sciences at The University of Alabama. "For most of us, unless we set aside a special Christmas savings account, holiday spending causes us to tighten our belts on other expenses."

      Fulmer suggests cutting back on the extras like dining out, entertainment, and extra clothing, then spreading that money among holiday purchases.

      "Getting great gifts for your loved ones doesn't have to cost you your next paycheck," said Lisa Lee Freeman, editor-in-chief, ShopSmart, a publication from Consumers Union. "To save this season, follow our advice to uncover deals, avoid lousy merchandise and get great buys on everything from earmuffs to electronics."

      Freeman offers these tips for saving money and staying on a holiday budget:

      1. Start online.

      Try on shoes and clothes for size in the store, and then look for them to go on clearance online. Check eBay first. Even if you skip the auctions and only buy items that have the "buy it now" option, you can save tons off retail.

      2. Dodge hidden charges and unwanted merchandise.

      Always check return costs and see if items bought online can be returned to a local store, especially for large purchases. If it's a bargain, grab it, but think twice about final-sale items.

      3. Don't pay full price.

      Before you check out online, Google "promotion code" and the name of the product to find additional savings. When planning a trip to the outlets, find printable coupons online for preferred stores. Request a price adjustment after you have made a purchase if you find a lower price in sale circulars or on sites like PriceProtectr.com that can track prices for you.

      4. Shop when you're at your best.

      Don't shop when you're exhausted: You'll be less likely to shop around and you won't pay attention to prices. Get dressed up when you go shopping. You will feel less desperate for a makeover and avoid blowing big bucks.

      5. It never hurts to ask.

      Don't underestimate your bargaining power, even at the doctor's office. Ask sales associates for advance notice of sales. Then shop the night before the sale and ask to have full price items put on hold until the sale starts.

      6. Get the biggest bang for your buck.

      Ask for freebies. For example, if you buy a TV ask for free delivery. If a salesperson won't budge on a price, see if you can negotiate an upgrade.

      Unemployment is up and consumer confidence is down heading into the holiday shopping season, so many consumers will be trying to stay on a budget this year...
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      Target Misses Price Target, Backs Out of Sale

      Britax car seats mispriced on Target site, store refuses to complete sales

      Bargain-hunting parents were thrilled when Internet chat boards lit up with news of a big sale on Britax car seats at Target.com -- just $43 instead of the usual $280.

      Hannah Abbott of Seattle rushed to order three of the seats, getting one for her still-unborn third child and ordering two more as holiday presents. Even the shipping was reduced. Hannah was thrilled but cautious. Then she received her email confirmation and started to relax.

      But jubilation soon turned to disappointment, when Target abruptly canceled the order. No money was taken from her account and no explanation was offered.

      "They just kind of sent me on my way and said sorry," Hannah said.

      But it doesn't work that way anymore. Consumers don't just meekly go away when they're told to. Hannah complained to Seattle's KING 5 News, which got on the phone to Target.

      Target at least found it in its heart to talk to KING 5 but it wouldn't budge on the price. It was all a mistake, said Target. The giant retailer said its Web site had a "pricing feed malfunction" and displayed the wrong price. (See KING 5's story).

      Accidents do happen and, although state laws vary, most states allow occasional flubs. But stores or Web sites that make a habit of it could find themselves in trouble eventually.

      Not the only incident

      The Britax case is far from the first pricing incident involving Target. Its errors and omissions have generated numerous complaints from consumers in recent years.

      Last month, a Long Island consumer complained that Target was advertising Hanes sweat shirts for $4.66 -- a price it said was the "lowest price of the season." But the consumer said she had purchased the same shirt at the story a few weeks earlier for $4.50.

      "I cannot believe any of their advertisements again. I am a senior citizen and my time and gas consumption were thoroughly wasted by their LIE!" the consumer said.

      In September, Casilda of Brooklyn, N.Y., bought a girls jacket from a rack that had a $19.99 price posted.

      "When I got to the register the jactet rang up at the original price of $44.99. I went to customer service and the very nice young man was willing to help me but needed a manager to override the difference in the amount," she said.

      "We spoke with two managers and eventually had to speak with Jeremy who was rude, impertinent, and told me that he didn't care what the sign said he was not giving me the jacket for the sale price. He further went on to explain that he didn't care if I called the bureau of consumer affairs or anybody else he was not honoring the sign which was posted above the merchandise," she said.

      Casilda said the manager eventually told her she could have a 10% discount on the jacket.

      In Michigan, Anthony of Grand Rapids bought a Zune car audio product marked with the price $39.99 but at the register, it scanned for $79.99, he said.

      "Store refused to sell the product for the price indicated on the sticker indicating they have the right to refuse sales to anyone," he complained.

      Target Misses Price Target, Backs Out of Sale: Britax car seats mispriced on Target site, store refuses to complete sales....
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      GE Recalls Wall Ovens

      November 18, 2008    
      GE is recalling about 244,000 GE Profile, Monogram and Kenmore wall ovens to inspect and repair defective units which could post a fire and burn risk.

      The extreme heat used in the self-clean cycle can escape, if the wall oven door is removed and incorrectly re-attached by the installer or the consumer. This can pose a fire and burn hazard to consumers.

      GE said it is aware of 28 incidents of minor property damage in which adjacent kitchen cabinets have been damaged. No injuries have been reported.

      This recall involves GE wall ovens sold under the following brand names: GE®, GE Profile™, Monogram® and Kenmore®. The wall ovens were sold in white, black, bisque and stainless steel. The following model and serial numbers can be found inside the oven on the left interior wall. For microwave combination ovens, the serial number can be found on the left interior wall of the microwave.

      BrandModelSerial Number Begins With
      GE/ProfileJCT915, JT912, JT915,
      JT952, JT955, JT965,
      JT980*, JTP20, JTP25,
      JTP28, JTP48, JTP50,
      TD, VD, ZD

      AF, DF, FF, GF, HF, LF, MF, RF, SF, TF, VF, ZF
      MonogramZET3058, ZET938,
      Kenmore (All model
      numbers start with 911)
      4771, 4775, 4781, 4904,
      4905, 4923*
      2T, 2V, 2Z

      3A, 3D, 3F, 3G, 3H, 3L, 3M, 3R, 3S, 3T, 3V, 3Z
      * Lower oven only

      The ovens, made in the U.S., were sold by home builders and appliance stores nationwide from October 2002 through December 2004 for between $900 and $3,600.

      Consumers should immediately inspect the oven to make sure they do not have an incorrectly re-attached wall oven door, which will not open into the flat position. If the wall oven door is incorrectly re-attached, consumers should not use the self-clean cycle and call GE for a free repair. Consumers can continue to use normal baking or broiling function in the oven until the oven is repaired.

      For additional information, contact GE toll-free at (888) 569-1588 between 8 a.m. and 8 p.m. Monday through Friday, and between 9 a.m. and 3 p.m. Saturday ET, or visit the firm's Web site at www.GEAppliances.com

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

      GE Recalls Wall Ovens...
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      Buyers' Beware Market

      Get to know yourself as a homebuyer before committing to any deal

      Lower prices and potential housing market deals alone shouldn't be enough to commit you to buying a home. Get to know your home-buying self first.

      More home buyers have a better chance now than at any other time in nearly a half decade to negotiate a home-buying deal that costs less and comes with some concessions thrown in.

      In many locations, buyers will find a glut of new homes, more motivated sellers, foreclosures, auctions, short sales and other market conditions that can make it a really good time to buy.

      That doesn't mean throw caution to the wind.

      The same conditions that lure buyers to market also lure misfits looking to cash in on your unfettered haste and the waste left from a boom market gone bust.

      No matter what the market conditions, it's also always a buyers' beware market, now perhaps more than ever.

      Here's how to begin to navigate today's housing market, step-by-step, and make a good deal without getting taken.

      Begin with making a personal "right-time-to-buy" decision

      If you stretch financially beyond your means to go after lower-priced homes, foreclosures or short sales, you could be setting yourself up for failure. Today's housing market is littered with home owners who borrowed more than they could afford.

      On the other hand, if you wait for prices to fall further you could miss out on a good deal. No one knows when the market hits bottom until it begins a sustained upward turn and you can look back and actually see bottom.

      Buy now because it's the right thing to do for you, because you need a roof over your head, because it's more affordable than renting and because you plan on sticking with the home long enough to make the deal pay off. Buy because homeownership is integral to your budget, your lifestyle and your goals.

      Get to know the many facets of home buying

      You've got a lot to learn, but obtaining a broad base of knowledge about the home-buying process is a relatively easy task, requiring only your time and attention. A glut of information is available on the Internet, from real estate industry-sponsored seminars and workshops and through a vast library of real estate guide books.

      You can also sit down with real estate agents (including exclusive buyers' agents, who never represent sellers), mortgage brokers, loan officers and accredited home ownership counselors. Post-secondary education at colleges and universities is also available.

      Get to know your local market

      Accept national news for what it is, a broad brush stroke of current events. You want housing news and information that really hits home. Get your housing market information from credible publications and broadcasts covering your market.

      Part of your homework should include learning the boundaries of your buyer's market. Your market can be designated by a ZIP code, a small neighborhood, a greater community or some larger region.

      Learn your property's true value

      Whether it's a new home, resale property, foreclosure or short sale, learn the true value of any property you are considering. Uneducated buyers tend to lowball sellers and ask for too many concessions. That can alienate the seller, especially those less motivated with top-value homes. Likewise, knowledge helps prevent you from spending too much.

      In both cases, use a real estate agent schooled in the history of local market trends and statistics. See comparables, track sale prices in your shopping area, use the local newspaper, online listing and for sale sites and other sources, to keep tabs on asking prices. Also visit open houses.

      Check your credit

      Your credit report is free from AnnualCreditReport.com, the only federally regulated source. You may have to pay a nominal fee for your credit score (a numerical scoring of your creditworthiness) depending upon your state law and other factors. But see both your score and your report. You may need to request corrections or adjust your credit habits to generate the best report and score -- before you start home loan shopping.

      Get your cash in the pipeline

      Get approved -- in writing -- for a mortgage. Use your newly gained knowledge to shop around -- a lot -- for a home loan. Shop online and off. Shop mortgage brokers, loan officers, credit unions and other lenders. Shop where you bank, shop where you don't. The key is exhaustive comparison shipping to get the most money at the cheapest rate.

      Broderick Perkins parlayed 30 years of old-school journalism into a digital real estate news service, the DeadlineNews Group, offering "News that really hits home!"™. The Silicon Valley bootstrap includes the Web site DeadlineNews.Com and the back shop Deadline Newsroom. Contact him at news@deadlinenews.com.

      Buyers' Beware Market...
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      Dealing with Disasters: Financial Preparation is Vital

      CPAs offer advice on how to be ready for the unexpected

      A wind-whipped fire that destroyed at least 100 homes and a college dormitory in the celebrity hideaway of Montecito, Calif., is a reminder that disaster can strike anywhere, anytime. At least four people were injured in the Montecito fires and thousands of homeowners and college students had to flee as flames and smoke approached.

      Would you be ready if a sudden disaster threatened your home and family?

      Dan Thomas of the California Society of CPAs says there are relatively simple steps you can take now to ensure that you will be ready if misfortune comes your way. His group, which represents more than 33,000 CPAs in California, has partnered with the Red Cross and IRS on disaster issues.

      Before disaster strikes

      1.) Protect your property.Think about ways you can avoid or reduce property damage if a disaster were to strike again. A few ideas:

      • Know where to turn off water, gas, and electric lines. Install smoke detectors.
      • Clear surrounding brush to protect your home against wildfires, install hurricane shutters on windows, use wind-resistant shingles on your roof, and secure objects that could fall and cause damage.
      • If youre not sure where to start, contact your local fire department for recommendations.

      2.) Conduct a household inventory.Make a list of your possessions so you can estimate their value for insurance or tax purposes.

      • Include model and serial numbers. Computer software programs are available to help with this task.
      • If possible, take photos or your possessions or videotape them. Dont forget to photograph your propertys exterior, your vehicles, and contents of your garage, closets, and attic.
      • Save receipts for valuable items and get professional appraisals of jewelry, collectibles, and artwork. These expensive items need to be listed individually in your insurance policy.
      • Store this list in a safe place away from your home, such as a safe deposit box at a bank located away from disaster prone areas.
      • Update your inventory annually.

      3.) Have adequate insurance.If necessary, seek special or additional coverage for fires, earthquakes, or other losses not covered by standard insurance.

      • If you own a home, buy at a minimum, full replacement or replacement cost coverage. This means the structure can be replaced up to the limits specified in the policy. Even better protection, although not always available, is guaranteed replacement cost coverage. This means the policy will pay to rebuild your house at todays prices, regardless of the limits of the policy. However, you must make an effort to keep the policy coverage amount current.
      • Check to see if the policy covers building-code changes, and look for a policy that covers the replacement cost of your possessions, not just the actual cash value.
      • If you rent, buy renters insurance, which pays for damaged, destroyed, or stolen personal property. You also may need special insurance if you live in an area prone to floods or earth movement. Ask your insurance agent.
      • Finally, dont overlook the importance of wind and hail, health, disability, long-term care, umbrella liability, life insurance and flood insurance. Standard home-insurance policies don't cover flooding, but the federal government does through the National Flood Insurance Program. You may need to draw on benefits from one or all of these policies if you are ever faced with another disaster.

      4.) Keep cash available.

      • Stash a small amount of cash or travelers checks at home in a place where you can get at the money quickly in case of a sudden evacuation, or if a disaster shuts down local ATMs and banks.
      • Set aside extra money in an emergency fund in a bank savings account, and keep your credit cards paid off so you will have enough credit to get you through a disaster.

      5.) Use an evacuation box and safe deposit box.

      • Put important papers in a box that you can grab in the event of an emergency. Some items to put in the box: travelers checks, a few rolls of quarters, negatives of important personal photographs, a list of emergency contacts, copies of prescriptions and medical records, copies of insurance policies, backup disks of critical computerized information, copies of other important family and financial records, and your safe deposit box key.
      • Store original documents, property deeds and birth certificates, in a bank safe deposit box.

      6.) Make an evacuation plan. Imagine that you could take only one suitcase or pack a single carload in the event of a disaster. What would you take, how would you leave your home, where would you rejoin your family, and who would you call if you became separated?

      After disaster strikes

      Step 1: Contact your insurer, stat.

      Call your insurance company as soon as possible. Some insurance policies place a time limit on filing claims. The time limit does vary from state to state. For example, in New York you have two years to file a claim, according to the insurance department.

      Let the company know about the severity of the damage. Insurance cases can be prioritized. If your home was completely destroyed, you will get more attention than a home that had minor damage.

      Make sure you give the insurance company all of your contact information. Make it as easy as possible for the company to contact you.

      The amount of time it takes for the claims process varies widely, depending on the amount of damage and the size of the storm. It could happen immediately or take up to 6 months if it's a complicated claim.

      If you can't stay in your house and you have to set up camp for a while at a motel or you need to bunk with some friends, you have the right to some cash. Insurance companies will reimburse you for additional cost of living expenses. This reimbursement will even cover restaurant meals within reason. In certain circumstances, insurance companies may distribute cash or ATM cards to policyholders in an emergency.

      Step 2: Document, document, document.

      It's up to you to substantiate your loss. Think about photographing the damage. Make an inventory of damaged items, and don't forget that your car is also covered under comprehensive insurance. Keep any records and lists of people you speak to.

      The better organized you are, the fewer problems you'll have. If you don't remember the value of some items, you can call your credit card company and ask them to send you a list of your purchases.

      It's also a good idea to take advantage of the Insurance Institute's home inventory software. This is a free program that lets you scan receipts, take pictures and take inventory of what you have in the house. If you have the luxury of time, this is a great way to be prepared for catastrophes. For more information, go to their Web site at www.iii.org.

      If you're not happy with the way the claim is settled, go back to the agent, and document your side to the head of the claims department. If you're still not satisfied, you can file a complaint with your state insurance department and of course, you can always hire an attorney.

      There's also the option of using your own adjustor. A public insurance adjuster assesses the damage to your home and can organize your claim. A public adjustor then works with your insurance company to maximize the return on your policy. You typically pay them a percentage of your claim.

      Because public insurance adjusters are regulated by the states, fees will vary. For more information on public insurance adjusters, go to the National Association of Public Insurance Adjusters Web site at www.Napia.com or call (703) 433-9217. It's a good idea to call your state government's insurance commission for a background check on any public adjuster you're considering.

      Step 3: Live with it -- for now.

      Just make temporary repairs before the insurance adjustor has a chance to come in and access the damage. Of course you should not compromise your safety. But if you have a leaky roof, just put some pots and pans around instead of having the damage fixed by a professional.

      This is a good way to make sure that you are reimbursed for any repair. If you are currently underinsured or you have a sizable unreinbursed property loss, you may be able to deduct this from your taxes. Talk to your local CPA about certain tax benefits that are available to you especially in president-declared disaster areas.

      First, subtract any insurance you anticipate receiving. Then subtract $100. The loss must be further reduced by 10 percent of your adjusted gross income. The balance remaining is what you can deduct from your taxes.

      If you think you might qualify for this deduction, collect your receipts, insurance statements, and other documentation and present it to your CPA.

      Those who prepare their own taxes, should review the "Nonbusiness Casualty and Theft Losses" on the IRS Web site and contact their state income tax bureau to learn more about both the federal and state guidelines for this deduction.

      Step 4: Watch out for scammers.

      If your home was destroyed by a hurricane, be cautious. There are dishonest service providers that prey on disaster victims.

      Don't be rushed into signing a contract with any roofing or building company. Instead, collect business cards and get written estimates for the proposed job. Beware of building contractors that encourage you to spend a lot of money on temporary repairs.

      Investigate the track record of any roofer, builder or contractor that you consider hiring. Look for professionals and get references. You can also call the Better Business Bureau for help. Never give anyone a deposit until you have done your homework.

      Step 5: Help for the doubly-unlucky.

      People who are still unable to go back home because of a previous hurricane should try to extend their additional living expenses. Usually you can utilize your additional living expense for a maximum of 12 months. But there may be some flexibility with your insurance company.

      People who have exhausted their insurance can go to the Federal Emergency Management Agency to get financial assistance. Their Web site is www.fema.gov.

      Dealing with Disasters: Financial Preparation is Vital...
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      Massachusetts Blocks H&R; Block, Option One Foreclosures

      Attorney General wants relief for endangered homeowners

      The State of Massachusetts has obtained a preliminary injunction against Option One Mortgage Corp. and H&R; Block Mortgage Corp. subprime lenders that originated thousands of loans in the state.

      The order prohibits Option One and American Home Mortgage Servicing, Inc., which currently services 9,700 active Massachusetts Option One loans, from initiating or advancing foreclosures on mortgage loans that are considered "presumptively unfair" under the court order.

      Under the order, AHMSI must give the Attorney General's Office at least 30 days notice before it intends to foreclose on any such loan, and if the attorney general objects, obtain approval from the Court before foreclosing on a loan.

      "We are pleased by the Court's decision and the relief it will afford, both to homeowners and to the communities suffering from the effects of Option One's loans," said Massachusetts Attorney General Coakley. "The economic crisis continues to worsen, and predatory subprime lending is at the core of the problem. This decision is further support that some subprime lenders engaged in irresponsible and unlawful lending practices. We intend to hold accountable those who engaged in such unlawful lending conduct."

      The attorney general filed suit against Option One and its parent company, H&R; Block, Inc., in June 2008, alleging that they originated thousands of risky subprime loans in Massachusetts, with reckless disregard as to whether borrowers would be able to afford their loan payments a practice that has contributed significantly to the foreclosure crisis in Massachusetts.

      According to the complaint Option One and H&R; Block engaged in unfair and deceptive conduct on a broad scale by selling extremely risky loan products to Massachusetts consumers that the companies knew or should have known were destined to fail.

      The complaint also alleges that the companies discriminated against black and Latino borrowers in Massachusetts by charging them higher points and fees to close their loans than similarly situated white borrowers and by targeting black and Latino consumers with marketing that pushed the sale of predatory loan products.

      Under the terms of the injunction, if mortgages meet certain characteristics which make them "presumptively unfair," Option One must direct AHMSI not to foreclose upon such loans without giving the Attorney General's Office 45-days to object.

      During that time, the Attorney General's Office can object to the foreclosure going forward if it is determined that the loans were so risky as to be unfair, or was originated using unfair or deceptive acts or practices. If the Attorney General's Office objects, the parties have 15 days to resolve their differences and discuss alternatives, such as an affordable loan modification.

      If they cannot reach a mutually agreeable resolution in this time period, then AHMSI may only proceed with a foreclosure if it receives Court approval. In considering whether to approve a foreclosure, the Court will consider whether the loan was unfair, whether the lender took reasonable steps to work out the loan and avoid foreclosure, and whether a fair and reasonable alternative to foreclosure exists.

      "Presumptively unfair"

      Under the order, a loan is "presumptively unfair" if it possesses the following characteristics:

      • The loan is an adjustable rate mortgage with an introductory period of three years or less;

      • The borrower has a debt-to-income ratio (the ratio between the borrower's monthly debt payments, including the monthly mortgage payment, and the borrower's monthly income) that would have exceeded 50 percent if Option One had measured the debt, not by the debt due under the teaser rate, but by the debt due under the fully-indexed rate, except whenthe borrower had a student loan in which payment had been deferred at least six months from the date of submission of the mortgage loan application, in which case debt-to-income ratio need exceed only 45 percent;

      • The loan has an introductory or "teaser" rate for the initial period that is at least 2 percent lower than the fully indexed rate, (unless the debt-to-income ratio is 55 percent or above, in which case the difference between the teaser rate and fully indexed rate is not relevant);

      • The loan-to-value ratio of the loan is 97 percent or the loan carries a substantial prepayment penalty or a prepayment penalty that lasts beyond the introductory period.

      If AHMSI intends to foreclose on a loan which it believes does not meet the standards for presumptive unfairness, it must still give the Attorney General's Office 30 days' notice, during which time the Attorney General's Office can object if it believes that the loan does possess those characteristics.

      In granting the preliminary injunction, the Court found that the Attorney General's Office had established a substantial likelihood that it will prevail in proving that Option One and H&R; Block Mortgage acted unfairly by issuing mortgage loans with reckless disregard of the risk of foreclosure.

      Massachusetts Blocks H&R Block, Option One Foreclosures...
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