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    Experts: Toyota Faces Challenge Winning Back Consumer Confidence

    Company's handling of problems faulted; did it grow too fast?

    So, where does Toyota go from here? How does the automaker gain back the confidence of its customers? In fact, can the company put things right?

    It can, according to Clarence Ditlow of the Center for Auto Safety, but it won't be easy.

    "For the next year they have to bat 1,000," he told "If they make a mistake they have to correct it almost overnight."

    Analyst Jessica Caldwell at the automotive Web site agrees that Toyota can bounce back, but says, "It's going to take some time."

    Toyota attempted to get the healing process started during the past week.

    Appearing before the House Energy and Commerce Committee, Jim Lentz, president and chief operating officer of Toyota Motor Sales, USA, confessed that the automaker has not "lived up to the high standards our customers and the public have come to expect." Lentz said he is "confident that no problems exist with the electronic throttle control" relating to the unintended acceleration problem, but noted that the investigation continues.

    Lentz apologized for what he called the company's "mistakes," adding that the company "must think differently when investigating complaints and communicate faster, better and more effectively with our customers and our regulators."

    At the same hearing, Rhonda Smith of Sevierville, TN, told of a harrowing experience she had while driving her new Lexus 350 ES on October 12, 2006.

    Smith told the panel she "lost all control of the acceleration of the vehicle" and that the car eventually reached a speed of 100 mph. She says she had the emergency brake on "while frantically shifting between all the gears (besides park) but mainly had it in reverse." After about three miles had passed, Smith adds, "I thought it was my time to die."

    After traveling six miles, Smith says, the car began to slow -- by itself -- and by the time it reached 33 mph, she was able to turn the engine off.

    The vehicle was towed to the dealership in Kingsport, TN, which said it would thoroughly check the problem. After several weeks, Smith says, "we were advised they could find nothing wrong with the car."

    The mea culpas from the automaker continued a day later when Toyota Motor Corporation President Akio Toyoda told the House Committee on Oversight and Government Reform that he takes "full responsibility" for the uncertainty about the safety of Toyota's vehicles that consumers are feeling.

    In his prepared testimony, Toyoda said part of the problem is due to the fact that the company "pursued growth over the speed at which we were able to develop our people and our organization," -- in other words, the company grew too fast. He expressed regret "that this has resulted in the safety issues described in the recalls we face today," adding "I am deeply sorry for any accidents that Toyota drivers have experienced."

    Ditlow says one way Toyota can help restore confidence is to meet its problems head on. "Every time they get a complaint of unintended acceleration, they need to have a team of engineers available to examine it, produce a written report, give it to NHTSA (National Highway Traffic Safety Administration), give it to the consumer."

    According to Ditlow, the way Toyota handled - or failed to handle - the problem "did more damage" to the company's image than the problem itself. "No one expects a perfect vehicle," Ditlow concluded. "What you do expect is that when there is a problem, it will be fixed."'s Caldwell tells that Toyota can learn from its mistakes. "When you don't answer questions or have a press conference, people are left to their own devices and will make the story for Toyota."

    She says if the company had taken a "firmer, more aggressive stance in the beginning, there wouldn't be just a complete witch hunt out there."

    Experts: Toyota Faces Challenge Winning Back Consumer Confidence ...
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    Class Action Accuses Yelp of Extortion

    CEO denies 'disappointing' allegations, blames 'conspiracy theories'

    Picture this: You're a business owner let's say you run a restaurant hounded by several negative reviews on a popular consumer website. You fear that your fledging reputation will be torpedoed. It seems like there's nothing you can do. Then, one day, you hear from the site: they'll take the reviews down, but it's going to cost you.

    Those are, essentially, the seedy allegations contained in a class action filed against Yelp on Wednesday. Lead plaintiff Gregory Perrault, owner of Cats & Dogs Animal Hospital in Long Beach, says that a Yelp sales person told him that, for a monthly fee, he could have more control over his company's page and the negative reviews posted there.

    The saga began last September, when Perrault asked Yelp to remove a negative review written by Chris R., a customer complaining about an experience in 2007 (Yelp's policy limits reviews to those detailing occurrences within the past year). Yelp complied, and Perrault subsequently asked the company to take down a vague and threatening review posted by a Kay R.

    That's when the Yelp representative threw out the alleged offer. For $300 a month, I'd have more control over my site and move things around and change the tagline on Google, Perrault told ABC News. He declined the offer, but Yelp was persistent; Perrault says he began receiving calls from the company at least once a week. Worse, the company re-posted Chris R's review, this time with a different last initial. The complaint came and went, popping back up whenever Perrault ignored Yelp's calls.

    Perrault filed suit out of concern that the calls and the shady complaints weren't going to stop. My fear is that unless I took this step and I don't sign up for their plan, I'm going to continue to get harassment, he said. It's like they're holding me over a barrel here if I don't sign up.

    Yelp co-founder and CEO Jeremy Stoppelman, for his part, called the lawsuit without merit and said that the company will fight it vigorously. In a blog entry denouncing Perrault's charges, Stoppelman wrote that [t]he entire value of the Yelp community to consumers and businesses hinges upon that trust and we would never do anything to jeopardize it.

    Stoppelman acknowledged that the site has long faced charges of monkeying around with reviews in exchange for money, but pointed out that such allegations ignore empirical evidence in favor of conspiracy theories.

    Despite counter-examples to the contrary (virtually no advertiser on Yelp has a perfect reputation), extensive media explorations that end inconclusively, and the absence of any actual evidence to support this theory, this unfortunate and untrue meme has taken on a life of its own, Stoppelman continued.

    Simply put, Yelp does not remove or hide negative reviews in exchange for money and Yelp salespeople do not offer to do so. Additionally, Yelp treats review content equally for advertisers and non-advertisers alike.

    Is it possible that Perrault fabricated the charges out of whole cloth, in an attempt to get negative reviews of his company taken off a popular website? Absolutely not, says Jared Beck, the lawyer handling the case.

    We've been directly contacted by dozens of people. And in every location you can think of. Literally across the country, said Beck, a member of the Miami firm Beck & Lee Business Trial Lawyers. What we learned is that this isn't an isolated practice or a single event or a single sales representative run amok. This seems to be a regular business practice.

    Indeed, the complaint cites several other business owners who allege similar conduct by Yelp, including a San Mateo furniture store owner who says she accepted Yelp's offer to remove negative comments for a six-month period in return for $350. After the six months were up, according to the complaint, the negative reviews returned.

    The suit seeks an injunction and unspecified damages.

    Class Action Accuses Yelp of Extortion: CEO denies 'disappointing' allegations, pointed out that such allegations ignore empirical evidence in favor of con...
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    Survey: Toyota Image Slips Among Its Current Customers

    Toyota slips behind Honda, though still ahead of Big 3 in image perception

    A Consumer Reports survey finds the intense publicity surrounding Toyota's recent recalls having a pronounced effect on the company's image among its current customers.

    In a recent follow-up to the Consumer Reports 2010 Car Brand Perception Survey, among consumers who drive a Toyota regularly, 60 percent said they would most likely purchase a Toyota the next time they are in the market for a new car. That's down 10 percentage points from the December 2009 survey. As a result, Toyota slipped behind Honda, while loyalty for Chevrolet and Ford changed little among owners. The full report is available online.

    To provide a snapshot of how public perceptions of Toyota are shifting in light of its cascading safety recalls, the Consumer Reports National Research Center repeated part of the 2010 Car Brand Perception Survey. For this follow up, a random, nationwide telephone survey was conducted over February 4-8 of 1,832 adults who said that their household owns a vehicle.

    Despite the attention Toyota has received due to safety concerns, the overall impact on the brand integrity in the eyes of the consumer was less than one may have anticipated, though admittedly this is a developing situation. Among the top brands, purchase intent among all consumers changed by a notable amount between the two surveys for only one brand; Toyota registered a decline of nearly 4 percentage points. The change was similar between genders, but purchase intent declined more among respondents aged 18 to 44 years old than those aged 45 and over.

    Even with this modest decline, Toyota purchase intent among all respondents remains greater than all brands except Ford (17 percent) and Chevrolet (14 percent).

    While brand loyalty among current owners has declined, it remains greater than other popular makes, including Chevrolet (52 percent), Ford (51 percent), and Dodge (28 percent). Notably, Dodge owners are less likely to purchase another vehicle from that brand than in December, at 28 percent versus 32 percent.

    Toyota entered its current crisis in a position of strength. It has led past Brand Perception Surveys by a significant margin, and in the latest full survey in December, at 196 points, it held a significant score advantage with over its closest competitor, Ford, at 141 points. The scores reflect consumers' total perception level of a brand across seven categories: Safety, quality, value, performance, design/style, technology/innovation, and environmentally friendly/green.

    In ranking those factors, respondents considered Safety to be the most important, up slightly from the previous year. Quality ranked second. These attributes have historically been associated with Toyota, exposing vulnerability as these traits are drawn into question as the automaker manages its crisis.

    Survey: Toyota Image Slips Among Its Current Customers...
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      Death Often Leaves Tangled Finances Behind

      Financial therapy helps surviving spouse cope

      Losing a spouse can be one of the most trying and emotional periods in an individual's life.

      However, as staff at the Kansas State University Financial Therapy Clinic are discovering, what may be just as trying for individuals is dealing with the financial situation a loved one leaves behind.

      Since opening its doors in late January 2009, one of the primary functions of the Financial Therapy Clinic has been to help provide public outreach by assisting with financial dilemmas through a blend of financial planning, relationship therapy and psychological therapy. Despite a diverse group of clientele, though, clinic staff have recently seen a number of divorced or widowed women in their 50s and 60s, said Kristy Archuleta, co-director of K-State's Financial Therapy Clinic and assistant professor in the K-State School of Family Studies and Human Services.

      "They've found themselves working with money for sometimes the very first time, since their husband might have handled the finances before his death," Archuleta said. "In some cases, they're just now finding out that they didn't plan well and they find themselves looking for help. Most of them are in a position where they cannot work for the rest of their lives, and we have to look at how to get them to the point at which they can retire."

      Coupled with gathering information about their spouse's estate, Archuleta said the process is a mentally and emotionally grueling one since often emotions and relationships are intermingled with finances and feelings of how money should be handled.

      "Not only are they dealing with the loss of a spouse, which can take one to two years, but they are also dealing with this overwhelming sense of anxiety from not knowing where things are financially. This can make it really difficult to make good financial decisions" she said.

      Talking about finances with a spouse can be just as tough, though, Archuleta said. In many cases, especially with individuals who may not have been actively involved in the household's finances, talking about the subject with their partner may seem taboo.

      If a couple has refrained from talking about money for a number of years, a relationship dynamic is formed between the individuals, and a spouse may therefore not feel comfortable approaching the subject of finances for a number of reasons, one of which may be fear, Archuleta said.

      "But questions should be asked," she said. "The best way is to have an open conversation about the financial situation and where important documents are kept. It's really difficult for people to talk about issues, like estate planning, because it's inevitable that one spouse will pass on, so people skirt around it because it's painful. But by doing this, the surviving spouse is left in a worse position because they weren't involved in the day-to-day planning and do not understand their own financial situation."

      Document locations

      To help with the discussion, Archuleta said direct questions should be asked, and the location of important financial documents should be discussed. Archuleta also provided some financial tips for older individuals, including the following:

      • Know where the important financial documents are kept, like bank funds, mutual funds and brokerage holdings, a safe deposit box, home mortgage, Social Security benefits, 401(k) and IRAs, life insurance policies, and retirement and annuity benefits.

      • Ask questions. "And, ask lots of questions to lots of different people," Archuleta said. This includes your financial planner, your attorney, your accountant, your tax preparer, your friends and family. "Widows can make easy targets for scams, so it's important to talk to others and gather lots of information," she said.

      • Research and read what financial terms and policies mean. The more you understand, the easier it will be to gain a grasp on the finances, Archuleta said.

      • Know where the money is going. "If you go get a coffee with your friends, that's a couple of dollars there. If you go to a garage sale, that's a couple of dollars there; you may end up spending more than you think you are" Archuleta said. "You have to know where your money is going. It can be very tedious, but it's very eye-opening."

      Finally, Archuleta said, it is never too early to start planning for the future death of a spouse.

      According to a 2000 report by the U.S. Census Bureau, 32 percent of women aged 55 and older are widowed -- a greater percent than that of women who are married and living with their spouses. Among men in the same age group, only 9 percent are widowed. The report says nearly 700,000 women will lose their husbands each year, and will remain widows for an average of 14 years.

      Death Often Leaves Tangled Finances Behind...
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      Consumer Groups Keep Up Pressure For New Consumer Agency

      Independent agency needed now more than ever, advocates say

      By Mark Huffman

      February 25, 2010
      It's a new day for credit card holders. A new law took effect this week giving card-holders new rights and reining in some of the industry's more abusive practices.

      Yet consumers should expect their lender to try and recoup some lost avenues of revenue in other ways, in the form of new fees. As Congress wrangles over financial reform, consumer groups say a Consumer Financial Protection Agency, one of the more controversial parts of the current bill, is needed more than ever.

      "The lesson of the CARD Act is clear: we need a Consumer Financial Protection Agency," said Heather McGhee, Director of the policy group Demos' Washington Office. "Banks have already found new ways to abuse consumers, and Congress can't meet every year to legislate against the newest credit card outrage."

      McGhee said new credit card outrages include 79 percent interest rates and enormous establishment fees on so called "subprime" credit cards; hidden costs on pre-paid cards, and the marketing of specialty cards to cover medical costs.

      "These kind of practices will continue until there is one agency charged with ensuring the safety of financial products used by American families and small business," she said.

      Even so, it appears that Congressional leaders are placing the CFPA on the back burner in order to advance financial reform legislation in the Senate. Last week Sen. Chris Dodd (D-CT), Chairman of the Senate Banking Committee, agreed to suspend consideration of the CFPA until the end of negotiations, in order to win the support of Sen. Bob Corker (R-TN).

      AGs support CFPA

      Though Senate Republicans oppose the stand alone consumer protection agency, it enjoys bipartisan support among the various state attorneys general. Last October, a number of attorneys general signed a statement urging Congress to approve CFPA.

      "Risky lending practices and a free-for-all in the financial services industry helped cause our current economic problems," said North Carolina Attorney General Roy Cooper at the time the statement was issued. "Smarter regulation and stronger enforcement, from federal and state authorities, are clearly needed to protect individual consumers and our entire economy."

      Why would state officials be in favor of the agency? Cooper noted that strong North Carolina laws against predatory lending prevented a foreclosure problem in the Tar Heel state until federal regulators "pre-empted" those laws, allowing national banks to engage in subprime lending.

      "Creation of a federal CFPA will be an important step toward a safer and sounder financial marketplace," he said.

      The proposal would give state regulators, including state attorneys general, the authority to enforce their state consumer protection laws against federally-chartered institutions.

      Consumer Groups Keep Up Pressure For New Consumer Agency...
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      Stick What in Your Ear?

      FDA warns about use of 'ear candles'

      Beeswax candles offered for sale by

      Does sticking a burning candle in your ear sound like a good way to remove ear wax or cleanse your blood of impurities?

      Many consumers are apparently trying this procedure -- often called "ear candling" -- because of claims that it can do everything from remove toxins in the ear canal to cure cancer. But federal health officials warn consumers not to use these products, saying they can cause burns and other serious injuries.

      The Food and Drug Administration (FDA) also said consumers shouldn't be swayed by claims that ear candling can improve hearing, relieve headaches, sinus and ear infections, purify blood, cure cancer, or improve brain functions.

      "FDA has found no valid scientific evidence to support the safety or effectiveness of these devices for any medical claims or benefits," the agency said in a statement released on Saturday.

      Ear candles are hollow cones about ten inches long made from a fabric tube soaked in beeswax, paraffin, or a mixture of the two. Companies that make these products claim that burning a candle in the ear creates a vacuum that draws wax and other debris from the ear canal.

      But the FDA said consumers who have used ear candles have suffered burns and perforated eardrums that required outpatient surgery. These injuries happened even when consumers used the ear candles according to the manufacturer's direction, the FDA said.

      Not for children

      "FDA is especially concerned because some ear candles are being advertised for use in children," the agency said. "Children of any age, including babies, are likely at increased risk for injuries and complications if they are exposed to ear candles. Small children and infants may move during the use of the device, increasing the likelihood of wax burns and ear candle wax plugging up the ear canal. "Also, their smaller ear canal size may make children more susceptible than adults to injuries."

      The American Academy of Otolaryngology-Head and Neck Surgery (AAO-HNS) also warns consumers about the risks associated with ear candling -- even for something as simple as removing wax from the ear canal. The organization represents specialists who treat the ears, nose, throat, head, and neck.

      "Ear candles are not a safe option of wax removal as they may result in serious injury," the AAO-HNS states on its Web Site. "Since users are instructed to insert the 10" to 15"-long, cone-shaped, hollow candles, typically made of wax-impregnated cloth, into the ear canal and light the exposed end, some of the most common injuries are burns, obstruction of the ear canal with wax of the candle, or perforation of the membrane that separates the ear canal and the middle ear."

      An international non-profit organization that exposes health-related frauds myths, and fallacies, has also investigated ear candling.

      A report on the Web site Quackwatch, titled "Why Ear Candling Is Not a Good Idea," cited many injuries associated with the practice, including external burns, ear canal obstructions, and perforated eardrums.

      The report by Dr. Lisa Roazen, who practices emergency medicine in New York City, also referred to a story in the Canadian newspaper, The London Free Press , regarding a woman who experienced stuffiness in her nose and ear pains while scuba diving.

      The woman went to a local health-food store and was referred to a "qualified" ear candler. During the procedure, the woman felt intense burning in her ear. She later went to the emergency room, where doctors were unable to remove the wax that had dripped from the candle into her eardrum. The woman had to undergo surgery, the story stated.

      During the operation, surgeons discovered a hole in the woman's eardrum. They suspected the ear candling caused that injury. The woman later recovered and did not lose her hearing. According to the story, the ear-candling practitioner apologized to the woman and stopped performing the procedure.

      Dr. Roazen's Quackwatch report also cited two fires in Alaska linked to ear candling, including one that led to a woman's death.

      "On January 27, 2005 a 59-year-old woman ignited her bedding when she dropped an ear candle that she was attempting to use in the ear without any assistance," the report stated. "The candle ignited the bedding and quickly spread to curtains and other combustibles in the room. The woman did escape but suffered an asthma attack and died in a hospital emergency room."

      Widely promoted

      Ear candles are sold and promoted in health food stores, flea markets, health spas and salons, and on commercial Web sites, including and other well-established, seemingly reputable sites. did a quick online search and found scores of companies selling ear candles. One company advertised a pack of "Earomatherapy" ear candles for $2.77; another sold a 12-pack of Beeswax ear candles for $28.85.

      We also found a company selling ear candles that pointed out the procedure is not recommended for children under the age of 12. The company, however, didn't base that warning on the safety of ear candling itself. It based that warning on the fidgetiness of children.

      "Children under 12 may not remain still while the procedure is being performed," the company states. "The procedure involves fire, therefore, extreme caution should be taken should you choose to ear candle a small child. Ear candling is not harmful to children, but fire is," the company added.

      Red herrings

      Another company selling ear candles attempted to refute doctors and others in the scientific community who criticize the safety and effectiveness of ear candling.

      "In our modern day, we are governed by the 'scientific method,'" the company states on its Web site. "Anything that can't be studied by this method is considered a 'scam,' and great efforts are made to discredit it. Of course, the 'scientific method' can't explain why the bumble bee can fly!"

      The company's Web site adds: "Generally speaking, natural remedies like EAR CANDLING, are inexpensive, so pharmaceuticals and Doctors won't make a fortune from prescribing ear candles, etc. It's easier for Doctors to call ear candles a scam, than lose patients to alternative remedies. Ear Candling Works!"

      Dr. Roazen and others medical experts disagree. "Candling is both ineffective and dangerous," Roazen wrote in her Quackwatch report.

      A recent report by the AAO-HNS Foundation echoed those concerns, saying studies have found that ear candling has caused burns, temporary hearing loss, and other serious injuries.

      "These studies have shown that although ear candling is heavily promoted, the mechanism of action is implausible," the report stated. "Furthermore, it has no observable positive effects and ear candling use may be associated with considerable risks."

      The report added: "The Food and Drug Administration (FDA) concluded that there is no validated scientific evidence to support the efficacy of the ear candles and warns against their use."

      The FDA advises consumers and physicians to report any injuries linked with ear candles to the agency. Those reports can be filed online or by phone at 1-800-332-1088.

      Many consumers are apparently trying this procedure, often called ear candling, because of claims that it can do everything from remove toxins in the ear c...
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      Super PoliGrip to Go Zinc-Free

      Manufacturer spurred by consumer health concerns, lawsuits

      The manufacturer of Super PoliGrip announced last week that it is removing zinc from its denture cream formula, the latest and most dramatic response to criticism from consumer groups and an ever-growing list of lawsuits claiming health problems as a result of excessive zinc intake.

      A press release by GlaxoSmithKline announced that the company is pulling three of its signature products Super PoliGrip Free, Super PoliGrip Comfort Seal Strips, and Super PoliGrip Powder while it works on a new zinc-free formula. The company maintained that PoliGrip is safe when used as directed, and that problems only arise when consumers apply more adhesive than directed [or] use it more than once per day. GSK says it is halting the manufacture, distribution, and advertising of the named products as a precautionary measure to minimize any potential risks to these consumers.

      The company has faced growing concern over the danger of zinc poisoning. Last October, GSK announced that it was placing inserts in all denture packages, warning consumers that excessive zinc intake can lead to serious health effects.

      That decision was prompted in part by a 2008 article in the medical journal Neurology, which profiled four people who used, on average, two tubes of denture cream per week and suffered varying levels of neurological damage as a result. GSK has stressed that a tube of denture cream should last a month or more, depending on its size.

      Zinc is an essential element of a human diet, often grouped with other so-called good chemicals, but too much of it can cause anemia, pancreatic diseases, and decreased levels of HDL cholesterol. Additionally, excessive zinc intake can lead to neurological and nerve damage, which in turn can cause numbness, problems balancing or walking, and tingling or weakness in the extremities. In rare cases, users have ended up paralyzed.

      An extreme case was Elizabeth Gilley, a 26-year-old woman profiled earlier this month in Time Magazine. Gilley has worn dentures and used denture cream on a daily basis since a genetic condition ate away at her teeth when she was a teenager. Gilley experienced numb extremities and heavy breathing, symptoms which got worse over a six-month period, and eventually caused her to collapse. She is now confined to a wheelchair, and is one of many American consumers who have filed suits against GSK.

      Indeed, the company has been named in dozens of lawsuits over the past few years, as has Procter & Gamble, which manufactures rival denture cream Fixodent. Last June, a number of suits against the two companies were consolidated in the U.S. District Court for the Southern District of Florida.

      The U.S. Drug Watchdog, a consumer advocacy group, has driven home the urgency of the situation, warning that zinc-laden denture cream could produce the worst case of zinc poisoning in U.S. history. The group pointed out that the Food & Drug Administration (FDA) doesn't require denture cream companies to disclose the danger posed by zinc poisoning.

      GSKs statement urged consumers who have used denture cream for several years in greater amounts than directed on the package or more than once per day to stop using the product and talk to their doctor. Consumers who are experiencing signs of zinc poisoning should help seek immediately, and can also call the National Poison Control at 800-222-1222.

      GSK announced that it is removing zinc from its denture cream formula, the latest and most dramatic response to criticism from consumer groups and an ever-...
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      Judge Approves $150 Million BoA Settlement

      But does so reluctantly, calling settlement 'paltry'

      A U.S. District Court judge has given final approval to the $150 million dollar settlement between Bank of America and the U.S. Securities and Exchange Commission over the bank's lack of disclosures in its acquisition of Merrill Lynch a year ago.

      Judge Jed S. Rakoff said he was approving the agreement, though he called it far from ideal, referring to it as paltry and half-baked justice. Rakoff rejected a proposed $33 million settlement last year as inadequate.

      In approving this settlement, Rakoff ordered the $150 million to be distributed to shareholders who lost money on their Bank of America stock when it plunged in the wake of the Merrill Lynch merger.

      Though the judge was not initially satisfied with the settlement, the SEC pushed hard for it. Ohio Attorney General Richard Cordray said he also favored the deal.

      We welcome Judge Rakoffs ruling, which recognizes that Bank of America failed to adequately disclose to its shareholders material information related to the Banks acquisition of Merrill Lynch. Todays decision validates and reinforces the core allegations of our lawsuit against Bank of America, said Cordray.

      Last September, Cordray, in concert with five public pension funds, filed a shareholder class action lawsuit alleging securities violations based on many of the same alleged facts at issue in this enforcement action brought by the SEC. The suit filed by Cordray and other public pension funds is pending before a different judge in the U.S. District Court for the Southern District of New York.

      Although the SEC did not, we sued not only Bank of America, but also top executives who we believe were personally engaged in violations of the securities laws, Cordray said. We will continue to aggressively pursue claims against Bank of America and other individual defendants on behalf of shareholders. We will not rest until Bank of America is held accountable for its wrongs, and until the rights of investors and retirees are vindicated.

      The lead plaintiffs group for the class action suit filed in September includes the State Teachers Retirement System of Ohio, the Ohio Public Employees Retirement System, and three other public pension funds.

      Merrill Lynch paid $3.6 billion in employee bonuses just days before Bank of America completed its purchase of the investment firm on January 1, 2009.

      Soon after, Merrill Lynch reported losses of more than $15 billion for the fourth quarter of 2008.

      Rakoff ordered the $150 million to be distributed to shareholders who lost money on their Bank of America stock when it plunged in the wake of the Merrill ...
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      Pediatricians Want Hot Dog Re-Design

      Doctors worry that current shape poses choking threat to children

      February 23, 2010 Pediatricians are issuing a warning about hot dogs, but it's not what you think. It has nothing to do with fat, sodium or the filler they use in the popular meat product. This time the physicians are worried about the hot dog's potential to choke youngsters.

      The American Academy of Pediatricians has issued a call for food manufacturers to alter the design of the hot dog so that children are more likely to eat it in smaller bites. The group noted that choking is a leading cause of injury and death among children, especially children three years of age or younger.

      Food, toys and coins account for most of the choking-related events in young children, who put objects in their mouths as they explore new environments. According to AAP, more than 10,000 children under age 14 choke on food each year, and up to 77 percent die.

      In its new policy statement, Prevention of Choking Among Children, to be published in the March issue of Pediatrics, AAP offers recommendations for government agencies, manufacturers, parents, teachers, child care workers and health care professionals to help prevent choking among children.

      Because the size, shape and consistency of certain toys and food increase the possibility of being a choking hazard, and because many of the prevention strategies currently in place to prevent choking on toys have not yet been implemented to prevent choking on food, the AAP recommends:

      • Warning labels on foods that pose a high choking risk.

      • A recall of food products that pose a significant choking hazard.

      • The establishment of a nationwide food-related choking-incident surveillance and reporting system.

      • Food manufacturers should design new food and redesign existing food to minimize choking risk.

      • CPR and choking first aid should be taught to parents, teachers and child care providers.

      Pediatricians should continue to provide guidance to parents on safe and appropriate food and toy choices, as recommended by the AAP, the group said in a statement.

      Janet Riley, President of the National Hot Dog and Sausage Council, said she agrees that parents should be better educated about food choking hazards. However, she questioned whether warnings on package labels would be effective.

      Pediatricians Want Hot Dog Re-Design...
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      Lack of Sleep Can Affect Students' Grades

      You snooze, you gain, research suggests

      All-nighters, whether it's partying or crashing for finals, can have an adverse effect on students.

      New research shows that educating students about the importance of sleep and offering feedback on sleep patterns can persuade them to catch some much-needed zzz's.

      For the research -- the first large-scale study of sleep in college students to include both subjective and objective measures -- Cornell University psychology professor James Maas used the Zeo Personal Sleep Coach. The new technology records a sleeper's time in light, deep and REM sleep through a small, wireless headband sensor.

      Maas distributed 300 devices to volunteers in his psychology class at the beginning of the fall 2009 semester. The students kept a written sleep log and recorded six nights of sleep data at each of three time points during weeks two, six, and 12 of the study.

      Between the second and third time points, students heard Maas lecture on the importance of sleep and got personalized e-mail feedback based on their own sleep patterns.

      Not surprisingly, says Maas, the students initially reported sleeping just an average of 7 hours 24 minutes a night -- much less than the 9 hours 15 minutes recommended for college students.

      But in comparing the students' sleep logs with the Zeo measurements, he also found that the students overestimated their sleep time by 47 minutes -- meaning they were actually getting an average of 2 hours 28 minutes less sleep than they should.

      The study also shows that the combination of sleep education and direct feedback from the Zeo motivated students to sleep better. By the end of the semester, students had increased their total nightly sleep time by an average of 15 minutes; and more than three out of five students had started sleeping almost an hour longer.

      The percentage difference was most dramatic for the students who began the study in the bottom quartile for total hours of sleep. Those students increased their total nightly sleep time by an average of 51 minutes, or 15 percent.

      And students with the best sleep scores -- those who spent the longest total time asleep and the most time in deep sleep -- were also the ones with the highest grades in the class.

      "Students in the past have said, 'I'm not going to change my sleep-wake schedule unless you can prove to me that it's going to make a significant difference in my grades,'" Maas says. "Now we have very good evidence that if you want to improve your general well-being, this is the key; and it's the key that some Cornellians use, and they're the ones who are getting the high grades."

      Dale Pescatore, an undergraduate student at Cornell, agrees. "I used to consider sleep a luxury, and it largely fell to the wayside when I was too busy balancing the other aspects of my life," Pescatore admits. "Since using the Zeo, I have realized that when sleep becomes a priority, everything else will fall into place."

      Lack of sleep has been linked to a number of ailments, including excessive weight gain and heart ailments .

      Lack of Sleep Can Affect Students' Grades...
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      Consumers: Know Your New Credit Card Rights

      New regulations take effect today but consumer vigilance is essential

      With many once-commonplace unfair credit card practices becoming illegal as of today, it's important for consumers to be aware of their new rights.

      "The new law is a pretty big step forward for consumers in leveling the playing field against credit card companies," Ohio Attorney General Richard Cordray said. "The provisions offer new protections that will eliminate many of the sneaky, one-sided practices that made credit card transactions so confusing and unfair to consumers."

      Treasury Secretary Tim Geithner calls the new law "a critical step forward in our effort to protect American families by prohibiting the use of unfair retroactive rate hikes and late fee and over-limit fee traps by credit card companies." But, he said, there is more to be done.

      "As we work with Congress on broader reform to make our financial system safer and more stable, we are also working to consolidate the fragmented authority of seven separate agencies into a single, independent and accountable Consumer Financial Protection Agency," Geithner said.

      The Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009:

      Prohibits unfair rate increases: In general, credit card providers can no longer increase interest rates within the first year after a consumer opens a new account. They also cannot increase the rate on an existing credit card balance. Since August 2009, credit card providers have been required to give consumers a 45-day notice before increasing interest rates.

      Bans universal default: Using a practice called universal default, credit card providers could increase a consumer's credit card interest rate if the consumer was delinquent on other payments, such as a cell phone or utility bill. The new rules prohibit this practice.

      Restricts over-the-limit fees: Credit card companies must obtain approval from the consumer before allowing the consumer to charge more than the card's limit and subsequently issuing an over-the-limit fee.

      Requires a co-signer for most consumers under 21 years old: Credit card providers cannot issue credit cards to consumers under 21 years old unless the consumer demonstrates the ability to pay or has a co-signer, such as a parent, guardian or spouse.

      Requires fair payment allocation: Credit card providers can impose interest charges only on balances in the current billing cycle, eliminating a practice known as "double billing," which generally affects individuals who pay off their balance every month. They also cannot allocate payments in order to maximize the interest a consumer must pay.

      Problems not over

      The new law doesn't necessarily mean consumers' credit card problems are over. The Center for Responsible Lending (CRL) notes that many issuers are finding ways to "dodge the reforms."

      According to CRL, some are:

      adopting schemes to game interest rates, with the little known "pick-a-rate" practice gaining increasing momentum. Pick-a-rate costs U.S. consumers $720 million per year and it may reach $2.5 billion annually as the practice spreads;

      shifting penalty fee structures to charge nine out of ten people the highest fee possible if they pay late, while projecting the appearance of lower fees. The average late fee today is $39, while the typical past-due amount is about $50; and

      padding their miscellaneous fees since the announcement of new Federal Reserve rules and passage of the Credit CARD Act, disguising many of the charges.

      While acknowledging that the CARD Act is a good thing, Brad Stroh, co-founder and CEO of, acknowledges that "for many consumers it will likely mean more headaches in managing their credit card account, and at the end of the day these changes could actually lead to higher fees or reduced lines of credit."

      The best way to avoid these fees, reductions in credit, or elimination of accounts, he says, is to carefully monitor communications with a credit card provider and understand the implications of their changes as well as your actions. This means taking the time to read mailings and speak with representatives when appropriate.

      "The days of tossing letters from your credit card company into the trash are over," says Stroh. "These mailings will likely contain valuable information and offers that will demand your attention."

      Management tips

      Stroh offers these credit card management tips:

      Maintain prompt payment status with your credit card company. Demonstrating that you can responsibly meet your current credit obligations is the number one behavior that will impact your standing with the credit card company and your credit score. By missing or being late on a payment you will incur fees, potentially increase your interest rate, and lower your overall credit score.

      Pay down high balances to improve credit card utilization. This will show that you can responsibly manage your credit limit, minimizing the chance of higher tiers of interest rates or reductions in credit limit. Additionally, better credit utilization will help boost your credit score.

      Maintain activity on your credit card accounts. By using the revolving credit lines that you need or want to keep and promptly paying on them, you can help avoid cancellation of those credit card accounts. Additionally, some credit card companies are introducing inactivity fees. This behavior will avoid those fees and help boost your credit score, while having a long existing credit line closed could lower your score.

      Avoid fees through responsible spending habits. Credit card providers will likely look to recoup revenue by charging fees for extra services. New regulations prohibit over limit provisions unless consumers opt-in to the service. Card providers could then charge consumers for this right. By remaining aware of credit limits and balances, consumers can avoid a need for these fees altogether.

      Remember, new regulations do not apply to corporate or small business cards. This means some small business owners might consider using personal cards for business expenses because of fee and rate limitations. However, these owners should remain cautious because their personal credit scores could suffer in the event of missed payments or defaults.

      "It is important to remember that these new regulations do not limit interest rates, they only make the communication with consumers more transparent," Stroh concludes. "The best approach then to these changes is to be proactive and adjust personal behavior to avoid negative implications."

      Not everyone is happy with the way the CARD Act is being implemented. Consumer activists are critical of the pace of the Act's implementation. What do you think about it? Let us know.

      Consumers: Know Your New Credit Card Rights...
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      Toyota Bragged About Limiting 2007 Recall

      Document cites savings to company in recalling only floor mats

      Toyota may have some explaining to do. In an internal document obtained by Congressional investigators, company executives noted they had saved $100 million by persuading U.S. regulators that a sudden acceleration problem with 2007 Camry and Lexus models was caused by floor mats.

      Citing it as a "win" for the company, the document said Toyota had been successful in negotiating with the National Highway Traffic Safety Administration to recall the floor mats rather than finding a defect in the cars that required a repair.

      Toyota ultimately suspended US sales of eight of its models and recalled millions of vehicles to address the sudden acceleration problem.

      In September 2007 Toyota announced a recall of 55,000 floor mats which were used in the 2007/2008 Lexus ES 350 as well as the 2007/2008 Camry. At the same time, NHTSA strongly urged owners to "make sure the driver-side, all weather floor mat is properly secured before driving the vehicles."

      At the time, NHTSA and Toyota noted that, if unsecured, the mats could slip forward and trap the accelerator pedal, causing the vehicle to accelerate uncontrollably. Though the recall was limited to the Camry and Lexus, had logged many complaints from Toyota Prius drivers about the sudden acceleration problem. And at the time, not all were buying Toyota and NHTSA's solution.

      The Rub

      "Here is the rub," one California reader told us in 2007. "If it truly were the mat catching the accelerator, why did turning the car off solve the problem? There is nothing with the power button that would do this. And yet each time when I restarted the Prius it was fine. If the accelerator were caught under the mat once the car was turned off the problem did not persist," she wrote.

      Fast-forward two years and Toyota recalls more floor mats to deal with the same problem. In September 2009 Toyota announced a recall of 3.8 million Lexus and Toyota cars, again blaming the sliding floor mats. At the time, owners of the affected models were asked to remove the floor mats until they could be replaced with a safer version.

      Then, just over a month later, NHTSA took the unusual step of correcting what it called "misleading" information from Toyota. In an early November 2009 statement, the National Highway Traffic Safety Administration said it was correcting what it called "inaccurate and misleading" information in a Toyota press release, concerning its recent recall of 3.8 million Toyota and Lexus models.

      The release in question stated that NHTSA had reached a conclusion "that no defect exists in vehicles in which the driver's floor mat is compatible with the vehicle and properly secured." Not so, the agency said.

      Must Address Design Flaw

      "NHTSA has told Toyota and consumers that removing the recalled floor mats is the most immediate way to address the safety risk and avoid the possibility of the accelerator becoming stuck. But it is simply an interim measure," NHTSA said in a November 4 statement. "This remedy does not correct the underlying defect in the vehicles involving the potential for entrapment of the accelerator by floor mats, which is related to accelerator and floor pan design."

      In other words, NHTSA said Toyota couldn't resolve the problem simply by removing the floor mats. They must address what safety researchers by then saw as a design flaw. Not long afterward, the carmaker capitulated, beginning what has turned into a financial and public relations nightmare.

      Congress, meanwhile, wants to know what Toyota knew and when it knew it. The document citing the savings in limiting the 2007 recall to floor mats may take center stage as the House Committee on Oversight and Government Reform holds hearings on the subject. The Obama Administration is also looking closely.

      "Unfortunately, this document is very telling," Olivia Alair, a spokeswoman for the Transportation Department, said. "We're going to hold Toyota's feet to the fire and make sure they do what's necessary."

      Toyota Bragged About Limiting 2007 Recall...
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      Some Seniors Aren't Required To File Federal Tax Return

      But filing is the only way to get any refund that's due

      While it is true that everyone has to pay taxes, there are exceptions, especially for people age 65 and older. If your gross income was below the Internal Revenue Service tax threshold last year, you don't have to file a return this year.

      More people fall into this category than you might think. According to the Tax Policy Center, more than half of the 65-plus age group isn't required to file.

      Naturally, you should check carefully to make sure you're exempt before not filing a return, as the income threshold is subject to change from one year to the next. Also, your filing status, and other variables, can make a difference.

      The income threshold is based on "gross income," meaning all the income you received during the year, unless it is specifically exempt from tax. You don't have to file a tax return this year if:

      • You are single and your 2009 gross income was less than $9,350 ($10,750 if you're 65 or older).

      • You are married filing jointly and your gross income was under $18,700. If you or your spouse is 65 or older, the limit increases to $19,800. And if you're both over 65, your income must be under $20,900 to not file.

      • You are head of household and your gross income was below $12,000 ($13,400 if age 65 or older).

      • You are married filing separately and your income was less than $3,650.

      • You are a qualifying widow(er) with a dependent child and your gross income was less than $15,500 ($16,150 if age 65 or older).

      Of course, there could be a very good reason to file a return, even if you aren't required to. If you had tax withheld from your income, you most likely are entitled to all of it back in a refund. However, you won't get a refund unless you file a return.

      And keep in mind that your state may require you to file a return, even if the IRS doesn't. So don't discard your tax records.

      Elderly Tax Credit

      Depending on your income level, you may be eligible for a federal tax credit for the elderly, which can add up to as much as $750 for a single taxpayer and up to $1,125 for a couple.

      To qualify, you must be 65 or older and a U.S. citizen. For a single filer, your adjusted gross income must be less than $17,500 and the nontaxable part of your Social Security or other nontaxable pensions, annuities or disability income must be less than $5,000.

      If you are under age 65 at the end of 2009, you can qualify for the credit only if you are retired on permanent and total disability and have taxable disability, according to the IRS.

      If you are married and are filing jointly, and both spouses qualify, your income will need to be less than $25,000, and your nontaxable Social Security or other nontaxable pensions must be under $7,500.

      If your income falls below the filing threshold but you had taxes withheld last year, you may be able to stop the withholding. According to the IRS, If you have taxes withheld for wage or pension Income and have less than $300 of unearned income (e.g. interest, dividends, unemployment compensation), you can stop your withholding by filling out a new Form W-4, Withholding Certificate or a Form W-4P, Withholding Certificate for Pension or Annuity Payments. You may obtain the form you need from a tax preparer, or they can be downloaded from the IRS Website.

      If you have any question at all whether you fall into the category of non-filers, consult a family member or tax professional.

      Some Seniors Aren't Required To File Federal Tax Return...
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      Debt Concerns Top 2009 Complaint List in Illinois

      Top 10 list reflects growing economic worries

      What was the biggest complaint from Illinois consumers in 2009? According to state Attorney General Lisa Madigan, her constituents were most upset about rising foreclosures and debt.

      Madigan says that 31,264 consumers filed complaints with her Consumer Protection Division last year. The consumer debt category topped the complaints filed by Illinois consumers, including a 65 percent increase in residential mortgage-related complaints.

      In addition, an estimated 21,000 consumers have called the Attorney General's Homeowner Helpline for assistance since 2008, while the Attorney General's Consumer Fraud Bureau helped secure an estimated $23 million in mortgage-related savings, including loan modifications for at-risk borrowers, last year.

      "These numbers demonstrate how this economic crisis is hitting home for tens of thousands of Illinois families," Madigan said. "Hardworking people are struggling to make their mortgage payments on time. They're fighting to cope with mounting debts, and they're being targeted by con artists looking to make a quick buck. This is a challenging time, and I urge anyone who is struggling to make ends meet to contact my office to make sure that they do not become victims of fraud."

      Consumer Debt Complaints Rank First

      Since 2008, complaints to Madigan's office about consumer debt grew nearly 16.5 percent, a reflection of the increasingly dire financial constraints people in Illinois are experiencing during the economic downturn. Complaints in this top category cover a wide range of consumer debt issues, such as residential mortgages, credit card debt, and installment loan debt.

      Specifically, the highest reported debt-related complaints involved mortgage foreclosure. In 2009, nearly 4,000 homeowners filed residential mortgage complaints with Madigan's office, a 65 percent increase over the previous year. In addition to the significant increase, the types of complaints reported are also transforming.

      In the first wave of the foreclosure, a majority of complaints reported to the Attorney General's office came from homeowners who were placed in risky home loans that they could never afford. As the foreclosure crisis continued, Madigan said that around 2008 her office began receiving more calls from homeowners who have lost their jobs and can no longer make their mortgage payments. Other debt-related complaints includes problems with collection agencies and credit card companies.

      Identity Theft Complaints Rank Second

      After calls to Madigan's office about consumer debt, identity theft remained high on the annual list of consumer complaints, coming in at the second most-reported issue. Madigan's office received 4,376 identity theft-related complaints in 2009. A significant number of the complaints involved people taking over victims' credit card and bank accounts.

      Rounding out the top ten, consumers complained about home improvement fraud, problems with their wireless or phone company, phony sweepstakes scams, auto sales fraud, mail or Internet purchase snafus, fraud directed at small business, complaints about utility services and motor vehicle repair problems.

      Debt Concerns Top 2009 Complaint List in Illinois...
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      It's Tax Season and TaxScamSeason

      How to avoid being taken when it comes time to pay up

      By Lisa Wade McCormick

      February 20, 2010

      Texas authorities are warning consumers to be wary of potential tax return scams.

      But their advice doesn't apply just to consumers in the Lone Star State. It can also help keep taxpayers across the nation from being duped by unscrupulous tax preparers who may charge excessive fees or fail to file consumers' taxes on time.

      According to the Internal Revenue Service (IRS), an estimated 1.2 million people earn fees for preparing Americans' tax returns.

      But Texas authorities and others nationwide often receive complaints about tax preparers who don't file consumers' taxes on time, charge exorbitant fees, make errors on consumers' tax returns, disappear after returns are filed, or fail to return consumers' personal financial documents.

      Authorities say consumers can protect themselves from crooked tax preparers by:

      • Reviewing the tax preparer's credentials;

      • Checking to see if there are any complaints about the tax preparer with the state's attorney general's office, district attorney's office, or other consumer protection groups. Consumers who hire certified public accountants can also check with their state's licensing board to see if there are complaints on file;

      • Ensuring the business is open year-round in case you need to ask follow-up questions about your tax return;

      • Demanding the tax preparer list all fees in writing;

      • Making arrangements with the tax preparer to return your personal financial documents; and

      • Confirming the basis for all tax deductions the tax preparer claims on your return.

      "Taxpayers are ultimately subject to accuracy and fraud penalties, plus accrued interest, for any income tax underpayment caused by filing incorrect tax returns," warned Texas Attorney General Greg Abbott.

      The IRS also advises taxpayers not to respond to any e-mails that appear to be from the agency. These fraudulent e-mails, which often increase during tax season, often direct consumers to links that request their Social Security, bank account, and credit card numbers.

      The IRS emphasizes that it does use e-mail to solicit sensitive financial and personal information from taxpayers or discuss account information. The agency also said it does not request financial account security information, like PIN numbers, from taxpayers.

      The IRS points out that phony e-mails that impersonate the agency often threaten consumers with additional taxes if they fail to respond, get the names of the Internal Revenue Service or other federal agencies wrong, have incorrect grammar or odd phrasing, or use long addresses in the links.

      The actual address, or URL, for the Internal Revenue Service is, which taxpayers are advised to consult to learn more about IRS-impersonation scams, identity theft, and suspicious e-mail.

      Consumers who received suspicious e-mails that appear to be from the IRS should forward them to at the IRS mailbox and then delete the messages from their inboxes.

      It's Tax Season and Tax Scam Season...
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      Google Social App Runs Into Buzzsaw

      Class action says Buzz violates privacy laws

      Google Buzz, the search giants new social networking feature, has generated countless headlines since its launch last week, most focusing on its novel and groundbreaking features, and some going so far as to dub it the Facebook killer.

      But Buzz drew decidedly less glowing coverage on Wednesday, when a Harvard Law student filed a class action alleging that the service publicizes users confidential information without first obtaining their permission.

      On February 9 the day Buzz was officially introduced 24-year-old Eva Hibnick logged into her Gmail account to check her messages, and noticed Buzzs new iconic four-color logo beneath the link to her inbox. Her experience was not unusual; Buzz was launched with no advance notice to speak of, leaving consumers to decipher the application for themselves. When Hibnick learned what Buzz was and how it worked, she was immediately concerned that the program improperly revealed her private information.

      I feel like they did something wrong, Hibnick told ABC News. They opted me into this social network and I didn't want it.

      It is by design that Buzz publicizes as much information as possible without any user input. Todd Jackson, the project manager in charge of the products rollout, wrote on Googles blog that Buzz is built right into Gmail, so you don't have to peck out an entirely new set of friends from scratch it just works.

      Sounds good, but the program has several Orwellian aspects. Hibnick was most troubled by Buzzs auto-follow feature. When the program was first launched, it automatically signed users up to receive Facebook-style status updates from the six people they most frequently chat or e-mail with. How the program really determines who those people are, though, remains a bit of a mystery. This writer, for example, was set up to follow two people that he hasnt spoken to in several years. Only one of the remaining four was someone that he e-mails regularly.

      Gmail quickly did away with auto-follow, modifying the site so that it provides a list of recommended followees, but leaves the ultimate decision to the user.

      Hibnicks attorney, Gary Mason, said the suit isnt primarily about money (although Hibnick is seeking monetary damages), but about preventing the Buzz catastrophe from repeating itself. What we'd like to see as result is a commitment from Google that they're not going to do this again the next time they launch a product, Mason said.

      The suit adds a new dimension to long-building concerns over Googles privacy policy. Reservations initially focused on the companys ability to know what any given person has searched for, along with features like Google Maps, which provides an instant birds-eye or street-view photo of millions of properties across the world. Eric Schmidt, the companys CEO, added fuel to the fire in an interview in December, when he declared that, If you have something that you don't want anyone to know, maybe you shouldn't be doing it in the first place.

      Hibnick is not the only one raising privacy concerns. The Electronic Privacy Information Center (EPIC) filed a complaint with the Federal Trade Commission (FTC) on Tuesday, in which it argues that Buzz violated user expectations, diminished user privacy, contradicted Google's privacy policy, and may have violated federal wiretap laws.

      EPIC wants the FTC to require that Buzz run as an opt-in application so that consumers have to affirmatively sign-up rather than as an opt-out program in which consumers are automatically enrolled. Mason, Hibnicks lawyer, also takes issue with Buzzs opt-out nature, describing it as an unfair and generally deceptive practice.

      The filing comes at an already-stressful time for Google, which is fighting for final approval of a settlement in the massive four-year-old Google Books lawsuit. Judge Denny Chin was set to rule on the agreement today, but announced he is taking more time to digest the issues.

      Hibnicks suit is being brought on behalf of all Gmail users whose accounts were automatically connected to Buzz. Mason estimates that there are over 30 million potential class members.

      Google Social App Runs Into Buzzsaw...
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      Ticketmaster and TicketsNow Settle Springsteen Concert Charges

      FTC warns other ticket resellers to play it straight

      Some fans of The Boss are due to collect some loot.

      In a settlement of Federal Trade Commission (FTC) charges of deceptive bait-and-switch tactics, Ticketmaster has agreed to pay refunds to consumers who bought tickets for 14 Bruce Springsteen concerts in 2009 through its ticket resale Web site TicketsNow.

      The company also has agreed to be clear about the costs and risks of buying through its reseller sites.

      According to the FTC's complaint, when tickets went on sale February 2, 2009, for Bruce Springsteen & The E Street Band concerts in May and June, Ticketmaster displayed a "No Tickets Found" message on its Web page to consumers to indicate that no tickets were available at that moment to fulfill their request.

      The FTC charged that Ticketmaster used this Web page to steer unknowing consumers to TicketsNow, where tickets were offered at much higher prices -- in some cases double, triple, or quadruple the face value.

      Ticketmaster also displayed the same misleading Web page to consumers looking to buy tickets for many other events between October 2008 and February 2009, the agency charged.

      "Buying tickets should not be a game of chance," said FTC Chairman Jon Leibowitz. "Ticketmaster's refrain is that it sold through TicketsNow to give consumers more choices. But when you steer consumers to your resale Web sites without clear disclosures, and they unknowingly buy tickets at higher prices, they'll be left with a sour note."

      Compounding this deception, Ticketmaster failed to tell buyers that many of the resale tickets advertised on were not "in hand" -- in other words, they were not actual tickets secured for sale at the time they were listed and bought. In fact, some tickets were being sold speculatively -- that is, they were merely offers to try to find tickets.

      For example, many consumers hoping to go to a Springsteen concert at the Verizon Center in Washington, DC in May 2009 paid for tickets in February that never materialized. Ticketmaster kept the sales proceeds for more than three months without a reasonable basis for believing it could fulfill the orders, the FTC complaint alleged.

      " sold phantom tickets without letting consumers know that the tickets did not exist. Then, the company held onto consumers' money, sometimes for months, when it knew those fans weren't going to see Springsteen," Leibowitz said. "Clearly consumers deserve better. They deserve to know what they're buying, including the risk that their tickets won't materialize."

      Under the FTC settlement, eligible consumers who have not previously received a refund will get back the extra money they paid to buy the higher-priced tickets from TicketsNow. For example, if a consumer paid $400 for two tickets from TicketsNow, and those same two tickets would have cost $200 from Ticketmaster, the customer would get a $200 refund.

      It wasn't just Ticketmaster's handling of Springsteen tickets that raised the ire of consumers.

      Bruce of Coppell, TX, tells that he bought tickets online for a Dwight Yoakam concert on Feb 5. "We took tickets to arena but could not find parking and were turned away by Mesquite police. We did not get to attend the concert although we paid good money for these tickets and felt that this was the most poorly planned concert. We are not happy Ticketmaster customers."

      "I am outraged at the fees being charged by Ticketmaster (25 percent of the cost of the ticket)," says Ray of Wilton, CA. "I was looking for tickets for Jeff Dunham. I was so outraged, I went down to the arena myself."

      The Commission staff is sending a warning letter to other ticket resale companies whose practices may violate the law. The letter discusses the Ticketmaster settlement and the FTC's concerns about the failure to disclose to consumers when tickets offered for sale are speculative or otherwise not in hand.

      According to the letter, the FTC strongly recommends, "that you review your own company's Web site to ensure that you are not making any misleading statements or failing to provide material information to prospective purchasers of tickets listed on your site."

      The state of New Jersey settled a complaint regarding Springsteen tickets about a year ago.

      Ticketmaster and TicketsNow Settle Springsteen Concert Charges...
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      Illinois Sues Marketer For Alleged 'Cramming'

      Consumers request 'free sample' but end up paying for multiple orders

      The State of Illinois is suing an Evanston-based marketing firm for "cramming" consumers' credit cards with unauthorized charges for supposedly free trial offers of coffee products.

      "We've received an extraordinary number of complaints from consumers who believed they were signing up for free items but wound up with unauthorized charges from this company," said Illinois Attorney General Lisa Madigan. "Because of cases like this, it's important that consumers carefully review their monthly credit card statements to ensure they're not being unexpectedly billed."

      Madigan's complaint alleges that defendants Peel, Inc., and its President Brian Dale sell products online at dozens of Web sites, including hundreds of complaints,, and The company markets its products using "free trial" offers and requires consumers to provide their billing information purportedly to cover shipping and handling fees for the supposedly free merchandise.

      However, within days of signing up for a free trial, consumers begin receiving unauthorized charges ranging from $19.99 to $49.99 on their credit cards.

      Further, Madigan's complaint alleges that if consumers are able to reach Peel's customer service, the company allegedly promises to stop charging consumers but fails to do so. Consumers continue to receive unauthorized charges on their credit cards. Madigan's Consumer Fraud Bureau and the Better Business Bureau have received more than 2,300 complaints against Peel and its affiliated Web sites.

      Complaints has also received hundreds of complaints about this company, most recently from Marvin, in Okemah, Okla.

      "In early August, 2009 I signed up for a free sample from Seattle Coffee Direct. All I had to pay was $2.99, which was charged to my eppicard.," he told "In late August I noticed a transaction on the eppicard account for approximately $38 from Seattle Coffee Direct, however they were using a different name to identify the payee. I immediately contacted eppicard and was told to call back to file a dispute when the charge cleared."

      Told that the disputed charge would be removed, Marvin was chagrined when another $38 charge appeared on his account four days later. When he called customer service he says he was told that he has signed up for two shipments a month, although he says he did nothing more than request a free sample.

      Madigan's suit alleges the defendants violated the Illinois Consumer Fraud and Deceptive Business Practices Act by placing unauthorized charges on consumers' credit card bills. The suit seeks a permanent injunction barring the defendants from doing business in Illinois, restitution for consumers, civil penalties of $50,000 for violating the Consumer Fraud Act, and an additional $50,000 for each violation committed with the intent to defraud.

      Want to know how cramming works? Click here.

      The State of Illinois is suing an Evanston-based marketing firm for "cramming" consumers' credit cards with unauthorized charges for supposedly free trial ...
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      Capital One Agrees to Refund $775,000 to Customers

      States had challenged annual membership fees on closed accounts

      With a little arm-twisting from the federal Office of the Comptroller of the Currency (OCC), Capital One has agreed to refund annual membership fees to customers who were assessed the fees after they had cancelled their credit card accounts and had no outstanding balance.

      The California and West Virginia attorneys general had challenged Capital One's practices. The OCC became involved when Capital One became a national bank, putting it under the OCC's jurisdiction. It announced the settlement today and said that Capital One would refund about $775,000 to customers affected by the actions, which occurred from 2004 to 2006.

      The bank said it would also reimburse all consumers who paid off their accounts within 90 days after requesting that the accounts be closed.

      "This problem was the result of a systems issue that we fixed in 2006," said bank spokesperson Tatiana Stead in a statement. At the time, we refunded membership fees for many customers who contacted us directly but, in retrospect, we should have done so for an additional 3,400 customers as well. We sincerely regret this error.

      Capital One was formerly a credit-card lender but expanded into banking as part of its strategy to weather the 2008-2009 financial meltdown. It acquired several banks over the last few years and is now the eighth-largest bank in the United States by deposits.

      It is also a frequent target of consumer wrath, as it has raised interest rates, cut credit limits and canceled credit-card accounts to reduce exposure to losses.

      "I received a notice from Capital One Bank stating the 4.9 percent APR on the Mastercard I have had for six years will be increasing to 13.9 percent," Helen, of Boca Raton, Florida, told "I have always paid my bill in total and on time if not early. I called the customer service line and they very politely read the 'cue cards' stating it was a "business decision due to the current economy."

      Capital One Agrees to Refund $775,000 to Customers...
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      FTC Cracks Down on Jobs Con Artists

      Scams prey on Americans left jobless by the recession

      The Federal Trade Commission (FTC) has launched a new crackdown on con artists who are preying on unemployed Americans.

      The fraudsters utilize job-placement and work-at-home scams, promoting empty promises that they can help people get jobs in the federal government, as movie extras, or as mystery shoppers; or make money working from their homes stuffing envelopes or assembling ornaments.

      As part of the law enforcement sweep, dubbed "Operation Bottom Dollar," the FTC has filed seven cases against the operators of deceptive and illegal job and moneymaking scams. In addition, the sweep includes 43 criminal actions by the Department of Justice, many involving the substantial assistance of the U.S. Postal Inspection Service.

      The agency also announced partnerships with the online job placement service, the search engine Bing and the centralized network of online communities Craigslist to help job seekers recognize job scams so they can avoid being victimized. Monster, Careerbuilder, Bing and Craigslist will display FTC consumer education material to people who are using the companies' Web sites to look for jobs.

      "Federal and state law enforcement officials will not tolerate those who take advantage of consumers in times of economic misfortune," said David C. Vladeck, Director of the FTC's Bureau of Consumer Protection. "If you falsely advertise that you will connect people with jobs or with opportunities for them to make money working from home, we will shut you down. We will give your assets to the people you scammed, and, when it's appropriate, we'll refer you to criminal authorities for prosecution."

      To help consumers avoid being conned by employment scams, the FTC has produced a new consumer education video in English and Spanish.

      FTC Law Enforcement Actions

      The FTC announced seven new cases against promoters of the job and moneymaking scams, including one that victimized more than 100,000 people. This brings to eleven the number of cases the agency has brought since last spring challenging these types of operations. In these latest actions, the FTC charged that:

      • Government Careers Inc. and three principals preyed on job seekers since at least March 2009 by running deceptive ads on job Web sites. Government Careers claimed it could help people get postal, border patrol, and wildlife jobs as well as administrative support and clerical positions with the federal government.

      • Real Wealth, Inc. and its principal allegedly conned more than 100,000 people by selling them booklets that supposedly explained how they could earn money by applying for government grants and working from home mailing postcards and envelopes.

      • Darling Angel Pin Creations and two principals allegedly claimed on the Internet and in newspaper advertisements that by purchasing a starter kit, consumers could earn up to $500 per week assembling angel pins, and that no experience, special tools, or sewing skills were required. Consumers paid between $22 and $45 to get started, and sometimes paid hundreds more for the supplies they would need to make the pins.

      • Abili-Staff, Ltd., two principals, and a related entity sold supposed work-at-home opportunities online. Billing itself as a "scam free" and "legitimate" job search service, Abili-Staff sold supposedly pre-screened lists of jobs, telling consumers they could access the lists after paying a fee ranging from $29.98 to $89.99, according to the FTC's complaint.

      • Entertainment Work, Inc. and two principals marketed memberships in a Web site that was supposed to list jobs as movie extras, jobs on television, or jobs in print media. By telemarketing and placing advertisements on Web sites and in newspapers across the country, the defendants sold trial memberships for $19.95 to $24.95, and automatically converted those into annual memberships for an additional fee of $80 after two weeks, according to the FTC complaint.

      • Independent Marketing Exchange, Inc. and its principal allegedly made false earnings claims, and additional misrepresentations in the course of selling a smorgasbord of work-at-home opportunities, including an envelope mailing opportunity, a postcard mailing opportunity, and a mystery shopper opportunity. Their deceptive practices have injured numerous consumers, including stay-at-home and single mothers.

      • Preferred Platinum Services Network and the husband-and-wife team who owned and operated it allegedly marketed a work-from-home scheme in which consumers were told they could earn significant sums by labeling postcards describing a non-existent product promoted by Preferred Platinum called "mortgage accelerator." Advertised in local pennysavers and newspaper classified sections, and at the defendants' Web site, the scheme touted earnings of up to $1 per postcard, as well as a 60-day money-back guarantee.

      Thousands of consumers get stung by schemes such as these.

      Sharon of New Bern, NC, tells of an ad that she says was on AOL's home page about a company that was hiring workers to work at home. "It talked about the company and the start up rate ($1.95) I clicked the link to go to the website, and it said the cost and what you are expected to get for $1.95 It doesn't say anything about any other costs at all."

      Sharon says her account was debited the $1.95, but, "days later I was billed $129.00. I tried contacting the company by sending an email, and the email came back. It was undeliverable. There is no phone number on the website. I later found out through their Terms and Services (on the bottom of the website) that you have to cancel within 3 days. That's why I was billed."

      "Purchased a product for work at home opportunity," writes Sandra of Indiana. "Was promised that this purchase would include medical billing software and names of (2) doctors that I would do medical billing for from my home. Was promised that the purchase would be delivered in 48 hours. Product was not delivered until 8 days after purchase and did not include what was promised. I have made several attempts to contact the company leaving numerous messages and have never received a call back. I paid $399 for the product and did not get what was promised."

      The tough economy has helped the "work at home scams" proliferate. Your best protection against them is to know the warning signs so you can avoid being taken.

      FTC Cracks Down on Jobs Con Artists...
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      Bank of America Steps Up Loan Modifications

      Reports improvement in modification rate after slow start

      Under pressure from the Obama Administration, Bank of America says it has stepped up its efforts to modify mortgages through the White House's Home Affordable Modification Program.

      Bank of America now says more than 12,700 of its mortgage holders have a permanent Home Affordable modification, up from nearly 3,200 a month earlier. Another 13,700 permanent modifications are pending, meaning final modified loan terms have been approved and documents have been sent for the customers' signatures, which will be their final step to a completed modification.

      The program began almost a year ago, with a strong government incentive for mortgage servicers to modify mortgages for struggling homeowners to help avoid rising foreclosures. But until now, very few loans were modified under the program.

      In fact, many homeowners reported to that nearly all servicers were difficult to deal with, asking that documents be faxed multiple times, stringing out the process, and in the end denying the modification or waiting until the property went to foreclosure.

      And despite Bank of America's reported improvement, it apparently can't help everyone.

      "We have submitted an application for the home affordable housing program ,the President Obama, program, to help us and Bank of America has denied us twice," Bea, of Temecula, Calif., said in a complaint to this week. "First because we don't have enough income and second, that we received $353.00 a month more income and extra $50.00 for food, we don't qualify."

      'Extraordinary measures'

      But the bank said it is continuing to take "extraordinary measures" to reach customers who face deadlines for providing necessary documentation for consideration of a permanent modification.

      "This initiative entails mail, telephone and door-to-door outreach -- averaging more than a dozen contacts per customer -- aimed at encouraging and helping eligible homeowners meet their documentation requirements and avoid falling out of the program," Bank of America said in a press release.

      But April, of Albuquerque, N.M., reports a somewhat different experience with Bank of America. It began, she says, when she called the mortgage servicer to say she was having trouble paying her mortgage and to request a modification.

      "I spoke with Louie who took all my financial information and told me he had an offer for a new mortgage trial payment of 967.20 for three months and if we could make that payment for three months our loan would be modified to a new affordable payment," April told "After making the three payments I called to find out what the status of the modification was and the rep told me there was no record of an offer or loan modification and there was nothing they could do."

      HAMP resulted in only 66,465 permanent modifications by the end of December, according to the Treasury Department. That compares with its goal of up to 4 million by 2012.

      Bank of America Steps Up Loan Modifications...
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      Florida Probes Eight Firms For Alleged Employment Scams

      Suspected of exploiting desperate job-seekers

      The ads make it sound easy; let the advertised firm train and place you in a new job, or set you up in a work-at-home business that will triple your income. It hardly ever works out that way, however.

      Now, the State of Florida has issued subpoenas to eight firms suspected of running employment or work-at-home scams.

      "Unemployed Floridians are particularly vulnerable to scams that falsely promise quick fixes for people who are jobless," said Florida Attorney General Bill McCollum. "With the unemployment rate in Florida at record highs, we need to be vigilant in our efforts against people looking to capitalize on someone else's difficulties."

      One of the firms receiving a subpoena is Career Services International, based in Orlando. McCollum's office is investigating allegations that the company misrepresents available services and collects fees for those services, but fails to provide them. Consumers have complained that the quality of service was not what the company had promised and indicated problems with missed deadlines, untrained employees, and lack of advertised expertise.

      Federal-State Crackdown

      The subpoena is one of a series issued over the past several months targeting employment scams and was announced today to highlight the office's joint enforcement effort with the Federal Trade Commission (FTC)and several other states. Seven other Florida companies have also received subpoenas investigating potential violations of Florida's Deceptive and Unfair Trade Practices Act. Allegations include misleading or deceptive marketing of work-from-home opportunities as well as job placement services and other Internet business ventures.

      The other firms under investigation include:

      Coretech Media LLC, doing business as and Net Money Training, located in St. Petersburg; Investigation of unfair and deceptive trade practices related to home business opportunity kits advertised over the internet

      Darling Angel Pin Creations, Inc., located in Brandon; Investigation of unfair and deceptive trade practices involving work at home job opportunity

      GC Displays, Inc., doing business as, located in Clearwater; Investigation of unfair and deceptive trade practices involving job placement services

      Home Biz Ventures, LLC, doing business as and, located in Clearwater; Investigation of unfair and deceptive trade practices involving internet business opportunity which offers on-line membership access to training and products to sell on auction sites

      My Career Corp., Inc., located in Tampa; Investigation of unfair and deceptive trade practices involving job placement services

      Pacific Webworks, Inc., located in Salt Lake City, Utah; Investigation of unfair and deceptive trade practices involving work from home opportunities

      Viable Marketing Corp., located in Seminole; Unauthorized recurring charges associated with negative option "work at home" internet business opportunity

      McCollum says consumers should be wary of any company offering employment positions that require little or no education but claim to pay high wages, companies that charge an up-front fee for their services or products, companies that offer "memberships" to internet-based employment opportunities, and any other opportunity that sounds too good to be true.

      Florida Probes Eight Firms For Alleged Employment Scams...
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      Packaged Salad Can Contain High Levels Of Bacteria

      Consumers Union calls for standards for greens

      The latest tests of packaged leafy greens by Consumer Reports found bacteria that are common indicators of poor sanitation and fecal contamination -- in some cases -- at rather high levels.

      Consumers Union, publisher of the magazine, is urging the Food and Drug Administration (FDA) to set safety standards for greens. FDA food safety legislation pending in the Senate, and passed last summer by the House of Representatives, would require the FDA to create just such safety standards.

      The tests, which were conducted with financial support from the Pew Health Group, assessed for several types of bacteria, including total coliforms and Enterococcus -- "indicator organisms" found in the human digestive tract and in the ambient environment that can signal inadequate sanitation and the potential for the presence of disease-causing organisms.

      While there are no existing federal standards for indicator bacteria in salad greens, there are standards for these bacteria in milk, beef, and drinking water. Several industry consultants suggest that an unacceptable level in leafy greens would be 10,000 or more colony forming units per gram (CFU/g) or comparable measure.

      Consumer Reports found that 39 percent of samples exceeded this level for total coliform, and 23 percent for Enterococcus. The tests did not find E. coli O157:H7, Listeria monocytogenes or Salmonella -- sometimes-deadly pathogens that can be found in greens, although it was not expected given the small sample size. The goal was to investigate other markers of poor sanitation that should be used in the food safety management of produce.

      "Although these 'indicator' bacteria generally do not make healthy people sick, the tests show not enough is being done to assure the safety or cleanliness of leafy greens," said Dr. Michael Hansen, senior scientist at Consumers Union. "Levels of bacteria varied widely, even among different samples of the same brand. More research and effort is needed within the industry to better protect the public. In the meantime, consumers should buy packages of greens that are as far from the use-by date as possible."

      For its latest analysis, CR had an outside lab test 208 containers of 16 brands of salad greens, sold in plastic clamshells or bags, bought last summer from stores in Connecticut, New Jersey, and New York. Among the findings:

      • 39 percent of samples exceeded 10,000 CFUs (or another similar measure) per gram for total coliforms and 23 percent for Enterococcus, the levels industry consultants deemed unacceptable.

      • 2 percent of samples exceeded French and 5 percent Brazilian standards for fecal coliform bacteria.

      • Many packages containing spinach, and packages which were one to five days from their use-by date, had higher bacterial levels. Packages six to eight days from their use-by date generally fared better.

      • Whether the greens came in a clamshell or bag, included "baby" greens, or were organic made no difference in bacteria levels.

      • Brands for which there were more than four samples, including national brands Dole, Earthbound Farm Organic, and Fresh Express, plus regional and store brands, had at least one package with relatively high levels of total coliforms or Enterococcus.

      "The Senate should act immediately to pass pending FDA food safety reform legislation that requires the agency to set performance standards as well as develop safety standards for the growing or processing of fresh produce," said Hansen. "FDA should also formally declare that certain pathogenic bacteria -- such as E. coli O157:H7, Salmonella, and Listeria -- be considered adulterants when found in salad greens." The Senate bill, S. 510, the FDA Food Safety Modernization Act, was voted unanimously out of committee in November. The House passed similar legislation last July.

      Until packaged salad becomes cleaner, consumers' best line of defense involves following these procedures in stores and kitchens:

      • Buy packages far from their use-by date.

      • Wash the greens even if the packages say "prewashed" or "triplewashed." Rinsing won't remove all bacteria but may remove residual soil.

      • Prevent cross contamination of greens by keeping them away from raw meat and poultry.

      Packaged Salad Can Contain High Levels Of Bacteria...
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      Dietary Supplement Scammer Pleads Guilty

      False claims generated nearly $12 million

      A Springfield, Mo., business owner has pleaded guilty in federal court to her role in a conspiracy to fraudulently market dietary supplements over the Internet with illegal claims that these supplements could prevent, treat or cure a number of diseases.

      Mai Lor, 25, used several Web sites were used to sell nearly $12 million worth of the products in 2005 and 2006, according to Beth Phillips, United States Attorney for the Western District of Missouri.

      Lor was co-owner, along with her husband, of Medycinex, which purchased dietary supplements and sold them over the Internet. At her husband's direction, Lor also formed Bio Nutrasource, LLC to carry on the business previously conducted by Medycinex.

      Lor contracted with co-defendant Tony T. Pham, 41, of Grand Rapids, Mich., to market and distribute the dietary supplements. Co-conspirators claimed that six products sold over the Internet had been proven reliable through clinical testing for the treatment and prevention of diabetes, irritable bowel syndrome, gout, high cholesterol, high blood pressure, heartburn and diarrhea. In reality, no clinical testing had been performed.

      Under federal law, a dietary supplement may not claim to treat, cure or prevent a specific disease or class of diseases. None of the dietary supplements sold by Lor and her co-conspirators are generally recognized, among experts as safe and effective for use under any of the conditions recommended in their labeling. Therefore, each of these dietary supplements is a new drug.

      None of them were approved by the FDA, and their labels do not bear adequate directions for use. Therefore, they are also categorized as unapproved drugs and misbranded drugs.

      The dietary supplements that were marketed as unapproved new drugs and misbranded drugs included Diabeticine (later renamed Diamaxol, and also known as Glucolex), Digestrol (also known as Digesticine), Uricinex (also known as Uricaid), Cholestasys Rx (later renamed Cholestasys), Hyperexol and Prolipamy.

      Pham, who pleaded guilty on July 2, 2009, to charges contained in the April 2, 2009, superseding indictment, owned and operated Techmedica Health, Inc., located in Grand Rapids. He admitted that he used Techmedica to repackage, sell, market, and distribute unapproved new drugs and misbranded drugs over the Internet.

      Pham acknowledged that since April 6, 2004, he participated in a conspiracy to buy and sell unapproved new drugs and misbranded drugs and to defraud the United States by impeding the lawful functions of the Food and Drug Administration to prevent the introduction of unapproved new drugs and misbranded drugs in interstate commerce, to regulate the interstate sale and distribution of drugs in the United States, and to safeguard the health and safety of consumers who purchase drugs.

      In addition to the conspiracy, Pham pleaded guilty to one count of wire fraud related to payments in the form of a wire transfers to a bank account.

      Pham sold $11,954,648 worth of those products in 2005 and 2006, using several different Web sites. Web sites used by Techmedica contained materially false testimonials, product information, and identification of medical professionals.

      Techmedica fabricated fraudulent customer identities using photographs purchased from Testimonials attributed to these fraudulent identities touted the effectiveness of the unapproved new drugs and misbranded drugs.

      Techmedica also posted one of the photographs on their Web sites to fabricate a non-existent physician, Dr. Judy Hamilton, for the purpose of lending authenticity to and endorsing product claims about Diabeticine for customers with Type I and Type II diabetes.

      The person identified as Dr. Hamilton was in fact a model from California. This same model's photograph was also used by Pham on another Web site to fabricate a non-existent nurse, Bethany Hunt, RN, to tout the effectiveness of the unapproved new drugs and misbranded drugs.

      Techmedica, through Pham, operated several Web sites using mirror image technology. When each of these Web sites was accessed from an FDA network computer, they displayed a "sanitized" version of the Web site containing medical claims that attempted to comply with the federal Food, Drug, and Cosmetic Act (FDCA).

      However, when each of these Web sites was accessed from a computer whose IP address could not be traced to the FDA, they displayed claims that the dietary supplements could cure, mitigate, treat, and prevent diseases, so that these supplements were sold as unapproved new drugs and misbranded drugs.

      By pleading guilty, Lor also agreed to forfeit to the government any property derived from the proceeds of the offenses, including $11,954,648 (for which she and her co-defendants are jointly and severally liable), three real estate properties in Springfield, properties in Rogersville, Mo., and Pleasant Hope, Mo., three vehicles and various bank accounts.

      Under federal statutes, Lor is subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000 or twice the gross gain.

      Diet supplement scams area huge business. The FTC routinely brings charges against these phony operations.

      A Springfield, Mo., business owner has pleaded guilty in federal court to her role in a conspiracy to fraudulently market dietary supplements over the Inte...
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      Survey: Customers Staying Satisfied Through 2009

      Retailers, financial services and e-commerce show improvement

      Customer satisfaction with the goods and services that Americans buy remained strong in the fourth quarter of 2009, according to the American Customer Satisfaction Index (ACSI).

      The index was virtually unchanged, dipping a mere 0.1 percent from the previous quarter -- to 75.9 on the ACSI's 100-point scale. It remained much higher than it was prior to the recession and also slightly higher than this time a year ago.

      Because economic recovery is highly dependent on consumer spending and high levels of customer satisfaction tend to strengthen consumer demand, the latest ACSI reading does not add to more economic woes. Despite anecdotal evidence to the contrary, most companies are providing good customer service and many have very satisfied customers.

      "As long as unemployment remains high and credit tight, it is difficult to see how we can get to a sustainable pace of consumer spending growth," said Professor Claes Fornell, head of the ACSI and author of The Satisfied Customer: Winners and Losers in the Battle for Buyer Preference.

      "But it is not all bad: the 'will to spend' is evidenced by high customer satisfaction. The issue is whether or not consumers have the 'means to spend,'" He added. "The recent news about the decline in unemployment and the rise in manufacturing hiring may not only lead to more people working, but may also dampen the fear of job loss. If so, the means to spend will face less of a hurdle."

      As the stock market rebounded in 2009, the rewards have been greater for those companies with improving ACSI scores. On average, companies that did well in ACSI saw their stocks increase by 75 percent, while stock prices for those with declining ACSI scores rose just 22 percent over the same period.


      Customer satisfaction with the retail sector, which includes department and discount stores, specialty retail stores, supermarkets, gas stations, and health and personal care stores, gained 1.3 percent to an ACSI score of 76.2.

      Nordstrom maintained its lead among department and discount stores, rising four percent to an all-time high of 83. Several other retailers posted large gains, including Target (+4 percent to 80), Dollar General (+5 percent to 79) and Dillard's (+4 percent to 78).

      Macy's, notable for bucking the positive trend, saw its score fall four percent to an industry low of 71.

      "I have never had a friendly experience at the Macy's in Reno," Victoria of Reno, NV, told "I would boycott the store altogether but sadly in Reno it is our only 'nice' store. I was looking at jewelry with a friend of mine, and by jewelry I mean the real stuff, diamonds, sapphires, etc. Anyway as we were looking at the cases the sales girl starts taking everything out and closing up for the night. The store didn't close for another 45 minutes!"

      Among specialty retailers, Barnes & Noble stood out, leading for a third straight year with a score of 84. Office supply retailers rebounded from a year ago, with OfficeMax making the biggest move, up four percent to 77 to tie Staples (+1 percent). Office Depot followed behind (+1 percent to 76).

      Home Depot improved for a second straight year, gaining three percent to 72. However, the improvement was not enough to move Home Depot up from the bottom of the specialty retail category or to close the gap with rival Lowe's, which gained four percent to an all-time high ACSI score of 79.

      Supermarkets were unchanged for a third straight year with an ACSI score of 76, even though food prices dropped after two years of large increases. Publix has been in the lead since 1994 and this year was no exception: the supermarket chain improved five percent to 86 -- its highest score ever.

      Safeway moved in the opposite direction one year after undertaking a large-scale store makeover. Its customer satisfaction retreated four percent to 72.

      Maureen of Novato, CA, tells that her local Safeway is always out of stuff. "Nine times out of ten, I have to go to another store to get items this store stocks, but the shelves are empty each time I shop there. The manager doesn't seem to care when you bring things to his attention."


      The finance and insurance sector improved slightly, rising 1.4 percent to 77.1. Health insurers made the largest gain, up 2.7 percent to an ACSI score of 75, led by improvements for UnitedHealth Group (+14 percent to 72) and Aetna (+8 percent to 70). Even though healthcare costs continue to rise, the pace of price increases has slowed.

      Banks held steady with a score of 75, although two of the largest banks -- Bank of America and JPMorgan Chase -- face a challenging customer environment with significant dropped in satisfaction. Smaller banks did better, as their aggregate score was unchanged for a third year at 80.

      One year after acquiring Wachovia, Wells Fargo improved one percent to 73, best among the large banks. JPMorgan Chase and Bank of America also made large acquisitions, but in the aftermath of the Chase purchase of Washington Mutual, customer satisfaction fell seven percent to 68.

      Likewise, Bank of America dropped eight percent to an industry low of 67 following its acquisition of Merrill Lynch and the subsequent cost-cutting undertaken to offset higher-than-expected debt.

      The property and casualty insurance industry declined 1.2 percent to an ACSI score of 80, while life insurance improves 1.3 percent to 79. Among life insurers, Northwestern Mutual and New York Life led the category, rising four percent each to 81 and 80, respectively.

      In the property and casualty industry, State Farm was on top at 82, a three percent improvement, followed closely by GEICO (+1 percent to 81) and Progressive (+1 percent to 80). The drop in ACSI for property and casualty insurance as a whole was driven by a three percent decline for smaller insurers, which have faced a more negative reaction to premium increases.


      The ACSI score for e-commerce was up 1.8 percent to 81.4, nearly matching its all-time high. Internet retail improved 1.2 percent to 83. Netflix led, rising two percent to 87. The online video rental company has seen sizable increases in its subscriber base, revenues and stock price over the past year.

      Amazon (unchanged) and Newegg (down two percent) were also strong performers with very high scores of 86. Customer satisfaction with eBay was up one percent to 79, but the auction site hasn't improved much over the years and eBay remained at the bottom of the list.

      "Overall, online shopping continues to grow and provide higher levels of customer satisfaction," said Fornell. "Free shipping promotions, competitive pricing, and the ability to browse and research an ever wider selection of merchandise from the comfort of one's home have made online retailing a very attractive and powerful alternative to traditional stores."

      As the stock market slump contributed to lower customer satisfaction with Internet brokerage services, the rebound in stock prices has had the opposite effect. Investor satisfaction with online brokerage was up 5.4 percent to an ACSI score of 78, the largest improvement for any category this quarter.

      Customer satisfaction with the larger full-service brokerages Fidelity and Charles Schwab has been less affected by the ups and downs of the market. They didn't fall as far last year and show less of a rebound this year, with Schwab up one percent and Fidelity down one percent to share the lead at 79.

      Even though their ACSI scores were lower, TD Ameritrade and E*Trade made big gains a year after customer satisfaction with their services plummeted, improving seven percent to ACSI scores of 76 and 74, respectively.

      Customer satisfaction with online travel websites jumped 2.7 percent to a score of 77. Priceline showed the greatest improvement, up six percent to an all-time high of 76, while Expedia led among major travel websites for a fourth straight year, up three percent to 79.

      Survey: Customers Staying Satisfied Through 2009...
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      Toyota Recalls Impact Online Car Shopping

      Toyota's loss is Ford &, Chevrolet's gain

      From the start, auto industry experts predicted Toyota's high-profile problems would benefit the carmaker's competitors. Early evidence tends to confirm that. is among the first to issue a study of Toyota's recalls on car shopping. It concludes there has been a noticeable shift away from Toyota and toward Ford and Chevrolet models.

      That confirms findings by Kelley Blue Book, which said that purchase consideration of Toyota fell 20 percent after the recent recalls, droping it from first place to third behind Chevrolet and Ford.

      For its study, CarGurus measured the change in online search volume within its car shopping product for specific recalled Toyota models. Search volumes were measured 10 days prior to and 10 days after Toyota's January 26th product recall announcement.

      After the recall announcement, Toyota's share of shopping search volume at CarGurus dropped between six and 16 percent depending on the car model. For the top four best-selling Toyota models recalled, comparable models from Ford and Chevrolet garnered the greatest increase in search volume share.

      Corolla's loss, Cobalt's gain

      During the ten days after the recall, search market share for the Toyota Corolla, the fifth best-selling car in the United States, dropped 13 percent compared to the ten days prior to the recall announcement. During this same period, the leading search share gainers for competitive products to the Corolla were the Chevrolet Cobalt, up 11 percent, and the Ford Focus, with a nine percent gain.

      Toyota's other top seller, the Camry, the third best-selling car in the United States, saw a similar shift in consumer consideration during this period. During the 10 days after the recall announcement, the Camry's share of search volume dropped 8 percent.

      During this same period, however, search market share increased 15 percent for the Ford Fusion and eight percent for the Chevrolet Impala.

      "Industry experts have already noted that Toyota's problems could impact other carmakers," said Langley Steinert, Founder/CEO of CarGurus. "What is surprising, however, is how much Ford and Chevrolet in particular appear to have benefited from Toyota's troubles. These two domestic manufacturers could leverage this opportunity to take significant market share from Toyota."

      But Toyota is mounting a counterattack but how effective it will be remains to be seen.

      Toyota Recalls Impact Online Car Shopping...
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      Big Banks Fare Worst In Consumer Survey

      HSBC achieves record low rating; Citibank, Fifth Third close behind

      One year after the financial meltdown and resulting bank bailouts, consumers have regained some trust in some financial institutions, according to a report by Forrester Research.

      "But the positive sentiment is not evenly distributed," the research group said in a statement accompanying the report.

      Some insurance companies, like USAA and Geico, regained some ground in the latest report, as did super-regional banks like PNC Bank, U.S. Bank, and Branch Banking and Trust (BB&T).

      "But some of the largest banks in the US, such as Chase and Citibank, still crowd the very bottom of the rankings," the report said. "And almost all investment firms are in the bottom half of our rankings. For the second year in a row, these wealth management firms as a group get the worst customer advocacy ratings overall."

      Forrester's annual Customer Advocacy rankings ranks nearly 50 US financial services firms in the by the percentage of customers who agree "my financial provider does what's best for me, not just its own bottom line."

      The financial services firms that rated lowest on the answer to that question are, in order:

      No more than 33 percent of customers of these companies agreed with the statement when it came to their bank or financial services firm.

      HSBC fared the worst of all, with only 16 percent of its customers agreeing with the statement. Forrester said it was the lowest customer advocacy score ever recorded.

      What could HSBC be doing to alienate so many customers? Camie, of Dayton, Ohio, is an HSBC customer by virtue of her Best Buy credit card.

      "They have the worst customer service I have ever dealt with," she told "One day when I got online to check my statement, I had a late fee of $39 dollars, but I have never received my statement in the mail. I called them and they claimed that I had signed up for paperless statements when I know that I would never do that because it would make me forget."

      Michelle, of Modesto, Calif., also has a Best Buy card through HSBC.

      "After the second statement arrived I noticed a small miscellaneous charge," she told "I looked back at the statement from the month before and there was one there too."

      Michelle called HSBC and said she was told it was an "insurance charge" in case she had a hardship and couldn't pay her bill.

      "I never signed up for this or was made aware of it at the time of purchase," she said.

      Bob, of Vancouver, British Columbia, is completely unimpressed with HSBC's financial services.

      "Their fees are astronomically high and their advisors are less knowledgeable than your local mom and pop financial planner," Bob told "They under performed the market every single year I was with them and tried to lie about the performance to trick me. They pretend to have a global advantage but really they have absolutely nothing."

      Forrester says large banks and financial institutions routinely place in the bottom of the rankings while smaller institutions rank near the top.

      "Part of it is that the banks are preoccupied with their bottom line," Forrester vice-president Bill Doyle told the New York Times. "They are public institutions who are in business to make money for their shareholder and inevitably, that shows to customers."

      Among the best-performing institutions in the Forrester survey are credit unions. This year's survey shows 70 percent of credit union customers say their financial institution puts their interests first.

      One year after the financial meltdown and resulting bank bailouts, consumers have regained some trust in some financial institutions, according to a report...
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      Energy Drinks, Alcohol a Bad Mix, Researchers Say

      Growing concern over trendy young adult cocktail

      Energy drinks are emerging as a beverage of choice for young people, who often mix them with alcohol. But combining alcohol and energy drinks may create a dangerous mix, according to research conducted at the University of Florida.

      In a study of college-aged adults exiting bars, patrons who consumed energy drinks mixed with alcohol had three time the risk of leaving a bar highly intoxicated and were four times more likely to intend to drive after drinking than bar patrons who drank alcohol only.

      The study appears in the April issue of the journal Addictive Behaviors.

      "Previous laboratory research suggests that when caffeine is mixed with alcohol it overcomes the sedating effects of alcohol and people may perceive that they are less intoxicated than they really are," said the study's lead researcher Dennis Thombs, an associate professor in the UF College of Public Health and Health Professions' department of behavioral science and community health. "This may lead people to drink more or make uninformed judgments about whether they are safe to drive."

      The UF study is the first of its kind to evaluate the effects of alcohol mixed with energy drinks in an actual drinking environment, that is, at night outside bars. Research on college student alcohol use in campus communities has traditionally relied on self-report questionnaires administered to sober students in daytime settings, Thombs said.

      Data for the UF study were collected in 2008 from more than 800 randomly selected patrons exiting establishments in a college bar district between the hours of 10 p.m. and 3 a.m. Researchers conducted face-to-face interviews with participants to gather demographic information and details on participants' energy drink consumption and drinking behavior.

      Participants also completed self-administered questionnaires that asked about their drinking history and intention to drive that night. Next, researchers tested participants' breath alcohol concentration levels. Participants received feedback on their intoxication levels and advice about driving risk.

      3 times more likely to be drunk

      Bar patrons who reported drinking alcohol mixed with energy drinks -- 6.5 percent of study participants -- were three times more likely to be intoxicated than drinkers who consumed alcohol only. The average breath-alcohol concentration reading for those who mixed alcohol and energy drinks was 0.109, well above the legal driving limit of 0.08.

      Consumers of energy drink cocktails also left bars later at night, drank for longer periods of time, ingested more grams of ethanol and were four times more likely to express an intention to drive within the hour than patrons who drank alcohol only.

      Consumers of alcohol mixed with energy drinks may drink more and misjudge their capabilities because caffeine diminishes the sleepy feeling most people experience as they become intoxicated. It's a condition commonly described as "wide awake and drunk," said study co-author Bruce Goldberger, a professor and director of toxicology in the UF College of Medicine.

      "There's a very common misconception that if you drink caffeine with an alcoholic beverage the stimulant effect of the caffeine counteracts the depressant effect of the alcohol and that is not true," Goldberger said. "We know that caffeine aggravates the degree of intoxication, which can lead to risky behaviors."

      The study, funded by the University of Florida Office of the President, raises a lot of questions and suggests topics for future research, Thombs said.

      "This study demonstrates that there definitely is reason for concern and more research is needed," he said. "We don't know what self-administered caffeine levels bar patrons are reaching, what are safe and unsafe levels of caffeine and what regulations or policies should be implemented to better protect bar patrons or consumers in general."

      Energy Drinks, Alcohol a Bad Mix, Researchers Say...
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      Seniors Looking for Love Online

      Lifestyles of older people encourage Internet dating

      Who really uses the Internet to make those "emotional connections" -- the young stud looking for a hit-and-run hookup?

      Maybe. But Alicia Cast, associate professor of sociology at Iowa State University, says older adults who are too busy to find a relationship in the conventional way are turning to the Web -- and are largely successful in making desired connections.

      "In many cases, there are some real structural forces that encourage the support and use of these technologies," says Alicia Cast. "And one of them is just structural constraints on people's time -- such as people who have kids, or have full-time jobs, or work long or extensive hours. They might also be older and the majority of people who are in their pool of eligibles are already in relationships."

      Cast and her graduate research assistant, Jamie McCartney, collected data from approximately 175 central Iowa newlywed couples over a three-year period. Among the sample, 25 couples first met online-either through online dating, social networking sites, or some other online means.

      Online daters didn't differ significantly from offline couples in terms of self-esteem levels, attractiveness, intelligence, and other personal characteristics, Cast says.

      The research found that spouses who meet online are older, less likely to be marrying for the first time, and have much shorter courtships -- averaging 18.5 months of dating before getting married compared with 42 months for those who met in more traditional ways offline.

      "There's an interesting contradiction there because the people who look online may not be perceived as being serious [by friends and family]," Cast says. "But the people who are doing the actual searching may look at it as a way to be incredibly serious about the process. And one of the things we found was that, indeed, their courtship periods are shorter."

      McCartney first identified the online trend among the study's sample, which Cast says has afforded them a rare research opportunity.

      "My understanding is that there are very few studies that have been able to simultaneously get access to a source of couples who meet through more conventional means, along with those who choose to meet people online," she says.

      Cast and McCartney continue to analyze data from their newlywed sample and are planning to publish that study in a professional journal.

      While her new research has found that people are using online means to find love, a previous study Cast conducted with David Schweingruber, ISU associate professor of sociology, suggests that a traditional proposal may have the most powerful impact when a couple decides to get married.

      Their study of 2,174 Midwestern university students on audience judgments about engagement proposals -- published in the journal Sex Roles -- found that using traditional proposal elements -- making the proposal on bended knee with an engagement ring -- still sends the most positive messages about the strength of the couple's relationship to their family and friends.

      "Taking to one's knee is still the gold standard, and so is a diamond [among the perceptions of friends and family]," Cast says.

      "Most couples know what's going to happen and so issues of sizing rings and those kinds of things are largely done behind the scenes," she adds. "But if you have a partner who doesn't do that and surprises you, then there is this kind of public evaluation where it's not considered serious until you show them the ring."

      The study also found that both men and women and older and younger individuals were likely to evaluate relationships based on their conformity to traditional proposal scripts.

      Would-be daters writing to drive home the point that one needs to be careful when looking for love online.

      Laurie of Westwood, MI, calls eHarmony "a complete fraud." She contends "they have the most unethical sick practices I have ever seen. You will be scammed in every way. I found email addresses most bogus but I kept writing. I finally got a refund or at least they said they would give me one. I now have it in writing to provide to my credit card company."

      "My profile (with was never honored as promised," writes Steve of Breckenridge, CO. "Sent random photos of people not even close to my desired profile. When I complained, they said it would change, it never did. A big scam. On top of that they promised 6 months free after charging my credit card without authorization. I am out almost $100. The site creates a lot of frustration!"

      Problems with online dating are nothing new. As long as four years ago, the state of Illinois was considering legislation to protect consumers using such services.

      Alicia Cast, associate professor of sociology at Iowa State University, says older adults who are too busy to find a relationship in the conventional way a...
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      State Attorneys General Settle with Western Union Over Money Laundering

      Millions to be used to fight 'profit smuggling' by Mexican cartels

      Attorneys general from the southwestern U.S have reached a $94 million settlement with Western Union Financial Services, Inc., that resolves a decade-long investigation into illicit money transfers that "have flowed freely" in the border region.

      The settlement includes $50 million in funding for the "Southwest Border Anti-Money Laundering Alliance," a four-state coalition against money laundering that includes the attorneys general of Arizona, California, New Mexico and Texas.

      "For years, billions of dollars in smuggling profits have flowed freely between the United States and Mexico," said California AG Edmund G. Brown Jr. "Today's agreement with Western Union gives our region the resources and cooperation we need to stem the flow of illicit cash across our borders."

      The settlement follows a decade-long investigation by the Office of the Arizona Attorney General into illegal money-laundering activity in the Southwest border region. The investigation found that hundreds of millions of dollars are being channeled to drug, weapon and human traffickers through Western Union money transfers.

      To resolve Arizona's investigation and more effectively address illegal money laundering, Western Union has agreed to:

      • Provide $50 million to establish and fund the Southwest Border Anti-Money Laundering Alliance;

      • Invest $19 million over the next several years into upgrades to its anti-money-laundering program;

      • Provide $4 million to support an independent monitoring program established to ensure anti-money-laundering measures are implemented; and

      • Pay $21 million to the State of Arizona to cover investigation and litigation expenses.

      "Bringing the four Southwest border states together and providing the money and information available in this agreement is a major step in our ability to crack down on drug cartels and organized border crime." said Arizona Attorney General Terry Goddard.

      The Southwest Border Anti-Money Laundering Alliance will support and fund training, information sharing and other initiatives in member states and Mexico and will work to enhance and better coordinate money-laundering investigations and prosecutions.

      Under the agreement, law enforcement organizations in Arizona, California, New Mexico and Texas will each be guaranteed grants totaling a minimum of $7 million to bolster efforts to combat money laundering.

      The U.S. Drug Enforcement Agency estimates that $18 billion to $39 billion is being smuggled from the United States to Mexico every year.

      State Attorneys General Settle with Western Union Over Money Laundering...
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      Consumers Scammed by Bogus Debt Collector to Get $1.6 Million

      Refund checks will arrive this month

      Thousands of consumers who were scammed into paying money they did not owe by con artists who threatened, harassed and lied to them will soon be receiving a total of $1.6 million.

      In 2003, the FTC sued three companies, operating under the name National Check Control, charging them with harassing and abusing consumers, falsely threatening criminal prosecution, illegally communicating with third parties, collecting amounts that were not due, and other violations of federal laws.

      In 2005, the court ordered a permanent halt to their operations and ordered them to pay redress to the consumers they had bilked. The defendants, including Check Investors, Inc., Check Enforcement, Inc., Jaredco, Inc., the companies' owner, Barry Sussman, and their corporate counsel, Charles Hutchins, unsuccessfully appealed the case to the Third Circuit Court of Appeals and the Supreme Court.

      Several readers wrote describing their run-ins with National Check Control.

      Kellie of Arlington, TX, says she received a letter stating that she had an unpaid check in the amount of $146.15, from "Sears." The claim, she says, came from National Check Control, which is "implying criminal prosecution. I have only shopped at Sears once in my life, and that was to purchase a major appliance for several, several, hundreds of dollars, in which I paid cash."

      Melissa from Newport News, VA, says she was threatened with jail over returned checks. "I asked for a copy of these checks because I dispute that I wrote them. He didn't let me finish before asking me did I want to go to jail today. He asked if I had children I said 'yes,' he told me to make arrangements because I was going to jail." She said she was in fear of being arrested.

      On February 7, 2008, one day after the appeals court refused to reconsider Sussman's appeal, he removed from a bank safe deposit box coins valued at $335,000 that the federal court had ordered him to turn over to the FTC for consumer redress.

      A federal jury convicted him of two felony counts -- theft of government property and obstruction of justice. In October 2009, he was sentenced to 41 months in federal prison and is currently serving his sentence.

      The FTC recovered a total of $1.6 million for consumer redress. The funds will be distributed to 24,916 consumers who each lost $100 or more as the result of the defendants' illegal actions. Consumers will begin to receive checks this month.

      Consumers Scammed by Bogus Debt Collector to Get $1.6 Million...
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      Minnesota Sues Two Health Discount Companies

      Consumers led to believe they were buying insurance

      Another state is taking a hard look at companies that sell medical discount cards, which many consumers easily mistake for cheap health insurance.

      Last week California regulators said they would seek new regulations for these health discount plans. This week Minnesota filed suit against two companies it says are exploiting the difficulty many Minnesotans have finding affordable health coverage by deceptively marketing and selling limited health discount plans to Minnesota consumers.

      The plans -- which Minnesota Attorney General Lori Swanson says were often represented to consumers as traditional or comprehensive health insurance or the equivalent -- at best offer limited discounts at select health care providers.

      "With insurance premiums rising and health care reform stalled, health discount plans are filling the void. The problem is they don't provide the financial protection people need if they get sick," Swanson said.

      A study released on February 5 by the Minnesota Department of Health found that the percentage of Minnesotans without health insurance rose from 7.2 percent to 9.1 percent between 2007 and 2009.

      Delaware and Texas firms sued

      Swanson sued Direct Medical Network Solutions, Inc., a for-profit Delaware corporation with its primary place of business in Southlake, Texas, and Association Healthcare Management, Inc., d/b/a Family Care, a for-profit Texas corporation with its principal place of business in Houston, Texas. Both companies have been given "F" ratings by the Better Business Bureau.

      The lawsuits allege that both companies deceptively marketed and sold their limited discount plans to Minnesota consumers, in part by misleading them into believing that the plans are health insurance or insurance-like products. Both companies used insurance terms like "coverage," "deductable," "co-pay" and "premium" to confuse consumers, the complaint says.

      The lawsuits allege that both companies represented to consumers that they cover 80 percent of medical expenses and have a vast network of doctors and hospitals. In fact, Swanson says the companies do not provide health insurance but only offer limited discounts off the prices charged by a narrow number of providers.

      The companies often pushed for quick sales by claiming that the current price was only available for a limited period of time or that the company could only sell a limited number of policies. They also used a misleading verification process to further the deceit on consumers, the suits say.

      Swanson says Direct Medical charged consumers an enrollment fee of around $135 and a monthly "premium" of up to $459.50. Family Care charged consumers an enrollment fee of around $100 and a monthly "premium" of up to $109.95 or more.


      Both companies, according to Swanson, generally refused to send written materials for the consumer to review prior to a purchase. When consumers received the written materials following their purchase, they often quickly cancelled the plans.

      Over one-half of Direct Medical's Minnesota customers cancelled within the first month, and more than 95 percent of the 1,216 Minnesota consumers who signed up with Direct Medical since 2007 have since cancelled. Similarly, more than 90 percent of the 3,411 Minnesota consumers who signed up with Family Care since 2004 have since cancelled, with 38 percent of Family Care's enrollees cancelling in the first month and 71 percent cancelling in the first six months.

      Both lawsuits were filed in Hennepin County District Court and seek injunctive relief, restitution for consumers, and civil penalties.

      Another state is taking a hard look at companies that sell medical discount cards, which many consumers easily mistake for cheap health insurance....
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      Illinois Sues Four Debt Settlement Firms

      States step effort to shut down scams

      The State of Illinois has filed individual lawsuits against four debt settlement companies, claiming that the defendants are engaging in deceptive marketing practices, charging excessive fees and doing little or nothing to improve consumers' financial standing.

      Along with these suits, Madigan has proposed legislation that would crackdown on the industry's abusive practices.

      "These companies are unfairly luring financially strapped consumers with misleading claims that they can effectively eliminate consumers' debt," Madigan said. "The reality is that, after enrolling in a debt settlement program, consumers too often find themselves in even worse financial straits. It's time to clean up this industry so that people struggling to pay off their debts aren't being sold a false bill of goods."

      The Attorney General's Consumer Fraud Bureau has recorded a sharp rise in consumer complaints against debt settlement companies that claim they can significantly reduce consumers' credit card debt and provide them with an alternative to bankruptcy protection. has also received a number of complaints about debt settlement companies. Kathleen, of Tollhouse, California, reported last November she had problems dealing with a company called Guardian Credit Solution.

      "We paid them $4490.00 to do a loan modification, which they never did," she told "Then one of their employees kept calling us telling us if we went into their Debt Settlement program then they could get a better deal for us on our loan modification. So we signed up for that and they got another $2395.88 of our money. They were going by the name Green Credit Solutions and then changed to Guardian. The debt settlement part of their firm was going under Green Credit Law Center and then changed to Erickson Law Group."

      Familiar story

      Typically, after consumers enroll in debt settlement programs, the companies charge excessive upfront fees and advise consumers to stop paying their credit card bills. For the first several months, significant portions of consumers' monthly payments are applied to the debt settlement company's fees, making it difficult for consumers to save enough money to be used for settlement purposes.

      As a result of not paying their credit card bills for months, credit card companies add fees and penalties to consumers' credit card balances and often even begin collection efforts to recoup the debt, all of which puts the consumers in a worse financial situation. In many instances, while consumers were enrolled in debt settlement programs, credit card companies have sued the consumers to collect the balance on the consumers' accounts.

      Madigan's lawsuits name the following defendants:

      &#149 Clear Your Debt, LLC, Swiftrock Financial, Inc., Orion Processing, LLC, and two managing members, Derin Scott and Shannon Scott. The defendants operate the businesses in Austin and Lago Vista, Texas;

      &#149 Endebt Solutions, LLC, d/b/a DebtOne Financial, based out of Long Beach, Calif.;

      &#149 Debt Consultants of America, Inc., and its owner Robert J. Creel of Dallas, Texas; and

      &#149 American Debt Arbitration of Clearwater, Fla., ADA President and Director Glenn P. Stewart, and Phoenix-based Nationwide Asset Services, Inc., NAS President and Director William Anderson, and Secretary and Director Gary K. Brown.

      In each case, Madigan's complaint alleges that the defendants have violated the Illinois Consumer Fraud and Deceptive Business Practices Act by misrepresenting the services they can provide to consumers and the impact that those services will have on consumers' credit.

      Each complaint asks the court to enter a permanent injunction barring the defendants from engaging in debt settlement in Illinois and order the defendants to pay restitution for aggrieved consumers, civil penalties of $50,000 for violating the Consumer Fraud Act, an additional $50,000 penalty for each violation committed with the intent to defraud, as well as a $10,000 penalty per violation committed against a person 65 years or older.

      Last October 40 Attorneys General signed a letter to the Federal Trade Commission asking the agency to tighten regulation of companies offering debt relief services to consumers. The FTC is currently reviewing a new rule proposal to amend the current Telemarketing Sales Rule.

      Illinois Sues Four Debt Settlement Firms...
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      Suit Says 'Biggest Loser' Jillian Michaels' Diet Supplement is 'Worthless'

      Supplement promises to restrict caloric intake automatically

      By Jon Hood

      February 11, 2010
      Former Biggest Loser Jillian Michaels is also a big liar, according to a class action lawsuit that calls a Michaels-endorsed diet supplement worthless.

      The suit, filed Tuesday in Los Angeles Superior Court, says that the Jillian Michaels Maximum Strength Calorie Control supplement falsely claims that it will restrict your caloric intake automatically. The complaint quotes Michaels's website,, as claiming that the drug is like an automatic diet. What could be easier! Print advertisements similarly boast, Two Capsules Before Main Meals And You Lose Weight. That's It.

      Michaels's website which paradoxically claims that America's TOUGHEST trainer makes losing weight SIMPLE! calls the supplement a proprietary formula specifically developed to restrict your caloric intake automatically. In other words, when you take this compound before main meals, you eat less... but the best part is, you won't even know it.

      Lead plaintiff Christie Christensen bought the supplement in January, and quickly discovered that it doesn't live up to the hype. According to the suit, Christensen bought the supplement after reviewing [and] believing the aforementioned claims, but, alas, her appetite did not decrease, her caloric intake was not automatically restricted, and she did not lose any weight.

      Christensen's lawyer says the suit has brought more dissatisfied dieters out of the woodwork. We're getting calls from many people now as a result of this who claim they had been similarly misled, said Melissa Harnett, of Los Angeles-based Wasserman, Comden & Casselman LLP. When it's a celebrity who has built her fame on telling people that it takes blood, sweat and tears to lose weight and then turns around and capitalizes on that fame by putting out a product that inherently is contrary to the notion that you need to exercise and eat right to lose weight, there's something wrong with that picture.

      The complaint takes a similarly disappointed tone, noting that while Michaels is fond of saying that long-term weight loss requires 'blood, sweat, and tears' she has decided to squander her fame by lending her name to to a worthless dietary supplement.

      No FDA approval

      Dietary supplements are not subject to FDA registration or approval. The Agency puts the onus on manufacturers to ensure the pills are suitable for sale, and generally only takes action if it discovers that an already-available pill is unsafe. Because of this relatively lax regulation framework, dietary supplements are notoriously hard to trust, and in rare cases they can prove dangerous or even deadly.

      Last May, the FDA warned consumers to stop taking Hydroxycut after discovering that the popular supplement could cause serious liver damage. That notice came after the Agency received 23 reports of serious liver damage, and learned of at least one liver-failure-related death.

      Christensen's suit is brought on behalf of all California residents who bought Michaels's supplement within the last four years, and alleges violations of several California consumer protection statutes. The complaint also names as defendants Thin Care International, which produces the supplement, and Basic Research, which handles the product's marketing.

      The complaint quotes a valuable warning from the FDA, that applies across time and regardless of whether a supplement is the subject of litigation: [M]any people look for quick and easy solutions to their weight problems. They find it hard to believe in this age of scientific innovations and medical miracles that an effortless weight-loss method doesn't exist. Any claims that you can lose weight effortlessly are false.

      Suit Says 'Biggest Loser' Jillian Michaels' Diet Supplement is 'Worthless'...
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      CVS Pays $1.95 Million to Settle Indiana Charges

      Two pharmacists with expired licenses wrote prescriptions for years

      CVS has agreed to pay the State of Indiana $1.95 million and look more closely at the expiration dates on its pharmacists' licenses.

      The state brought charges, claiming that two pharmacists with expired licenses dispensed prescription drugs for several years at CVS Pharmacy Stores.

      The case stemmed from an investigation by Attorney General Greg Zoeller's Medicaid Fraud Control Unit (MFCU). It alleged that at different times between 1997 and 2007, CVS employed as pharmacists two individuals whose licenses had expired: Morris "Mo" Skirvin at a store in Nashville, Ind., and Edward Certain at a store in Marion, Ind.

      According to the investigation, Skirvin's pharmacist license expired in 1990, long before his employer Hook-SupeRx was acquired by CVS, but he did not renew the license and allegedly forged a new one each renewal period.

      After MFCU began investigating Skirvin's license, CVS came forward and disclosed that another pharmacist, Certain, also had been practicing without a license. Certain had a valid license at one time but it expired in 2002 and he did not renew it, MFCU found.

      Together, Skirvin and Certain filled an estimated 60,778 prescriptions, the investigation alleged, and the Indiana Medicaid program was over-billed for fees to which the unlicensed pharmacists were not entitled.

      "When consumers get prescriptions filled, they do so trusting that the person behind the pharmacy counter dispensing medication is up to date on their licensing. That trust was violated by these two individuals," Zoeller said. "To its credit, CVS has resolved this situation in a responsible way: First it came forward and acknowledged that a pharmacist with an expired license had been employed at its Marion store. Now CVS will implement a screening program to ensure that none of its pharmacist employees are operating without a license."

      As part of the settlement, CVS also agreed to set into motion several consumer protections: It must verify that pharmacist employees and contractors have valid Indiana pharmacist's licenses. CVS must require applicants for pharmacist positions to disclose any aliases they have used and whether they are ineligible to hold a license.

      Within 90 days of the agreement's approval, CVS will perform records checks on its Indiana pharmacist employees through the Indiana Professional Licensing Board to verify that all are appropriately licensed. The company will perform similar checks every six months for three years, the agreement says.

      This week the Indiana Board of Pharmacy approved a related licensing agreement with CVS that was connected to CVS's agreement with the Attorney General's Office.

      The $1.95 million settlement with the State, to be paid within 60 days, is not considered a fee or a fine or an admission of wrongdoing; and it will be used to reimburse the Indiana Medicaid program and investigative costs, Zoeller said.

      CVS Pays $1.95 Million to Settle Indiana Charges: CVS has agreed to pay the State of Indiana $1.95 million and look more closely at the expiration dates on...
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      Google Cuts Nexus One Cancellation Fee

      Price cut comes after FCC inquiry

      Google has cut the early termination fee (ETF) for its Nexus One smartphone from $350 to $200, coming on the heels of an inquiry from the Federal Communication Commission (FCC) about the high price, according to the Wall Street Journal.

      The Nexus One is distinctive for lacking any "lock-in" to a major wireless carrier. Buyers of a Nexus One without a network plan only have to pay the $535 fee up front, and pay no cancellation fee.

      But those who buy the phone at a reduced rate with a T-Mobile contract -- currently the only carrier offering a plan for the phone -- originally had to pay a $350 fee to Google, on top of a $200 ETF for T-Mobile, if they canceled the contract within the first two months of service.

      That led to the FCC sending a letter to Google as part of its larger inquiry into wireless carrier cancellation fees. "The purpose of this letter is to gather information about whether customers are adequately informed about Google's Equipment Recovery Fee in connection with its offering of the Nexus One to customers who agree to a two-year contract with T-Mobile," the agency said.

      "We've been working with T-Mobile to improve our customers' overall Nexus One experience through a reduction in the equipment recovery fee (ERF) associated with purchasing the Nexus One with a T-Mobile service plan," Google said in a statement.

      ETFs are a bone of contention in the wireless industry. Critics claim that they "lock in" customers to long-term contracts with a carrier to avoid paying high penalties, while supporters say the fees are necessary to subsidize the sale and marketing of high-end phones at a low cost.

      Numerous lawsuits brought at the state level, and threatened regulation at the federal level, led all four major wireless carriers -- AT&T, Sprint, T-Mobile, and Verizon Wireless -- to prorate their termination fees over the life of a two-year contract.

      Media watchdog group Free Press, a staunch foe of termination fees, praised Google for cutting the ETF on the Nexus One. "This is clear evidence that the wireless industry needs an active cop on the beat to look out for consumers," said Free Press policy counsel Chris Riley.

      The wireless carriers' responses to the FCC inquiry are due on February 23.

      Currently, the Nexus One only works on GSM networks, which prevents it from being usable with Sprint, Verizon Wireless, or most AT&T networks. Google has claimed that a version of the Nexus One will be available for Verizon Wireless customers soon.

      Google Cuts Nexus One Cancellation Fee...
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      Toyota Issues Recall To Fix Prius Brake Problem

      But only 2010 models are included in recall

      For Toyota, it's one more headache as the beleaguered carmaker issued a widely expected recall to fix a problem on 133,000 2010 Prius models, as well as 14,500 Lexus vehicles.

      Toyota said it would update software in the vehicles' anti-lock brake system. The ABS, in normal operation, engages and disengages rapidly as the control system senses and reacts to tire slippage.

      Some 2010 model year Prius and 2010 HS 250h owners have reported experiencing inconsistent brake feel during slow and steady application of brakes on rough or slick road surfaces when the ABS is activated in an effort to maintain tire traction. Some have reported not being able to stop the car.

      Toyota said it responded to owner concerns with a running production change for 2010 Prius that was introduced last month, improving the ABS systems response time, as well as the systems overall sensitivity to tire slippage. The production change for the HS 250h is planned for later this month.

      The brake problem recall comes on top of the highly-publicized sudden acceleration recall that prompted Toyota to not only recall eight popular models of its cars, but suspend their sale in the U.S.

      The Prius Brake recall is limited to 2010 models although has received complaints about other model year Prius brake problems. Last month, Lisa, of South Salt Lake, Utah, reported a problem with her 2008 Prius.

      From day one I have noticed the brakes do not work properly, Lisa told At first I thought it was just a terrible car for rain or snow but it was having problems in the slightest rain shower. If I hit a pot hole or bump while slowing down the brakes release. If the traction control activates the brakes release. The smallest bump or slight slip from one tire and the brakes stop working. If I'm turning into a driveway or onto a side street and theres a bump or dip by brakes will release and my car will slide. Now that I'm aware of the brakes slipping I've noticed it's every day, the roads will be perfectly dry, I have brand new tires, the brake pads just barely checked at the dealer, but if I hit a bump I have no brakes.

      Recall Limited To 2010 Models

      Unfortunately for Lisa and other drivers experiencing the problem in older models, both the recall and the National Highway Traffic Safety Administration probe are limited to the 2010 Prius. NHTSA reported last week it had opened an investigation into the 2010 Prius after receiving 124 complaints about the brakes.

      Toyota said the recall will allow Toyota dealers to perform the software update on 2010 Prius vehicles sold prior to this running production change. Only Prius vehicles produced since May 2009 and all HS 250h vehicles are subject to this recall. The company says first- and second-generation Prius vehicles use a different ABS system and are not involved in this campaign.

      The ABS system on the Lexus HS 250h is similar in design to the Prius. The software adjustment planned for HS 250h production and dealer modification is being finalized and will be announced very soon, the company said.

      Toyota will begin mailing letters to Prius owners included in this recall next week and HS 250h owners within the next few weeks, to let them know when to bring their vehicles into a dealership. Owners will only receive a letter if their vehicle is involved in the recall.

      Older Camrys Recalled

      Separately, Toyota said it will conduct a voluntary safety recall on approximately 7,300 early production - 2010 model year Camry vehicles equipped with the 4 cylinder engine to inspect for a power steering hose that may be in contact with a front brake tube. This contact could lead to a hole in the brake tube and cause a brake fluid leak, increased brake pedal stroke and greater vehicle stopping distance.

      Owners of the involved 2010 Camry vehicles will be notified by mail starting in the middle of February.

      Were committed to doing everything we can as fast as we can to restore consumer trust in Toyota, and these recalls are part of this effort, said Jim Lentz, President and Chief Operating Officer, Toyota Motor Sales. We regret the inconvenience this recall will cause to Prius and HS 250h owners, and will do our best with the support of our dealers to make sure that it is conducted in the most trouble-free manner possible.

      For Toyota, it's one more headache as the beleaguered carmaker issued a widely expected recall to fix a problem on 133,000 2010 Prius models, as well as 14...
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      Court Reinstates Dell Class Action Over Faulty Parts

      Arbitration clause ruled unenforceable

      A class action alleging that Dell shipped faulty laptops is set to reopen, after a federal appeals court reversed a 2008 district court ruling dismissing the case.

      The suit was brought by lead plaintiffs Michael Omstead, Melissa Malloy, and Lisa Smith, who allege that their Inspiron laptops contained defective cooling fans, power supplies, and other essential materials. The suit concerns Inspiron 5160 and 1150 models sold between July 2004 and January 2005.

      The case's dismissal arose out of a complicated back-and-forth between Dell and the plaintiffs shortly after the case was filed. Dell moved to compel individual arbitration, pointing to a clause in its terms and conditions that requires all disputes to be "resolved exclusively and finally by binding arbitration administered by the National Arbitration Forum (NAF)."

      The plaintiffs contended that individual actions would be a waste of time and money, and that the NAF is "blatantly biased" against consumers. Because of the plaintiffs' refusal to arbitrate their cases, Dell filed a motion to dismiss based on failure to prosecute. The court granted the motion, and the plaintiffs were seemingly out of luck.

      However, in the order reinstating the case, Judge Lyle Strom of the U.S. Court of Appeals for the Ninth Circuit held that the dismissal was an "abuse of discretion," and stated emphatically that "[the p]laintiffs did not cause any unreasonable delay in the progression of their case."

      The court went on to hold Dell's arbitration provision unenforceable in its entirety when judged under California law. The court cited California case law holding that an arbitration agreement is unenforceable when "(1) the waiver is found in a contract of adhesion, (2) the contractual setting is one in which disputes between the contracting parties predictably involve small amounts of damages, and (3) it is alleged that the party with the superior bargaining power [here, Dell] has carried out a scheme to deliberately cheat large numbers of consumers out of individually small sums of money."

      The court's ruling is a major victory for the named plaintiffs, who had no recourse after the case was thrown out. The very purpose of class actions is to provide relief to consumers whose damages are too small to justify the time and money necessary to bring an individual lawsuit. Indeed, plaintiffs in class action lawsuits do not have to pay their attorneys; legal fees come out of the eventual settlement (assuming there is one).

      Counsel for the plaintiffs were predictably satisfied with the ruling. "We got the courtroom doors open, which was our primary goal," said Jonathan Selbin, one of the attorneys for the plaintiffs.

      Arbitration clauses have come under increasing scrutiny in recent years. In March 2009, the Supreme Court ruled last year that consumers can sometimes fight such provisions. And in July, NAF agreed to stop arbitrating all credit card cases pursuant to an agreement reached with Minnesota Attorney General Lori Swanson.

      Court Reinstates Dell Class Action Over Faulty Parts...
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      Big Changes Coming for Banks in 2010

      'Free checking' likely to be among the casualties

      Although the recession may have dealt its worst blows, banks are adjusting to a new environment, one with stricter regulations, fewer opportunities for big risks, and heavy sentiment against them.

      In that light, Mintel Comperemedia, a provider of direct marketing intelligence, is forecasting five major changes for banks in 2010.

      "Based on evidence from recent direct marketing, I see waves of change ready to wash through the banking industry," says Susan Wolfe, vice president of financial services at Mintel Comperemedia. "From the fall of free checking to the rise of comprehensive banking rewards programs, banks seem poised to make 2010 a year of innovations. The biggest challenge will be finding new opportunities for revenue."

      The end of "free checking"

      It's been a marketing mantra, but this year, the cry of "free checking" will start to fade, Wolfe believes. In 2009, fewer than half of checking direct mail offers promoted free checking, down from three-quarters in 2007-2008. "With pending regulations on overdraft fees, banks risk losing a major revenue source," she said. "Charging fees on checking is one way to recoup income." Some banks may implement monthly fees, while others will let customers decide which perks are worth paying for, similar to the "Build to Order" checking account from BBVA Compass.

      Bigger rewards programs

      With the decline of free checking, Mintel expects an increase in rewards checking and more specifically, rewards banking. As financial institutions look for ways to appeal to new clients and make current customers more loyal and profitable, they'll start offering rewards for more than just debit use. Capital One, for example, introduced reward checking in late 2009, linking to its credit card rewards program so customers could earn points faster.

      Programs designed to increase deposits

      Another way banks will try to increase revenue in 2010 is by creating automatic account builder products that boost deposits. Industry leaders Bank of America and Wachovia already feature innovative savings programs -- "Keep the Change" and "Way2Save" -- and Capital One has just launched "SmartCents" checking. Deposit-building accounts get customers invested in multiple products, while helping banks secure more deposits.

      More aggressive debit card marketing

      Mintel has seen direct mail decline across financial services categories, but debit card volume remains strong at nearly 67 million offers in 2009. "I expect we'll see more aggressive debit card marketing this year because banks are using debit fees to increase revenue," Wolfe speculates. "Direct mail may not increase, but I expect to see more cash incentives and other perks that encourage debit card usage."

      Cash incentives increase and expand

      Cash incentives are a hot direct marketing tactic for checking accounts, appearing in most offers. In 2010, cash incentives will grow even more enticing. Mintel Comperemedia has already seen $200 and higher from Capital One and Key Bank. The company expects banks to start using cash incentives for other types of deposit accounts, too.

      While the Mintel prognostication doesn't mention it, a change in the way in which banks deal with their customers might go a long way toward increasing the industry's bottom line. Complaints to from bank customers indicate the treatment consumers receive is a major gripe.

      Scott from Jacksonville, FL, says BBVA Compass Bank charged him $76 in NSF (non sufficient fund) fees for withdrawal transactions that occurred on the same date as a deposit which covered the amount of the withdrawals. "The explanation was that 'withdrawals are processed before deposits.' They seem unwilling to reverse the charges. I don't like being ripped off, especially in these difficult economic times. The executives of this particular bank are absolutely ignorant if they think I'm going for this. This is an example of very poor customer service and as a result, the bank has lost my business permanently."

      Freddie from Rex, GA, tells of a terrible experience he had discussing an account problem with a Bank of America representative. "As the conversation begin to progress she begin to act cold & heartless acting as if I done something wrong by questions her about my credit. When I expressed my concerns over her closing my account without my permission & how I wanted to protect my credit she stated she didn't care & close the account anyway. One person can really ruin a great banking relationship & experience with awful customer service."

      Big Changes Coming for Banks in 2010...
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      California Targets Medical Discount Plans

      State officials seek new licensing regulations

      For the self-employed and the unemployed, finding good, affordable health insurance can be a challenging task. Consumers who mistake a medical discount service for a health insurance policy can wind up losing money and still having no insurance.

      In California, state regulators have begun cracking down on discount health and dental plans that consumers say they are led to believe are insurance plans. The marketers of these medical discount plans, meanwhile, insist there is nothing misleading in their pitch.

      California is not the first state to take on medical discount plans. In Massachusetts last September, Attorney General Martha Coakley filed proposed new consumer protection regulations designed to protect residents of the Bay State from unscrupulous marketing of plans that claim to offer discounts on medical products or services.

      The problem was greater in Massachusetts, perhaps, because the state had passed a law requiring all residents to have health insurance.

      It is critical that companies who offer any kind of medical coverage plans or medical discount card clearly disclose what their plans do and do not offer, and whether they fulfill the individual mandate." Coakley said at the time. "We have received numerous complaints from consumers who have fallen victim to these deceptive discount plan scams."

      The complaints are also being heard in California. Health officials say medical discount plans are being pushed the hardest in poor communities. The worst offenders, they say, are fraudulently marketing themselves as low-cost insurance.

      "They're basically cheating poor people," Dr. Dev GnanaDev, immediate past president of the California Medical Association, told the Los Angeles Times.

      After receiving more than 150 consumer complaints about misleading medical discount pitches over the last four years, the California Department of Managed Health Care is asking for new licensing regulations.

      Department officials say a number of plan marketers have promised consumers unrestricted access to medical providers, when in fact the cards were worthless.

      At best, a medical discount card will offer patients a negotiated discount for services with participating medical service providers. If you go to a doctor or hospital or doctor that has an agreement with the medical discount plan, you would receive a discount.

      However,it is a fact that health care providers routinely discount their services -- often at an inflated price to start with -- for patients who lack insurance, or who must pay a large deductible out of pocket. So in some cases, an uninsured patient might get the same break as someone who had paid for a medical discount card.

      The Times reports the industry trade group that represents the medical discount plan industry is also pushing for regulations, to keep "bad actors" out of the business and damaging the industry's reputation. With California's unemployment rate high and still rising, state officials say it's a fertile environment for those tempted to blur the line between health insurance and a medical discount plan.

      In California, state regulators have begun cracking down on discount health and dental plans that consumers say they are led to believe are insurance plans...
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      Coke Charging More for Less

      CSPI: Price works out to $8.50 a gallon

      Coca-Cola has introduced a new, 7.5-ounce can of its iconic soft drink and while calorie counters may appreciate the convenience of a 90-calorie can, dollar counters may be in for sticker shock.

      According to the Center for Science in the Public Interest (CSPI), the new cans cost 50 to 140 percent more than 12-ounce cans on an ounce-for-ounce basis.

      In Washington, D.C., 12-packs of 12-ounce cans have been available for between $4 and $5.99 at Giant and Safeway stores. Both stores charge $3.99 for 8-packs of the new 7.5-ounce cans. So while the bigger cans have been selling for between $0.89 and $1.33 per quart, the new ones sell for $2.13 a quart, or about $8.50 a gallon.

      So far, the smaller cans are available only in some New York City and Washington, D.C., retail outlets. The company says they'll go available nationwide in April.

      Sandy Douglas, the president of Coca-Cola North America, claims the new mini can is an "innovation" that "reinforces the Company's support for healthy, active lifestyles." But attentive shoppers may wonder what all the fuss is about. Coca-Cola has sold 8-ounce cans and bottles of Coke for years (again, at significantly inflated prices).

      "The only 'innovation' here is that Coke is charging more money for less product," said CSPI executive director Michael F. Jacobson. "Then again, these are the same folks who are ripping off Americans with expensive frauds like the 'calorie-burning' Enviga. And 'endurance peach mango' VitaminWater, which, besides doing nothing for one's endurance, contains no peach or mango. Now, the company wants a pat on the back for selling little cans of water and high-fructose corn syrup for $8.50 a gallon."

      Recently, New York Governor David Paterson proposed a penny-per-ounce excise tax on soda pop to help pay for health programs. An angry press statement issued by the industry's top lobbyist called the proposal a "money grab, pure and simple," and reminded the Governor that New Yorkers "continue to struggle through a tough economy with double-digit unemployment rates." Yet the price difference assessed by Coca-Cola on the 7.5-ounce cans is bigger than Paterson's proposed tax -- about two or three cents per ounce.

      Coke Charging More for Less...
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      Renters of Foreclosed Properties in Connecticut Have Rights

      But many renters remain unaware of new law

      Homeowners aren't the only ones affected by the foreclosure crisis. Renters also face problems, not of their own making, when their landlord defaults.

      Thanks to legislation signed into law in Connecticut last year, renters have new rights and can't be immediately evicted. Before the new law, renters were often the last to know their home was in foreclosure. Sometimes they continued paying rent to their former landlord, who pocketed the money even though they no longer owned the property.

      Before the "Protecting Tenants at Foreclosure Act of 2009" took effect, most leases were nullified if the property went to foreclosure, meaning the occupants of the house had no rights. Under the new law, tenants may stay in a foreclosed home until their lease expires. If they are on a month to month contract, they are entitled to 90 days notice before having to move.

      Unfortunately many tenants are still unaware of their new rights, and in Connecticut, Attorney General Richard Blumenthal reports bankers and realtors are taking advantage of that lack of awareness.

      Blumenthal says his office has received complaints from tenants hastily and illegally forced out of rental homes after their landlords' properties were foreclosed. Evicted tenants are typically current on their rent, but face eviction because of their landlord's financial troubles.

      In many cases, he says real estate agents have pressured tenants to leave, without informing them of their rights under the new federal law. Some banks begin eviction procedures immediately upon completing foreclosure, despite the consequences for tenants and a federal law that requires a 90-day delay.

      "Tenants have rights to remain until their lease ends -- rights that deserve respect and enforcement," Blumenthal said. "We're warning banks and real estate interests: foreclosure is no excuse for illegal eviction. These cease-and-desist letters send a message to powerful property owners that foreclosure gives them no right to engage in automatic eviction."

      Hasty evictions serve no one's interests, Blumenthal says. Vacant properties quickly become rundown and damaged by vandals, decreasing the value of foreclosed properties and surrounding properties.

      "Tenants in foreclosed properties -- victims of their landlord's financial failures -- deserve to be treated fairly and lawfully when forced to find a new home," Blumenthal said. Law firms, Realtors and lenders have moral and legal obligations to provide fair notice and time for tenants to find alternative housing after foreclosures. We are alerting law firms, lenders and real estate companies that they must follow this law or face legal action.

      Renters of Foreclosed Properties in Connecticut Have Rights...
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      Chemnutra Owners Sentenced for Melamine-Tainted Pet Food

      Nevada couple gets probation and $25,000 fine

      A federal judge today sentenced two Nevada business owners to three years probation for distributing a melamine-tainted ingredient that triggered a massive pet food recall in 2007 and caused the deaths and illnesses of thousands of dog and cats nationwide.

      U.S. Magistrate Judge John T. Maughmer also ordered Sally Qing Miller, 43, a Chinese national, and her husband, Stephen S. Miller, 57, to each pay a $5,000 fine. In addition, Whipple ordered the Miller's company, Chemnutra, Inc., to pay a $25,000 fine.

      Today's sentencing ends a long legal case that centered on the involvement of the Millers and Chemnutra with importing and distributing the melamine-tainted wheat gluten used in the recalled pet food.

      A Rhode Island pet owner whose cats died after eating some of the tainted food said today's sentence was too lenient, and justice was not served.

      "I feel the sentence is not appropriate, said Carol V. of Rhode Island, whose beloved cats, Smudge and Jessica, died of renal failure. "They (the Millers) did not follow the rules and thousands suffered because of it -- financially and emotionally."

      "There is no justice for Smudge, Jessica, or the others," she added. "This was no elbow knocking over a bad ingredient. Whether or not they knew someone in China adulterated the product does not matter to me. This company did not abide by the laws and rules of importing a food product. Laws and rules exist for a reason. When they are broken, there should be consequences."

      But federal officials applaud the judge's sentence and their investigation and prosecution of the case.

      "Today's sentence sends a strong message that we will work tirelessly to stop dangerous goods from entering the American marketplace," said John Morton, the Department of Homeland Security's assistant secretary for U.S. Immigration and Customs Enforcement (ICE). "ICE will continue to aggressively pursue individuals and organizations involved with illegally importing tainted or substandard goods that may jeopardize the safety of our families, communities and pets."

      "We commend the action of the U.S. Attorney's Office against those companies and individuals responsible for many animal injuries and deaths from melamine contamination of pet food. The FDA will support strong enforcement of the law to protect the health and safety of our pets," said Dr. Joshua M. Sharfstein, principal deputy commissioner of the Food and Drug Administration (FDA).

      Chemnutra is a Nevada-based company that buys food products in China and imports them into the United States. The company then sells those products to pet food makers and other manufacturers in the food industry. Sally Miller is Chemnutra's controlling owner and president, while Stephen Miller is an owner and the company's chief executive officer.

      From November of 2006 through February 2007, Chemnutra and Millers imported more than 800 metric tons of melamine-tainted wheat gluten from China in at least 13 separate shipments, according to a federal indictment. Melamine is a chemical used to make plastic and fertilizers and is not allowed in human or pet food.

      Chemnutra and the Millers received the melamine-tainted wheat gluten at a port of entry in Kansas City, Missouri, the indictment said. The company then sold and shipped the tainted wheat gluten to customers across the United States, who used the tainted product to make various brands of pet food.

      A federal grand jury in 2008 indicted the Millers and Chemnutra for their roles in importing the tainted wheat gluten.

      The Millers and their company later pleaded guilty to one count of selling adulterated food and one count of selling misbranded food.

      "By pleading guilty, Chemnutra and the Millers admitted that melamine was substituted wholly or in part for the protein requirement of the wheat gluten so as to make it appear the wheat gluten was better or of greater value than it was," Beth Phillips, United States Attorney for the Western District of Missouri, said in a statement released today. "They also admitted that the labeling of the wheat gluten was false and misleading because the wheat gluten was represented to have a minimum protein level of 75 percent, when in fact it did not. The labeling was also false and misleading because melamine was not listed on the label as an ingredient."

      During today's federal court hearing, Judge Maughmer decided not to impose further restitution because of the $24 million settlement reached in a civil suit filed in the wake of the pet food recall.

      The melamine-tainted wheat gluten forced pet food makers to recall more than 150 brands of dog and cat food during 2007. It was the largest pet food recall in U.S. history.

      Dogs and cats across the country suffered kidney failure after eating the contaminated food. While there is no coordinated national tracking system to monitor the number of pet deaths, the FDA said approximately 1,950 cats and 2,200 dogs died after eating pet food made with tainted wheat gluten imported from China.

      Wheat gluten is a natural protein used as binding agent in pet food to thicken the gravy. Adding melamine to the wheat gluten made the product appear to have a higher protein level than it did, FDA officials said.

      Back in Kansas City, Phillips said her office will continue to aggressively prosecute companies and individuals who put consumers at risk.

      "We are committed to protecting the health and safety of the public," she said. "We will vigorously prosecute those who violate the Food, Drug, and Cosmetic Act and other federal statutes designed to protect the public from this kind of criminal conduct."

      Assistant U.S. Attorneys Gene Porter and Joseph Marquez prosecuted the Chemnutra case. It was investigated by the FDA's Office of Criminal Investigation and U.S. Immigration and Customs Enforcement.

      Chemnutra Owners Sentenced for Melamine-Tainted Pet Food...
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      Disability Advocates 'Shocked' at Their Levels of Toxic Chemical Exposure

      New study examines possible links between disability and toxicity

      A new study examining possible links between exposure to chemicals used in everyday products and learning and developmental issues strikes a personal chord with leading advocates for the disabled.

      Could the autism, cerebral palsy, or other learning and developmental issues these individuals and their families face be associated with the toxic burdens in their bodies? Could the toxins in their bodies impact the fate of any children they hope to have in the future?

      Those are the issues the new study, "Mind, Disrupted", wanted to explore.

      The study's release on Thursday coincided with a Senate hearing about the public's exposure to chemicals and the country's outdated Toxic Substances Control Act (TSCA).

      In the new study, sponsored by the Learning and Developmental Disabilities Initiative, 12 "leaders and self-advocates" from the learning and developmental disabilities community volunteered to have their bodies tested for 89 chemicals known or suspected of sabotaging the development of humans' brains and nervous systems.

      The chemicals included bisphenol A (BPA), lead, mercury, organochlorine pesticides, polybrominated diphenyl ethers (PBDEs), perchlorate, perfluorinated compounds (PFCs), and triclosan.

      The study found:

      • A total of 61 chemicals in the 12 participants;

      • Each participant had at least 26 chemicals in their bodies; some had as many as 38 chemicals;

      • 16 chemicals were detected in all the participants, including BPA, mercury, lead, polybrominated diphenyl ethers (PBDEs), perfluorinated compounds (PFCs), perchlorate, and organochlorine pesticides;

      • 11 participants had detectable levels of triclosan, which has been found to disrupt thyroid hormone function in rats. This chemical is used in antibacterial soaps, toothpaste, and other personal care products;

      • 10 participants had mercury levels above the Centers for Disease Control and Prevention (CDC) average. Studies have linked exposure to this heavy metal with altered memory and motor function, and learning disabilities;

      • 8 participants had a brominated flame retardant known as Deca in their bodies. Prenatal exposure to this chemical, used in electronics and furniture upholstery, has been linked with impaired fine motor skills and attention. Elevated levels of this chemical in umbilical cord blood has also been associated with lower scores on multiple developmental tests in children;

      • 3 participants had lead concentrations above the CDC average. Lead is a heavy metal used in electronics, PVC plastics, and cosmetics. Studies have linked prenatal exposure to lead with premature births, learning difficulties, and decreased intelligence.

      "I was very shocked to see how many toxic chemicals were in my body," said participant Jeff Sell, who has 15-year-old twin sons with autism. He is the Vice-President of Public Policy for the Autism Society (ASA). "I started going green before it was fashionable and I watch what I put in my body and what I eat. I didn't think my toxic exposure would be as high as was."

      "These chemicals are not supposed to end up in our bodies," said participant Cathy Ficker Terrill, president and CEO of the Ray Graham Association for People with Disabilities. Her daughter, Beth Terrill, who also participated in the study, has a developmental disability and chemical sensitivities.

      "Having a child with complex allergies made (my family) very interested in learning about toxic chemicals," Ficker Terrill said. "We were shocked by our chemical body burden results because we have been living in an allergy-free house since Beth was 8."

      Researchers billed this analysis as the first biomonitoring study that exclusively focused on members of the learning and developmental disabilities community.

      "Its goal is to identify the presence of toxic chemicals that are associated with disrupting healthy neurological development in people whose lives have been directly touched by learning and developmental disabilities," researchers said of the study.

      The study, however, did not attempt to "correlate the presence, type or severity of a disability," researchers said. "Given the current state of scientific knowledge, no one can say that an exposure to a specific chemical causes a specific developmental disability."

      "Overwhelming evidence"

      But not everyone is willing to be so reserved in their conclusions.

      "The overwhelming evidence shows that certain environmental exposures can contribute to lifelong learning and development disorders," said Dr. Ted Schettler, Science Director for the Science and Environmental Health Network.

      Consider some of the chemicals researchers found in all the participants' bodies and their possible associations with learning and developmental issues:

      • BPA: This chemical is widely used in such products as baby bottles and the lining of metal food and beverage cans. Prenatal exposure to BPA has been linked with altered behaviors in two-year-old children, especially girls.

      • Lead: Studies have linked exposure to this heavy metal with premature births, learning difficulties, and decreased intelligence.

      • Perchlorate: This chemical is used in rocket fuel and airbags. Studies have linked exposure to perchlorate with reductions of iodine in breast milk and neonatal thyroid hormone levels in rats. In humans, some research suggests that maternal exposure to perchlorate during pregnancy could possibly cause abnormal fetal development.

      • Four organochlorine pesticides, including DDT, which was banned in the United States in 1972. Exposure to these pesticides has been linked with decreased metal function, including memory, attention, and verbal skills in children. Most of the research was done in children raised in agriculture areas;

      Discovering these and other toxins in their bodies frightened and angered many of the study's participants.

      "It is disturbing that even though it's been a long time since DDT has been banned as a pesticide in the U.S., it still exists and builds up in our bodies. It's disturbing that it has that kind of staying power long term," said participant Vernell Jessie, when she learned her body was contaminated with it.

      "I do have an 18-year-old and I figure that whatever might be going on in my body might certainly be going on in her body," added Jessie, a longtime disability advocate. "It's very disturbing to think that a chemical that was banned decades ago may still be taking up residence in the body of my child."

      Participant Laura Abalafia is worried what effects the lead and other toxins found in her body could have on the baby she hopes to have in the future.

      "I was surprised about how sad I felt after receiving my results," said Abalafia, national coordinator with the Learning and Developmental Disabilities Initiative. "I want to have a child someday soon, and now I know that this extremely vulnerable little person will be exposed to some very toxic substances."

      "Everybody wants to make sure a baby can thrive in a safe and healthy environment, but so many everyday products contain toxic chemicals like lead," she added. "Even children's toys and some candies have lead in them, so we really have no understanding of how to make safe purchases and protect our children or unborn from some very serious threats."

      "Federal policy needs to change"

      Abelafia and others involved with the project say Congressional leaders can take a big step toward reducing the public's exposure to dangerous chemicals by revamping the antiquated Toxic Substances Control Act (TSCA).

      "Federal policy needs to change to reflect 21st Century science -- including the importance of critical windows of development, mixtures of chemicals, and low-dose exposures -- to ensure current and future generations reach their fullest potential," the study said.

      "Scientific evidence is piling up, revealing how chemicals are contributing to the alarming increases we are seeing in childhood leukemia, learning disabilities, reproductive disorders and other health problems," said Charlotte Brody, RN, National Field Director of the Safer Chemicals, Healthy Families coalition and lead author of the report. "But meanwhile the federal law that is supposed to protect us has stayed frozen in time."

      Both the Safer Chemicals, Healthy Families Coalition and the Learning and Developmental Disabilities Initiative have called on Congress to strengthen the country's chemical laws. Their recommendations include:

      • Immediately take action against the worst chemicals now on the market;

      • Require manufacturers to disclose basic information about possible heath hazards associated with their chemicals;

      • Protect the most vulnerable from exposure to harmful chemicals;

      • Hold industry responsible for demonstrating chemical safety;

      • Promote safe, "green" alternatives;

      • Ensure consumers' "right to know" by requiring labeling of chemical ingredients in products;

      • Use the best scientific methods to determine the safety of chemicals on the market.

      Former Atlanta Falcons football player David Iron, who has a diagnosed learning disability, supports these measures. "I want to know more about these chemicals that get into our bodies and how these chemicals might be hurting us and making it harder to achieve our goals," said Irons, who participated in the study.

      "As a professional football player, I have to be as mentally and physically fit as possible -- it's my job," he added. "I want to know how to avoid toxic chemicals for myself, but I also really want little kids not to be exposed to these chemicals, especially if sometimes the chemicals could harm their bodies or brains and make it harder for them to learn."

      The American Chemistry Council (ACC), a trade association for the chemical industry, has downplayed recent studies that found links between BPA, phthalates, and other chemicals with developmental and health issues. The ACC says the chemicals are safe for everyday use.

      Congressional leaders in Washington, D.C. are now debating concerns about the publics' exposure to toxic chemicals and the country's outdated chemical safety laws. Those talks opened Thursday during a Senate Environment and Public Works Subcommittee.

      Weeks before the hearing started, Sen. Frank Lautenberg (D-NJ) and Rep. Bobby Rush (D-IL) called on their colleagues to toughen the TSCA.

      "The use of chemicals is pervasive in our modern society and, when properly tested and used, they improve the quality of life for families here and throughout the world," said Rush, chairman of the Energy and Commerce Subcommittee on Commerce, Trade and Consumer Protection. "But just because chemicals have value, does not mean they are always beneficial to our health, particularly the health and maturation of young children and those whose health has already been compromised."

      "As we work to reform TSCA, I will continue to vigorously prod industry to seek out and invest in the development of safer, more viable alternatives to hazardous chemicals and substances," Rush added.

      There's another benefit of revamping the TSCA, researchers point out. It could reduce the country's burgeoning health care costs.

      "We could cut the health costs of childhood disabilities and disease by billions of dollars every year by minimizing contaminants in the environment," said Dr. Phil Landrigan of the Children's Environmental Health Center at Mount Sinai School of Medicine. "Investing in our children's health is both cost-effective and the right thing to do."

      Disability Advocates 'Shocked' at Their Levels of Toxic Chemical Exposure...
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      FTC Issues 'Bamboo' Ad Warning

      Retailers, including Wal-Mart, Target, and Kmart, get agency letters

      The Federal Trade Commission (FTC) is warning 78 companies across the U.S. that they may be breaking the law by selling clothing and other textile products that are labeled and advertised as "bamboo," but actually are made of manufactured rayon fiber.

      The warning, sent in letters by the agency's staff sent last week, tell the retailers of the FTC's concerns about possible mislabeling of rayon products as "bamboo," so the companies can take corrective steps to avoid Commission action.

      "We need to make sure companies use proper labeling and advertising in their efforts to appeal to environmentally conscious consumers," said David C. Vladeck, Director of the agency's Bureau of Consumer Protection. "Rayon is rayon, even if bamboo has been used somewhere along the line in the manufacturing process."

      The FTC sued several companies last year for allegedly selling products labeled or advertised as "bamboo" that in reality were made of rayon. Rayon is a man-made fiber created from the cellulose found in plants and trees and processed with harsh chemicals that release hazardous air pollution. Any plant or tree -- including bamboo -- could be used as the cellulose source, but the fiber that is created is rayon.

      "While we have seen action by some retailers to correct mislabeled clothing and textile products, our hope is that these warning letters will serve as a wake-up call to all companies, regardless of their size," Vladeck said.

      The FTC staff letter outlines the requirements for proper labeling and advertising of textile products derived from bamboo. The letter states, "Rayon, even if manufactured using cellulose from bamboo, must be described using an appropriate term recognized under the FTC's Textile Rules...Failing to properly label and advertise textiles misleads consumers and runs afoul of both the Textile Rules and the FTC Act."

      In the letter, the FTC tells the companies they should review the labeling and advertising for the textile products they are selling and remove or correct any misleading bamboo references.

      Along with the warning letters, the agency sent each company a synopsis of FTC decisions finding that the failure to use proper fiber names in textile labeling and advertising was deceptive and violated the FTC Act. Under the Act, the FTC can seek civil penalties of up to $16,000 per violation against any company that receives this information but fails to correct its advertising and labeling.

      Companies that were sent warning include small and large retailers, with both online and brick-and-mortar stores, and firms selling textile products labeled or advertised as "bamboo" that may be made of rayon. The more commonly known retailers include:, Barney's New York, Bed Bath & Beyond, BJ's Wholesale Club, Bloomingdale's, Costco Wholesale, Garnet Hill, Gold Toe, Hanes, Isotoner, JC Penney, Jockey, Kmart, Kohl's, Land's End, Macy's, Maidenform, Nordstrom,, QVC, REI, Saks Fifth Avenue, Sears, Shop NBC, Spiegel, Sports Authority, Target, The Gap, The Great Indoors, Tommy Bahama, Toys R' Us, Wal-Mart, and

      This latest announcement follows four FTC enforcement actions brought against companies selling rayon products that were misleadingly labeled and advertised.

      According to the Commission's complaints, filed in August 2009, the companies falsely claimed that their rayon clothing and other textile products were "bamboo fiber," marketing them using names such as "ecoKashmere," "Pure Bamboo," "Bamboo Comfort," and "BambooBaby."

      The complaints also challenged a number of other deceptive "green" claims, including that the products retained the bamboo plant's antimicrobial properties, were made using environmentally friendly manufacturing processes, and are biodegradable.

      The FTC sued several companies last year for allegedly selling products labeled or advertised as "bamboo" that in reality were made of rayon....
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      Ford Addresses Brake Problem in Fusions

      U.S. carmaker says its braking problem is a software glitch

      Like Toyota, Ford appears to have a hybrid brake problem. The U.S. automaker said it would repair more than 17,000 Ford Fusion hybrids to address a brake problem. Toyota, meanwhile, stopped short of a recall of its Prius hybrids, whose brakes are under scrutiny in both the U.S. and Japan.

      The Ford announcement coincided with a report by Consumer Reports detailing a possible braking problem in the Fusion. A Consumer Reports engineer reportedly ran a stop sign when he was unable to stop his Ford hybrid with his normal braking action. Pushing the pedal farther than normal, he reported, caused the conventional brakes to engage, stopping the vehicle.

      The engineer reported that, though his foot was firmly planted on the brake, the car slowed slightly but did not stop the way it normally did. According to the National Highway Transportation Safety Administration, at least one other fusion driver has reported a similar incident to the agency.

      Ford said it traced the problem to a software glitch in both the Ford Fusion and Mercury Milan hybrids built before October 17, 2009. The glitch is said to occur when the car shifts from electronic braking into conventional braking mode.

      Ford said it could fix the problem by simply upgrading the software in the cars. The company said it would inform owners by mail to take their vehicles to a Ford dealer for the fix.

      Consumer Reports said the glitch occurred right after its driver crossed a railroad track, calling to mind problems Prius drivers reported after hitting a pothole or other bump. Consumer Reports said the brake pedal needed to be pushed more than an inch farther down to engage the conventional brakes.

      Ford said it is not treating the repair as a recall, but as a "customer satisfaction" matter. Technically, the carmaker says, it's not a brake failure because the brakes will engage if you push on the pedal hard enough.

      Like Toyota, Ford appears to have a hybrid brake problem. The U.S. automaker said it would repair more than 17,000 Ford Fusion hybrids to address a brake p...
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      Eli Lily Pays Mississippi $18.5 Million to Settle Zyprexa Claim

      Money arrives at critical time, state says

      The State of Mississippi has recovered some much needed cash, as drug giant Eli Lilly has agreed to an $18.5 million fraud settlement over the drug Zyprexa.

      The drug was only approved for major psychotic disorders, but the state alleged that the drug company promoted the drug to doctors for many unapproved uses such as minor depression. The company's studies showed the drug caused diabetes, but publication of the studies was suppressed, according to state officials.

      The money, said Mississippi Attorney General Jim Hood, comes at a critical time.

      "We recovered every penny we spent on the drug by Medicaid and the State Insurance Plan, plus penalties," Hood said. "Hopefully, the Legislature will use this money to prevent the shut down of our courts, prosecutors, law enforcement and other vital government services."

      By settling the claims, Eli Lilly admits to no wrongdoing. The agreement with Eli Lilly ensures, among other things, that the company:

      • will not make any written or oral claim that is false, misleading or deceptive regarding Zyprexa

      • will not promote Zyprexa for off-label uses

      • communications concerning off-label uses of Zyprexa shall not be false, misleading or deceptive

      Any violation of the above, and the other settlement terms negotiated, will result in further penalties for Eli Lilly, Hood said.

      The State of Mississippi began pursuing its claims against Eli Lilly nearly four years ago as a means to recover funds expended by the State of Mississippi in purchasing the prescription drug known as Zyprexa for non-medically necessary uses, and to recover funds expended by the state in purchasing Zyprexa for uses in which the efficacy of the medication was outweighed by the dangerous side effects associated with the drug.

      Thirteen months ago, Eli Lilly agreed to a massive $1.42 billion Zyprexa settlement with both state and federal governments. Approximately 30 states, including Mississippi, were involved in the suit.

      Among Hood's allegations against Eli Lilly were that the company's pre-clinical studies demonstrated that the drug causes weight gain and hyperglycemia, which is linked to diabetes. Additionally, Eil Lilly allegedly knew of Zyprexa's propensity to cause diabetes nearly a year and a half before it first warned of the risk of diabetes in the United States, and the company consistently suppressed attempts within the company to make the association between drug induced weight gain and hyperglycemia public.

      Hood also said the company misled doctors regarding the safety and efficacy of the drug.

      Eli Lily Pays Mississippi $18.5 Million to Settle Zyprexa Claim...
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      FTC Wants to Outlaw Advance-Fee Foreclosure Rescue

      Several states already have such bans in place

      The Federal Trade Commission is seeking to outlaw foreclosure rescue operations that charge an advance fee for their alleged services. The FTC is seeking the move through federal rulemaking instead of legislation.

      "Homeowners facing foreclosure or struggling to make mortgage payments shouldn't have to contend with fraudulent 'companies' that don't provide what they promise," FTC Chairman Jon Leibowitz said. "The proposed rule would outlaw up-front fees so companies can't take the money and run."

      Several states already have laws on their books outlawing advance-fee foreclosure rescue. The FTC rule would make it illegal throughout the U.S. According to the Notice of Proposed Rulemaking announced today, historic levels of consumer debt, increased unemployment, and an unprecedented downturn in the housing and mortgage markets have contributed to high rates of mortgage loan delinquency and foreclosure.

      The agency expressed concern that the mortgage crisis has launched an industry of companies purporting, for a fee, to obtain mortgage loan modifications or other relief for consumers facing foreclosure. The FTC has brought 28 cases in this area, and state and federal law enforcement partners have brought hundreds more.

      Generally these cases charged that companies do not provide the services they promise and that they misrepresent their affiliation with the government and government housing assistance programs, including the Making Home Affordable Program.

      Public comment

      The FTC notice seeks public input, particularly from attorneys and other professionals, on a proposed rule that would require mortgage relief companies to make good on their promised results before charging or accepting payment from consumers. Under the proposed rule, companies could not be paid until they had a documented offer from a mortgage lender or servicer that lives up to the promises they have made.

      "Far too many homeowners have paid up-front fees to bad actors who promised loan modifications but never delivered," Treasury Secretary Timothy Geithner said. "I commend the FTC for proposing a strong set of safeguards to protect consumers from these predatory practices."

      The proposed rule also would bar providers from telling consumers to stop communicating with their lenders or mortgage servicers, and from misleading them about key facts such as:

      • The likelihood of getting the results they want, and how long it will take.

      • Their affiliation with public or private entities.

      • Payment and other existing mortgage obligations.

      • Refund and cancellation policies.

      In addition, the proposed rule would require providers to tell consumers that they are for-profit businesses, the total amount consumers will have to pay, that neither the government nor the consumer's lender has approved their services, and that there is no guarantee that the lender will agree to change their loan.

      Wouldn't cover banks

      The proposed rules would apply to for-profit companies that, in exchange for a fee, offer to work with lenders and servicers on behalf of consumers to modify the terms of mortgage loans or to take other steps to avoid foreclosure on those loans. The proposed rules generally exempt entities that own or service mortgage loans. Attorneys would have a limited exemption from the proposed advance fee ban if they represent consumers in a bankruptcy or other legal proceeding.

      The FTC rulemaking proceeding is required by legislation secured in 2009 by Senator Byron Dorgan and Chairman Jay Rockefeller. Any proposed rule would apply only to entities within the FTC's jurisdiction under the FTC Act. That means the rule would not ally to banks, thrifts, and federal credit unions.

      As the first step in the rulemaking process, on June 1, 2009, the FTC issued an Advance Notice of Proposed Rulemaking seeking comment on the practices of for-profit mortgage relief services providers.

      FTC Wants to Outlaw Advance-Fee Foreclosure Rescue...
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      Listening to Your Car

      Your car is speaking to you when it makes noises -- it's up to you to listen

      What is your car telling you when it thumps, pings, or hisses? Should you head for your mechanic or just ignore it and hope for the best?

      In its March issue, the car-whisperers at Consumer Reports take away some of the mystery by identifying which noises drivers should turn down the radio for.

      When you hear a noise that's unusual -- a whine, a creak, or a squeal, for example -- consider it an alert that something has changed. By paying attention to those sounds, you can often catch a minor problem before it becomes a major one. Here's what to listen for:

      • Squealing brakes. If you hear squealing only during braking, especially light braking, it's probably caused by a vibration at the brake pads. Squealing doesn't affect your braking performance and, while it's annoying, it is usually nothing to worry about and can happen even with new pads. If you hear a similar high-pitched squeal from the brakes while the car is moving but it stops when you step on the brake pedal, it can be a sign that your brake pads have worn down and need changing soon.

      What to do. Have a mechanic inspect the brakes. In the case of the squeal during braking, he may be able to apply a lubricant to quiet the vibration.

      • Squeals under the hood. If you hear this while revving the engine or when first starting it while cold, the noise is often due to a slipping drive belt. The belt could need adjusting or it could be glazed (the sides look shiny), which means it requires replacement.

      What to do. Have a mechanic look over the drive belts and replace them if necessary.

      • Light rattling in the engine. This might be pinging, which can sound like tiny marbles bouncing around inside the engine, and usually occurs while accelerating or climbing hills. It's often due to using gas with too low an octane rating and can begin occurring in older engines because of carbon buildup. Severe pinging can damage the engine.

      What to do. Check your coolant temperature gauge. If the temperature is normal, try using premium gasoline. If that doesn't correct the pinging, have the car checked by a mechanic.

      • Rhythmic thumping. If the noise increases and decreases with the speed of the car, it's probably a tire problem, such as torn rubber in the tread, a bubble in the sidewall, or a flat spot.

      What to do. Have the tires inspected as soon as possible. Torn rubber or a bubble could lead to a blowout, so get new tires. A flat spot is annoying but not serious.

      • Hissing beneath the hood. It's most likely a vacuum leak, caused by a cracked or disconnected vacuum hose. Your engine could also be running or idling rough and the "check engine" light could be on.

      What to do. If it's a disconnected hose, you may be able to reconnect it yourself. Or take the car to a mechanic.

      • Grinding sound from brakes. This means you've waited too long to replace your brake pads, your car is unsafe to drive, and your repair bill has just jumped to another level. The brake pads have worn completely through and are grinding against the brake rotor, which probably also needs to be replaced.

      What to do. Stop driving and have the car towed to a mechanic.

      Bear in mind that taking your car to a mechanic is no guarantee that your problems will be solved. receives loads of complaints from consumers about the treatment they get at the hands of some of these "pros." Among them:

      • Mark of Ewa Beach, HI, thinks he got ripped of by his local Pontiac dealer. "$250 to replace a car battery. (This is the third one on a four year old car); $425 to replace rear disk brakes only; and $328 to replace an ignition key. These are ridiculous service fees!"

      • Ashleigh of Montgomery, AL, tells us of an unsettling experience with Ralph's Auto Repair. "Mr. M agreed to replace my engine in my 1999 Grand Jeep Cherokee for 1850.00. We made an agreement that if I gave him 1500.00 up front he would release my truck when it was repaired and set up a payment plan for the remaining balance." Ashleigh says he gave Mr. M 1500.00 as he requested, but now, "he has been avoiding my calls and has not repaired my truck or refunded me my money. I have been without a vehicle for four months now. I've had to pay friends/coworkers 60.00 a week to take me back and forth to work."

      Amid growing concerns about the auto repair business, Congress is moving to guarantee consumers get a fair shake when they take their vehicles to be fixed.

      Listening to Your Car...
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      Feds Investigate Toyota Prius Brakes

      Focus shifts to electrical systems

      Toyota, already reeling from several massive recalls, has a new problem. The National Highway Traffic Safety Administration (NHTSA) says it has opened a formal investigation of the 2010 Toyota Prius. The goal is to learn whether the 37,000 vehicles suffer momentary loss of braking when traveling on bumpy surfaces.

      NHTSA said it has received 124 consumer complaints about the problem, four of them involving crashes and two of those involving minor injuries.

      A Toyota spokesman said the company would "cooperate fully" with the investigation.

      Toyota's problems began to accelerate Wednesday as Transportation Secretary Ray LaHood advised owners of recalled Toyotas to "stop driving them" until a dealer could inspect them and said U.S. safety investigators are continuing their probe.

      Although LaHood quickly retracted his comments, the Japanese government also told the automaker to investigate reports of brake failure on some Prius models. The Japanese Transportation Ministry cited 14 reports of brake failure in the latest generation of the hybrid since it went on sale in May 2009.

      An examination of complaints to also reveals instances of reported brake failure. Gary, of Trumansburg, N.Y., said he had an accident in his 2009 Prius on November 13, 2009 in which his car was totaled. From the start, he said, he suspected brake failure.

      "I was in a situation where I had to stop very quickly and braked as hard as I could," he told The car slowed to a point then seemed to 'plateau' until my car struck a truck.

      Gary said he never heard or felt the "ABS sound" or vibration, and had always suspected something was not right with the brakes. Because of the accident, he says he incurred a $2,200 debt to Toyota, from whom he leased the car.

      In early January Virginia of Ottawa, Ontario told that her 2005 Prius has always had a brake problem.

      Bump in the road

      "The brakes momentarily fail if the car hits a fair size pothole or bump while braking, and like other posters it took many occurrences of this to convince me it was the car's problem, not my braking," she wrote.

      Linda of Johnson City, Tenn., wrote last November that her 2007 Prius had exhibited strange behavior, with the brakes sometimes not engaging immediately after applying pressure to the pedal.

      Paul of Sedona Ariz., reported last April that he had been in three accidents, or near accidents in his 2009 Prius due to a combination of mysterious acceleration and loss of brakes.

      "The first incident, a near accident, occurred when the car in front of me stopped," Paul told "I was driving slowly but my car suddenly seemed to accelerate on its own and my brakes failed. How I stopped my car I will never know."

      The second incident was occurred in his garage, he says, when the car sped up and did not repond to the brakes.

      The third incident occurred in a parking lot, he said. While driving slow and looking for a place to park, the brakes did not hold and the result was the car hit a parked car.

      Toyota has not issued a recall of the Prius to check the brakes, but the New York Times quotes a Toyota spokeswoman as saying a brake defect could not be ruled out.

      NHTSA's brake check

      U.S. safety investigators are also probing reports of Prius brake problems. Wednesday the National Highway Traffic Safety Administration issued a statement saying it had begun an investigation.

      "NHTSA has received a number of complaints about a potential defect affecting the brake system in Toyota's Prius hybrid and is conducting field work to examine the issue," the agency said.

      Part of that field work may focus on the cars' electrical system. LaHood, who backed off of his comments about not driving Toyotas during Congressional testimony Wednesday, told reporters at an impromptu news conference that the cars' electronics were being scrutinized.

      Could braking and acceleration problems in the Prius have an electric connection? Brakes in hybrids do, in fact, have a large electrical component. In addition to standard brakes, which rely on brake pads pressed against drums, hybrids use their electric motors to help slow the car.

      "We are looking at the electronics. I can't be specific because we are looking at these complaints to see what they are," LaHood said.

      And while LaHood says he never meant to suggest that owners of recalled Toyotas should park them until a dealer can inspect them, lawyers in both the U.S. and UK say that might, in fact, be sound advice.

      A leading British traffic and criminal lawyer urged the owners of almost 181,000 vehicles recalled by Toyota in the UK to park them or face being charged with dangerous driving if they were in an accident.

      The Prius is Toyota's third best-selling model in the U.S., with only the mid-sized Camry and compact Carolla outselling it.

      Feds Investigate Toyota Prius Brakes...
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      Kellogg's Nutri-Grain Statements Misleading, Suit Says

      Accuses Cereal Company of Glossing Over Dangers of Trans Fat

      A class-action lawsuit filed Monday accuses Kellogg's of tricking consumers into believing its Nutri-Grain cereal bars are healthy, when in fact they contain inherently dangerous trans fat, which the plaintiffs say makes the product unfit for human consumption.

      The suit contends that Kellogg misleads consumers into believing that Nutri-Grain Bars are healthy by making misleading claims on the product packaging. Such statements include 'Excellent Source of Calcium,' 'More of the Whole Grains Your Body Needs,' and 'Eat Better All Day.'

      Unfortunately for the plaintiffs, who make some valid points about the dangers of trans fats namely that they increase the risk of heart disease, cancer, and type 2 diabetes the suit devolves into weak tea before long. The complaint strains credibility in attempting to portray the aforementioned misleading claims as anything other than competent advertising.

      Though possibly true, the suit says of the representations on the packaging, these statements are deceptive in intent and nature: they imply that these products are healthy despite the fact that they contain artificial trans fat.

      The plaintiffs then go on to attack the images chosen by Kellogg for the product packaging, specifically an image of a verdant field and an image of a Nutri-Grain Bar next to an image of a water bottle, a salad, an apple, and person exercising. The problem? The obvious implication of this is that Nutri-Grain Bars are, like water, apples, salads, and exercising, part of a healthy lifestyle.

      The suit noted that an increasing number of American jurisdictions are banning trans fats from food altogether. Since 2008, when California became the first state to prohibit the use of trans fats in restaurant food, New York City, Philadelphia and Baltimore, among others, have followed suit. The plaintiffs use this along with a 2004 Danish law setting a ceiling of two grams of trans fat for all foods as evidence that Kellogg's supposedly healthy products have so much toxic artificial trans fat that they would be illegal to sell in many parts of the world.

      The suit, led by June Higginbotham and Jennifer Red of Southern California, is being brought on behalf of anyone who bought one or more Kellogg's products containing artificial trans fat between January 1, 2000 and the present. The complaint includes counts for false advertising under the Lanham Act, unfair competition, and breach of several California consumer protection statutes.

      In addition to seeking compensatory damages, the plaintiffs are demanding that Kellogg cease the complained-of advertisements, disgorge any profits by which it was unjustly enriched, conduct a corrective advertising campaign, and destroy all misleading and deceptive materials and products.

      Higginbotham and Red join a growing list of litigants challenging the veracity of breakfast food-related claims.

      In September, Dannon settled a lawsuit alleging that ads for the company's Activa brand yogurt promoted as a panacea for digestive issues exaggerated the product's actual benefits. Then, in October, two New Jerseyans claimed in a $5 million suit that General Mills ads led them to believe that eating Cheerios would lower their cholesterol levels. The following month, a class action accused Kellogg of falsely claiming that Cocoa Krispies would strengthen kids' immune systems against illness.

      Maybe it's time to go back to bacon and eggs.

      Kellogg's Nutri-Grain Statements Misleading, Suit Says...
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      Ohio Sues California Foreclosure Rescue Operations for Conning Consumers

      Attorney General's lawsuit targets Orange County law firm, disbarred attorney

      Ohio Attorney General Richard Cordray this week named United Law Group, Inc. (ULG), a California law firm founded by California attorney Sean Alan Rutledge, in a lawsuit for bilking Ohioans who faced foreclosure out of thousands of dollars.

      The lawsuit alleges that the law firm promised foreclosure rescue and legal services to save homes and collected upfront fees but failed to deliver. In at least one instance a consumer was forced into foreclosure. ULG's attorneys are not licensed to practice law in Ohio and never filed any court documents or provided legal representation on behalf of their clients.

      According to the lawsuit filed in Franklin County Common Pleas Court, ULG solicited Ohioans over the phone and used high-pressure sales tactics to convince them to agree to foreclosure rescue services. Consumers then signed a Special Power of Attorney and Attorney-Client Fee Contract for representation on mortgages, loan modifications and foreclosures. To secure payment of the upfront fee ranging from $1,500 to $4,000, ULG asked for access to consumers' bank accounts and then withdrew money without regard to scheduled payment dates. The lawsuit also states that ULG often cut off all contact with consumers after the final fees were debited.

      In one case, a consumer was current on her mortgage, but defaulted into foreclosure after she hired ULG and they instructed her to stop making payments.

      "The egregious practices of this group are nothing less than predatory. This lawsuit demonstrates the scary sophistication of some rescue scam operations," said Cordray. "They can be savvy, with highly educated employees and target individuals who are in a very vulnerable position. The practices are absolutely unconscionable and unfortunately illustrate the need for Ohioans to be vigilant and do their homework. I strongly suggest deep research into any company requiring an upfront fee."

      In November 2009, the State Bar Court of California ruled that ULG founder Sean Alan Rutledge was to be involuntarily enrolled as an inactive member of the State Bar of California for his conduct, which was found by the court to pose "a substantial threat of harm to his clients or the public."

      In a separate action, Cordray filed a lawsuit against Guardian Services Group, also based in California, for promising foreclosure rescue services to Ohioans, accepting upfront fees and never delivering. The suit, filed in Montgomery County Common Pleas Court, accuses the company of charging consumers thousands of dollars and refusing to provide refunds even though the services were never provided.

      In each case, Cordray is asking the courts for a permanent injunction, restitution to consumers and civil penalties of $25,000 for each violation of Ohio's Consumer Sales Practices Act. The lawsuits are part of an ongoing statewide investigation into foreclosure rescue companies operating in Ohio. To date, Cordray has filed nine lawsuits against businesses targeting Ohio consumers and has issued more than 30 cease and desist orders.

      In early January, Cordray secured a judgment of $81,894 against Michael Brotherton, who operated Financial Emergency, Inc., a rescue business in Greene County. The judgment, filed in the Common Pleas Court of Greene County, stemmed from a lawsuit filed in June charging Brotherton with promising to negotiate debt settlements and loan modifications, collecting upfront fees for up to $1,269 and then failing to deliver. The court ordered full reimbursement to the five victims named in the case.

      With these lawsuits, Cordray has filed against nine foreclosure rescue scam operations targeting Ohioans since taking office in January 2009. The lawsuits are part of a full-on effort to hold companies accountable for violating Ohio law in the wake of the foreclosure crisis. Cordray has additionally sued three mortgage servicers for unfair or deceptive loan modification practices. The lawsuits against Carrington Mortgage Services, American Home Mortgage Servicing Inc. and Barclays Capital Real Estate dba HomEq Servicing for violations of Ohio's Consumer Sales Practices Act introduce an unprecedented legal strategy. To date, Cordray is the only state Attorney General in the country to use this strategy to hold mortgage servicers accountable.

      Ohio Sues California Foreclosure Rescue Operations for Conning Consumers...
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      New Lottery Scam Claims to Be From Better Business Bureau

      BBB offers tips on how the beat the cheaters

      If you can't trust the Better Business Bureau, whom can you trust?

      The organization is warning about a new scam that is using its name in order to steal tens of thousands of dollars from victims who are led to believe they have won a lottery.

      So far, scammers posing as BBB employees have fleeced one victim of $80,000 and several other consumers have reported that they were contacted over the phone or via e-mail by someone claiming they were with the organization.

      According to the Better Business Bureau, these consumers were told that they had won a lottery and that, in order to receive the prize, they must first wire money back to the scammers. In some cases, the scammers used the names of real BBB employees --directing victims to legitimate bios and profiles on BBB's Web site -- in order to reinforce their ruse.

      "Many people are struggling in the current economy and when someone tells you that you've won millions in a lottery, it can seem like an answer to prayer," said Steve Cox, President and CEO of the Council of Better Business Bureaus. "Every year, tens of thousands of people contact BBB about a suspicious lottery and instead of cashing in, many lose thousands of dollars they don't have."

      BBB emphasizes that it does not run a lottery nor award prizes to consumers. Anyone who receives a call, letter or e-mail about winning the lottery should consult the following checklist in order to avoid falling victim to a lottery scam:

      • Make sure the story checks out. Always confirm the facts directly with the organization the representative claims to be from -- whether it's BBB or any other organization. Use contact information that you found on your own from the organization's Web site; don't rely on phone numbers or Web links provided by the representative. Scammers often pretend to be from legitimate businesses or non-profits and a quick call directly to the organization can help set the record straight.

      • Never pay money to get money. Lottery scammers make their money by convincing victims that they have to pay money up front -- to cover such costs as taxes or fees -- in order to receive their winnings. Because it is extremely difficult for the victim to track or retrieve money sent via wire transfer, scammers will often use this as their payment method of choice.

      • Don't fall for the phony check. Scammers will often send a check in the mail to the victim with the instructions that in order to receive the full prize he or she must deposit the check and wire back a portion of the funds to cover fees or taxes. This gives the victim a false sense of security because the check will clear initially, but eventually be discovered as a fake. The money is then taken out of the victim's account and he or she is out the funds sent to the scammer.

      The BBB lottery scam isn't the only one out there. Gregory of Columbia, SC tells that he was contacted by a Paul Jones saying that he had won a $3.5 million dollar lottery. "I was informed by him to wire $1250 to an Alecia Edwards so I can collect my money. I sent the transaction and they said that they were at an airport near my location but nobody ever show to bring me any money." Gregory says the scammers are now telling him that he needs to send them another $2500 to complete the transaction. "They wont stop calling and they have the $1250 I sent them already," he concludes. "I tried to tell them to just send it back but they told me to get a lawyer if I want my money back."

      Despite all the warnings, consumers continue to fall for these scams.

      New Lottery Scam Claims to Be From Better Business Bureau...
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      Church Groups Indicted in Delaware Mortgage Rescue Scheme

      Largest foreclosure rescue scam in state history, attorney general says

      Master Builders for Christ and Vision Builders Christian Center, along with three of its principals, have been charged in a 21-count indictment in Delaware, on charges of running a massive mortgage rescue scam.

      Warrants have been issued for the arrest of Jamaar Manlove, Larry Manlove, and Rhonda Manlove, and racketeering liens have been placed on their assets. Delaware Attorney General Beau Biden says the case is believed to be one of the largest mortgage rescue fraud indictments in the state's history.

      The indictment alleges that Jamaar Manlove ran a criminal enterprise involving theft, money laundering, and forgery in which he preyed on vulnerable homeowners who faced imminent foreclosure.

      In these scams, struggling homeowners are convinced to sell their homes to third parties to avoid foreclosure, based on the false promise that they can repurchase their homes through a complex sale/lease-back arrangement when their financial situations improve. In reality, this never happens.

      Instead, these schemes impose huge hidden fees that take thousands of dollars of equity away from homeowners, and they ultimately lose their homes, unable to obtain financing to repurchase their home.

      It's not clear what role the organizations played in the alleged scheme, but both are described as Christian real estate operations. In the past, many so-called "affinity scams" have taken advantage of the victims' and perpetrator's shared beliefs to generate trust, trust that ultimately proves to be misplaced.

      "Those who take advantage of vulnerable homeowners under extreme financial duress or facing foreclosure should be on notice," Biden said. "We will track you down, prosecute you, and put you behind bars."

      The indictment follows a 10-month investigation by the Attorney General's Consumer Protection Unit and includes charges of criminal racketeering, conspiracy, money laundering, felony theft, forgery, and failure to file taxes. If convicted on all counts each defendant faces a minimum of two years in prison. Jamaar Manlove faces a maximum of 83 years in prison if convicted on all counts.

      Biden said the case is the direct result of the collaborative work of the Delaware Attorney General's Mortgage Fraud Task Force, which was formed in June 2009 to reduce foreclosures and foreclosure-related fraud statewide.

      Church Groups Indicted in Delaware Mortgage Rescue Scheme...
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      Fifth Third Bank Sued Over Overdraft Fees

      Suit seeks class action status and millions in restitution

      A group of Fifth Third Bank customers has filed a lawsuit against Fifth Third Bank, seeking refunds of millions of dollars in overdraft charges the plaintiffs contend were taken illegally.

      The suit maintains that the overdraft fees were often charged when the customers had enough funds in their accounts to pay for purchases.

      "It is one thing to charge an overdraft fee when someone has actually overdrawn their account. It is entirely another to charge an overdraft fee when the customer's account has sufficient funds, said Hassan Zavareei, a partner at the Washington, D.C.-based law firm Tycko & Zavareei LLP, which represents the plaintiffs.

      The suit charges that in some cases Fifth Third charges overdraft fees and additional fees for every day an account is overdrawn -- even when an account is overdrawn solely because of bank fees charged by Fifth Third.

      "The bank is essentially charging overdraft fees on overdraft fees," said Zavareei. "This is outrageous bank conduct, made worse by the fact that most of the bank's victims are struggling to make ends meet."

      Over the years, has received similar complaints about Fifth Third Bank, particularly its overdraft policies.

      The lawsuit was filed in federal court on behalf of Marlene Willard, of Hephzibah, Georgia, and other bank customers who claim they were unfairly and illegally charged overdraft fees by Fifth Third Bancorp for charges they made on their ATM/debit cards.

      The class action lawsuit alleges that these fees violate federal and state law, as well as the contractual relationship the bank has with its customers. The lawsuit seeks certification of a class action on behalf of Fifth Third Bank customers who were improperly charged overdraft fees or who received insufficient disclosures about such overdraft fees.

      "Manipulation" alleged

      The complaint alleges that Fifth Third Bank manipulates debit transaction posting to cause overdraft fees even when there are sufficient funds to pay for a certain purchase. Further, the suit claims Fifth Third Bank fails to properly disclose fees that will be charged at the point of sale, and uses deceptive disclosures in its contract with customers to hide its true overdraft policies.

      "We are continuing to investigate Fifth Third and other banks around the country. Customers must be compensated for bank practices that caused hundreds of millions of dollars in improperly charged fees," Zavareei said.

      The complaint also alleges that Fifth Third Bank has not allowed its customers to opt out of "overdraft protection," as recommended by Federal regulators.

      Fifth Third Bancorp is a diversified financial services company headquartered in Cincinnati, Ohio. The Company has over $100 billion in assets and operates 16 affiliates with 1,306 full-service Banking Centers in Ohio, Kentucky, Indiana,Michigan, Illinois, Florida, Tennessee, West Virginia, Pennsylvania, Missouri, Georgia and North Carolina.

      For the first time, the Consumer Financial Protection Bureau has taken action against a bank for violating regulations governing bank overdraft fees....
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      Toyota Announces Accelerator Pedal Fix

      Automaker pledges to repair recalled vehicles quickly and conveniently

      Toyota says it will begin fixing accelerator pedals in recalled vehicles this week.

      The car company says its engineers have developed and "rigorously tested a solution that involves reinforcing the pedal assembly in a manner that eliminates the excess friction that has caused the pedals to stick in rare instances." Toyota says it also has developed an "effective solution" for vehicles in production.

      Parts to reinforce the pedals are already being shipped for use by dealers, and dealer training is under way, Toyota said. Many dealers have been scheduled to work extended hours to complete the recall campaign as quickly and conveniently as possible, with some even staying open 24 hours a day. The company has also stopped production of affected vehicles for the week of February 1.

      "Nothing is more important to us than the safety and reliability of the vehicles our customers drive," said Jim Lentz, president and Chief Operating Officer, Toyota Motor Sales (TMS) U.S.A., Inc. "We deeply regret the concern that our recalls have caused for our customers and we are doing everything we can -- as fast as we can -- to make things right. We know what's causing the sticking accelerator pedals, and we know what we have to do to fix it. We also know it is most important to fix this problem in the cars on the road."

      On January 21, Toyota announced its intention to recall approximately 2.3 million select Toyota Division vehicles equipped with a specific pedal assembly and suspended sales of the eight models involved in the recall on January 26.

      Toyota vehicles affected by the recall include:

      • Certain 2009-2010 RAV4s

      • Certain 2009-2010 Corollas

      • 2009-2010 Matrixes

      • 2005-2010 Avalon

      • Certain 2007-2010 Camrys

      • Certain 2010 Highlanders

      • 2007-2010 Tundra

      • 2008-2010 Sequoia

      No Lexus Division or Scion vehicles are affected by these actions. Others that are


      affected include Toyota Prius, Tacoma, Sienna, Venza, Solara, Yaris, 4Runner, FJ Cruiser, Land Cruiser, Highlander hybrids and certain Camry models, including Camry hybrids, all of which remain for sale.

      Further, Camry, RAV4, Corolla and Highlander vehicles with Vehicle Identification Numbers (VIN) that begin with "J" are not affected by the accelerator pedal recall.

      In the event that a driver experiences an accelerator pedal that sticks in a partial open throttle position or returns slowly to idle position, Toyota says the vehicle can be controlled with firm and steady application of the brakes. The brakes should not be pumped repeatedly because it could deplete vacuum assist, requiring stronger brake pedal pressure. The vehicle should be driven to the nearest safe location, the engine shut off and a Toyota dealer contacted for assistance.

      Detailed information and answers to questions about issues related to this recall are available to customers at and at the Toyota Customer Experience Center at 1-800-331-4331.

      Proposed fix

      Toyota says it has pinpointed the issue that could cause accelerator pedals in recalled vehicles to stick in a partially open position. The issue involves a friction device in the pedal designed to provide the proper "feel" by adding resistance and making the pedal steady and stable. The device includes a shoe that rubs against an adjoining surface during normal pedal operation.

      Due to the materials used, wear and environmental conditions, these surfaces may, over time, begin to stick and release instead of operating smoothly. In some cases, friction could increase to a point that the pedal is slow to return to the idle position or, in rare cases, the pedal sticks, leaving the throttle partially open.

      The automaker calls the solution for current owners "both effective and simple." It says a precision-cut steel reinforcement bar will be installed into the assembly that will reduce the surface tension between the friction shoe and the adjoining surface. With this reinforcement in place, the excess friction that can cause the pedal to stick is eliminated.

      The company says it has confirmed the effectiveness of the newly reinforced pedals through rigorous testing on pedal assemblies that had previously shown a tendency to stick.

      Separately from the recall for sticking accelerator pedals, Toyota is in the process of recalling vehicles to address rare instances in which floor mats have trapped the accelerator pedal in certain Toyota and Lexus models (announced November 25, 2009), and is already notifying customers about how it will fix this problem. In the case of vehicles covered by both recalls, Toyota says it plans to remedy both at the same time.

      Toyota Announces Accelerator Pedal Fix...
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      New Credit Card Rules Take Effect Feb. 22

      But much of the damage has already been done

      By Mark Huffman

      February 1, 2010
      By now you have probably received a notice from your credit card company outlining the changes to your account that will occur later this month, when the Credit Card Accountability and Disclosure Act finally goes into effect.

      The law was changed in response to years of consumer complaints about abusive behavior by credit card companies. When the new law goes into effect on February 22, there will be several principal changes:

      Payment crediting

      Under the new law, if you pay more than the minimum monthly payment, the excess will be applied to balances with the higher interest rate. Currently, the credit card companies can apply it any way they choose, and usually choose to apply it to the balance with the lowest interest. The purpose of this particular change is to allow consumers to pay off their higher balances more quickly, saving on interest charges.

      Paying interest

      You will have a minimum of 21 days following the close of each billing cycle to pay off the balance to avoid accruing periodic interest charges. Cash advances, however, may still carry an interest charge, even if you pay it back within 21 days. The 21 day window was added because many consumers complained there was so little time between the time they received their monthly statement and when the payment was due.

      Rate changes

      Under the new rules, rate increases can be made on new balances with a 45-day notice. However, rates on existing credit card balances cannot be changed except under special conditions. This change is designed to end the practice of credit card companies raising customers rates on a whim.

      Penalty APR

      A penalty APR, also known as drastically raising your interest rate, can still be applied to your account, but only if you fail to may a minimum payment on time, make a payment in which the check bounces, or are late or exceed your credit limit on another account or loan you have with that particular credit card company, or any of its related companies. This provision does away with something called "universal default," which meant a credit card company could jack up your rate if you were late paying any bill, such as your electric bill.

      Other changes include:

      • No interest rate increases, in most cases, for the first year that any account is open.

      • Your payment will be due on the same date each month, and if the date is a Sunday, it could be received by Monday and not draw a late fee

      • In most cases credit card companies may not raise the rate on existing balances, just new charges.

      • Your statement will provide a toll-free number for a reputable credit counseling agency.

      In addition, credit card company communications to customers will become simpler and easier to understand. One prominent change to statements is the requirement that consumers be provided with an illustration of how long it will take them to pay off their balance, illustrating paying only the minimum amount due each month versus paying off the debt in three years. There will be other changes to statements as well.

      "This includes removing the Arbitration section from the agreement effective February 22, 2010," Chase said in a letter to customers.

      But Chase also emphasized that nothing in the new rules "change the interest rates and fees on your account."

      And therein lies for rub for millions of credit card customers. Since Congress passed the CARD action last May, credit card companies have been busy jacking up rates, closing accounts, lowering credit limits, raising minimum monthly payments and adding new fees. In short, doing many of the things they will no longer be allowed to do after February 22.

      Consumers complained so loudly that some in Congress proposed passing another law, speeding up implementation of the CARD act to early December. But the measure died when early December came and went without the measure getting out of committee.

      Rep. Carolyn Maloney (D-NY), author of the CARD Act, charged lenders were taking advantage of the eight month window between passage of the law and its implementation to continue to abuse consumers. In late October 2009, a report by the Pew Health Group's Safe Credit Cards Project tended to confirm her suspicions.

      The October report found that 100 percent of credit cards offered online by the leading bank card issuers continued to include practices that will be outlawed once legislation passed in May takes effect next year.

      The report also found that advertised credit card interest rates rose an average of 20 percent in the first two quarters of 2009, even as banks' cost of lending declined.

      "Since passage of the Credit CARD Act, we found that credit card issuers have done little to remove practices deemed unfair or deceptive by the Federal Reserve," said Shelley A. Hearne, managing director of the Pew Health Group, which oversees the project. "In fact, some of the most harmful practices have actually grown more widespread-not one of the bank cards reviewed would meet the legal requirements outlined in the Credit CARD Act, which is bad news for consumers."

      New Credit Card Rules Take Effect Feb. 22...
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      Bang for the Buck: Consumer Reports Rates TVs

      Advice on what to splurge on and what to skip

      With the Super Bowl and Winter Olympics just days or weeks away, this could be a great time to buy that new TV you've been thinking about, especially since prices are continuing to fall.

      In fact, you may be able to find a set with a screen size ranging from 46 to 50 inches for as little as $600. The March issue of Consumer Reports includes ratings of over 130 LCD and plasma TVs and advice on what features are worth the price.

      "Whether you're a first time buyer or you want to upgrade your existing flat-panel, TV prices have never been better and they continue to fall," says Paul Reynolds, electronics editor of CR. "It's not always best to go for the least-expensive model we've found that some features are worth the extra-cost."

      Things to consider when making your purchase:

      • Resolution: 1080p vs. 720p. 1080p resolution, called full HD, is now very common, but some 50-inch and smaller TVs still have 720p resolution. Salespeople may suggests that 1080p sets have better picture quality overall, but it's not always the case. Generally, a 1080p set does have the potential to display finer detail than a 720p because the screen has more pixels (the elements that make up the image). The price premium for 1080p has shrunk but still runs $100 to $200. Consumer Reports recommends buying a 1080p set if the TV is 50 inches or larger, and price isn't an issue.

      • Less Blur: 120Hz & 240Hz. Ads make a big deal of 120Hz and 240Hz technologies, which promise to reduce blurring and the loss of detail that can occur when LCD TVs display fast-moving images. 120 Hz technology doubles an LCD TV's usual 60Hz frame rate, and 240Hz quadruples it. (Some models combine a 120Hz frame rate with a scanning, or flashing, backlight, to create a 240Hz effect.) Purchasing a TV with anti-blur technology can cost an extra $200 or more and results varied in the magazine's lab tests. A 60Hz set should satisfy most casual viewers, but it's worth considering a 120Hz TV now that the feature is available on lower-priced sets.

      • Screen Size: Consumers in the market for a TV may opt for a smaller screen size to keep costs down. Consumer Reports suggests that consumers purchase the biggest screen their budget and space allow, rather than a smaller model with extra features that will be rarely used.

      • High-priced HDMI cables: Retailers will try to talk consumers into spending $50 or more for an HDMI cable to use with a new HDTV. Consumer Reports recommends buying decent-quality cables with sturdy connectors, but not expensive ones. A 6-foot HDMI cable should cost $10 or so. Even so-called high-speed cables designed for 1080p throughput shouldn't cost more than $20 for a 3-to-6-foot cable. If low-priced HDMI cables aren't available at the store, look online.

      Consumer Reports' Best Buys: HDTVs

      Most of the TVs featured in Consumer Reports latest ratings have excellent or very good picture quality, so there are many fine choices. Below are is list of CR Best Buys which are mainstream values. (Sets are listed from largest to smallest screen size).

      LCD TVs

      • Vizio VF550M, $1,400

      • Toshiba Regza Cinema Series 52XV648U, $1,400

      • Toshiba Regza 46XV645U, $1,000

      • Insignia NS-L42Q-10A, $650

      • LG 42LF11, $700

      • Sanyo DP42849, $630

      • Vizio VO320E (720p), $390

      • Sanyo DP26649 (720p), $300

      Plasma TVs

      • LG 50PQ30, $800

      • Insignia NS-P501Q-10A (720p), $650

      • Panasonic Viera TC-42PX14 (720p), $550

      • LG 42PQ30

      No list, of course, is foolproof.

      Melinda of Fredericksburg, VA, tells "After 1.5 years my 32 inch Vizio began clicking off and on, then eventually turned off for good. I have been doing some research and have found out that there is a problem with the power supply. This appears to be a defect. Vizio has not agreed to fix this, as of yet. 550.00 down the drain!"

      From Ed of Los Gatos CA, "Purchased a new 42 in HDTV and within 30 days it went dead. Took it into their repair center and they have had it for 60 days with no resolve in sight. The warranty period is wasting away and I cannot get an answer on what they are going to do it anything. Help."

      Maria of Joliet, IL, purchased a Panasonic HDTV last year and says the lamp has burned out. "I have checked the website," she writes, "and see it cost over 200 for a replacement. I also see where this is a known issue to Panasonic about this defective lamp. I now have no TV and no money to get the replacement part. I am stuck with a $1,000 TV that we can not use because the lamp is burned out."

      Tiffany of Albuquerque, NM tells us that she purchased a 37-inch Insignia TV and two days after the one-year anniversary it went dead. No picture sound or anything. "I watch TV probably 1-2 hours a day," she says. "Many calls to get help and guidance for this worthless TV and nothing. They said that since it was out of its warranty they would do nothing. I could either take it to a shop or throw it out."

      The complete report, "Best TVs for the buck," is available in the March 2010 issue of Consumer Reports. The report includes buying advice, ratings of over 130 LCD and plasma TVs, best and worst brands, and six easy steps to get high-definition TV programming.

      If you don't like anything you see on the list or in the stores, you can always take matters into your own hands.

      Super Bowl and Winter Olympics are just days or weeks away, this could be a great time to buy a new TV you've been thinking about, especially since prices...
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