Current Events in May 2010

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    Pampers Parents Liars? That's P&G's Answer to Complaining Consumers

    Safety regulators launch investigation into 'chemical burn' complaints

    Parents who've complained that reformulated Pampers caused severe diaper rash in their children are liars, a Procter & Gamble executive claims.

    "For a number of weeks, Pampers has been a subject of growing but completely false rumors fueled by social media that its new Dry Max diaper causes rashes and other skin irritations," said Jodi Allen, P&G Vice President for Pampers. "These rumors are being perpetuated by a small number of parents, some of whom are unhappy that we replaced our older Cruisers and Swaddlers products while others support competitive products and the use of cloth diapers. Some have specifically sought to promote the myth that our product causes 'chemical burns.'"

    Allen offered no documentation for her allegations, simply labeling the complaints of parents false. But an analysis of complaints filed with finds that most come from parents who were loyal Pampers customers until they encountered problems with the reformulated "Dry Max" Pampers.

    Earlier today, Lorea of Paso Robles, Calif., said that her six-month-old son recent developed "this burn-like rash that looks as though it is melting his skin off." Lorea said that she has "always loved Pampers Swaddlers and would recommend them to anyone" but now warns her friends against them.

    "Pampers have always been my diapers of choice but that has now changed," said Amy of Gretna, Neb., who said she has used Pampers on her four children over the last eight years with no difficulty. But she said her eight-month-old son now has a rash that "nothing would cure."

    While P&G haughtily dismisses parents' claims, others are taking them seriously. The U.S. Consumer Product Safety Commission and Health Canada have opened investigations after receiving complaints from parents. And a Seattle law firm said it is investigating possible claims against Procter & Gamble.

    Keller Rohrback L.L.P. said its investigation includes both Pampers Swaddlers Diapers with Dry Max and Pampers Cruisers Diapers with Dry Max. Parents wanting to learn more about the firm's investigation can call 800.776.6044 or email

    In her statement, P&G's Allen said the company has "comprehensively and thoroughly investigated these and other claims and have found no evidence whatsoever that the reported conditions were in any way caused by materials in our product."

    "To date, there have been in excess of two billion diaper changes using the new product, with only a handful of rash complaints, none of which were shown to be caused by the type of materials in our product. In fact, we have received fewer than two complaints about diaper rash for every one million diapers sold, which is average for our business and does not deviate from the number of calls we received prior to Dry Max," she said.

    P&G did not respond to's requests for comment.

    Facebook protest

    When one parent launched a page on Facebook protesting the new product, more than 3,000 other parents signed on as friends.

    It's not just parents in the U.S. who are complaining. Rebecca, of Rochdale, in the UK, has a similar story.

    "I have used Pampers nappies for five years on all my boys and never had a problem before, but recently they have been constantly leaking and gel crystals are going everywhere," she told I am using Pampers baby dry and they're splitting and my son had a handful of crystals."

    Pampers Parents Liars? That's P&G's Answer to Complaining Consumers...

    C&T, Sorelle, Golden Baby Drop-Side Cribs Recalled

    C&T International/Sorelle is recalling about 170,000 drop-side cribs.

    The cribs drop-side hardware can disengage from the tracks, causing the drop side to detach from the crib. When the drop-side partially detaches, it creates space between the drop side and the crib mattress. The bodies of infants and toddlers can become entrapped in the space, which can lead to strangulation and/or suffocation.

    Complete detachment of the drop sides can lead to falls from the crib. In addition, slats can detach from the sides of the cribs. Infants and toddlers can then become entrapped, strangle or fall out of the crib.

    CPSC and C&T/Sorelle have received reports of 104 incidents of drop-side and slat detachments in C&T/Sorelle drop-side cribs. Six infants received bruises and abrasions to the head, face, torso or leg from becoming entrapped or falling after the drop side collapsed. An additional five infants who were entrapped or fell were found by their parents and were not injured.

    This recall involves C&T International, Sorelle and Golden Baby wood cribs. The full-size cribs were sold in natural, white and cherry finishes. The model number and/or model name is printed on a label affixed to the footboard or headboard under the Caution statement.

    The cribs were sold at childrens product stores and other retailers nationwide from January 2000 through March 2010 for between $300 and $600. They were made in Italy, Latvia, Brazil, China and Vietnam.

    CPSC urges parents and caregivers to immediately stop using the recalled cribs and find an alternative, safe sleeping environment for their baby. Consumers should contact C&T/Sorelle to receive a free replacement kit. For four of the older models of the cribs the Hampton, Jackie, Nina and Rita models -- the firm may be unable to supply a part to repair the crib and will, instead, provide consumers with a $100 voucher towards the purchase of another C&T product.

    Contact: For additional information, contact C&T/Sorelle toll-free at (877)791-9398 between 10 a.m. and 4 p.m. ET Monday through Friday or visit the firms website at

    The following cribs are included in the recall (arger photos).

    Alessandra; Model Number: 180

    Alex 3 in 1; Model Number 910

    Amelia; Model Number 185

    Chelsea; Model Number 100

    Federica; Model Number 170

    Glenda/Toscana; Model Number 350

    Hampton; Model Number 303

    Jackie; Model Number 440

    Jessica; Model Number 810

    Lana; Model Number 240

    Leonardo; Model Number 395

    Marisa; Model Number 680

    Martina; Model Number 135

    Mirabella; Model Number 930

    Nadia; Model Number 245

    Natasha; Model Number 900

    Nico; Model Number 630

    Nina Pine; Model Number 710

    Noelle; Model Number 999

    Pagodina; Model Number 195

    Rita; Model Number 490 - Manufactured
    between 2001 and October 2007

    Rosa; Model Number 870

    Rosemary; Model Number 925

    Silver; Model Number 485

    Important Message from CPSC: CPSC reminds parents not to use any crib with missing, broken, or loose parts. Make sure to tighten hardware from time to time to keep the crib sturdy. When using a drop-side crib, parents should check to make sure the drop side or any other moving part operates smoothly. Always check all sides and corners of the crib for disengagement. Disengagements can create a gap and entrap a child. In addition, do not try to repair any side of the crib. Babies have died in cribs where repairs were attempted by caregivers.

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

    C&T, Sorelle, Golden Baby Drop-Side Cribs Recalled...

    Pampers Parents Say New Diapers Causing Blisters

    New 'Dry Max' product was introduced in March

    May 6, 2010
    In the last six weeks, parents around the world who use Procter & Gamble's Pampers diapers have reported strange rashes on their children's skin. Many of the parents are convinced the diaper is causing the rash. Most of the complaints are aimed at new "Dry Max" Swaddlers and Cruisers, introduced in March.

    "After purchasing Pampers Cruisers Size 4 diapers with Dry Max, my daughter Isabel began to get a very severe diaper rash with open sores and burns," Kathryn, of Woodbury, Minn., told "It caused so much discomfort that she screamed at changing time and began to hold her urine and bowel movements."

    In the course of a month Kathryn said she took her child to Urgent Care twice and to her pediatrician. She said a prescription for dystatin didn't work and neither did a prescription strength burn cream.

    "We also had x-rays done because we began to think she was having severe stomach issues," Kathryn said. "Diet changes and allergy testing were not helping and the rash continued."

    Changing diapers helped

    After a friend told her about similar complaints about Pampers on the Web, Kathryn tried a different brand of diaper.

    "After 48 hours of changing the brand of diapers, our daughter's rash is 75 to 80 percent better and is now comfortable again."

    Company denies it

    Procter & Gamble denies there's a problem and says it monitored 300,000 diaper changes over six years to be sure the new diapers are safe, according to a recent Minneapolis Star Tribune article.'s call to a P&G spokesman for comment was not returned by deadline.

    The U.S. Consumer Product Safety Commission (CPSC) told the Star Tribune it was investigating more than a dozen complaints about Dry Max. Health Canada is also investigating parental gripes, the agency said.

    The company says the new diapers are twice as absorbent and lighter than earlier versions. But the rash of complaints prompted Ad Age magazine to call the new diaper roll-out a marketing blunder akin to New Coke.

    Facebook protest

    When one parent launched a page on Facebook protesting the new product, more than 3,000 other parents signed on as friends.

    It's not just parents in the U.S. who are complaining. Rebecca, of Rochdale, in the UK, has a similar story.

    "I have used Pampers nappies for five years on all my boys and never had a problem before, but recently they have been constantly leaking and gel crystals are going everywhere," she told I am using Pampers baby dry and they're splitting and my son had a handful of crystals."

    Pampers Parents Say New Diapers Causing Blisters...

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      Luggage Fees TopConsumer Reports'Survey of Travel Gripes

      Rudeness among the 24 most frequent complaints involving airlines hotels, and rental-car companies

      By James Limbach

      May 6, 2010

      Travelers have a lot to gripe about, but what bugs them most are luggage charges and add-on airline ticket fees, according to a survey by Consumer Reports.

      Travelers also were very annoyed by rude or unhelpful staff, whether at airlines, hotels, or rental-car companies.

      In a nationally representative survey conducted in January, CR asked 2,000 consumers to score three lists of travel gripes covering rental-cars, airlines, and hotels for a total of 24 items on a 1-to-10 scale, 1 meaning an experience "does not annoy you at all" and 10 meaning it "annoys you tremendously."

      Luggage charges (8.4 overall) and added airline ticket fees (8.1), top the list, but rude or unhelpful staff at rental-car companies (7.9), hotels (7.8) and airlines (7.7) were also among the more annoying things that rub travelers the wrong way while traveling.

      Dave of Orlando, FL, cites a prime example. He tells, "I was disrespected by the most arrogant and pompous group of people I have ever had the displeasure of dealing with in my life," while renting a car from Thrifty at Memphis airport. "When I checked in the rental vehicle I was told that one of the bugs on the windshield was instead a small nick in the glass. I explained it had bugs on it when I rented it and I still thought it was one of the many bugs on the windshield. Then his attitude changed and the guy was now accusing me of intentionally putting a nick in a windshield and covering it with bugs. He demanded that I fill out paperwork...or I could be 'arrested right now.'" Dave says he will never do business with Thrifty again.

      The complete report on how travelers ranked all 24 annoyances is available in the June issue of Consumer Reports.

      Among the highlights:

      • Poor communication about airline delays (7.1) annoyed people slightly more than the delays themselves (6.8).

      • Airline travelers who hog your seat (7.0) and carry-on space (6.7) are less annoying that some other irritants. Many people give crying babies and unruly kids (4.9) on planes a pass and have apparently gotten used to puny or no airline snacks, (5.1) and long lines for security and check-in (5.2).

      • Women travelers are somewhat more annoyed than men. Among complaints for which the gender gap was sufficient: pricey in-room hotel snacks (6.8 women, 5.2 men); insufficient or chintzy hotel bedding (7.2 women, 6.2 men), and high-pressure pitches for extra rental-car coverage or upgrades (7.1 women, 6.0 men).

      • Some gripes, annoyed respondents under age 50 much more than those 50 and older. Those included rude or unhelpful airline staff (8.6 under 50, 8.0 50 or older), rental-car pitches (6.8 under 50, 6.1 50 or older), and absence of the ordered car (6.5 under 50, 5.4 50 and older), However, older folks are far more ticked off than younger people by those unruly kids on planes (4.5 under 50, 5.3 50 and older).

      The Consumer Reports National Research Center conducted a telephone survey of a nationally representative probability sample of telephone households. 2,000 interviews were completed among adults aged 18+. Interviewing took place from January 21-25. The margin of error is +/- 2 percentage points at a 95 percent confidence level.

      Luggage Fees Top Consumer Reports' Survey of Travel Gripes...

      Iowa Sues Bankrupt US Fidelis

      Joins a list of states taking the extended warranty marketer to court

      By Mark Huffman

      May 6, 2010

      Iowa is the latest state to haul bankrupt US Fidelis into court, charging the marketer of extended car warranties with consumer fraud.

      Iowa Attorney General Tom Miller accused the St. Louis-area company of using robo-calls and direct mail to sell auto service contracts that were falsely portrayed as if they were warranties offered by auto manufacturers.

      "We alleged this company used an intensive campaign of trickery, deception and harassment to mislead Iowa consumers," Miller said.

      Defendants named in the lawsuit are U.S. Fidelis, Inc. (which formerly was known as National Auto Warranty Services, Inc., and "Dealer Services"); Darain Atkinson; and Cory Atkinson. U.S. Fidelis is located at Wentzville, Missouri.

      U.S. Fidelis was one of the companies that deluged consumers with direct mail and phone calls, including repeated telemarketing calls to consumers on the U.S. "Do Not Call" registry, Miller charged. Much of that abusive marketing ended when the Federal Trade Commission (FTC) took legal action last year against the company making "robo-calls" for the companies marketing the so-called extended warranties.

      Miller said U.S. Fidelis now is bankrupt and has ceased contacting consumers, but the lawsuit aims to have a court completely prohibit the company and Darain and Cory Atkinson from participating in similar ventures in the future. The lawsuit also seeks civil penalties and reimbursement to consumers.

      US Fidelis also faces Lawsuits by the attorney generals of Idaho, Kansas, North Carolina, Pennsylvania, Ohio, Washington and Wisconsin.

      In his suit Miller said US Fidelis's marketing plan was to sell auto service contracts "by lying to consumers about the identity of the seller, misrepresenting the nature of the products, and engaging in a campaign of abusive telemarketing of consumers." He said the company attempted to deceive consumers that their own vehicle's manufacturer was contacting them to extend the manufacturer's warranty, when that was not the case.

      "We allege that through trickery and by creating a false sense of urgency, U.S. Fidelis deceived consumers into believing they needed to purchase a contract to keep their warranties in place," Miller said. "But U.S. Fidelis has no connection to any auto manufacturer, and the product it was selling was nowhere near as extensive as a manufacturer's warranty."

      Iowa Sues Bankrupt US Fidelis...

      FDA Describes Dirty Conditions At Tylenol Plant

      Congress launching an investigation

      Late last week the Food and Drug Administration (FDA) urged consumers to stop using Children's Tylenol and other over-the-counter products made by McNeil Consumer Healthcare. This week the agency explained why.

      FDA said its inspectors encountered thick dust and contaminated ingredients at the Fort Washington, Pa., plant producing the products. Some equipment was covered with grime, there was a hole in the ceiling in one room and pipes were patched with duct tape.

      On closer inspection, FDA said it found raw ingredients contaminated by an unspecified bacteria, a lack of quality control procedures and poor handling of complaints. Among the complaints, the agency said, were 46 reports of "dark material" in the liquid products between June 2009 and April 2010. While bacteria were present in the plant, FDA said its tests failed to detect it in any finished product.

      Johnson & Johnson, which owns McNeil Consumer Healthcare, has suspended production at the Pennsylvania plant and promised to do better.

      "The quality issues that the FDA has observed, many of which we had recently identified in our own quality reviews and communicated to the FDA, are unacceptable to us, and not indicative of how McNeil Consumer Healthcare intends to operate," the company said in a statement. "While the chance of serious adverse medical reaction is remote, we apologize to those who rely on our medicines for the concern and inconvenience this recall may have caused. We will provide a detailed response to the FDA on their observations, and work diligently to ensure that they are addressed."

      The company said it would not restart operations until it has taken the necessary corrective actions and can assure the quality of products made there.

      FDA has urged parents to select private label alternatives for the over-the-counter medications and said it was considering possible further regulatory action.

      Meanwhile, Congress is getting into the act. Both the chairman and ranking Republican on the House Committee on Oversight and Government Reform issued a joint statement saying they are "deeply concerned" about the recall.

      Chairman Edolphus "Ed" Towns (D-NY) and Ranking Member Darrell Issa (R-CA) have announced that the committee has opened an investigation into the circumstances surrounding a major recall of children's medication.

      FDA Describes Dirty Conditions At Tylenol Plant...

      Tennesseans Urged to Be Aware Of Potential Price Gougers

      Consumers should be on the lookout for exorbitant prices for fuel, cleaning supplies

      With waters from the weekend's devastating floods in West and Middle Tennessee now receding, Attorney General Bob Cooper is calling on consumers in the state to be on the lookout for potential price.

      Some individuals may take advantage of the terrible acts of nature by unreasonably or excessively raising the prices they charge for goods and services that are essential and vital to the health and welfare of storm ravaged consumers.

      Some examples of basic items people need to watch for possible extraordinary rising prices are: hotels and fuel rates; sump pumps; generators; shop vacuums; cleaning products and building supplies.

      "This is a time when our thoughts and prayers are rightfully with those affected by the floods and their potential aftermath," Cooper said. "While most Tennesseans would never take advantage of anyone in this tragedy, we are prepared to enforce the law against anyone who needlessly raises prices to take advantage of our fellow Tennesseans and visitors."

      The AG, in conjunction with the Tennessee Division of Consumer Affairs, reminds consumers and businesses that they will pursue price gougers. In the horrific aftermath of Hurricanes Katrina and Ike, the Office of the Attorney General took action against several gas stations and hotels in violation of the Tennessee Consumer Protection Act with inflated gas prices.

      The price-gouging act specifically states that it is illegal to set prices that are grossly in excess of the price generally charged immediately prior to the disaster. The price-gouging act is automatically activated when the Governor declares a disaster. Tennessee Gov. Phil Bredesen declared a State of Emergency at 12:30 on May 1.

      Another law makes illegal "unreasonably raising prices or unreasonably restricting supplies or essential goods, commodities or services in direct response to a . . . natural disaster," regardless of whether the event occurred in Tennessee. Penalties for violations of the act are up to $1,000 per violation and are Class B misdemeanors.

      The Attorney General, in conjunction with the Division of Consumer Affairs, can request that a court issue injunctions and order civil penalties of up to $1,000 for each violation. The State can also seek refunds for consumers.

      Tennesseans Urged to Be Aware Of Potential Price Gougers...

      Trump University a Scam, Suit Claims

      Students say they spent thousands of dollars and got nothing in return

      A group of consumers has filed suit against Trump University, the financial institution that holds itself out as a vehicle to instant wealth and happiness, alleging that the only thing they got from the school was a massive amount of debt.

      According to the suit, Trump University promises big things, assuring consumers that "it's the 'next best thing' to being Donald Trump's next 'Apprentice." Indeed, the company's website promises that students can, depending on their goals, "become the next real estate mogul," "become your own success story," or "learn wealth strategies."

      But the plaintiffs say it didn't take long before they realized that "[t]he primary lesson Trump University teaches its students is how to spend more money buying more Trump seminars."

      According to the complaint, when the plaintiffs first arrived at Trump University, the faculty sought to reassure them about the high cost of the seminars they were being offered. Specifically, the plaintiffs say they were told they would get all their money back at their first real estate closing, and that they stood to make "tens of thousands of dollars" every month after that. And, in addition to the seminars, the plaintiffs say they were promised, among other things "a one-year apprenticeship, a one-on-one mentorship ... [and] a 'power team' consisting of real estate [professionals]."

      Lead plaintiff spent $60,000

      As it turned out, Trump University might have oversold itself a bit. According to the suit, the one-year apprenticeship turned out to be a three-day seminar; the one-on-one mentorship, paradoxically, "consisted of no practical insights and no mentorship"; and the members of the "power team" were only interested in lining their own pockets.

      The suit also says students were asked to raise their credit card limits and prepare "detailed financial statements," ostensibly so that they would have enough money to cover their first real estate investment opportunity. In reality, though, the plaintiffs claim Trump University was just making sure that the students would have enough money to cover the Trump Gold Program, which clocks in at an eye-popping $34,995.

      According to the suit, lead plaintiff Tarla Makaeff was talked into signing up for the program after Trump University speaker Tiffany Brinkman guaranteed that her first real estate deal "would earn her in the ballpark of $35,000." Makaeff spent $60,000 on Trump courses over a one-year period, and ended up having to turn down the only two real estate deals that came her way, as "both were flawed and appeared unprofitable."

      Allegations resemble other suits

      Unfortunately, Trump University isn't unique. Last September, a suit against Millionaire University claimed that students spent over $20,000 on "real estate investment opportunities," only to end up with property that no one was willing to buy. The homes were in "high crime, highly vandalized areas," and, in case that wasn't enough, Millionaire University saturated neighborhoods with "five or more of the same model close proximity to one another," making resale almost impossible.

      Trump University was founded by Donald Trump, the real estate tycoon and host of The Apprentice, the NBC reality show in which contestants compete to be Trump's second-hand man. The school's home page features a characteristically intense-looking Trump next to the headline, "Are YOU My Next Apprentice? Prove it to me!" A button below the challenge instructs visitors to "Join Now. It's Free."

      The plaintiffs are demanding a full refund for the money they spent on Trump University courses, an injunction prohibiting Trump from falsely advertising the school, and all suit-related costs, including attorneys' fees. The suit alleges breach of contract, breach of the covenant of good faith and fair dealing, negligent misrepresentation, fraud, and violation of several California consumer protection statutes.

      A group of consumers has filed suit against Trump University, alleging that the only thing they got from the school was a massive amount of debt....

      California Charges Crooks Recycled Imported Trash

      Rogue recyclers trucked millions of cans, bottles from Arizona, Nevada

      May 5, 2010
      California officials have shut down three beverage-container recycling fraud rings in which rogue entrepreneurs trucked millions of cans and bottles from Arizona and Nevada to illegally claim California Redemption Value (CRV) refunds.

      Attorney General Edmund G. Brown Jr. said that in total, the fraud rings robbed the state of more than $3.5 million used to operate the state's recycling program as well as to promote recycling throughout California. Thirty-one individuals have been arrested.

      "These bands of thieves have been caught red-handed running tons of cans and bottles from across the state's border and fraudulently collecting money through the California Redemption Value program," Brown said. "Defrauding the state's recycling program is not a way to make easy money. We are looking for you and you will be caught."

      Conviction of redemption fraud and the importation of recyclable materials is a felony if the redemption amount is over $400.

      In one case originating in Nevada, a ring imported to California 1.6 million pounds of cans and bottles -- enough, if not compacted, to fill 464 18-wheelers.

      In another case, cans were not only hauled from the Phoenix area to Moreno Valley for the CRV deposit, they were filled with sand to add weight for an increased deposit return.

      In a third case, agents looking for one recycling fraud suspect along Interstate 8 observed yet another truck carrying thousands of cans. That observation spurred a two-month investigation, resulting in the arrest of the owner of a recycling center and three other suspects.

      California is one of 11 states with a bottle and can redemption program. Among its neighbors, Oregon has a program, but Nevada and Arizona do not. When a person purchases a bottle or can in California, the CRV is paid at the checkout stand. When the container is redeemed at one of the state's 2,000 recycling facilities, the CRV is returned to the consumer. For beverage containers weighing less than 24 ounces, the CRV is 5 cents; for containers 24 ounces and greater, the CRV is 10 cents. For aluminum, the CRV equals $1.57 per pound.

      When an out-of-state can or bottle is fraudulently redeemed in California, the program loses money because money is paid out for a container for which the CRV was never paid. This robs the CRV program, which relies on unclaimed CRV to administer the program and support a variety of activities that promote recycling across the state.

      "Recycling fraud is a crime against California consumers and we take it very seriously," said CalRecycle Director Margo Reid Brown. "Our inspectors work closely with state and local law enforcement to root out and prosecute criminals who steal the money used to repay Californians and support our state's recycling programs. These arrests are evidence that recycling fraud will not be tolerated."

      California's program began in 1987, following legislation passed in 1986. Today, about 80 percent of bottles and 84 percent of aluminum cans purchased in the state are returned for recycling.

      "Californians are doing a great job recycling their bottles and cans," added Attorney General Brown. "We don't want people intent on committing recycling fraud to harm a program that is working well."

      To combat recycling fraud, CalRecycle staff visits major recycling processors to inspect loads of beverage containers delivered for CRV reimbursement. In 2009, the department removed 25 recycling centers from the state program for submitting fraudulent claims. CalRecycle refers recycling fraud cases to the Department of Justice for criminal investigation and prosecution.

      Here's how the three recycling fraud rings were broken up in April by the Department of Justice:

      1. Department of Justice special agents observed Mariano Dejesus-Solis collecting and storing recyclable materials at his Las Vegas residence, as well as at several storage facilities in North Las Vegas. Twice a week, Dejesus-Solis and his accomplices drove 16-foot and 24-foot rental trucks filled with approximately 5,000 pounds of aluminum cans and bottles to a storage facility in Montclair (San Bernardino County) where the loads were parceled out to accomplices who would take them to recycling centers. The group defrauded the CRV program an estimated $2.5 million by illegally importing more than 1.6 million pounds of cans and bottles. On April 8, 15 suspects were arrested in Riverside and San Bernardino counties, with assistance from local law enforcement.

      2. In the Phoenix area, a group collected used beverage containers from consumers and purchased some from recycling centers at a reduced rate and then transported them to a residence in Moreno Valley (Riverside County). Daily, members of this group took multiple smaller loads to the Perris Valley Recycling Center (Riverside County) to redeem the CRV refund, defrauding the CRV fund an estimated $1 million. On April 20, a search warrant resulted in the seizure of 50,000 pounds of bottles and cans, with an estimated CRV value of $100,000. Many cans contained sand to add weight. Twelve people were arrested.

      3. On Interstate 8 near Winterhaven, Calif. and Yuma, Ariz. agents with the Imperial County and San Diego Major Crimes Teams were looking for a CRV fraud suspect when they encountered another suspected CRV fraud ring -- two men transporting a large quantity of aluminum cans in a truck. This observation launched a two-month investigation, with assistance from CalRecycle, which resulted in the April 23 arrests of four people, including Michael Barshak, the owner and operator of ACE Recycler, a recycling center in San Diego. Agents have initially estimated that the ring's operation, which spanned four months, transported 40,000 pounds of cans with an approximate value of $135,000.

      Brown Jr. said that in total, the fraud rings robbed the state of more than $3.5million used to operate the state's recycling program as well as to promote...

      'Alcoholism Cure Foundation' is Fraud, Suit Says

      FTC, Florida seek damages, injunction

      By Jon Hood

      April 5, 2010
      A lawsuit brought by Florida and the Federal Trade Commission (FTC) accuses The Alcoholism Cure Foundation (ACF) of defrauding consumers with a bogus "permanent cure" for alcoholism, and of threatening to expose the medical records of customers who fall behind on their monthly payments.

      The suit, filed in federal court in Jacksonville, says that ACF has advertised its "permanent cure" since at least 2005. According to the complaint, the company provides "individual dietary supplement regimens for consumers and...purported doctor monitoring and support," but doesn't employ anyone with "doctorates or licenses related to the treatment of alcoholism."

      The company offers programs for two categories of consumers: Heavy Drinker and Very Heavy Drinker. The programs each start out at an introductory rate and then level off at around $180 per month and $270 per month, respectively. Customers must purchase the prescribed supplements separately, inflating an already hefty bill.

      Once a customer has signed up for one of the programs, ACF continues to charge his credit card or PayPal account every month without notice. ACF made at least $693,000 between 2005 and 2009, according to the complaint.

      'Medical certainty'

      The company's current web page is "under construction," but a cached version proclaims that "Today's The Day We Cure Your Alcoholism." The site promises the "best technology to end alcohol abuse permanently," and says that customers can "'enjoy a few drinks' -- without cravings." The site goes so far as to say that ACF's program represents "Medical certainty. There is no alcoholism if you replace missing molecules your brain seeks in alcohol."

      According to the suit, a consumer who wants to sign up for an ACF program must complete an online assessment, choose either the "Heavy Drinker" or "Very Heavy Drinker" program, and provide payment information.

      However, the complaint says that ACF's web page "fail[s] to identify adequately what terms and conditions consumers purportedly agree to by submitting their Assessment form," and that "even if consumers are aware of a Terms and Conditions page, it is indecipherable and internally inconsistent."

      And customers who don't know or understand the terms and conditions pay a very heavy price. According to the suit, consumers who try to cancel their subscription are told that they must remain in the program for at least five months before ACF will release them.

      Additionally, ACF "require[s] consumers to submit 'Proof of Continued Drinking' to prove that they are not cured. ...Defendants state the submission should include, among other items, notarized notes from the consumer's doctor and five friends stating that the consumer continues to drink, liquor receipts from the previous two months, and several kinds of laboratory testing."

      Making matters worse, ACF plays hardball with consumers who renege on their "obligations." According to the complaint, the company threatens delinquent consumers with "litigation and the attendant 'unwanted publicity.'" ACF has taken several consumers to small claims court in Florida.

      Worse, the company continues to charge consumers' credit cards or PayPal accounts, "often in amounts far exceeding the monthly subscription fee," and in some cases discloses their private medical records to the Better Business Bureau.

      The suit requests unspecified damages, as well as a permanent injunction to prevent future violations of state and federal law.

      'Alcoholism Cure Foundation' is Fraud, Suit Says...

      Missouri Court Orders 'Sham' Charity to Pay Restitution

      Only one percent of funds went to charity

      With so much need in the world, scam artists have no trouble finding a worthwhile charity to impersonate, exploiting consumers' good will and willingness to help. The latest example comes from Missouri.

      The St. Louis County Circuit Court has ordered Sidney Young and a group called Our American Veterans, Inc., to pay restitution and civil penalties of $118,252 for deceptive solicitations in Missouri.

      Missouri Attorney General Chris Koster calls the group "a sham nonprofit corporation," which he said claims to help homeless veterans when in fact, the vast majority of OAVI's revenue went straight into the pockets of Sidney Young, his family, and OAVI's employees and contractors. The group is based in Fort Valley, Georgia.

      Koster said Young used telemarketers to convince potential donors that their donations would be distributed to "as many veterans as possible." He said that in 2007 and 2008, at least 632 Missourians gave more than $16,500 to OAVI.

      Koster said OAVI never meant its primary purpose to be assisting veterans. He said that in reality, less than one percent of the donations actually went to veterans, and not one Missouri veteran ever received assistance from OAVI.

      Koster filed suit against Our American Veterans, Inc., in May when he launched "Operation Broken Charity," an initiative to crack down on fraudulent fundraisers claiming to help police, firefighters, and veterans.


      "It's contemptible that people would take advantage of decent, charitable Missourians by promising to use their money help the brave people who keep us safe," Koster said. "This action should be a message to fraudulent charity fundraisers that we will not tolerate this behavior."

      Koster said that in addition to the restitution and civil penalties, the court issued an order permanently barring the defendants from soliciting in Missouri.

      Consumers should be very careful when asked to donate to charities or relief efforts, such as the ones that have sprung up in the wake of the earthquakes in Haiti and Chile.

      Here are some red flags that indicate the organization calling you for a donation is not legitimate.

      • High pressure or threatening telemarketers who want you to contribute immediately.

      • Someone calls and thanks you for a pledge you don't remember making.

      • Copycat names. Names that might be misleading or deceiving.

      Before contributing to any organization that's unfamiliar to you, ask that the information to be sent to you in writing. Ask how much of your gift will be used directly for the charity. Ask how much will go toward administrative costs. Legitimate charities have no problem giving you this information.

      If you're contacted by someone who says they represent a well-known charity, don't rush to write a check. Don't hesitate to contact the charity to find out if they know about the appeal and have authorized it.

      Above all, never give out your personal or financial information over the phone, or at the door.

      Missouri Court Orders 'Sham' Charity to Pay Restitution...

      Bisphenol A Found In Most Canned Goods

      Container industry disputes the findings, says researchers 'pursued a clear agenda'

      By Mark Huffman

      May 4, 2010
      Levels of bisphenol A (BPA) in amounts shown to cause health problems in laboratory animals are present in most canned food, according to a new study released by The National Work Group for Safe Markets, a coalition of public health and environmental health groups.

      The study, No Silver Lining, tested food from 50 cans from 19 U.S. states and one Canadian province for BPA contamination.

      Over 90 percent of the cans tested had detectable levels of BPA, some at higher levels than have been detected in previous studies.

      BPA is a widely used chemical in the container industry. It has properties that make plastic bottles more rigid and is also present in plastic liners of tin cans. The study said it tested canned fish, fruits, vegetables, beans, soups and tomato products.

      One can of DelMonte green beans had the highest levels of BPA ever found in canned food, at 1,140 parts per billion, the report said.

      While the Food and Drug Administration says current levels of BPA found in plastic containers are not harmful, some health advocates take a different view, pointing to studies suggesting the chemical ends up in the products within the containers.

      In Washington, Sen. Diane Feinstein (D-CA) embraced the report, saying it demonstrates that too much of the chemical ends up in food and beverages. She says exposure to even low doses of BPA, a synthetic sex hormone, has been linked to cancer, abnormal behavior, diabetes and heart disease, infertility, developmental and reproductive harm, and obesity.

      Bill would ban BPA

      Feinstein has introduced legislation that would ban BPA in cans, in addition to other food and beverage containers. The Senator said she is hopeful that the Food Safety Act will include language that protects consumers from BPA exposure.

      "I was pregnant with my second child at the time of this study, and I hate to think I exposed her to BPA through the canned foods I ate, especially when there is evidence that even small amounts of this chemical can cross the placenta and impact prenatal development," said Bobbi Chase Wilding of Clean New York, report co-author.

      Dr. George Lundgren, a family physician, was biomonitored and discovered BPA in his own body.

      "Diabetes and obesity are increasing at such a rate in my own practice that diet and lack of exercise alone can't explain it away," Lundgren said. "The fact that there is no labeling on products that expose us to a chemical that may be linked to serious health problems is disturbing."

      In the last two years many retailers have stopped selling some products, such as infant formula bottles, containing BPA. Now there are signs some manufacturers are following suit.

      "General Mills announced it is removing BPA from its organic tomatoes' cans, so we know that companies that want to do the right thing, but we need the FDA to commit to an outright ban protect consumers," said Mike Schade, from Center for Health, Environment & Justice, also a co-author.

      Taking issue

      But the packaging industry is taking issue with the report.

      "We are extremely disappointed that in their zeal to educate consumers, the workgroup pursued a clear agenda. In doing so, it failed to provide readers with the full story on BPA in canned foods," said Dr. John Rost, chairman of the North American Metal Packaging Alliance Inc.

      Rost said the plastic coatings of cans, which contain BPA, provide an important protection against foodborne illness and, as yet, there is no substitute.

      Bisphenol A Found In Most Canned Goods...

      Food Safety Bill Would Ban BPA

      Recent amendments make legislation more controversial

      By Mark Huffman

      May 4, 2010
      The Food Safety Modernization Act, which is headed for a Senate vote this week, enjoys bipartisan support, in part because of the recent rash of foodborne illness events over the last few years.

      But a recent amendment to the bill, outlawing the chemical BPA in plastic food containers, has drawn opposition from the food industry, which has generally been supportive of the bill.

      The amendment was offered by Sen. Diane Feinstein (D-CA), a long-time BPA foe. Feinstein says the National Toxicology Program in the Department of Health and Human Services has citied "some concern" that BPA may affect neural development in fetuses, infants and children at current human exposures. She says dozens of additional peer-reviewed scientific papers have also found evidence of adverse health effects such as increases in breast and prostate cancer risk, heart disease, liver abnormalities and diabetes.

      The Food and Drug Administration's official stand, at least for the moment, is the amount of BPA found in food and beverage containers does not pose a threat to human health.

      BPA is used in a wide variety of consumer products, including food containers, water bottles and baby bottles, although many retailers, including Wal-Mart, have dropped children's products containing the chemical.

      Amends Federal Food, Drug and Cosmetic Act

      The Act, which gained traction following several high profile Salmonella and E. coli outbreaks over the last three years, amends the Federal Food, Drug, and Cosmetic Act to expand the authority of the Secretary of Health and Human Services to regulate food, including by authorizing the Secretary to suspend the registration of a food facility.

      It would also require each food facility to evaluate hazards and implement preventive controls on a regular basis. Food manufacturers would be assessed new fees to pay for recalls and facility re-inspections.

      The House of Representatives passed its version of the bill last July, gaining bipartisan support in a 283-142 vote. Under the terms of the legislation, the FDA's proposed powers include creating a registry of food producers and importers that would be updated regularly, the ability to quarantine potentially unsafe food products from entering particular geographic areas, and levying a fee of $500 on food facilities to fund the new oversight and investigation procedures.


      Most Social Network Users Post Risky Information, Survey Finds

      Around $4.5 billion lost annually to viruses, spyware and phishing

      May 4, 2010

      Everyone, it seems, is benefiting from the growing numbers of consumers using social networks such as Facebook and MySpace - including criminals.

      The number of online U.S. households using these networks has nearly doubled in the past year the latest and Consumer Reports State of the Net survey found that 52 percent of adult social network users have posted personal information such their full birth date which can increase their risk of becoming a victim of cybercrime.

      The survey results, tips to protect users' information online and ratings of security software are featured in the June issue of the magazine.

      "Many people use social networking sites to share personal information and photos with their friends quickly and easily," says Jeff Fox, Technology Editor for Consumer Reports . "However there are serious risks involved which can be lessened by using privacy controls offered by the sites."

      The CR National Research Center conducted a nationally representative survey of 2,000 online households in January. It found that nine percent of social network users experienced some form of abuse within the past year, such as malware infections, scams, identity theft or harassment.

      Users who post information such as a full birth date -- month, date, and year -- (38 percent), photos of children (21 percent), children's names (13 percent), home street address (eight percent) and details when away from home (three percent) are especially vulnerable to becoming victims of abuse.

      And cybercrime can be costly. CR estimates that consumers have lost $4.5 billion over the past two years and replaced 2.1 million computers compromised by malware.

      Seven things to stop doing on Facebook NOW!

      Social networks are a fast and easy way to share information and photos with friends. Incidents of crime can be lessened and possibly avoided by changing the following habits:

      • Using a weak password. Avoid simple names or words that can be found in a dictionary, even with numbers tacked on the end. Instead, mix upper- and lower-case letters, numbers and symbols. A password should have at least eight characters. One good technique is to insert numbers or symbols in the middle of the word.

      • Listing a full birth date. Listing a full birth date -- month, day and year -- makes a user an easy target for identity thieves, who can use it to obtain more personal information and potentially gain access to bank and credit card accounts. Choose to show only the month and day or no birthday at all.

      • Overlooking useful privacy controls. Facebook users can limit access for almost everything that is posted on a profile from photos to family information. Consider leaving out contact info, such as phone number and address.

      • Posting a child's name in a caption. Don't use a child's name in photo tags or captions. If someone else does, delete it by clicking Remove Tag. If a child isn't on Facebook and someone includes his or her name in a caption, ask that person to remove the name.

      • Mentioning being away from home. Three percent of Facebook users surveyed said they had posted this information on their page. Doing so is like putting a "no one's home" sign on the door. Be vague about the dates of any vacations.

      • Being found by a search engine. To help prevent strangers from accessing a profile, go to the Search section of Facebook's privacy controls and select Only Friends for Facebook search results. Be sure the box for Public Search isn't checked.

      • Permitting youngsters to use Facebook unsupervised. Facebook limits its members to ages 13 and older, but children younger than that do use it. If there's a young child or teenager in the household who uses Facebook, an adult in the same household should become one of their online friends and use their email as the contact for the account in order to receive notification and monitor activity.

      Free security programs

      Consumer Reports State of the Net survey found that 40 percent of online U.S. households had at least one virus infection in the past two years so it's important for consumers to protect their computers with security software. Although almost all new PCs come with a free trial version of a subscription security suite from a company such as Symantec or McAfee, CR's latest tests confirm that consumers can skip paying for these programs and still be safe online.

      Avira AntiVir Personal 9 offers ample protection for most -- free of charge -- and was among the best anti-malware programs, but it persistently tries to sell you its untested $27 pay version, which adds some features. Microsoft Security Essentials is also free, but less obtrusive. Although it scored lower overall than Avira, Microsoft's program was a little better at identifying Web sites that host malware.

      Consumers willing to pay for special protection or extra features such as a spam filter and a browser toolbar should consider Symantec Norton Internet Security 2010 ($70) or BitDefender Internet Security 2010 ($50). Both security suits include firewalls that are a little better than those built into recent versions of Windows, as well as fine anti-spam protection.

      According to CR, Symantec's suite is one of the best products tested for detecting websites that host malware and for speed in scanning a hard drive for threats. BitDefender costs less and can work with non-Microsoft e-mail programs such as Thunderbird.

      Most Social Network Users Post Risky Information, Survey Finds...

      States Subpoena Craigslist Records

      'Blatant' prostitution ads still appear on site, attorneys general charge

      By Truman Lewis

      May 3, 2010
      A coalition of 39 state attorneys general charges that Craigslist continues to display blatant prostitution ads in its "adult services" section and elsewhere on its popular Web site. The AGs are supporting a wide-ranging subpoena that seeks access to the company's records.

      The subpoena was issued by Connecticut Attorney General Richard Blumenthal, who said the "Craigslist brothel business seems booming -- belying its promise to fight prostitution.

      The best evidence is thousands of ads that remain on Craigslist -- skimpily and slickly disguised with code words," Blumenthal said. In November 2009, Blumenthal and other AGs wrested an agreement from Craigslist, which agreed to shut down its "erotic services" section and relaunch it as an "adult services" category, with stricter enforcement of rules and higher fees.

      But Blumenthal charges that the higher fees have accomplished little, except to increase Craigslist's revenue. He cited recent news media reports that Craigslist may be profiting "in the tens of millions" from prostitution ads, rather than turning over the ad proceeds to charity, as it promised in 2008.

      "If it is breaking its promises to the public, it may be breaking the law," Blumenthal said. "The truly dangerous and darkest side of these ads is their potential to enable and even encourage human trafficking and child exploitation. This lucrative online red light district has real victims -- women and children virtually entrapped and exploited."

      It's not clear, though, what action, if any, Craigslist is legally required to take. At the time of the 2009 agreement, Kurt Opfahl, staff attorney for the Electronic Frontier Foundation, noted that existing law provides immunity to services such as Craigslist for actions taken by users. However, he said law enforcement officials can subpoena companies like craigslist for user information such as phone and credit card numbers.

      Might be evil?

      In an April 29 blog posting, Craiglist CEO Jim Buckmaster rejected demands from Twitter users that Craigslist shut down its adult services section.

      Buckmaster said the Twitter campaign was similar to the reasoning of "at least one" attorney general who he said has "essentially demanded that all of Craiglist personal be shut down."

      Buckmaster said the reasoning behind the demands is that casual sex is "evil" and that, therefore, Craigslist personal are evil and should be shut down.

      "We will continue to work with our partners in law enforcement and advocacy groups, and reach out to potential new ones, as we strive to do the best job we can in combating human trafficking, while preserving the full-fledged classifieds (complete with all of the free personals categories) that CL users (and the general public) want and deserve," Buckmaster said.

      The subpoena to Craigslist seeks, among other things:

      • All documents describing the manual review process used to review potentially objectionable advertisements, including the total number of employees assigned to such review, and the number of advertisements eliminated or rejected as a result of these procedures;

      • Information about each advertisement eliminated, rejected or the subject of law enforcement communication;

      • Communications from law enforcement regarding advertisements involving or relating to suspected illegal activity and Craigslists steps in response;

      • All documents substantiating Craigslists claim that recently implemented new proprietary technical measures designed to further reduce the volume of inappropriate ads in the personals section*have eliminated the majority of inappropriate ads in the casual encounters subsection, and have, in fact reduced the total volume of all ads in that section by approximately 50%.

      • All documents describing Craigslists telephone verification system for its erotic services or adult services sections, including the total number of ads eliminated or rejected as a result of these procedures;

      • All documents relating to the permanent blocking by Craigslist of telephone numbers due to the posting of unlawful or inappropriate advertisements, including the total number of accounts blocked;

      • All documents describing the credit card verification procedures used to block the accounts of persons who violate Craigslists terms of use, including the total number of accounts blocked as a result of these procedures;

      • All documents relating to communications between Craigslist and any persons, companies, or other entities which offer or sell services and/or software designed to facilitate circumvention of Craigslists terms of use.

      • All documents relating to the contribution of 100 percent of the net revenues from the sale of advertisements in Craigslists erotic services or adult services category, including, but not limited to any decisions to limit or cease such contributions.

      States Subpoena Craigslist Records...

      Gamers Mad at Sony for Yanking PS3's Linux Compatibility

      California class action alleges self-serving bait-and-switch

      By Jon Hood

      May 3, 2010
      A group of Linux users has filed suit against Sony, upset about the company yanking Linux capability from its PlayStation 3 (PS3) game console.

      When PS3 made its debut in 2006, it gave users the option to run a so-called alternate operating system, something that couldn't be said of Nintendo Wii or Xbox. The "Install Other OS" feature was popular among gamers who used Linux, the Unix operating system that is free to download.

      But a software update released on April 1 neutered the option, labeling it a security risk. Although the update was technically optional, gamers who failed to install it would no longer be able to watch BluRay movies, play new games, or download copyright-protected videos from a central server.

      Forgoing the update would also deny users access to the PlayStation Network, a prerequisite to playing online games and participating in PS3 chat, the system's bustling online forum.

      The suit, filed last week in federal court in California, says Sony ramped up PS3 sales by marketing the system as Linux-friendly, then threw gamers under the bus once the money was in the bank.

      "Sony knowingly and willingly accepted monetary benefits from Plaintiff and the Class, but Sony did not honor its obligations," according to the suit. "Rather, Sony benefited from the sales of PS3s with the Other OS function which it then forced purchasers to either disable or forgo other important PS3 functions."

      The suit says Sony's alleged bait-and-switch constitutes an "unfair and deceptive business practice perpetrated on millions of unsuspecting consumers."

      According to the complaint, lead plaintiff Anthony Ventura "chose to purchase a PS3, as opposed to an Xbox or a Wii, because it offered the Other OS feature." The plaintiffs point out that the PS3 console is "substantially more expensive" than many of its counterparts, and that, "[a]t the time of its launch, the PS3 was the most expensive gaming console available, retailing for $599.00 in part because it is capable of far more than merely playing games at home."

      The suit also says Sony caught many gamers off guard, relying only on the update to tell them that Linux capability would soon be defunct. According to the complaint, "Sony did not provide any other notice to its customers that it would disable [the capability]. In fact, a substantial number of Sony's customers only realized that Sony had unilaterally disabled the Other Advertised Features when they attempted to use those features on April 1, 2010."

      Jon of Cincinnati, Ohio, wrote on April 2, the day after the update was released. His complaint echoed the lawsuit: "An advertised launch feature 'OtherOS' has been disabled in a required firmware update. No compensation or additional features has been offered. This was one of the 2 reasons I bought a PS3 versus an Xbox360."

      The suit is brought as a putative class action on behalf of "all persons who purchased a PS3 during the period November 17, 2006 to March 27, 2010 and who did not resell their PS3 before March 27, 2010."

      The suit alleges breach of contract, breach of the covenant of good faith and fair dealing, unjust enrichment, and violations of the California Unfair Competition Law and California's Consumer Legal Remedies Act. The plaintiffs are seeking restitution for the money they spent on their game consoles.

      Gamers Mad at Sony for Yanking PS3's Linux Compatibility...

      FDA Warns Consumers to Avoid Vita Breath

      New York health officials find excessive levels of lead

      The U.S. Food and Drug Administration (FDA) is warning consumers not to purchase or consume Vita Breath, a dietary supplement manufactured by American Herbal Lab Inc. of Rosemead, Calif.

      The agency says the product, marketed at health fairs and on the Internet for treatment of breathing ailments, may contain hazardous levels of lead.

      The FDA was notified by the New York City Department of Health and Mental Hygiene about a patient with lead poisoning who reported taking Vita Breath and two other herbal products.

      New York authorities analyzed a sample of Vita Breath and reported it contained 1,100 parts per million of lead. This level is more than 10,000 times higher than FDA's maximum recommended level for lead in candy.

      The FDA said it has collected and is currently analyzing its own samples of Vita Breath.

      People with high blood levels of lead may show no symptoms, but the condition may cause damage to the nervous system and internal organs. Acute lead poisoning may cause a wide range of symptoms, including abdominal pain, muscle weakness, nausea, vomiting, diarrhea, weight loss, and bloody or decreased urinary output.

      Children are particularly vulnerable to lead poisoning. Lead poisoning can be diagnosed through clinical testing, and individuals who have taken Vita Breath should talk to their health care providers about testing.

      The FDA said it is working with state officials in New York and California to further investigate Vita Breath.

      FDA Warns Consumers to Avoid Vita Breath...