Current Events in August 2011

You don't normally think of men sitting around clipping grocery coupons from the newspaper but a survey finds that men are nevertheless becoming not just savvy shoppers but also astute coupon collectors.

In a survey conducted for Coupons.com, 59 percent of men said they redeem coupons when shopping, up 8% over last year.

Maybe this isn't surprising, given the success of Groupon, LivingSocial and other daily deal sites but men's changing behavior isn't limited to the daily deal sites, according to the Coupons.com study, which also found men's use of all types of coupons on the rise.

"Men are changing their shopping behaviors as a result of many things, including that coupons are for so much more than groceries," said Jeanette Pavini, Coupons.com household savings expert. "They are not going through the newspaper clipping away, but instead finding alternative sources which include online, at sites such as Coupons.com, and mobile phone apps such as Grocery iQ."

Pavini said the steady development of new applications is likely to fuel rising usage of coupons, real and virtual, by male shoppers.

"Men don’t want to pull out a stack of coupons so the fact that they can save coupons right to store loyalty cards through ‘Save-to-card’ is a huge plus,” she said.

Highlights from the study:

Coupons.com offers online coupons from major national marketers, including A&P, CVS, General Mills and Kellogg's.

Consumer Reports says it can no longer recommend that consumers buy the Honda Civic, one of the top-selling compacts in the U.S.

The non-profit magazine said the newly-redesigned Civic is "less agile and with lower interior quality" than previous models.

"It also suffers from a choppy ride, long stopping distances, and pronounced road noise," said the magazine, which has recommended the Civic for 20 years and made it a "top pick" in five of the last 10 years.

Instead, the magazine chose the 2011 Hyundai Elantra as its top small-car choice, praising its roomy interior and impressive fuel economy. The Civic finished 11 out of 12 cars rated by Consumer Reports, trailed only by the Volkswagen Jetta.

"While other models like the Hyundai Elantra have gotten better after being redesigned, the Civic has dropped so much that now it ranks near the bottom of its category," said David Champion, who headed the magazine’s test center.

Honda disagreed, saying the new Civic "excels in areas that matter to small-car customers, including fuel efficiency, safety, and reliability."  

After a scolding from the Internal Revenue Service (IRS), Delta Air Lines says it will process tax refunds for customers who were charged for a federal tax on airline tickets that lapsed when Congress failed to renew it.

Other airlines are still trying to figure out what to do about the unexpected windfall, which occurred after Congress failed to vote on extending the federal ticket tax, which amounts to about $61 on a $300 ticket.

Customers who purchased a ticket before July 23 paid a tax that is no longer in effect. The IRS said airlines should return the money to consumers.

"The IRS will continue to work with the airline industry to address issues relating to the collection and payment of the taxes involved,” the agency said in a July 28 statement. “Taxpayers do not need to take any action at this time. The IRS will provide further guidance on this issue in the near future.”

But, as always, there's a catch, the IRS warned.  If you buy a ticket before the tax is reinstated but travel after it goes back into effect, what happens?

Answer: Nobody knows.

"The legislation could either impose tax on all travel occurring after its enactment or provide an exemption for passengers who purchased tickets during the period when the tax was not in effect," the IRS said in a statement on its Web site.

Quite a mess

Delta had originally said it would book $4 million to $5 million in additional daily revenue and had no plans to change its ticket prices, even though the tax was no longer in effect. Now the airline says it will issue refunds.

Alaska Air says it wants to make it easy for customers to get refunds but hasn't figured out how to process it through its ticketing system. Other airlines are still studying the issue.

Meanwhile, the unintended bonanza for passengers is putting a kink in airport operations. The Federal Avaiation Administration (FAA) has furloughed more than 4,000 employees in 35 states and halted numerous construction projects at airports around the country.

“I’m very disappointed that Congress adjourned without passing a clean extension of the FAA bill,” U.S. Transportation Secretary Ray LaHood said last week. “Because of their inaction, states and airports won’t be able to work on their construction projects, and too many people will have to go without a paycheck. This is no way to run the best aviation system in the world.”

The Republican-controlled House of Representatives declined to approve the reauthorization unless new rules were adopted to make it more difficult for FAA personnel to unionize. 

Ford Motor Company is recalling as many as 1.1 million pick-up trucks because metal straps securing the fuel tanks are prone to corrosion and can break.

The National Highway Traffic Safety Administration (NHTSA), which announced the recall, said it involves certain 1997 through 2003 model year Ford F-150, 2004 model year Ford F-150 heritage, 1997 through 1999 model year F-250 less than 8,500 lbs. gross vehicle weight rating (gvwr), and 2002 and 2003 Lincoln Blackwater vehicles manufactured from June 20, 1995, through August 4, 2004.

The affected vehicles were originally sold, or currently registered in, Connecticut, Delaware, Illinois, Indiana, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Vermont, West Virginia, Wisconsin, and the District of Columbia.

Severe corrosion

Prolonged exposure to road deicing chemicals may cause severe corrosion of the fuel tank straps which secure the tank to the vehicle, the agency said.

As a result of the corrosion, one or both straps may fail allowing the fuel lines to separate from the tank, or in some cases, causing the tank to contact the ground. either scenario may result in a fuel leak presenting a fire hazard.

In late April a ConsumerAffairs.com reader, Rebbecca of Lorain, Ohio, said she filed a complaint to NHTSA after she said the fuel tank fell off her 1999 Ford F-150.

Lucky break

“Luckily we were breaking for a red light when it happened,” she said. “The entire family was in the vehicle.”

In early May NHTSA announced it was investigating those Ford fuel tanks and had expanded its probe to include earlier models.

NHTSA says Ford will notify owners and instruct them to take their vehicles to a dealer to have the fuel tank straps replaced with straps that have increased corrosion protection. Early in this campaign, if replacement straps are not available, dealers may install a cable support under the strap as an interim repair or a steel reinforcement over the existing strap as a permanent repair, the agency said. Any repairs will be performed free of charge.

The safety recall is expected to begin on or about September 12, 2011. Owners may contact Ford Motor Company customer relationship center at 1-866-436-7332.

You're driving along, listening to the radio, and a program comes on featuring a guest who says it's easy to walk about from your debts. All you need is a clever debt-settlement service.

Intrigued, you write down the toll-free number at the next traffic light and give the company a call. The experience, however, doesn't quite work out as advertised. In fact, you end up in worse shape than before.

How could that radio station broadcast a program that was so misleading? That's what Colorado Attorney General John Suthers wanted to know. The program about debt settlement, it turns out, was not produced by the station that aired it but by an infomercial producer, who bought time on the station and aired it.

Suthers filed suit last year against Real Talk Network and its principals, charging them with deceptive marketing. He's now reached a settlement with the company, requiring it to pay $226,414 – with most of that going to consumer restitution.

The settlement resolves charges that the company’s infomercials falsely promised, through deceptive infomercials and seminars, that they could help consumers get out of debt and pay off their mortgages in less than 10 years.

Static

Real Talk Network isn't the first debt relief company, posing as a broadcaster, to run afoul of consumer authorities. Earlier this year three companies and their owner, who allegedly falsely claimed they could help consumers quickly eliminate their credit card debts and stop calls from debt collectors, were banned from the debt relief business under a settlement with the Federal Trade Commission (FTC).

According to the FTC’s complaint, The Hermosa Group and Financial Future Network deceptively advertised debt relief services, in English and Spanish radio and television ads, claiming that consumers could pay thousands less than what they owe on credit cards.

The defendants themselves did not provide any debt relief services. Instead, the advertising was meant only to generate sales leads -- the names and phone numbers of consumers who called the defendants’ toll-free number -- which the defendants sold to debt relief providers or other sales lead generators.

Mike, of Fayetteville, Ga., is in the doghouse, and he blames Just Flowers.

“Placed an order to be delivered to my wife on our anniversary,” Mike told ConsumerAffairs.com. “Placed the order the day prior, and was assured that it would deliver the next day.”

But the next day came and there was no deliver.

“I even called Just Flowers at about 4 PM to let them know the delivery had not arrived yet --- the CSR didn't do any checking, just said that they have until 6 PM to deliver and he was sure it would arrive by then.”

But 6 PM came and went and Mike said there was no delivery. He says he's still fighting with Just Flowers for a refund, but now has a slightly bigger problem.

“My wife assumes that I forgot our anniversary,” Mike said. “'Nuff said, yes?”

The answer is the same as an hour ago

Kathleen, of Schuyler Falls, N.Y., says she is on a payment plan with Capital One, trying to pay down their credit cards. It's hard, she says, because her husband has been cut back to part-time because of the economy.

“They call daily, not once but almost every hour to hour and a half everyday,” Kathleen said. “I can time them, whether or not we tell them to check their records. Then we're told 'oh yes, we see that, thank you.' The emotional stress this causes daily is now too much. The constant harassment is now out of control.”

There are no legal limits on the number of times a day a debt collector can call, but if Kathleen believes it to be harassment, she should start keeping a log of the calls and report it to New York Attorney General Eric Schneiderman's office.

Temperature's rising

Denise, of Richmond, Va., recently learned some of the limitations of having a home warranty, that is supposed to pay when things like air conditioners break.

“I lost my air conditioning on May 20 and notified Old Republic,” Denise told ConsumerAffairs.com. “They started a file on me and contacted an HVAC company in Richmond, who sent a mechanic over the next day. He told me I needed a new compressor, and that he would notify Old Republic of this. So far so good.”

When she hadn’t heard anything in a couple of days – with temperatures 90 degrees and higher in Richmond – Denise said she called. The mechanic had not even turned in the paperwork yet, she was told.

“The next day I called again,” Denise said. “He had turned in the paperwork but I was told he had “forgotten to specify the model of compressor.”

After repeatedly spending more than a half-hour on hold with each call, and sending her children to a neighbor's house to spend the night because of the heat, Denise took matters into her own hands.

“Finally I told one of the customer service operators that I had been in touch with an HVAC company I have used in the past in Richmond, who would fix my compressor the next day, and her response was 'sure you can call them, we just won’t reimburse you for the charges,'” Denise said.

That, in a nutshell, is pretty much the limitation of a home service warranty. The homeowner has no control over who does the repair and when they do it.  

We don't want to be the cause of any wedding bell blues but all the gay newlyweds in New York State need to keep in mind that the state's new same-sex marriage law doesn't cut much wedding cake come tax time.

While New York and a growing number of smaller states now recognize gay marriage, the Internal Revenue Service does not, thanks to the 1996 Defense of Marriage Act, which prohibits all federal agencies from recognizing same-sex marriages.

That means that same-sex couples are likely to face higher tax bills for health care, harsher estate-tax treatment and higher tax preparation costs.

This apparent inequity drew little attention when only a handful of relatively small states allowed gay marriage. But New York is not only the nation's third-most-populous state, it's also home to many of the richest, most influential and most litigious gay Americans.

After all, in a time when most state legislatures can't agree on whether or not to turn the lights on when it gets dark, New York's lawmakers and governor put up little resistance to legalizing same-sex marriage, thanks to a well-organized and very well-financed lobbying effort by the gay community.

This influential group is not likely to return meekly to the closet when it's time to cough up the annual tax payment. Count on some skillful use of the GOP's anti-tax rhetoric when New York's gay community takes the tax fight to Capitol Hill – and when the Obama Campaign's fundraisers come calling.

Health care

Perhaps the biggest inequity gay couples currently face involves company-paid health benefits. With many large employers paying for family health insurance for all married employees, those in same-sex marriages find themselves having to pay additional income tax on the benefits provided to their same-sex partners.

Some businesses now offer to reimburse employees for the additional tax they incur on such benefits but that raises the question of whether the reimbursement is taxable as income.

Of particular interest to affluent gay couples is the estate tax – or the "death tax," as the Tea Party and GOP call it. Currently, a heterosexual spouse can inherit money and property from a deceased marriage partner without tax penalties if the estate is under $5 million. Any amount over that is taxed at up to the top rate of 35 percent.  

Gay couples receive no such benefits and any assets left by one homosexual partner to another are subject to full taxation.  The "taxation without representation" argument is older than the United States and -- except for its feudal treatment of the District of Columbia -- is one that Congress finds difficult to resist.  

Plastic replaced cash. Could your smartphone be replacing plastic? American Express and Verizon Wireless are betting it might.

The financial services and telecom giants say they are teaming up on a digital payment and commerce platform that will allow consumers to order and pay for goods by typing in their phone number on select smartphones and tablets.

The two companies plan to integrate Serve, an existing commerce platform, on several Verizon products. In the next few months, Verizon Wireless customers will be able to establish Serve accounts that will enable them to make payments and redeem offers for goods and services directly from their mobile phones and tablets using Serve.

Phone number authenticates

Serve works by authenticating a mobile number, then allowing a customer to make a purchase on-screen. Verizon Wireless customers who have Serve-enabled devices will be able to buy goods and services on their mobile phone in just a few clicks.

The two companies say businesses will benefit as well. Merchants who accept Serve mobile payments will see faster processing and settlement,” they say. The Serve card is currently accepted by the millions of merchants in the United States who accept American Express.

Since coupons are all the rage now, American Express and Verizon Wireless will also hop on that bandwagon. They will collaborate to source, distribute and simplify redemption of online and mobile offers with participating merchants through the use of the Serve account. For example, as customers redeem certain offers or coupons using their mobile phones, the credit may automatically appear in their Serve account.

Payfone

The two companies are also working with Payfone to support Serve checkout on Verizon Wireless devices. Payfone's pre-authorization and routing features will guide Verizon Wireless customers who use the Serve application make mobile payments simply and securely.

"Our collaboration with Verizon highlights the speed at which Serve is evolving to reach a wide audience," said Dan Schulman, group president, Enterprise Growth, American Express. "Verizon Wireless customers will soon be able to complement their busy lifestyle with a trusted payment platform that delivers a fast, flexible and secure way to manage their day-to-day mobile purchases, and together we're taking the necessary steps to make mobile commerce a reality."

In a survey that has set off heated conversations in the blogosphere, a Canadian research firm has concluded that consumers who use the Internet Explorer web browser have, on average, lower IQs than those who use Firefox, Chrome or other browsers.

AptiQuant Psychometric Consulting Co conducted free online IQ tests last month, with more than 100,000 people taking part. The company then recorded the scores and matched them up with the web browsers they used.

“A significant number of individuals with a low score on the cognitive test were found to be using Microsoft Internet Explorer (IE) versions 6.0 to 9.0,” the company said. “There was no significant difference in the IQ scores between individuals using Google Chrome, Mozilla Firefox and Apple’s Safari; however, it was on an average higher than IE users.”

Smart people's browers?

Individuals using Opera, Camino and IE with Chrome Frame scored even higher.

“These data support the hypothesis that the IQ score and the choice of web browser are related,” the company said.

AptiQuant said its findings have “important implications and identify reasons behind the continuous use of outdated browsers, that has been bugging the web developers and IT companies since the last decade.”

Fighting words?

In other words, the firm seems to be suggesting, IE users aren't exactly the sharpest crayons in the box.

Those who are partial to Microsoft's web browser aren't taking this lying down. Within 24 hours of the survey's release, an IE users group has threated AptiQuant with a lawsuit. AptiQuant CEO Leonard However said his email inbox is jammed with hate mail.

Blogger Leo Sigh called the AptiQuant “an idiotic company” and that most studies of this nature “are a waste of money.”

In its press release, AptiQuant appeared to express some IT frustration with Microsoft's browser.

“Any IT company involved in web development will acknowledge the fact that millions of man hours are wasted each year to make otherwise perfectly functional websites work in Internet Explorer, because of its lack of compatibility with web standards,” the company said. “The continuous use of older versions of IE by millions of people around the world has often haunted web developers. This trend not only makes their job tougher, but has also pulled back innovation by at least a decade.”

Nestlé Purina PetCare Company is recalling a limited number of 3.5- and 7-pound bags of its Purina ONE Vibrant Maturity 7+ Dry Cat Food from a single production run and shipped to customers in 12 states in December 2010. 

This is being done because some bags of the product have been found to be contaminated with Salmonella.  Only Purina ONE Vibrant Maturity 7+ Dry Cat Food with both the “Best By” date and the production code shown are included in this voluntary recall : 

*”Best By” Date and Production Code are found on the back or bottom of the bag.

The product was distributed to customers located in California, Iowa, Illinois, Indiana, Kentucky, Michigan, Minnesota, Missouri, North Dakota, Nebraska, Ohio and Wisconsin, who may have further distributed the product to other states.

Nestlé Purina PetCare Company became aware of the contamination as a result of samples that had been collected in several retail stores.

No additional Purina cat or dog products are involved in this voluntary recall.  No other Purina ONE brand products are involved.   Only Purina ONE Vibrant Maturity 7+ brand products which match the “Best By” dates and production code above are included in this recall.

Consumers who have purchased Purina ONE Vibrant Maturity 7+ Dry Cat Food products with these specific “Best By” Date and Production Codes should discontinue feeding the product and discard it.

Salmonella can affect animals eating the product, and there is a risk to humans from handling contaminated products.  People handling contaminated dry pet food can become infected with Salmonella, especially if they have not thoroughly washed their hands after having contact with surfaces exposed to this product.  Healthy people infected with Salmonella should monitor themselves for the following symptoms:  nausea, vomiting, diarrhea, abdominal cramping and fever.  Rarely, Salmonella can result in more serious ailments including arterial infections, endocarditis, arthritis, muscle pain, eye irritation and urinary tract symptoms.  Consumers exhibiting these signs after having contact with this product should contact their healthcare providers.

Pets with Salmonella infections may exhibit decreased appetite, fever and abdominal pain.  If left untreated, pets may be lethargic and have diarrhea or bloody diarrhea, fever and vomiting.  Infected but otherwise healthy pets can be carriers and infect other animals or humans.  If you pet has consumed the recalled product and has these symptoms, please contact your veterinarian.

For further information or to obtain a product refund, please call NPPC toll-free at 1-800-982-6559 or visit www.purina.com.

From the minute the proposed deal was announced, some consumer advocates spoke out in opposition to AT&T's plan to purchase T-Mobile.

The proposed deal would create the nation's largest cellular provider, easily eclipsing current number one Verizon Wireless, and consumer advocates warned consumers would pay the price. But not all consumer advocates agree.

Around the country, 10 attorneys general have spoken up in favor of the deal. The group, led by Arkansas Attorney General Dustin McDaniel, a Democrat, and Utah Attorney General Mark Shurtleff, a Republican, calls on the U.S. Department of Justice and the Federal Communications Commission to expeditiously review and approve the proposed merger.

Will benefit consumers

The state officials contend the merger will create new capacity for the combined company, leading to better phone service and faster data downloads for consumers. The attorneys general join 26 governors, other state and local elected officials, 10 national unions, major high-tech and venture capital firms and other national organization in calls for federal regulators to approve the merger.

"There are significant economic and public benefits to this merger, and I'm proud to work with my fellow attorneys general to communicate our concerns to the DOJ and FCC," McDaniel said. "My primary concern is my hope that federal regulators do not require the divestiture of much-needed spectrum capacity."

More broadband

In their letter, the attorneys general cited AT&T's commitment to deploy "Long-Term Evolution" wireless broadband to more than 97 percent of the U.S. population as a result of the merger. LTE is a next-generation technology that supports faster wireless broadband speeds and has fewer delays. The spectrum capacity AT&T would acquire will be critical to serving those needs.

In the letter to DOJ Assistant Attorney General Christine Varney and FCC Chairman Julius Genachowski, the attorneys general urged approval of the merger "with appropriate and carefully-crafted merger-specific remedies and conditions… [that] may be needed to protect competition and the public interest without unduly delaying the merger or undermining the synergies, economies or benefits of the merger."

In addition to McDaniel and Shurtleff, attorneys general from Alabama, Georgia, Kentucky, Michigan, Mississippi, North Dakota, South Dakota, West Virginia and Wyoming signed the letter.

Others oppose

Consumer advocates who oppose the proposed deal say it will stifle competition and lead to higher prices and there are plenty of public officials who agree. In March, New York Attorney General Eric Schneiderman said he is launching a full-scale review of AT&T’s proposed acquisition of T-Mobile, citing tjhe possibility of higher prices for consumers.

Last week Sen. Al Franken (D-MN) formally asked regulators to reject the proposed deal, calling it bad for consumers.

For years, people running a sweepstakes scam would instruct their victims to send money using a Western Union Moneygram, since it was untraceable and the funds not retrievable.

But now it appears schemers have updated the scam, substituting pre-paid debit cards as a way to take money from their marks.

In Oregon, Attorney General John Kroger has noticed the trend, with consumers reporting suspicious callers promising sweepstakes winnings but instructing potential victims to purchase a prepaid credit card to cover "taxes" or "fees" associated with collecting their cash prize.

For example, Kroger says one Oregon resident was contacted on his cell phone last week by a con artist who asked him to purchase three $1,000 Green Dot MoneyPak credit cards. In order to collect his sweepstakes prize, the man was told he must call an Idaho number and read the serial numbers off the back of the cards.

Old story

Bogus sweepstakes and lottery offers have been around forever, and while many easily see through these too good to be true schemes, many others fall victim to them. Often, they are precisely the people who can least afford to lose money.

These operations are often run by perpetrators located outside the U.S. – making it very difficult for law enforcement agencies to track them down. In 2010 officials received 1,054 complaints about international money schemes, with $1,999,323 in reported losses – more than double the $707,783 reportedly lost in 2009.

Kroger offers the following advice to consumers when it comes to unsolicited telephone calls, mail or e-mail about a sweepstakes or lottery:

• Never pay to play in a sweepstakes.
• Never pay money to claim a prize.
• Do not give out your prepaid credit card number to someone you don't know (learn more about Green Dot prepaid cards).
• Participating in a foreign lottery is illegal and such lotteries often have close ties to organized crime.
• Beware of fake organizations that go by names similar to more widely-known groups in order to trick consumers.
• Government agencies do not sponsor sweepstakes.
• Beware of requests for information about your income, credit card ownership, or bank accounts as a condition of participating in a sweepstakes or lottery.
• Do not participate in sweepstakes or respond to advertisements that resemble a check, bill or invoice.
• Destroy fake sweepstakes or lottery offers by shredding or deleting them.

Why the change?

Sweepstakes scammers have moved to pre-paid money cards because law enforcement has waged an extensive information campaign, warning consumers about the dangers of using Western Union to send money to people you don't know. Moneygram locations now routinely provide warnings about possible scams.

Consumers should not be tricked, just because scammers have updated their old tricks. It's still the same of scam.