Current Events in October 2011

The new Apple iPhone 4S has been getting rave reviews but there are undercurrents of dissatisfaction from early users who say the battery life is subpar.

It's not clear how serious or how widespread the problem is but a ConsumerAffairs.com analysis of more than 1.1 million consumer comments on Twitter, Facebook and other social media and blogs finds numerous complaints about battery life.

Of the negative comments analyzed, fully 23% were about poor battery performance, more than any other single topic.

Users report situations like finding 20% less power after leaving the phone unused overnight, 10% loss of power in 15 minutes of iMessage usage over WiFi, and 50% power loss in three hours without use, according to Information Week.

It's not unusual to have problems in new versions of the iPhone.  We all remember the complaints about the iPhone 4's antenna, which actually turned out to be a software glitch.

Most of geekdom seems to feel that the battery problem is most likely a software glitch as well and, thus, easily fixable once the exact error is nailed down.

The Guardianreported that  Apple engineers have been contacting some iPhone 4S customers and asking them to install performance profiling software.

One owner said Apple contacted him directly and asked him to install a monitoring program on the phone to try to diagnose the problem.

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Sentiment analysis by NetBase

It had to come to this.  First it was super-sized burgers and fries, then Starbucks' Trenta. Now it's the king-sized candy bar that's flying off the shelves (and onto customers' hips but that's another story).

Yep.  Hot from Hershey, Pa., comes news that sales of king-sized Hershey bars are up about 18%.  Not only that, but Hershey says it is the kind-size leader with a 54%  share of the market for bigger bars.

"King-size conversion has progressed nicely due to merchandising, continued distribution gains, innovation and consumer recognition that this is a good price/value proposition," said Hershey Chief Executive John Bilbrey.

Yes, and also because they're really big candy bars.

It's not just candy bars that are making the cash register ring, though.  Bilbrey is also smiling over sales of Reese's Minis king-size.  It's hard to see how Minis can be king-size but Bilbrey must know.  After all, he's the candy man.

If you lie awake nights wondering what's in the candy pipeline, Bilbrey told market analysts that he expects to "launch some close-end line extensions that will bring variety and excitement to some existing brands including Hershey's Drops, Cookies 'n' Cream at a king-size pack price, Hershey's Pieces Milk Chocolate with Almonds, and Jolly Rancher Crunch 'N Chew," according to trade papers.

Besides helping build Hershey's bottom line, the new king-sized bars should also help build consumers' bottoms, as they rationalize that it is, after all, just a single candy bar. 

Every 6 seconds, someone in the world dies from stroke. The Centers for Disease Control and Prevention says there are ways to reduce the risk and to recognize the signs of a stroke.

A stroke, sometimes called a brain attack, occurs when a clot blocks the blood supply to the brain or when a blood vessel in the brain bursts. You can greatly reduce your risk for stroke through lifestyle changes and, in some cases, medication.

“Someone in the United States has a stroke every 40 seconds and while that is a statistic to some, it’s a life abruptly changed for the person who suffered the stroke and the person’s family,” said CDC Director Thomas Frieden, M.D., M.P.H.  “We can do so much more to prevent strokes and the new Million Hearts initiative offers opportunities for individuals, providers, communities, and businesses to apply tools we have readily available today to reduce strokes and heart attacks.”

The CDC recommends Americans follows their ABCS:

• Aspirin for people at risk
• Blood pressure control
• Cholesterol management
• Smoking cessation

Less than half of Americans who should be taking an aspirin a day are taking one; less than half of Americans with high blood pressure have it under control. Only 1 in 3 Americans with high cholesterol is effectively treated, and less than a quarter of Americans who smoke get help to quit when they see their doctor.

The risk for stroke varies

Anyone could have a stroke, but some populations are at higher risk than others. Compared to whites, African-Americans are at nearly twice the risk of having a first stroke. Hispanic Americans' risk falls between the two. 

Moreover, African-Americans and Hispanics are more likely to die following a stroke than are whites.

High blood pressure, a risk factor for stroke, affects 68 million adults in the United States and about half of adults with high blood pressure do not have their condition under control.

Sudden symptoms of stroke

Stroke can cause death or significant disability, such as paralysis, speech difficulties, and emotional problems. Some new treatments can reduce stroke damage if patients get medical care soon after symptoms begin. When a stroke happens, it is important to recognize the symptoms, call 9-1-1 right away, and get to a hospital quickly.

The sudden onset of any of the following symptoms require immediate medical attention:

• Sudden numbness or weakness of the face, arm or leg, especially on one side of the body
• Sudden confusion, trouble speaking or understanding
• Sudden trouble seeing in one or both eyes
• Sudden trouble walking, dizziness, loss of balance or coordination
• Sudden, severe headache with no known cause

More than 2 million heart attacks and strokes occur every year and treatment for these conditions and other vascular diseases account for approximately $1 of every $6 healthcare dollars.

Google has done what might be called a roll-up in the daily deals business. The search giant says that more than a dozen sites, including zozi, kgbdeals and Gilt City, will distribute their deals through Google Offers.

It's the latest headache for Groupon, which along with Living Social quickly grew to dominate the daily deals space but has been stymied in its efforts to go public by the wobbly stock market.

The deal with Google means the smaller competitors can stop fighting each other and use Google's massive reach and superior targeting technology to aim deals at the most attractive targets.

Google will also be using something called  "Offer Ads," a service that places deals against search results, the Wall Street Journal reported.

Google's attempt to make a splash in the daily deals business, Google Offers, has been little more than lukewarm, capturing only about 1% of the market in its first year.

Today's roll-up may change that, but however it turns out for the players, it should be helpful to consumers by putting more deals at their fingergtips.

The same can't be said for Groupon.  Google's move may scare off potential investors in Groupon's IPO, set for this Thursday.  The widely-read Barron's trashed the IPO this week, saying Groupon has an unproven earnigns record and slowing growth.

We often get reports from very upset pet owners who believe the commercial food products they fed their dog or cat caused them to get sick and, in some cases, die.

These reports prompted one ConsumerAffairs.com reader to to write that as her dog was recovering from surgery, she switched him from the commercial dog food she had been feeding him.

“I did a lot of research and now he loves and eats Royal Canine Urinary,” Tonya, of Port Orchard, Wash., told ConsumerAffairs.com. “I am very happy with this prescription dog food. Also my vet sent me some paperwork on what I can do to feed him other foods. The list says plain cooked chicken, plain cooked turkey, eggs, rice, peas, pasta, white potatoes, cabbage, cauliflower, bananas, and melon. I am so happy and my pup pup is too! Hope this helps.”

Get a vet's advice

Tonya did the right thing in only feeding her dog prepared food that her vet recommended. But what is good for Tonya's dog might not be healthy for yours. A vet's advice is needed.

In fact, the American Veterinary Medical Association (AVMA) warns that some human foods can be deadly.

"Table scraps should definitely not be a part of your pet's diet," said AVMA President Roger Mahr, DVM. "Gravies, meat fats and poultry skin can readily cause stomach and intestinal upsets, and even lead to a life-threatening condition called pancreatitis in dogs.”

Despite popular myths, giving dogs bones is also a no-no. Bones will splinter when chewed and cannot be digested by the animal's system.

No chocolate

Just like their masters, most dogs crave chocolate, but it can be poisonous. Not only should it not be given to them, it should be stored in places where they can't get to it.

As for cooking for your pet, the experts say it should not be undertaken lightly. The AVMA does not recommend that people attempt to prepare home-cooked meals for their pets because pet nutrition is very complicated and unique to species and individual animals.

If you are sure you want to cook for your pet, or you feel a medical condition requires it, the AVMA recommends you first consult with your veterinarian and do some research on appropriate diets for your pet. A pet owner should only consider recipes for pet food that are developed for dogs or cats by veterinarians or trained professionals in animal nutrition.

And, as in Tonya's case, a prescription pet food, available from your vet, might be a better alternative.

Kristin Christian, a Los Angeles businesswoman, is credited with the idea. On November 5, consumers all across the country are being urged to move their accounts from a large, “mega-bank” to a credit union or small community bank.

Christian launched the "Bank Transfer Day" movement after getting fed up with her bank. She's moving, and is urging others to join her. In the wake of Bank America's decision to add a fee for using a debit card for purchases, many other consumers appear ready to join her. Others have expressed a wide variety of grievances.

Consumers may be receptive

“Bank of America is the most greedy, insidious bank in America,” Helene, of Lakewood, Calif., told ConsumerAffairs.com. “I went to cash a check drawn on BofA directly at their teller counter. I was told it would cost me $5 to cash their check at their bank. This check was for under $30 and they expected me to pay them $5 to cash it. They are the reason Occupy (Wall Street) is in existence!

Emily, of Tacoma, Wash., was attracted to Chase by their “free” checking account. But she says after the account was opened, she learned it wasn't exactly free.

“I found that I had to maintain a $1,500 balance for it to be free or do direct deposit, but it only applies to direct deposits from government checks or company payrolls,” Emily said, “I am a small business owner looking to have a direct deposit account for sales through a merchant account, and that doesn't apply. When I chose to cancel my account with 24 hours of opening it, they informed me that because I didn't wait 90 days, I would be charged $25 for each account - checking and savings! If I wait the 90 days, I will still get a $30 charge.”

Donna, of Cupertino, Calif., recounts what she remembers an an unpleasant incident with Wells Fargo a few years ago.

“I had five small transactions pending on a Friday, then I checked my account on Saturday and three cleared with two still pending,” Donna said. “I checked my account on Sunday, there's no action. I checked my account on Monday, and a $100 check I wrote that same weekend that I didn't think would hit before the five smaller transactions, not only hit, but the bank reversed the three transactions it had already cleared and bounced all five of the smaller transactions.”

Credit Unions taking advantage

For these and other consumers who might want to switch their banking, credit unions are trying to make it easier. The Credit Union National Association announced that is more than 7,000 member credit unions have already seen a surge in new members since Bank of America announced in September its $5 monthly debit fee.

The Credit Union Association of New York has assembled a special page on its website containing tools for members to take advantage of Bank Transfer day, including media talking points and model press release. Three Long Island credit unions have collaborated on a special website, BetterBankingForLongIsland.com, promoting “checking that's really free, lower rates on loans,” and “friendly, professional service.”

Will consumers make the switch on Nov. 5? After years of resentment at mounting fees, it might not take a lot of encouragement.

I was surprised this weekend to read an obituary for Virginia Knauer, 96, consumer affairs advisor to three presidents and an early advocate of unit pricing, nutrition labeling and automobile safety and fuel efficiency.

It was Mrs. Knauer who lured me into the field of consumer advocacy and indirectly led me to found ConsumerAffairs.com nearly 12 years ago.  

We had worked together at a public affairs firm in Washington in the 1980s and, although I had since lost touch with her, a former colleague told me a few years ago that Mrs. Knauer had died, so I had already assigned her to the side of the ledger marked "deceased," putting me in the company of many others who wrote her off prematurely.

Misgivings

Ralph Nader was among those who expressed misgivings about Mrs. Knauer, charging that she did not have enough authority as President Richard Nixon's consumer affairs advisor to bring about significant changes. But when Republican business leaders began complaining that she was pushing too hard, consumer advocates soft-pedaled their criticism.

An energetic, cheerful and well-coiffed Philadelphia matron, Mrs. Knauer minced no words in telling corporate executives that they could not overlook the interests of the people who bought their products.  To advance her arguments, she commissioned a study that demonstrated good customer relations were more important in  retaining customers than big advertising budgets.

She was an early and energetic advocate for toll-free numbers and insisted businesses should have call centers staffed by well-trained employees who could answer consumers' questions and solve their warranty and product repair issues.

Early feminist

An early feminist, Mrs. Knauer always had time to seek out promising young women and urge them to embark on business and political careers.  One of her assistants in the Nixon Administration was a young lawyer named Elizabeth Hanford, who later married Sen. Bob Dole, became U.S. Transportation Secretary, U.S. Secretary of Labor and a U.S. Senator from North Carolina.

Mrs. Knauer -- no one dared call her Virginia -- was a graduate of the University of Pennsylvania and the Pennsylvania Academy of Fine Arts. She served on the Philadelphia City Council and headed the Pennsylvania Bureau of Consumer Protection before coming to Washington.

Besides President Nixon, she served as consumer affairs advisor to Presidents Gerald Ford and Ronald Reagan.  

While in public life, she insisted that being pro-consumer didn't mean being anti-business.  And when working in the private sector, she quickly informed her colleagues that being pro-business didn't mean being anti-consumer.

When she was invited to join our small public affairs firm, the Strategic Alliance Group, she quickly made it clear that there would be nothing "honorary" about her appointment and that she would personally review and approve any and all projects that bore her name.

Not anti-business

Mrs. Knauer was delighted with the ConsumerAffairs.com concept of a for-profit, advertising-supported Web site that empowered consumers and businesses to interact directly and publicly and volunteered to serve on our board of advisors which, sadly, we never got around to forming. 

In what little spare time she had, Mrs. Knauer raised Doberman Pinschers and later Maine Coon Cats.  Even in her later years, she was a spirited and vocal motorist who was not easily intimidated by even the most aggressive cab driver.  She was also a sterling traveling companion.  The best part of any out-of-town trip was dinner with Mrs. Knauer.  

Unfailingly polite, energetic, incorruptible and thoroughly convinced that good consumerism was good business, Virginia Knauer was an outstanding public servant, a generous mentor and a wonderful friend.   

When you see an advertisement on the web for a product sample or trial offer that only requires a payment of a dollar or two, it pays to be very, very wary. JoAnn, of Rochester, Minn., said she agreed to a one-time debit from her bank account of $9.95, only to discover US Search had made two additional withdrawls of $19.95.

“I cancelled their service last night within hours of receiving my report, which, in fact, was not the information I requested,” JoAnn told ConsumerAffairs.com. “I have tried to call them but no answer. I have sent them three emails, my account has been closed, but I have not heard back from them re the two bogus $19.95 charges.”

Advice for JoAnn comes from another of our readers, Jeff, of Henderson, Colo., who says he encountered a similar problem with US Search.

“I called the 800 number again and a gentleman answered the phone and transferred me to another person. I told him my dilemma and after he spoke with his supervisor, he came back to tell me that they had no record of my first call to cancel my membership and all of their information for the background checks is acquired from free government sites that are available to all. When I told him that I would dispute the fraudulent charges with my credit card, he changed his story and all of a sudden, he saw the first time I called and cancelled my membership and told me that he would reverse the charge. I went to these free sites in the meantime and found the information I was looking for but this time, it was correct plus it was complete.

And consumers should also remember that when you agree to allow a company to charge your credit card for a small amount, they have the ability to take larger amounts and require you to jump through the necessary hoops to dispute the extra charges. Companies that use trial offers to promote a more expensive service are required to clearly state the terms to consumers. Consumers need to read all the fine print before they take advantage of these offers.

Adjustment needed

Carey, of Newton, Mass., sent us a copy of a complaint he directed to the Attorney General of Massachusetts regarding Dish Network.

“Apparently, they are incapable of delivering a signal when it rains or snows,” Carey said. “However, this bit of information was never communicated to me or any customer of theirs that I have talked to. Given the weather here in Massachusetts and other states where it rains and snows it seems unreasonable for them not to alert customers prior to signing a 2 year contract with a $400 early termination fee.”

Satellite reception is subject to interruption by snow and rain drops, especially as one gets farther from the equator.  It's not that the signal is not being sent but rather that it's being blocked by the snow flakes or rain drops.  This is simply a fact of life, sorry to say.

How long does it take to discover damage to a rental car?

Cathy, of Redwood City, Calif., is another rental car customer who has been informed she is liable for damage to her car, informed of this only after turning it in.

“I rent from Avis all the time,”Cathy told ConsumerAffairs.com. “However, after returning from a trip, I have mail from them stating the car I rented, while I rented it, was in an accident. I assure you, I never had an accident."

Cathy says she spends about $1,000 a month with Avis, and that fact might well give her some leverage as she tries to contest the accusation that she damaged the vehicle. However, she will need to escalate the matter to a higher level within Avis.

Meanwhile, one way to eliminate this growing consumer complaint is to require rental companies to inspect all returned vehicles in the presence of the returning customer. If there is damage, the customer could be assessed a fee on the spot. If not, the consumer wouldn't get a nasty surprise weeks later, and have the feeling they are being conned.

Netflix took it on the chin when it tried to raise its subscription fees to cover the cost of streaming more recent movies.  Bank of America was villified when it imposed a $5 monthly charge on debit cards.

So what will happen now that Coinstar is raising the price of DVD rentals at its Redbox kiosks from $1 a day to $1.20 a day, effective on Halloween, Oct. 31?

Good question.  It's only 20 cents but somehow $1.20 sounds a lot higher than $1.  Even so, it doesn't seem likely that protesters will be picketing their local Redbox dispenser.

In its defense, Coinstar says it's the first time in eight years that Redbox has raised its daily DVD rental price.  Blu-ray discs and video games will stay at their current daily rental rates of $1.50 per day for Blu-ray and $2 a day for games.

And what's to blame for this price increase?  Well, it's certainly not streaming fees, since you have to lug the DVD home yourself and bring it back the next day.

Coinstar blames the price hike on higher debit card fees, among other things. 

But didn't Congress force banks to lower the transaction fees merchants pay on debit cards?

The answer, as is so often the case with anything involving Congress, is yes and no.

The card swipe fee "reform" pushed through Congress by Sen. Dick Durbin (D-Ill.) does indeed put a cap on the fees banks charge to process most debit card transactions.  But it substantially raises fees on small transactions -- and $1 is pretty small by any measure.  

Consumer sentiment

So how are consumers feeling about Redbox these days?  We analyzed about 350,000 consumer comments on Twitter, Facebook and other social media and found that, by and large, folks are feeling kind of grumpy.

Although Redbox business appears to be booming, the fact that folks pony up $1 doesn't necessarily mean they're happy.  Fully 24% are peeved that the big red box didn't have the movie they wanted.  Of course, this is what Netflix was trying to fix when it rejiggered its fees, only to be villified by its customers.

Another 16% don't like the movie they rented, which is hardly Redbox's fault. Interestingly, about 16% are peeved because they blame Redbox for killing off Blockbuster and other video stores.  

In terms of overall consumer sentiment, Redbox is about where it ws a year ago -- with a net positive sentiment of about 49%, not bad compared to Netflix, which was hovering around 25% positive last time we checked.  That's way down from its year-ago 60% positive rating.

Redbox enjoyed a brief spurt of positive sentiment in March, when it new suite of online and mobile tools that make it easier to find specific games and movies.  

Each fully-automated redbox kiosk holds 630 discs, representing up to 200 titles. Consumers simply use a touch screen to select their favorite movies, swipe a valid credit or debit card and go. To find the nearest redbox location, consumers can visit www.redbox.com or text 'redbox' to 50101 from a mobile phone, the company said back in February.

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Sentiment analysis powered by Netbase

The U.S. Department of Transportation has fined South African Airways and LAN Airlines for violating its price advertising rules.  Caribbean Airlines was fined for improperly limiting reimbursements for delayed baggage.

“When passengers shop for an airline ticket or air tour, they have a right to know the full price they will have to pay,” said U.S. Transportation Secretary Ray LaHood.  “We expect airlines and ticket agents to treat their passengers fairly, and we will take enforcement action when they violate our price advertising rules.”

South African

The South African Airways case also included Destination Southern Africa.  The companies were fined for violating federal aviation laws and the Department’s rules prohibiting deceptive price advertising in air travel.  South African Airways was fined $55,000 while Destination Southern Africa, which promotes air travel packages for South African Airways as well as its own tours, was fined $20,000.  

An investigation by the Department’s Aviation Enforcement Office found that ads on both companies’ websites failed to adequately disclose government taxes and fees that were in addition to the advertised fare.  The ads also did not properly disclose that the air and hotel tour prices were available only with double occupancy.

When consumers clicked on a link next to the fare listed on the homepage, they were taken to a second page where they could select a specific vacation package.  Only after making a selection were they taken to a third page where they could see the taxes and fees and the requirement for double occupancy.
The websites violated DOT rules requiring any advertising that includes a price for air transportation to state the full price to be paid by the consumer, including all carrier-imposed surcharges.  

Today’s penalties follow a $20,000 fine in September 2010 against Lion World Travel, another ticket agent marketing tours for South African Airways, for violating the Department’s full-fare advertising rule.

LAN

Chile-based LAN Airlines was fined $50,000, also for violating federal aviation laws and the Department’s rules prohibiting deceptive price advertising in air travel. 

For a period of time in 2011, LAN used a program on its website that allowed consumers to search for flights by exact dates or by flexible dates.  When passengers made searches, LAN provided air fare quotes along with a note that the fares did not include taxes or fees. 

However, the page containing the quotes did not indicate either the type or amount of the fees, and there was no link that took consumers to information about the additional charges.  

Caribbean

Caribbean Airlines, a carrier based in Trinidad and Tobago, was fined $60,000 for limiting reimbursements for lost, damaged and delayed baggage to less than consumers were entitled under an international treaty.

“Both domestic and international travelers have a right to be fairly compensated for lost, delayed and damaged baggage,” LaHood said.  “Consumers have the right to be treated fairly when they fly, and we will continue to take enforcement action when their rights are violated.”

Under the Montreal Convention, an international agreement that sets liability limits for international air transportation, airlines are liable for damages caused by delayed baggage up to a limit that is the equivalent of just under $1,800 in U.S. currency, unless the carrier has takenall reasonable measures to prevent the damage or it was impossible to take these measures. 

The Convention requires carriers to compensate passengers for loss, damage or delay of baggage on international flights in most cases. It also forbids carriers from setting a lower baggage compensation limit for international flights or from refusing to accept liability for the loss of any types of baggage, such as jewelry, electronics, or other high-value items.

A review of Caribbean’s website last spring by the Department’s Aviation Enforcement Office led to an investigation of the carrier’s baggage liability policies, revealing numerous violations of the Convention between March 1, 2010 and April 30, 2011.

Caribbean routinely told passengers that it was not liable for the loss of irreplaceable or high-value items such as electronics, jewelry, cameras or cash, and the carrier’s website also stated that it would not compensate passengers for the loss of these items. In a number of cases, passengers found that some of these expensive items had been removed from carry-on bags they were required to check after boarding because of cabin space limitations.

In addition, Caribbean violated the Convention by regularly refusing to pay claims for damaged baggage and by limiting payments for buying necessities due to delayed bags to $25-$75 per day. Caribbean also frequently required passengers to file a report on their missing property before leaving the airport terminal, which unreasonably limited the time they had to discover that items were missing from their baggage.

A new research report outlines problems with the growing trend among cities to outsource traffic enforcement to red-light and speed camera vendors.

PlanetRX is on online marketer of popular health products. Like any other online merchant, the transaction is fairly straightforward. The consumer supplies their credit card information and the company ships the order.

But this month a number of consumers complained that PlanetRX was very quick to charge their credit cards but has been just the opposite when it comes to shipping their order. Wendy, of Fresno, Calif., said she used PlanetRX back in June and was pleased with the service.

“This time, I placed an order with PlanetRX.com on Aug 31 for $68.15,” Wendy told ConsumerAffairs.com. “After about a month, I waited because I've ordered things before from other sites that have been back-ordered and they've always come through eventually. I inquired using their system. Someone responded within a couple of days stating that my items were on back-order, coming directly from the warehouse. It could arrive in two or three weeks, but I could cancel my order at any time.”

No response

Wendy says she decided to wait it out, but inquired three more times. All three times, she says, she received no response.

“I also called a few days ago, spoke to a live person and told her my issue, Wendy said. “She told me to call back during business hours, dial extension 300, and they would be able to cancel my order. I have tried that, and gotten the same result as everyone else - automated message that never goes anywhere. When I dialed extension 300, it kept looping me back to the same useless recorded message, instructing me to the website, which now appears to have been downgraded to the bare minimum.”

Carpenter, of Indinapolis, Ind., also reports a frustrating delay on his order placed on Oct. 4.

“On October 17, I emailed the Help Desk about a shipping date, and received a reply that "someone should respond to your request within three to seven business days, posted on my online account and emailed to me,” Carpenter said. “On October 26, I emailed the Help Desk again after receiving no reply to my first two requests for information. This is also the very first time I've ever had a problem with an online order.”

A bad feeling

Jennifer, of Bloomington, Ill., said she had a bad feeling when she placed an order on September 21 and her credit card was immediately charged, but days went by with no delivery, or even a confirmation of her order.

“It's now October 23 and nothing,” she told ConsumerAffairs.com. I have sent three emails asking about my order and have gotten no response whatsoever. I have tried to cancel, but nothing. I used my debit card, so the money is just gone. It's not just me having this problem, it's everyone! How are they legally operating?”

According to PlanetRX's website, Jennifer should have received a confirmation of her order. When the confirmation did not arrive, the site says Jennifer should have logged in to the Order Status Wizard where she should have been able to check the status of her order.

Can you charge before you ship?

But for many consumers writing to ConsumerAffairs.com, it's the speedy charging of their credit cards and the weeks that have passed with no delivery that is the issue. Some want to know if it is legal for a merchant to charge their cards before shipping their product.

Ordinarily, the answer is no. But the CreditInfo.com website quotes a spokesman for Mastercard as saying they can if you specifically agree to let them. The site quotes Visa as saying "a merchant is not permitted to bill ahead of time" except in case of a deposit or down payment that the customer agrees to.

American Express said the merchant can charge your card as soon as you give your account number; but if you receive the bill before the merchandise, call American Express customer service and you don't have to pay while they investigate.

For consumers who have received no response in weeks and have been unable to cancel their orders, it might be a good idea to contact your credit card company and dispute the charge.

On the other hand ...

Well, that's all fine and good but we're not certain any of those supposed exceptions would pass muster with the Federal Trade Commission, which regulates mail order and online commerce.

The FTC's guide for merchants is pretty clear.  It says:  

When you advertise merchandise, you must have a reasonable basis for stating or implying that you can ship within a certain time. If you make no shipment statement, you must have a reasonable basis for believing that you can ship within 30 days. That is why direct marketers sometimes call this the "30-day Rule."

If, after taking the customer’s order, you learn that you cannot ship within the time you stated or within 30 days, you must seek the customer’s consent to the delayed shipment. If you cannot obtain the customer’s consent to the delay -- either because it is not a situation in which you are permitted to treat the customer’s silence as consent and the customer has not expressly consented to the delay, or because the customer has expressly refused to consent -- you must, without being asked, promptly refund all the money the customer paid you for the unshipped merchandise.

That's it in black and white.  Unless customers have expressly given their permission for the company to take their money and fail to fill their order, anyone having this problem should immediately inform PlanetRX that they will complain to the FTC if the charge is not rescinded.

• Read more about the FTC's rules.  
• File a complaint with the FTC.

Trek is recalling about 27,000 Trek 2012 FX and District bicycles. The bolt that secures the seat saddle clamp to the seat post can break posing a fall hazard.

Trek has received four reports of incidents with one injury involving a broken tooth and lip injury.

The bicycles affected by this recall include the following models:

Model Year 2012: Trek 7.2 FX, 7.3 FX, 7.4 FX, AND 7.5 FX; District, and 9th District bicycle models: WSD, Livestrong and Disc models.
The model name is found on the bicycle's frame.

Consumers can determine the model year by looking at the SKU number stamped on the bottom bracket, which is found near the pedals. If the last two digits of the SKU are 12, the bicycle is a Model Year 2012 bicycle.

Specialty bicycle retailers sold the bikes nationwide between May 2011 and September 2011 for between $550 and $1,100. They were made in China.

Consumers should stop riding the bicycles immediately and contact an authorized Trek dealer for a free replacement bolt.

For additional information, contact Trek at 800-373-4594 between 8:00 a.m. and 6:00 p.m. CT Monday through Friday or visit the company's website at www.trekbikes.com

The National Credit Union Administration (NCUA) today took control of Birmingham Financial Federal Credit Union of Birmingham, Ala. While continuing normal member services in a new location, NCUA said it will work to resolve issues affecting the institution.

Like motorists viewing a grisly car wreck, big banks are slamming on the brakes and rethinking any plans they may have had to start charging customers for using debit cards to make purchases.

J.P. Morgan Chase is the latest to say it has decided to take a pass on the fees, according to The Wall Street Journal.  

Don't, though, jump to the conclusion that Chase never charges for debit cards. Brad of Denver will set you straight on that.

"I lost my direct deposit when I lost my job. Now I have to make 6 purchases on my debit card to prevent a $6 charge to my bill," he told ConsumerAffairs.com recently.

"'So I have to spend money to prevent you from charging me,' I asked the Chase representative on the phone. She laughed and said, 'They can be small purchases, like a candy bar or a pack of gum,'" Brad said

"So Chase is making me spend money so I don't lose money to Chase," Brad asked.  Yes, said Chase. Brad calls this a "slap in the face."

On the sidelines

Chase joins US Bank, Citigroup, PNC, Key Bank and other large banks on the sidelines, watching with quiet fascination as Bank of America is tarred and feathered by customers enraged over its $5 per month debit fee.

Bank of America, meanwhile, may be getting that weak-kneed feeling.  It has not yet implemented the fee and now says it hasn't worked out the details and asserts that the new fee won't affect everyone -- sort of a "fee, what fee?" defense.

Wells Fargo, Regions Bank and SunTrust have all been testing various types of fees in selected markets.  No one is yet discussing the results publicly.

Where's the money?

The banks say they need to regain billions of dollars in revenue that's been lost because of new restrictions on overdraft charges, credit card fees and interest rates and debit card transaction fees that are charged to merchants. 

Free checking is already a thing of the past except for those who have enough money in their account that they couldn't care less about a $15 or $25 monthly fee. Banks still like customers who have lots of money, after all.

The banks may be feeling like Netflix these days.  Netflix has been hammered for trying to raise prices to enable it to buy the streaming rights to more movies.  Bankers tend to think they provide a valuable service and don't begrudge themselves a hefty fee or two in return.

Mark Dow, a Wall Street money manager for Pharo Capital Management, says our current economic problems are not caused by too much regulation or by Obama Administration policy, but by one simple thing – too much household debt.

In a webcast interview this week with the Daily Ticker, Dow said consumers took on too much debt, creating an overhang that only time can cure.

“The government can kind of prop you up until you are sober enough to walk on your own, but ultimately you have to walk on your own,” Dow said.

Only by getting out of debt, Dow says, can Americans resume a spending level that will support economic growth.

Academics agree

Hundreds of miles from Wall Street, researchers at the University of Iowa have concluded much the same thing after studying how consumers got into so much debt. They conclude that it happened over more than three decades of easy money.

In the 1970s, it was hard to run up debt and few families ever got to the point of bankruptcy. Bankruptcy filings have grown overall from about 110,000 in 1960, to over 1.6 million in 2003, according to the U.S. Department of Justice. Filings dipped to 480,000 in 2007, then jumped back up to nearly 1.1 million in 2010.

What's so different between now and then? For one thing, the researchers say, there were tighter credit standards for all types of credit.

1970s credit standards 

University of Iowa Sociology Professor Kevin Leicht analyzed data from a 2007 survey of 2,400 bankrupt Americans. He applied credit limits of the 1970s – a mortgage no greater than 30 percent of income, a car payment no more than 10 percent of income, and a single credit card with a $1,000 limit.

Leicht's study suggests that one-quarter of households that filed for bankruptcy in 2007 would not have been in that situation if the credit regulations of the 1970s had remained in place.

$667 per month less

If the tighter restrictions still existed, the average person in bankruptcy in 2007 would have spent $667 per month less on debt payments. That's substantial, Leicht says, considering the median income of the bankrupt households was just $23,000.

"Families in bankruptcy today struggle with hundreds of dollars more in monthly payments than the prior generation could have ever borrowed," said Leicht. "They are stressed by debt burdens that would have been unthinkable, not to mention illegal, under regulations that existed just three decades ago."

Why did families run up so much debt, and more importantly, why were they allowed to? The reason is simple, says Leicht. People's wages began to stagnate. Without credit, they could not maintain a rising standard of living, spending money to grow the economy.

Not earning enough money

To cope with it all, workers put in more hours, reduced savings and increased debt. A married couple's average number of paid hours of work rose from 53 per week in 1970 to 63 in 1997. The percentage of families where both spouses work rose from 36 percent to 60 percent. And average credit card debt per household more than doubled, from $3,000 in 1989 to $7,300 in 2007.

"The expansion of credit made possible by deregulation enabled families to maintain the image of middle-class respectability even as they struggled to stay afloat," says Leicht, who co-authored a book on the subject, Postindustrial Peasants: The Illusion of Middle-Class Prosperity. "We loan people money for consumption, which means they'll keep buying products even if employers don't pay them well."

Getting paid more, says Leight, is the way out of the debt morass. Consumers determined to get out of debt and stay that way can't spend more to boost the economy unless they earn more.  

Kim, of Spanaway, Wash., says she has been receiving some unwelcome telemarketing calls lately from a robo-caller.

“My complaint is that for some reason we have been getting calls from United American Insurance at our home,” Kim told ConsumerAffairs.com. “We are on the do not call list and I had never even heard of them so I have no idea how they got our number. Its a pre-recorded message that's getting left on our answering machine.”

Calling someone on the Do Not Call List is against the law, unless the company has received a request for information from you or had a prior business relationship within the last 18 months. The fact that it's a robo-caller making the calls sound a bit like it's a rogue operation. Kim should file a complaint with Washington state Attorney General Rob McKenna. 

Scam Alert

Marian, of Alisso Viejo, Calif., writes to warn folks about rental scams on craigslist. While these scams are nothing new, and craigslist posts warnings on its site, it's not a bad idea to remind everyone they have to be careful.

“Looking for an apartment in the West LA area and have come across several 'landlords' who supposedly live out of town therefore can not show the place,” Marian said. “Pictures only. False address given and they want a money order before they give a key.”

Not only that, Marian says they want the rent wired via Mone-gram, meaning you can't trace it or get it back. Marian said one address given as an apartment for rent turned out to be a local post office. The moral of the story, of course, is to never rent an apartment you haven't inspected with the landlord or rental agent.

Side effects

We continue to get reports from consumers taking the antibiotic Cipro that it causes some scary side effects in them. S., of Taber, Alberta says all was fine at first.

“Near the end of taking Cipro, I started having palpitations/heart jumping to catch up on missed beats,” S. told ConsumerAffairs.com. “Sometimes every 3rd or 4th beat is messed up, for hours or days at a time. Occasional heart pains. This has gone on now for almost a month. Very disturbing. Now I'm experiencing a flurry of tests on my heart.”

According to medical authorities, possible side effects include tightness in the chest and difficulty breathing.  S. may be having an unrelated problem that may need quick attention. If you have any severe side effects from any medication, see your physician immediately.

Defending against abusive debt collectors

Companies have every right to take appropriate action to collect debts owed to them. Almost no one will dispute that. However, there are rules and they have to be followed.

I received a call from Capital One on a past due balance,” Jon, of Alanson, Mich, said. “I told him I have been laid off and don't have a date. He stared name calling so I hung up. He called me back 12 times in 20 minutes harassing me. I have all the calls in my call log. He violated 15 USC 1692d) 806(5)&806(2).

Jon knows his consumer law. 15 USC 1692d covers harassment or abuse and reads, in part, “A debt collector may not engage in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section...The use of obscene or profane language or language the natural consequence of which is to abuse the hearer or reader. Causing a telephone to ring or engaging any person in telephone conversation repeatedly or continuously with intent to annoy, abuse, or harass any person at the called number. If Jon wants to file a formal complaint with the U.S. Federal Trade Commission, he can do so here.

Airbnb got a big sour dose of bad publicity earlier this year when a couple of Northern Californians complained that their apartments had been trashed by miscreants they'd rented to via Airbnb.

AirBNB was quick to institute new protection policies and claims the problems have been solved.  And maybe they have, since no similar complaints have come to light lately.  Add to that a notable lack of complaints from renters and things start to look a little too good.  

"There's nothing consumers don't complain about," our editor barked, smoke and ash billowing from his cigar.  "Get out there and find some dirt."

Fortuitously, I had already scheduled a visit to New York City to visit my family, so I began poking around hotel Web sites and the Airbnb site and quickly determined that I'd save almost $200/night in an Airbnb as compared to regular hotels. 

I was a little nervous about logistics, such as how would I get the apartment keys, so I only looked at buildings with a doorman. 

I found Airbnb.com to be more usable than many of the big hotel comparison sites I was used to. This made me more willing to try it out. I was pleasantly surprised that many of the Airbnb units I considered already had user reviews; this also made me more willing to take a chance.

I was confused about whether you're supposed to contact the Airbnb host first before booking to confirm availability. I ended up booking first and it worked out. The host emailed me right away and confirmed my stay.

The host emailed me the address of the apartment, Upper East Side, a block away from a Starbucks, and in a nice 25-story building. All I had to do was show up and the doorman would have my keys. Seemed pretty simple.

A dark night

However, I arrived in New York in the evening, and it was too dark for the cab driver and I to see the address numbers on the buildings, so he ended up dropping me half a block away and I had a short walk through evening streets.

In the future, I'd recommend using Google maps to find the exact location of the apartment/Airbnb rather than just getting out of the cab at the right cross streets.

Anyway, having escaped the street person, I got my keys, and arrived in the apartment. It was clean, larger than a hotel suite, had a nice view of the East River, and had a more comfortable bed than any hotel I've stayed in.

I was nervous that there would be issues with the wireless internet, but when I arrived I found that the host had left me a clear note with the password and it worked fine.

Overall, I had a very positive experience with Airbnb and have been recommending it to my friends and family

Many of the Airbnb's, including the one I stayed in, require a material security deposit, which is presumably part of their new consumer protection policy. Airbnb pre-authorized my credit card for $150, and cancelled the  reauthorization 48 hours after I checked out of the Airbnb as the host hadn't  charged me for damage. I think it is probably rare that a host will ding a guest for his or her security deposit, but it's something to keep in mind, I suppose.

At the request of the Federal Trade Commission, a U.S. district court has halted a debt collection operation that allegedly deceived and abused consumers – making bogus threats that consumers had been sued or could be arrested over debts they often did not owe. 

The FTC charged two individuals and seven companies in a Corona, California-based debt-collection operation doing business as Rincon Debt Management.  The court order stops the illegal conduct, freezes the operation's assets, and appoints a temporary receiver to take over the defendants’ business while the FTC moves forward with the case.

Operating since March 2009, the defendants have been unjustly enriched by at least $9.4 million, according to documents the FTC filed with the court.

“Consumers have a right to expect that debt collectors will be truthful and abide by the law,” said FTC Commissioner Edith Ramirez.  “We allege that, instead, the victims in this case were subject to abusive and illegal debt-collection practices, and that cannot stand.”

The FTC complaint alleges that the defendants targeted both English- and Spanish-speaking consumers.  The defendants called consumers and their employers, family, friends, and neighbors, posing as process servers seeking to deliver legal papers that purportedly related to a lawsuit.  In some instances, the defendants threatened that consumers would be arrested if they did not respond to the calls. 

The defendants also allegedly posed as attorneys or employees of a law office,and demanded that consumers pay “court costs” and “legal fees.”  However, according to the FTC, the debt collectors making calls to consumers were not actually process servers, attorneys, or their employees, and the defendants did not file lawsuits against consumers. 

In many instances, consumers did not even owe the debt the defendants were trying to collect, the FTC charged.

The FTC charged that the defendants’ false and misleading claims that they were process servers or attorneys who had filed – or were about to file – a lawsuit against a consumer violated the FTC Act.  In addition, the FTC alleged that the defendants violated the Fair Debt Collection Practices Act by:

• improperly contacting third parties about consumers’ debts;
• failing to disclose the name of the company they represented, or the fact that they were attempting to collect on a debt, during telephone calls to consumers;
• misrepresenting the existence of a debt, the amount, and other facts about the debt; and
• failing to notify consumers of their right to dispute and obtain verification of their debts.

By now, even inexperienced computer users are familiar with the “419 email scams,” which try to convince the recipient that the sender is an African prince, under siege and trying desperately to get his vast fortune out of the country.

With last week's violent death of long-time Libyan ruler Moammar Gaddafi, scammers are using the circumstances of his death and the wide publicity it has received to tweak the scam a bit. As a result, in-boxes around the world are now receiving a email that claims to be from one of Gaddafi's former associates who – you guess it – needs your help in moving a vast fortune outside the now rebel-controlled country.

The message purports to be from Muhammad Ali (no, not THAT Muhammad Ali) and bears the subject line “TOP SECRET MY FRIEND – Regarding late leader Moammar al-Gaddafi.

Losing the war but winning the money

“From your heart, accept this offer, as we have lost the battle,” the message begins.

In the message, the writer claims to have been Gaddafi's “chief defender officer” who fled the country when his boss was killed and is now hiding in an undisclosed European country. He has with him, he says, a small fortune given to him by Gaddafi to use to buy weapons to carry one the resistance. Now that the war is lost, he says, he must do something with the three million euros entrusted to him. That's where you come in.

“As the battle is over, I want to give you the secret deposit key of this fund to make this claim, and use 70 percent of the fund to establish good investment that can benefit both of us in the country of your choice,” the message reads.

Pulling on heartstrings

The remaining 30 percent is to be used, the message says, to set up an orphanage, since the former security chief says he has found God and lost his family in the war. It instructs the recipient to contact “a lawyer” in Spain, who will explain how to proceed – presumably with paying a significant fee or providing access to your bank account.

“You may think it's crazy that anyone would ever fall for such an email, but remember there are people who are vulnerable or elderly who might be tricked into believing that the offer is real - and end up losing a lot of money as a result,” said Graham Cluley, Senior Technology Consultant at Sophos security software.