Current Events in November 2011

Last holiday season was the first in which there were new rules in effect for gift cards, making them a bit more consumer-friendly.

The biggest rule change was the end of the “use it or lose it” quality of most gift cards, which would expired if not used in a short period of time. Now, the CARD Act prohibits gift cards from expiring sooner than five years from the date they were issued or money was last loaded.

Since gift cards are likely to be the most sought-after holiday gift, according to the National Retail Federation, there are some things to keep in mind when doing your shopping.

1. Avoid unnecessary fees

While the CARD act did away with some gift card fees, others remain. Generally, the cards with the most fees tend to be the ones issued by credit card companies. These are known as “general purpose” cards and can be used wherever the credit card is accepted.

While that's convenient, stores that sell gift cards are usually a better deal. The deals get better if you search for gift cards that offer free shipping or digital gift cards.

2. Discounts are available

Yes, you can get discounts on gift cards, which is sort of like buying money at a discount. You can save up to 30 percent but the person receiving the gift will just assume you paid full price. You can find more information about discounted cards here.

3. Gift card sellers have to provide more information

The 2011 holiday season is the first in which gift card issuers are required to have transparent disclosures on their cards. This is the second part of the CARD Act rules affecting gift cards. The added information means consumers can feel confident that what they see is what they get.

4. Buy Gift Cards with Credit Card Rewards

Lots of us have credit card rewards that pile up unused. A gift card is a great way to use them. Twenty-eight percent of consumers plan on using credit card rewards to buy presents this holiday season, according to American Express.

This is a particularly useful strategy when it comes to buying gift cards because most credit card companies offer more value with gift card redemption than with cash back. For example, Citi ThankYou Points are 37 percent more valuable when redeemed for gift cards as opposed to cash.

5. Unused gift cards can be cashed in for cash

You probably don't want to give the recipient cash as a present, but if they truly would rather have the greenbacks, it is easily arranged. They can sell unused cards for cash via online gift card exchanges. Even expired cards can be the source of some cash through state programs.

Pharmaceutical giant Merck & Co. has agreed to a massive $950 million settlement with the U.S. government and 43 states over the way it marketed the painkiller Vioxx.

The popular arthritis drug was withdrawn from the market in 2004 after it was linked to increased risk of heart attack and stroke among those who took it.

The U.S. Department of Justice said Merck will also plead guilty to misdemeanor charges that it marketed Vioxx as a treatment for arthritis before it gained approval to do so from the Food and Drug Administration (FDA). The criminal component of the agreement centers on the illegal marketing and promotion of Vioxx for the treatment of rheumatoid arthritis.

The FDA estimated in 2004 that Vioxx was responsible for more than 27,000 deaths.

Vioxx was introduced into the market in 1999 but was not approved by the FDA as an indication for rheumatoid arthritis until 2002. While it is not illegal for a physician to prescribe a drug for an unapproved use, federal law prohibits a manufacturer from promoting a drug for uses not approved by the FDA.

Vioxx pulled

On September 30, 2004, Merck voluntarily withdrew Vioxx from the market worldwide, citing an increase in the incidence of adverse cardiovascular events in patients taking Vioxx. An investigation followed which focused on allegations that Merck marketed Vioxx for the treatment of rheumatoid arthritis before the FDA approved the drug for that usage, and that Merck promoted the cardiovascular safety of Vioxx by means of certain statements and writings that were inaccurate, misleading and inconsistent. These allegations form the basis of the civil and criminal resolutions.

Merck faced thousands of personal injury lawsuits over Vioxx but initially defended each one individually before deciding, in 2007, to reach a class settlement of $4.85 billion. Last year the U.S. Supreme Court gave the green light to a securities fraud suit alleging that Merck made misleading statements about the safety of Vioxx, causing financial harm to the company's shareholders.

The states participating in the settlement say Merck made false and misleading statements to their Medicaid programs.

In agreeing to the settlement, Merck said it is not an admission of guilt and that there is no basis to conclude members of upper level management were involved in the violations.

Just in time for Thanksgiving, Federal Communications Commission (FCC) chairman Julius Genachowski has declared the proposed AT&T/T-Mobile merger a turkey.

The full FCC must still vote, but Genachowski said that after reviewing 200,000 pages of documents and holding more than 100 stakeholder meetings, he has concluded the deal is not in the public interest. The FCC also reviewed 50 petitions to reject the deal from companies including Cablevision, C Spire, DISH, EarthLink, and Sprint.

Technically, the FCC cannot block the deal and it's likely the affair will wind up in court, but Genachowski's finding pretty effectively sticks a fork in it and finds it over-cooked.

The FCC has the power to approve the deal but if it finds it unacceptable, it can only refer it to an administrative law judge, who is obligated to consider all of the evidence gathered during the FCC's review.

And the conclusion of the FCC's review, as Genachowski reads it, is that a combined AT&T and T-Mobile would result in unprecedented concentration and massive layoffs despite AT&T's claim that it would save jobs and speed the deployment of high-speed broadband to rural and underserved areas.

DOJ Suit

The U.S. Justice Department has reached similar conclusions and has already sued to block the merger.  That case is expected to go to trial in February, and the FCC is likely to hold off until the outcome of that case is clear. If the DOJ prevails, no further FCC action would be needed.

Just a few weeks ago, Attorney General Eric Holder made it known the Justice Department's opposition is not a token gesture.  He said litigators are "ready and eager" to go to trial.

AT&T issued a statement calling the FCC's move disappointing.

"It is yet another example of a government agency acting to prevent billions in new investment and the creation of many thousands of new jobs at a time when the US economy desperately needs both," Larry Solomon, senior vice president of corporate communications for AT&T, said. "At this time, we are reviewing all options."

Working from home sounds great but it's not as easy as paying a few hundred dollars for a kit that supposedly provides everything you need to set up a thriving business that you can operate while comfortably seated in your pajamas.

Tens of thousands of consumers are defrauded every year by schemes that promise an easy road to riches, or at least prosperity, through work-at-home schemes and "business opportunities."

Hoping to at least even the odds a bit, the Federal Trade Commission has approved changes to its Business Opportunity Rule that will ensure that consumers have the information they need when considering buying a work-at-home program or any other business opportunity.

The changes simplify the disclosures that business opportunity sellers must provide to prospective buyers. The simplified disclosures will help prospective purchasers assess the risks of buying a business opportunity, while minimizing compliance burdens on businesses.

In addition, the rule, which will be effective on March 1, 2012, applies to business opportunities previously covered as well as work-at-home offers such as envelope stuffing and craft assembly opportunities.

The final rule requires business opportunity sellers to give consumers specific information to help them evaluate a business opportunity. Sellers must disclose five key items of information in a simple, one-page document:

• the seller's identifying information;
• whether the seller makes a claim about the purchaser's likely earnings (and, if the seller checks the "yes" box, the seller must provide information supporting any such claims);
• whether the seller, its affiliates or key personnel have been involved in certain legal actions (and, if yes, a separate list of those actions);
• whether the seller has a cancellation or refund policy (and, if yes, a separate document stating the material terms of such policies); and
• a list of persons who bought the business opportunity within the previous three years.

Misrepresentations and omissions are prohibited, and for sales conducted in languages other than English, all disclosures must be provided in the language in which the sale is conducted.

Consumers should use the disclosure document and supplementary information to fact-check sellers' sales pitches.

This information will be helpful to consumers like Teresa Yeast, a stay-at-home mother who purchased a craft-assembly work-at-home program from a company called Darling Angel Pin Creations.

The FTC filed a law enforcement action against that company in February 2010 for allegedly claiming that consumers could make hundreds of dollars assembling angel pins at home.

"It's important to be skeptical and to be cautionary when you're approached with ... a business opportunity," Mrs. Yeast said. "I saw an opportunity that looked great, and took it. They took my money."

The Federal Trade Commission is mailing hundreds of refund checks to consumers who were defrauded by an operation that allegedly sent them counterfeit cashier's checks and made false promises of large cash prizes.

Canadian companies Cash Corner Services, Inc., Family Choice Store, Inc., and their principals -- mailed letters congratulating consumers on winning up to $750,000 in a lottery or sweepstakes, and enclosed a fake check.

They told consumers the check would cover taxes or fees that had to be paid before the "winnings" were paid out. Consumers were instructed to deposit the check and wire back a portion of the proceeds.

More than 200 consumers will receive refund checks. The average amount of payment will be approximately $370, and the total amount to be distributed will be about $83,000.

Those who receive the checks from the FTC's redress administrator should cash them within 60 days of the date they were issued. The FTC never requires consumers to pay money or provide information before redress checks can be cashed.

Those with questions should call the redress administrator, Rust Consulting, Inc., 1-855-793-1369, or visit www.FTC.gov/refunds.

Many of the Occupy Wall Street protesters are a little vague on what they're mad about, but tax breaks for big corporations are usually high on their list.

Now a new report, “Corporate Taxpayers & Corporate Tax Dodgers,” is likely to add more fuel to the fire. Produced by Citizens for Tax Justice and the Institute on Taxation and Economic Policy, the study examines the income taxes paid (or not paid) by 280 companies in the Fortune 500. The study’s authors note that:

“Seventy-eight of the 280 companies paid zero or less in federal income taxes in at least one year from 2008 to 2010. Twenty-five of these companies enjoyed multiple no-tax years, bringing the total number of no-tax years to 108. In the years they paid no income tax, these companies earned $156 billion in pretax U.S. profits. But instead of paying $55 billion in income taxes as the 35 percent corporate tax rate seems to require, these companies generated so many excess tax breaks that they reported negative taxes.”

In other words, thanks to tax loopholes, some of these companies paid nothing to the IRS.

Among the worst offenders were the big telecommunications companies:

• Between 2008 and 2010, Verizon received $12.3 billion in tax subsidies from the federal government and had an effective tax rate of –2.9 percent.

• In the same period, AT&T received nearly $14.5 billion in federal tax breaks, second only to Wells Fargo, which received nearly $18 billion. It had an effective tax rate of 8 percent.

• Comcast received $2 billion in tax breaks and had an effective tax rate of 20.6 percent.

• The telecom industry as a whole paid an effective tax rate of 8.2 percent during the 2008–2010 period — far below the standard 35 percent corporate tax rate.

Some food is good for you. Some food is bad for you. Then, some food isn't what you think it is. The latter can fall into the category of “food fraud.”

Researchers at Michigan State University say there are increasing cases of food being marketed to consumers as possessing some benefit it doesn't have. Or, in some cases, where potential harmful effects are obscured. It's almost always done for economic gain.

The Michigan State Study, published in the Journal of Food Science, said food fraud differs from a food safety incident involving unintentional act with unintentional harm, and a food defense incident characterized as a deliberate focus on intentional harm.

Intentional substitution

In an act of food fraud, the manufacturer or marketer engages in deliberate and intentional substitution, addition, tampering, or misrepresentation of food, food ingredients, or food packaging, or makes false or misleading statements made about a product for economic gain.

The study says examples that are potentially dangerous, including melamine added to milk to boost the apparent protein content,  salvaging dropped fruit that is bruised and subsequently contaminated with E. coli, and substituting less costly species of fish and misrepresenting them as more expensive species which may be toxic or cause allergic reactions.

“These types of food fraud ultimately pose risks to the consuming public,” the study authors write.

Increasing potential

As food products become more exotic and niche-oriented, the potential for food fraud increases. For example, how do you know that expensive sheep's milk cheese wasn't really made with cow's milk?

The Washington Post reports a Virginia man was convicted last year of selling 10 million pounds of cheap, frozen catfish fillets from Vietnam as much more expensive grouper, red snapper and flounder. He sold the fish to national chain retailers, wholesalers and food service companies, who passed it on to unsuspecting consumers.

The authors also write that food fraud could potentially be more dangerous than traditional food safety risks, since adulterants are typically unconventional and the current intervention and response systems are not looking for these contaminants.

The authors call for additional research on the risk associated with food fraud while also citing the need to support a continued public-private partnership approach to countering food fraud.

We hope you're not among those who'll be headed out Thanksgiving night to stock up on supposed bargains.  But no matter when you begin your holiday shopping, there are plenty of potential traps to watch out for.

“Retailers are allowed to set their own rules on shipping and handling fees, but in some cases those rules lack clear disclosure and add unanticipated costs to consumers,” said Barbara Anthony, the Undersecretary of the Massachusetts Office of Consumer Affairs and Business Regulation. “When holiday shopping, consumers need to do their homework and be aware of the rules. If a consumer does not like the shipping and handling terms, he or she should consider shopping elsewhere.”

The Office of Consumer Affairs checked 50 retailers in the Bay State, mixing traditional department stores, online-only retailers, and television infomercial-style items. In reviewing the shipping and handling rules, the investigators identified six issues consumers should be aware of before making a purchase.

One box, two items, one larger shipping and handling fee

Traditionally, if you buy multiple items at one time through a retailer, your shipment should be subject to one charge. But not all companies work that way, and even if you order two of the exact same items, and they come in one box, the shipping and handling fee can be charged to both items.

If you order two pairs of Pajama Jeans, they will come in one box, but you will be charged the $7.95 shipping and handling fee twice, for each pair of pants you buy.

When “free” doesn’t mean free

Many television advertisements include buy-one-get-one-free offers on the items being sold. But “free” isn’t always free. In the case of Aluma Wallets, the “free” wallet is subject to a $4.99 shipping and handling fee.

The Perfect Meatloaf pan charges $7.95 for shipping the additional “free” item. Comfortisse Bra sells its items in a set of three, and consumers can order two more sets for free, but it charges $9.95 for shipping and handling on each of the three sets (nine bras in total).

In making such purchases, consumers should be aware that multiple shipping and handling fees can wipe out any perceived savings by buying the product in the first place.

Extra parts mean extra costs.

The NuWave Oven comes with a hefty $29.95 shipping and handling fee. The website offers additional parts to the oven, like a “Nuwave twister” and “party mixer” for free, but with additional shipping and handling fees.

The Ronco Six-Star Knife Set offers a lifetime guarantee on all its items and free replacements – with a $2.95 shipping and handling fee on each replacement.

How much is too much for shipping and handling?

In some cases, consumers cannot answer that question until it is too late, or the shipping and handling fee does not pop up until the last confirmation window on the website and is missed by the consumer.

Many online websites do not detail shipping and handling fees until after shipping or billing information is entered into the website, including Ninja Kitchen System 1100, a food processor. Know all the costs and fees associated with a product before providing your payment information.

Sometimes paying a little more will save. Sometimes paying a little less will save.

Some retailers, like Staples and REI, charge shipping and handling for smaller dollar-amount purchases. Staples charges $9.95 for purchases under $45 and REI charges $5.99 for purchases under $50. If you plan on buying $43 worth of products at Staples, buy a pack of pens for $2 to reach the $45 threshold and save on the shipping fees.

On the flip side, some retailers charge more as the purchase price increases. Crane and Co., and Bed, Bath and Beyond use those systems. Know what price levels trigger higher fees at those and similar retailers.

Returns might cost more than postage.

In some cases, retailers will charge a shipping and handling fee for accepting a return via mail, even if you are paying the postage. The North Face, for example, deducts $7 for a return through the mail. So, if you expect $50 back for a return, you will only get $43.

To avoid these fees, the Office of Consumer Affairs recommends consumers follow these tips:

• Research shipping and handling fees online, or call the retailer to get the details;
• Add up shipping and handling before completing a purchase;
• Do not give payment information until you know what the fees are and you are certain you will buy the item;
• Ask if there is shipping and handling on returns;
• If you must make a return, and the retailer has a local location, take it back to the store, do not mail it back;
• If possible, shop at brick-and-mortar stores, where there are no shipping and handling fees, or consider shopping at retailers that will ship an item to a local store with no shipping and handling fees.

This time last year gasoline prices were rising, but were well under $3 a gallon. Over the following months, they kept rising, hitting an average of $3.98 a gallon in early May.

So why haven't high gas prices ignited inflation like they did 40 years ago? Those old enough to remember the 1970s might also remember the oil shocks of 1973 and 1979.

Those two large oil price increases caused inflation in the prices of core goods. The 1990s brought even larger oil shocks, yet the prices of core goods didn't go up. Then, when gas prices rose $1 a gallon in the space of a few months this year, researchers wanted to understand why high energy prices led to inflation then, but not now.

"Many economists would say that the difference in inflation for these two decades was caused solely by monetary policy," said Lance Bachmeier, a Kansas State University economist. "But when we looked at the data for core goods, we found that is not the case."

Some prices actually falling

More than that, the prices of many goods -- such as clothing or vacations -- are actually deflating instead of inflating because of improved technology and reduced energy costs.

Bachmeier and colleague Inkyung Cha used inflation data from the Bureau of Labor Statistics to look at more than 100 core goods. Core goods do not include groceries, but rather include goods such as cars, household appliances, clothing, cosmetics, toys and vacations. These kinds of goods are not affected as much by oil shocks, Bachmeier said, but have actually experienced some minor deflation from rising oil prices. The reason is simple; consumers have less money to spend.

"If you used to spend $10 to fill your tank, and now you are spending $20, that gives you $10 less to spend on cosmetics or clothing," Bachmeier said. "So that causes the demand of those goods to fall, and then the price falls."

Bachmeier and Cha credit improvements in energy efficiency for helping keep production costs in check. The biggest cost for some manufacturers is energy, so even small advances in technology have helped reduce production costs. For instance, newer technology has helped diesel trucks get 7 miles per gallon, when they used to get 4.8 miles per gallon in 1977. Other technologies have created more energy-efficient methods of producing paper and steel, among other developments.

Lack of credit

At the same time, consumers don't have the access to credit they once did before the collapse of the housing market. With fewer dollars available in the rest of the economy, demand falls and sometimes, so do prices.

In the last few weeks, consumers have noticed gasoline prices are going down a bit.

Bachmeier attributes the lower prices to uncertainty about the global economy. Without this uncertainly, he says, gas prices might reach $5 a gallon.

In other words, when the economy recovers, consumers had better to pay sharply higher prices for fuel. Will $5 a gallon gas finally produce inflation? It might at the beginning, but Bachmeier predicts consumers will adapt, lessening the impact of another oil shock.

"United States consumers will realize that gas prices are not likely to go much below where they are right now," Bachmeier said. "Some college students and others with low incomes will walk or ride bicycles when possible. Consumers will put more emphasis on gas mileage when they buy a new vehicle. Even at $3 per gallon, an average middle-age male driver will save about $200 per month on gas by driving a Hyundai Elantra rather than an SUV."

Maybe Jennifer Lopez will be next to get the axe?  Laura Soave, who headed up the return of Fiat to U.S. shores since March 2010,  ”has left the company and will pursue other interests,” as Chrysler put it today.

JenLo, you may recall, has become the celebrity face of the Fiat 500, doing commercials and personal appearances for the minuscule car but suffered an embarrassing moment at the Los Angeles Auto Show when she was unable to open the door of one of the cars.

It seems the handle was stuck for unknown reasons.  

As far as we know, Ms. Soave was unable to find a similar scapegoat for the dismal sales performance of the 500.  Or maybe she is the scapegoat?

Sergio Marchionne, Chrysler CEO and chairman, had confidently predicted the company would sell 50,000 of the cars annually but fewer than 16,000 had been sold as of the end of October.

The current party line is that sales are slow because it has taken longer than expected to get dealerships open.  Chrysler says it now has 130 dealerships in the U.S. but admits that in October, 29 of them did not sell a single car, FiatOwner.org reported.

Chrysler Group named Timothy Kuniskis, 44, to replace Soave.

“Tim brings broad expertise and leadership in dealer operations and marketing where he has been already working with the team to shape the direction of the Fiat Brand,” Marchionne said.

Customer grousing

One advantage of not selling many cars, of course, is that you don't get many complaints that way. But the early returns are starting to come in anyway, like one we recently received from Dave of Manitoba.

"Upon purchasing the car I was told it was manufactured in Europe [but] it is in fact built in Mexico and has very poor build quality, so far both front seats have broken, trim falls off, some new trim already been replaced once has come off again," Dave said, but added that fuel economy is his major concern.

"The car is sold as being able to do 55 mpg (Canadian) on the hwy ... [but] to date which is 4 months and 18,000km we have not got above 43 mpg. [They] have no answers as to why the fuel ecomony is so bad, and are not prepared to find out why," he said.

Last week it was Google that, prodded by the feds, cut loose hundreds of mortgage modification scheme advertisers.  This week, Bing and Yahoo are doing the same, after years of profiting from the ads, which prey on desperate homeowners trying to avoid foreclosure.

A little known agency, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), says it has now shut down 125 alleged scams that had been widely advertised on Google, Yahoo and Bing.

SIGTARP investigates, among other things, mortgage modification schemes in which companies charge struggling homeowners a fee in exchange for false promises of lowering the homeowner’s mortgage through TARP’s housing program known as the Home Affordable Modification Program (HAMP).

Microsoft, which founded Bing and whose technology powers Yahoo Search, said it has suspended its relationship with more than 400 advertisers and has blocked all future advertising associated with the 125 scams identified by SIGTARP. Google suspended 500 advertisers last week.

“Many homeowners who have fallen prey to these scams were enticed by Web banner ads and online search advertisements that promised, for a fee, to help lower mortgage payments,” said Christy Romero, Deputy Special Inspector General for SIGTARP.

Upfront fee

That's what happened to Rebecca of Murfreesboro, Tenn., who was told she could lower her house payment through a mortgage modification.

"I had to pay them $2,198.00 and was told ... that if I didn't get the results I needed that I could get a full refund of my money. I did not get the results I needed and have asked for my money to be refunded and keep getting the runaround," Rebecca told ConsumerAffairs.com. "I am about to lose my house because of this."

The latest action won't help Rebecca but may keep other consumers from falling into the same trap, Romero said:

“SIGTARP's work in cutting off these Internet advertisements will immediately and dramatically decrease the scope and scale of these scams by limiting their ability to seek out and victimize struggling homeowners. SIGTARP will investigate and hold accountable criminals who defraud homeowners in connection with HAMP, while doing everything we can to stop homeowners from becoming victims in the first place.”

The most common schemes included asking homeowners for an up-front fee and telling homeowners to stop paying their mortgage and to cease all contact with their lender. The schemes included diverting mortgage payments to the scammers, transferring property deeds, and/or releasing sensitive personal financial information. In some instances, the Web sites claimed to be affiliated with the U.S. government through the use of a government seal or name similar to a government agency.

"They send us an application to file, we did, and their fee was $2700.00 upfront, and we paid it," said Elia of Antioch, Calif., in a recent complaint to ConsumerAffairs.com. "On Sat 11-12-2011, we received a letter from Guaranty Bank stating that they are unable to fully process our regular payment since we owe $5710.26. There is no way!! We do not have this kind of money."

What to do

Homeowners can protect themselves from becoming a victim of these scams by seeking a HAMP mortgage modification directly through their lender or mortgage servicer or through HUD-approved housing counselors who are available at 1-888-995-HOPE (4673) or www.makinghomeaffordable.gov.

HAMP is a free program that does not require a fee to be paid to your lender or a HUD-approved counselor.

Homeowners should continue to pay their mortgage directly to their lender and should not send those payments through anyone other than their lender. Homeowners should be wary of anyone who tells them to stop paying their mortgage or to cease all contact with their lender, as these are hallmarks of a mortgage modification scam.

Pool Corporation, the largest distributor of swimming pool products in the United States, has agreed to stop anticompetitive tactics that it allegedly has been using to keep out new competitors in local markets around the nation, as part of a settlement that resolves charges by the Federal Trade Commission.

PoolCorp distributes products used in the construction, renovation, repair, service, and maintenance of residential and commercial swimming pools.

The FTC charged that for the past eight years, PoolCorp, based in Covington, Louisiana, used its monopoly power to thwart entry by new competitors by blocking them from buying pool products directly from manufacturers. The strategy significantly raised the costs incurred by its rivals, thereby lowering sales, increasing prices, and reducing the number of choices available to consumers, the agency alleged.

Specifically, the FTC contends that PoolCorp threatened manufacturers of pool products that PoolCorp would not sell their products at any of its 200 distribution centers if manufacturers also sold their products to new distributor rivals. According to the complaint, PoolCorp's threats were significant because the loss of PoolCorp sales could be catastrophic to even the largest pool products manufacturer.

As a result, the agency alleged, these threats were effective, and manufacturers representing more than 70 percent of all pool products sales refused to sell to new distributors. In order for a distributor to succeed, the FTC alleged, it must be able to buy pool products directly from manufacturers because there are no cost-effective alternatives.

The FTC alleges that PoolCorp's conduct impeded new distributors from entering the market, raised the costs of new distributors, and likely resulted in higher prices. The FTC alleged that the company's tactics constituted illegal exclusionary acts and practices. There allegedly was no pro-competitive rationale for PoolCorp's exclusionary conduct.

The proposed order settling the charges is intended to remedy PoolCorp's alleged anticompetitive conduct. It prohibits PoolCorp from:

• Conditioning the purchase or sale of pool products, or membership in PoolCorp's preferred vendor program, on the intended or actual sale of pool products by a manufacturer to any other distributor;
• Pressuring, urging, or otherwise coercing manufacturers to stop selling, or to limit their sales, to any other distributor; and
• Discriminating or retaliating against a manufacturer for selling, or intending to sell, pool products to any other distributor.

The settlement order also requires PoolCorp to put in place an antitrust compliance program to ensure it does not violate the terms of the order in the future.

The U.S. Department of Transportation (DOT) today fined Spirit Airlines $50,000 for violating federal aviation laws and the Department’s rules prohibiting deceptive price advertising in air travel. 

“Consumers have a right to know the full price they will be paying when they buy an airline ticket,” said U.S. Transportation Secretary Ray LaHood.  “We expect airlines to treat their passengers fairly, and we will take enforcement action when they violate our price advertising rules.”

DOT rules require 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.  The only exceptions currently allowed are government-imposed taxes and fees that are assessed on a per-passenger basis, such as passenger facility charges, which may be stated separately from the advertised fare but must be clearly disclosed in the advertisement so that passengers can easily determine the full price they must pay. 

Internet fare listings may disclose these separate taxes and fees through a prominent link next to the fare stating that government taxes and fees are extra, and the link must take the viewer directly to information where the type and amount of taxes and fees are displayed.  In print advertisements, including billboards and posters, an asterisk or other symbol placed next to the advertised fare may refer the reader to the bottom of the advertisement where the type and amount of the fees may be stated separately, in type large enough so that passing consumers can read the information. 

In addition, if carriers advertise an each-way fare that is available only if the consumer purchases a roundtrip ticket, the advertisements must clearly and conspicuously state the roundtrip purchase requirement.

For a period of time in June 2011, Spirit used billboards and hand-held posters to advertise new service from Los Angeles that contained an asterisk next to the advertised fare.  On the billboards, the asterisk led to small print which stated that additional taxes, fees and conditions would apply, but did not disclose the amount of those taxes and fees.  The posters did not include any information about the taxes and fees or their amounts. 

In addition, Spirit sent Twitter feeds announcing $9 each-way fares.  A consumer who clicked on the link that was provided was taken to a page on Spirit’s website where the carrier disclosed for the first time that these fares did not include all taxes and fees, and that they were subject to a roundtrip purchase requirement. 

Only after clicking on a second link, which took readers to the bottom of the page, was the amount of additional taxes and fees disclosed. 

Under DOT’s recently adopted consumer rule that enhances protections for air travelers, carriers will be required, among other things, to include all government taxes and fees in every advertised fare beginning Jan. 24, 2012.

Soon after Apple rolled out its new iPhone 4S, complaints began to appear about battery life. Consumers who bought the device reported the battery ran down quickly, requiring charging more than once a day, in some cases.

Apple suggested the problem would be fixed in an upgrade of the operating software, but some users complained the upgrade just made the problem worse.

It turns out that the iPhone 4S isn't the only smartphone producing battery life complaints. A number of other phones, from other manufacturers and running on other platforms, display similar behavior.

Take the Motorola's new Droid Razr, using Google's Android operating system. The phone is viewed as a challenger to the iPhone 4S but also seems to have the 4S' battery life problem.

A negative

In the over 100 reviews of the phone posted on VerizonWireless' website, many of consumers list battery life as a “con,” despite finding many “pros” with the device.

“My battery seems to die just from me staring at the screen,” a reviewer going by the screen name “Mobeda” said.

“Battery life is less than a working day with apps killed,” another reviewer named Eezak said.

In addition to having lots of energy-eating features, the Razr runs on Verizon's faster 4G network, which the iPhone 4S does not. Another Android phone, the HTC Rezound, earned a four-star ratting from a reviewer named Wilsoncraft, who labeled his review “Fast and Beautiful,” giving the device five stars for every feature except one.

“Very short battery life even with 4g off and brightness turned down,” Wilsoncraft wrote.

'Doesn't last'

The HTC Evo, which operates on Sprint's 4G network, is a very popular phone but, like many other 4G devices, produces complaints about the battery.

“The only bad thing is the battery, it doesn't last too long,” wrote a reviewer going by Shenam80.

The problem, experts say, is that today's crop of sophisticated smartphones do more than their batteries can support – or drain our batteries faster than our older phones that didn't do as much. Speed and features require energy and the batteries that power the phones just haven't kept up.

A super battery?

If battery life is a major concern, it might pay to stick with your old phone for a while longer. Researchers at Northwestern University say they have figured out how to dramatically expand the life of a smartphone battery.

A team of engineers has created an electrode for lithium-ion batteries -- rechargeable batteries such as those found in cellphones and iPods -- that allows the batteries to hold a charge up to 10 times greater than current technology. Batteries with the new electrode also can charge 10 times faster than current batteries.

That means you could charge your battery in about 15 minutes and have it last all week.

“We have found a way to extend a new lithium-ion battery’s charge life by 10 times,” said Harold H. Kung, lead author of the paper. “Even after 150 charges, which would be one year or more of operation, the battery is still five times more effective than lithium-ion batteries on the market today.”

When can consumers expect to see such a battery? The technology could be in the marketplace in the next three to five years, they say.  Please hold.

Congress took another bite out of lower-income consumers last week, approving a spending package that includes significant cuts to the Legal Services Corporation, a move that will make it significantly harder for low-income people to access legal aid.

"Legal  aid grantees help low-income people with legal issues regarding foreclosures and evictions,  consumer problems including predatory lending, restraining orders in domestic violence cases, child custody, child support,  bankruptcy and more," said Alan W. Houseman, executive director of CLASP, the Center for Law and Social Policy.

"With the lingering effects of the recession, low-income people's need for legal assistance is growing," Houseman said.

The cuts to LSC are part of a broader appropriations bill or "minibus" that bundles FY 2012 funding for Commerce, Science & Justice, Agriculture, Transportation and Housing and Urban Development.  The bill reduces funding for LSC in FY 2012 to $348 million from $404.19 million this fiscal year. The last time LSC was funded at $348 million was in 2007.

"Funding provided through the Legal Services Corporation is the only way millions of Americans can bring their civil cases — child support and custody decisions, foreclosures and veterans’ benefit disputes, for example — to court,” said American Bar Association President Wm. T. (Bill) Robinson III.

“The ABA will work diligently with Congress to seek restoration of the $56 million in lost — and desperately needed — funding in a future budget year,” Robinson said.

The entire cut is designated to come from basic field programs, which means LSC grantees providing legal assistance to low-income clients would see a cut to their grants amounting to 14.8 percent. 

"Reducing funding for LSC curtails people's access to resources to secure equal justice," Houseman said. "The reduced funding for LSC is part and parcel of a larger issue with the direction of our policies. Domestic programs that aid low- and moderate-income people remain a target of deep cuts, yet we continue to punt the question of how to make sure we generate enough revenue to meet the nation's needs. "

LSC is the largest funder of civil legal aid for low-income people.

Already, legal services providers are being forced to lay off staff, make critical programmatic decisions, and even shut their doors.  A cut on the scale included in the minibus would force even more offices to close and many in need of legal help to be turned away.

Consumer groups urged the Consumer Financial Protection Bureau (CFPB) today to require prepaid card issuers to provide consumers with the same kinds of protections they get when using a traditional debit card linked to a bank account.

“As the cost of bank accounts continue to rise, more and more consumers are turning to prepaid cards as an alternative,” said Michelle Jun, senior attorney for Consumers Union, the advocacy arm of Consumer Reports. “But prepaid cards offer weaker protections than bank accounts and can be loaded with hidden fees that make them costly to use.

"Prepaid card issuers should be required to provide consumers with the same mandatory protections that come with traditional debit cards and to clearly disclose all fees so consumers know these costs up front,” Jun said.

Many consumers are relying on general purpose, reloadable prepaid cards to manage their finances and make purchases. However, consumers who rely on prepaid cards are only entitled to voluntary protections provided by card issuers when cards are lost or stolen and used to make unauthorized charges.

Loopholes

Those voluntary protections come with loopholes and could be subject to change at any time. Prepaid card fees often are poorly disclosed and can make the cost of using these cards much higher than anticipated by consumers.

The letter submitted to the CFPB was signed by Consumers Union, Center for Public Policy Priorities, Center for Responsible Lending, Coalition of Religious Communities, National Consumer Law Center, SC Appleseed Legal Justice Center, and U.S. PIRG.

The groups called on the CFPB to enact a number of mandatory protections for consumers using prepaid cards, including:

• a cap on how much money consumers can lose if their card is lost or stolen or when unauthorized charges are made;

• a guarantee that missing money will be recredited promptly and no later than 10 business days after the consumer reports it;

• clear and conspicuous disclosures of all fees before the consumer signs up to use the card;

• the right to receive a statement or other forms of transaction information; and

• a prohibition on overdraft fees for all prepaid cards.

It's one thing when consumers complain about a product or service. It's quite another when someone who sells it agrees with them. That's the case of "J," (we're not going to use his name, we'd like him to keep his job) who says he works at a Radio Shack in New York, and has had it with Boost Mobile.

"After selling phones for the better part of three years, I have come to the conclusion that Boost Mobile, although a good price, it a complete waste of money," J told ConsumerAffairs.com. "Mainly because if you need help with your phone, expect to be on the phone trying to figure out their IVR. It will take you over a half of an hour to try to reach support. There is no button to hit for customer service. The options they give you are limited. They make you sit on the phone listening to how to program your phone, but at the end, they say sorry, cannot do it through the system, and to call back and request to speak to a live operator. How am I supposed to do that if they wont give me the option. It is a serious waste of my time as an associate, and a waste of my customers time for having to wait that long to speak to somebody."

For the sake of his customers, J says he refuses to sell another Boost phone.

Bought insurance without his knowledge

Kerri, of Alexander, Ark., says she was reviewing her husband's bank statement and noticed that Bank of America had been debiting $19 a month for the past two years for an accidental death insurance company.

"Last week my husband called them and demanded they stop debiting the account," Kerri said. "He was told he had 'signed up' for this insurance and they could not just cancel it. They agreed to send him a copy of the policy which was to include start date and a list of coverage."

Kerri says a week later he received a piece of paper in the mail from Bank of America that was not an insurance policy, but what appeared to be a sales pitch for Accidental Hospital Insurance, with a list of coverages.

"It's an enrollment form," Kerri said, "We did not ask for this. It also states that the coverage would begin once we signed the form and sent it back in. I held onto it, with absolutely no intentions of signing anything. One week later we received an 'activation form' from Bank of America reminding us that we had not signed the form, please return etc. I have no intention of signing this."

Meanwhile, Kerri says no one has been willing to help her have the debit removed. It sounds like her husband was enrolled in an insurance program without every applying. It may be time for her husband to contact the Arkansas Insurance Commission and let that office get to the bottom on it.

Make close inspection

Vince, of Oren, Utah, is another rental car customer who thinks he was wrongly charged for damage to a vehicle that someone else caused.

"Hertz wrongly charged my bank account $280.00 for something I did not do," Vince told ConsumerAffairs.com. "They claimed that I brought the rental car back with a tiny chip on the windshield. Yes I did take the car back with the chip on the windshield; however the chip was already there on the windshield. My two boys pointed out to me when I brought the car home for our trip. When the agent and I inspected the exterior of the car before I took it home neither he nor I really inspected the front windshield the focus was mostly on the body of the car."

With all due respect to Vince, the whole purpose of an inspection is to find any damage. Consumers shouldn't expect the rental agent to point it out to them. And don't take a vehicle or drop it off without having an agent conduct a thorough inspection with you.