Current Events in July 2014

Let's face it: thanks to inflation, being “a millionaire” just isn't what it used to be. In an America where an ordinary single-family home can be worth over $500K in many markets, simply having “a net worth of a million dollars or more” is no longer synonymous with “Woo-hoo! My family and I are set for life.”

That's been the case for at least a generation now. There's even classic pop-culture jokes about it: in the 1997 movie Austin Powers: International Man of Mystery, a spoof of “sexy secret agent” tropes, there's a scene where the villainous Dr. Evil, who was frozen in 1967 and thawed out 30 years later, speaks to the United Nations and threatens to set off a nuclear weapon unless he is paid “One MILL-yun dollars” … and the diplomats burst out laughing at the paltry sum.

Even so: if you are indeed a millionaire, you're still much better off than the average American these days. And if you're in the marketing biz, you want to know what millionaires buy so you can make money selling to them, so it's no surprise to read in MediaPost that the market-research firm Mintel has been studying the spending habits of millionaires – or “affluent shoppers,” as they're called in the report.

Might be surprising

What might be surprising is where and how those affluent shoppers do their shopping: MediaPost summarized it under the headline “Millionaires love Costco, Home Depot and Lowe's.”

There were actually two studies mentioned in MediaPost's piece. The Mintel study of “affluent shoppers” focused on people's incomes, rather than assets or net worth, which means many of the shoppers were not millionaires, nor anywhere close: an annual salary of $150,000 does indeed make you “high-income,” yet depending on how much money you spend versus how much you save or invest, it's also easy for somebody to make that much money and still have a low overall net worth, or even be in debt.

The second study, from the investment site Millionaire Corner, focuses on actual millionaires — multi-millionaires, in fact, with a total net worth of $5 million or more excluding their primary residence. But both studies, about these two groups of people with some overlap between them, reached similar conclusions: affluent or downright rich shoppers tend to prefer stores like Costco and the two home-improvement warehouses to more “upscale” stores:

Only 2% of the survey (based on 1,200 investors with net worth ranging from less than $100,000 to more than $5 million) ever go to Lord & Taylor, for example. And only 8% of the highest net-worth shoppers go to Neiman Marcus.

Hmm. Interesting choice of stores — if I had a dollar for every time I heard or read some variation of the joke “Neiman-Marcus? More like Needless Markup, amirite?,” I'd almost be rich enough for investment sites like Millionaire Corner to develop a professional interest in me. So just how exaggerated is that cliché, anyway?

$70 candles

The Neiman-Marcus website, as of July 15, is offering a sale on its exclusive store-brand scented candle-in-a-jar: usual price $70, but you can get one for only $56, shipping included.

Exclusively ours. Tap into the power of fragrance to create a welcoming and comfortable ambiance in your home with these intoxicating scented candles.

*Made of soy-blend wax with fragrance oils.

*Available in Peach (shown in front) or Pamplemousse & Bois (shown in back); select fragrance when ordering.

*Sold individually; each approximately 3.625"Dia. x 3.375"T.

*Made in the USA.

By comparison, Amazon sells scented jar candles of the same size or even larger (and in a much wider variety of scents) for $9 and up, or you can haunt the brick-and-mortar discount stores and bargain outlets and find nice jar candles for as little as $4 (as I personally have done).

Decorative scented candles are perfectly fine things to have, if you like that sort of thing and take all applicable fire-safety precautions. Now suppose you have $56, the desire to own a scented wax candle in a glass jar and the desire to one-of-these-days be a millionaire, or at least be debt-free and have accumulated some savings and assets for youself.

What would you say is your best course of action: spending the whole $56 on the Neiman-Marcus candle, or buying a candle elsewhere for considerably less money, and using the difference to pay down your debt, bulk up your savings, add to your investment account or otherwise get closer to your financial goal?

And here's another question: if two people have identical incomes and outlays, except one person pays Neiman-Marcus prices for discretionary items whereas the other one shops in the “Target or cheaper” range, which one is more likely to sit in the millionaire corner someday? Which one will get there first?

Hint: it's probably no coincidence that “only 8% of the highest net-worth shoppers go to Neiman Marcus.”

If you've thought of becoming a mail carrier, meter reader, print newspaper reporter or farmer, you may want to reconsider your career path.

Those are the occupations most likely to go the way of the dodo, according to the CareerCast report on the Most Endangered Jobs

While the job landscape may be bustling with new opportunities in the information technology sector, these 21st century jobs come at the expense of other industries.

Going, going....

CareerCast, which bills itself as a “global job search portal,” says current mail carriers may have a safe career, but the profession is rapidly contracting for postman wannabes. Mail carrier is just one casualty of a tech-based job market that shares a unifying theme: paper.

Newspaper reporters face a projected 13% decline in hiring in the coming years. Layoffs and furloughs in the industry are commonplace.

Consumers haven't quit reading the news or the latest bestseller, but rather are consuming their information online and not in print. Want to catch up on the latest news? Power on your smart phone or tablet and get the latest happenings from around the globe in one place. Want to read a book? Download any title instantly.

The logging industry is feeling the impact of the move from print to digital. Dramatically lower demand for paper means much less demand for wood pulp that lumberjacks help provide. The result is a 9% decline in logging industry employment. Falling demand for paper also affects printers.

Blame technology

The use of paper isn't the only factor behind technology endangering certain fields. Sometimes, advancements render the need for certain jobs moot. Meter reader is one such field.

A growing number of gas and electric companies are installing electronic meter readers that instantly provide usage updates. The result is a 19% job decline for meter readers anticipated by 2022.

Kiss them good-by

Here are the 10 most endangered jobs, according to CareerCast's 2014 Jobs Rated report and statistics culled from the U.S. Bureau of Labor Statistics:

• MAIL CARRIER - Median Salary: $53,100 - Hiring Outlook: -28%
• FARMER - Median Salary: $69,300 - Hiring Outlook: -19%
• METER READER - Median Salary: $36,410 - Hiring Outlook: -19%
• NEWSPAPER REPORTER - Median Salary: $37,090 - Hiring Outlook: -13%
• TRAVEL AGENT - Median Salary: $34,600 - Hiring Outlook: -12%
• LUMBERJACK - Median Salary: $24,340 Hiring Outlook: -9%
• FLIGHT ATTENDANT Median Salary: $37,240 Hiring Outlook: -7%
• DRILL-PRESS OPERATOR - Median Salary: $32,950 - Hiring Outlook: -6%
• PRINTING WORKER - Median Salary: $34,100 - Hiring Outlook: -5%
• TAX EXAMINER AND COLLECTOR - Median Salary: $50,440 - Hiring Outlook: -4%

Just yesterday we reported that a coalition of consumer groups wants the feds to require that automakers use only the Environmental Protection Agency's official mileage estimates in their advertising.

Now the EPA has a suggestion of its own. It wants automakers to road test their cars before making fuel economy claims, according to a report in today's Wall Street Journal. Currently, some carmakers use wind tunnel tests and engineering calculations to arrive at their mileage estimates.

The suggestions follow several high-profile errors by Ford, Hyundai and Kia, which had to dial back their claims after EPA tests and consumer gripes pointed out the discrepancy.

For its part, the EPA says that the gap between manufacturers' mileage claims and consumers' real-world experience is the most frequent complaint registered with the agency.

"Some automakers already do this, but we are establishing a regulatory requirement for all auto makers," Chris Grundler, director of the EPA's Office of Transportation and Air Quality, told the Journal.

Using actual road tests instead of wind tunnels would make it harder to manipulate the results, he said. 

The EPA revised the tests it uses to arrived at its official estimates in 2008. Since then, the EPA estimates have generally coincided closely with consumers' experiences. 

In June, Ford restated mileage estimates for several of its models, including the C-Max Hybrid.  In March, Hyundai apologized for overstating the mileage estimates for its Sonata sedan, the latest in a series of such blunders by the Korean automaker. 

For years, we've been told by the “experts” that a drink or two of alcohol each day may be good for our hearts. Little-by-little, though, that conventional wisdom may be falling by the wayside.

Just last week, ConsumerAffairs reported that a University of Pennsylvania study found no heart health benefit from alcohol.

Now, new research published in the Journal of the American College of Cardiology says even in moderation, consumption of wine and hard liquor may be a risk factor for atrial fibrillation, an abnormally fast heartbeat that can lead to stroke, heart failure and dementia.

It isn't just the heavy drinkers at risk

Researchers in Sweden studied 79,016 adults, ages 45 to 83, who completed an extensive questionnaire about food and alcohol consumption in 1997. After following the participants for up to 12 years through national registries in Sweden, researchers found 7,245 cases of atrial fibrillation.

Consistent with previous research, the study found an association between high alcohol consumption -- defined as more than three drinks per day -- and increased risk for atrial fibrillation and a strong association with binge drinking. Previous studies had not reported findings on moderate alcohol use.

The Swedish study showed an increase in risk for atrial fibrillation with moderate drinking of wine and liquor. Moderate drinking was defined as one to three drinks per day.

While many studies have shown that light to moderate alcohol consumption can have beneficial outcomes on the heart, such as reducing ischemic heart disease and stroke, it is important to balance these benefits against the potential risk of developing atrial fibrillation, said Susanna C. Larsson, Ph.D., Associate Professor, Unit of Nutritional Epidemiology, Institute of Environmental Medicine at the Karolinska Institutet in Stockholm, and lead author of the study.

The study showed that binge drinking -- consuming five or more drinks on a single occasion -- was associated with an increased risk for drinkers of wine and liquor. Excluding binge drinkers from the analysis reduced the risk only slightly for heavy and moderate drinkers of wine and liquor.

Good news for beer drinkers

While the association between moderate wine and liquor consumption and increased atrial fibrillation risk was strong, the Swedish study did not find such a relationship with atrial fibrillation and moderate beer consumption or even binge drinking of beer.

"We have no explanation for the lack of association with beer consumption," Larsson said. "It is likely that beer is consumed more regularly during the week, whereas wine and liquor is more often consumed during weekends only. Adverse effects of alcohol on atrial fibrillation risk may be less pronounced if alcohol consumption is spread out over the week compared with consumption of larger amounts of alcohol during a few days per week."

The caveat

Prospective studies, which follow a group of participants over time, can identify associations, or conditions that exist together, but an association does not necessarily mean moderate alcohol use causes atrial fibrillation. There could be other reasons atrial fibrillation is seen more often in drinkers.

Still investigators identified several factors that could explain the relationship between alcohol consumption and atrial fibrillation.

Past studies have shown an association between alcohol consumption and depression of heart function, cardiac condition abnormalities, dilated cardiomyopathy with supraventricular arrhythmias and other conditions that could lead to atrial fibrillation.

Eight New Jersey car dealerships will be paying $1.8 million to settle charges that they deceived customers through such tactics as failing to disclose existing mechanical defects or past damage to used cars; charging for supplemental warranties and other costly “after-sale items” without customers’ consent; and failing to honor the negotiated or advertised prices for vehicles.

“This settlement is a tremendous success for the consumers who were affected by the alleged deceptive sales tactics,” Acting Attorney General John J. Hoffman said. “The consequences, including a civil penalty of $1.8 million, are particularly appropriate in light of the fact that the owners of these dealerships allegedly violated an earlier settlement in which they had promised not to engage in such practices.”

The earlier settlement, reached in 1999, covered similar consumer grievances.

The dealerships are all owned by Carmelo Giuffre, of Brooklyn, N.Y., and Ignazio Guiffre, of Colts Neck, N.J.

The settlement includes Route 22 Auto Sales Inc., d/b/a “Route 22 Toyota,” Route 22 Automobiles Inc, d/b/a “Route 22 Honda,” Route 22 Nissan Inc. d/b/a “Route 22 Nissan,” and Hillside Automotive Inc. d/b/a “Route 22 Kia”, all located in Hillside; Hackettstown Auto Sales, Inc d/b/a “Hackettstown Honda”; Hudson Auto Sales Inc. d/b/a Hudson Honda, in West New York; and Freehold Automotive LTD, Inc. d/b/a “Freehold Hyundai” and Freehold Chrysler Jeep, Inc d/b/a “Freehold Chrysler Jeep.” All eight dealerships are owned by Carmelo and Ignazio Giuffre.

“Buying a new or used vehicle can be an intimidating process, especially for consumers who lack the ability to independently learn about a used car’s condition or history before making a decision,” Division of Consumer Affairs Acting Director Steve Lee said. “Our state laws protect all consumers by ensuring they have access to all relevant information when buying a motor vehicle. This settlement is intended to ensure that these dealerships will not again violate our laws or deceive potential customers.”

A spokesman for the dealerships, Rich Tauberman, said programs have already been implemented to inspire greater consumer confidence. 

“This Consent Order reflects a desire by Route 22 Auto Sales, Inc. and its affiliated dealerships to avoid costly and prolonged litigation, focus on its business and build on the transition to 'One Price,' an innovative, transparent and negotiation-free sales process,” Tauberman said.

Among the costs of modern life that have risen sharply in recent years is auto insurance. A recent analysis shows its average cost is up 335% over five years. It goes without saying that anything you can do to lower your insurance cost, you should do. Still, many of us don't.

Doug Whiteman, Bankrate.com's insurance analyst, says the 10 largest U.S. auto insurance companies offer a wide range of discounts to customers who meet certain criteria and these companies add new discounts each year.

“Discounts are one of the ways insurers try to win business and separate themselves from the pack,” Whiteman told ConsumerAffairs. “And it seems they're coming up with new and more creative discounts all the time.”

Safety features help

For example, this year Whiteman found more insurers – State Farm, Geico, Farmers and USAA among them – offering discounts on cars that have daytime running lights. If your car has them, but you haven't told your insurance company, you most likely aren't getting the discount.

Anti-lock brakes also get you a discount with all of the big 10 except Progressive, Nationwide and American Family. In fact, the more safety features you car has, the more discounts you can get.

“With a lot of these safety features, the insurance companies believe they are making the vehicle safer and it's less likely you'll be in an accident,” Whiteman said.

An excuse to buy a new car?

Since safety features are more likely to be found standard on later model cars, rather than one 10 years old, you can probably get a lower rate just by driving a newer car.

“Five out of the 10 largest insurers have a newer vehicle discount,” Whiteman said. “What they mean by newer vehicle tends to vary. Typically we're talking 3 years old or less.”

Keeping your mileage low – meaning you do less driving and are less likely to be in an accident – can also get you a lower rate with all but Geico and Farmers. However, some insurers might require you to install a device that feeds data about your driving habits to the company.

“Consumers do have concerns about privacy and this might be one of the reasons this type of discount, or this type of telematics gadget hasn't swept the industry,” Whiteman said. “We found that the low mileage discount is offered by most of the insurance companies but it doesn't necessarily mean they all require you to have one of these onboard devices.”

Good grades

If you have a student driver in your household making all A's and B's, all 10 of the surveyed insurance companies will give you a discount. If all drivers take a defensive driving course, 8 of the 10 discount your rate.

All but American Family provide a discount for having an anti-theft device. And if you bundle your policies – insuring your vehicles and home with one carrier, all 10 reward you with a discount.

How much of a discount? It's hard to say. Different companies have different discounts. And since insurance regulations vary state-to-state, one company's discounts in California may differ for those offered in Louisiana.

In most instances Whiteman says discounts are around 3% to 5%. In some cases, however, he said he's found discounts of 30% or more.

Checking to see what discounts you qualify for and notifying your insurance company could be a profitable use of your time.

Citigroup, which received $45 billion in bailouts during the 2008 financial crisis, will pay $7 billion for misleading investors about "securitized" subprime mortgages. The "bundling" of the risky subprime loans into securities helped lead to the Great Recession.

Today's agreement follows weeks of negotiations that reportedly centered around the size of the penalty. Citigroup had held out for a total penalty of $4 billion, a figure that was rejected by the Justice Department.

The fines announced today include a $4 billion civil penalty, $2.5 billion in debt relief to struggling homeowners and $500 million to various state agencies and the Federal Deposit Insurance Corp.

“The penalty is appropriate given the strength of the evidence of the wrongdoing committed by Citi,” Attorney General Eric Holder said in a statement. “Despite the fact that Citigroup learned of serious and widespread defects among the increasingly risky loans they were securitizing, the bank and its employees concealed these defects.”

Holder said the task force investigation was continuing and more banks were in its sights.

“Citi is not the first financial institution to be held accountable by this Justice Department, and it will certainly not be the last,” he said.

Citigroup CEO Michael Corbat said the settlement was "in the best interests of our shareholders, and allows us to move forward and to focus on the future, not the past.”

The settlement is the largest to date to be hammered out by a task force established by President Obama in 2012 to investigate the role of big banks in the financial crisis.

States react

State attorneys general who participated in the prosecution were divvying up the spots this morning.

New York State will receive at least $182 million: $92 million in cash and a minimum of $90 million in consumer relief for struggling homeowners.  California will recover $102 million while Illinois will get $84 million.

“Since my first day in office, I have insisted that there must be accountability for the misconduct that led to the crash of the housing market and the collapse of the American economy,” said New York Attorney General Eric Schneiderman. “Systemic frauds harmed thousands of New York homeowners and investors, and today's result is a major victory in the fight to hold those who caused the financial crisis accountable.” 

“Citigroup misled consumers and profited by providing California’s pension funds with incomplete information about mortgage investments,” California Attorney General Kamala Harris said. “This settlement holds Citi accountable and compensates the state’s pension funds that protect the retirement savings of hardworking Californians.”

The settlement includes $44 million in relief to fully recover for losses incurred by Illinois’ pension systems and $40 million in consumer relief.

“This relief will fully restore the losses Illinois’ pension systems incurred as a result of Citigroup’s fraudulent schemes in the mortgage-backed securities market, and it will provide much-needed aid to Illinois homeowners who are still paying for Wall Street’s reckless actions,” Illinois Attorney General Lisa Madigan said. 

In education, STEM is hot. STEM stands for science, technology, engineering and math, and a major push is underway to encourage more students to pursue these fields.

The U.S. has enough arts majors, the reasoning goes. What the country needs is more smart young people trained in the ever-more-complex technical fields.

Apparently the emphasis has worked. The U.S. has seen an increase in students graduating in STEM fields.

Good luck getting a job

But there's just one problem. The overwhelming majority of STEM graduates are not working in STEM jobs. The U.S. Census Bureau has released a report showing that 74% of those who have a STEM-related bachelor's degree are not working in a STEM field.

"STEM graduates have relatively low unemployment, however these graduates are not necessarily employed in STEM occupations," said Liana Christin Landivar, a sociologist in the Census Bureau's Industry and Occupation Statistics Branch.

Those who are working in STEM fields tend to be men. The numbers show that about 86% of engineers and 74% of computer professionals are men.

Engineering

In fact, drilling deeper into the numbers reveals that studying computer science or engineering provides the best path to a STEM career.

According to the Census Bureau report, engineering and computer, math and statistics majors had the largest share of graduates going into a STEM field with about half employed in a STEM occupation.

Science majors, on the other hand, had fewer of their graduates employed in STEM. About 26% of physical science majors; 15% of biological, environmental and agricultural sciences majors; 10% of psychology majors; and 7% of social science majors were employed in STEM.

Efforts to draw more women to STEM careers have produced spotty results. Some 14% of engineers are women – the STEM field where they are most underrepresented. There are more women among mathematicians and statisticians, life scientists and social scientists, the report found.

STEM enhancement efforts

Groups like the STEM Education Coalition are among those encouraging STEM education. The group says it is trying to elevate STEM education as a national priority.

Part of that new emphasis is focusing on public education. The group says only 48% of eighth graders have science teachers who majored in science.

The federal government is also heavily promoting STEM education initiatives. The Department of Education is proposing a $110 million program for school districts, in partnership with colleges, to improve STEM teaching and learning.

For those students who are able to land a job in a STEM field, the payoff is significant. In the Census Bureau report engineering was the major with the highest average earnings – $92,000. That compares with just over $50,000 for arts majors.

Puff the Magic Dragon may have survived living by the sea with a little smoke coming his way but your dog and cat might not be so lucky. According to Heather Wilson-Robles, assistant professor at the Texas A&M College of Veterinary Medicine & Biomedical Science, studies show that dogs exposed to large amounts of secondhand smoke have changes in their lung tissue over time.

This isn't too surprising, since dogs' and cats' lungs are virtually the same as humans. 

There are some areas where dogs differ from humans though. Snouts, for example. Studies suggest that muzzle length plays a role in the type of cancer a dog is likely to develop from secondhand smoke.

According to a survey of recent research at Livescience.com, dogs with long muzzles are more likely to develop nose and sinus cancers, since their noses and sinuses have more surface area on which carcinogens can accumulate, while dogs with short and medium-length muzzles are more likely to develop lung cancer.

Cats are more prone to develop cancers of the mouth and lymph nodes because of secondhand smoke. When cats groom themselves, they lick up the toxic substances that have accumulated on their fur. That puts their mouth at risk for cancer causing carcinogens.

Dogs and cats aren't the only ones affected. Birds are extremely sensitive to air pollutants and are at risk for lung cancer and pneumonia when exposed to secondhand smoke. Secondhand smoke has also been found to cause heart problems in rabbits.

If you can't throw your stogies away there are a few things that can help.
Quit smoking around your pets and wash your hands after smoking before you touch your pet or anything it may come in contact with.

Nicotine in cigarettes is very toxic to pets if they ingest it so keeping cigarettes out of your house is always the best bet for everyone, pet owners included!

“Never share private information on a public computer” is a standard, longtime Internet safety rule.. Ideally, any password-protected activity, from checking your email to monitoring your online banking accounts, should only ever be done from your own personal device (outfitted with all proper security software, of course).

If you need another reminder of why you should follow this rule, the latest post from security blogger Brian Krebs provides one: “Beware keyloggers at hotel business centers.”

As the name suggests, keylogging software is a form of malware that literally logs your keyboard activity – in other words, keeps track of every button you type, so if you check your email, use a credit card, manage your bank account or anything else on a computer outfitted with keylogging software, whoever installed it now has a record of your passwords, credit card numbers and everything else you typed.

And apparently, there's a big problem with thieves secretly installing keylogging software on hotel computers, big enough that the U.S. Secret Service is, according to Krebs, “advising the hospitality industry to inspect computers made available to guests in hotel business centers, warning that crooks have been compromising hotel business center PCs with keystroke-logging malware in a bid to steal personal and financial data from guests.”

Secret Service advisory

The Secret Service issued a non-public notice about it on July 10, including tips for various ways hotels can try to keep their public computers safe.

Unfortunately, as Krebs pointed out, an ordinary hotel guest has no way of knowing which hotel computers are safe, and which are not, which is why public computers should never be used for anything more than casual web browsing. If you need to do more than that, here's what Krebs advises:

If you’re on the road and need to print something from your email account, create a free, throwaway email address at yopmail.com or 10minutemail.com and use your mobile device to forward the email or file to that throwaway address, and then access the throwaway address from the public computer.

Illinois Attorney General Lisa Madigan has staked out a new area of consumer protection with a pair of lawsuits against two supposed debt-relief companies that claim they can reduce or eliminate outstanding student loans.

Madigan filed the suits against First American Tax Defense LLC, based in Chicago, and Broadsword Student Advantage LLC, based in Frisco, Texas, alleging the unlicensed companies engaged in deceptive marketing practices and illegally charged consumers hundreds of dollars in upfront fees to reduce or eliminate their student loan debt burden.

In reality, Madigan alleges, the companies sought to scam vulnerable people into paying as much as $1,200 upfront for bogus services, including assistance enrolling in a fake “Obama forgiveness program,” or for government services that are already free of charge.

“These companies illegally charge fees for services that student loan borrowers can obtain themselves through government programs at no cost,” Madigan said. “My office will be aggressive in cracking down on scam operations that prey on student loan borrowers for profit.”

$1.2 trillion

Student loan debt levels have grown to historic proportions, now affecting nearly 40 million Americans who have $1.2 trillion in outstanding debt. Madigan’s lawsuits allege that First American and Broadsword Student Advantage are doing an end-run around an Illinois law that she wrote to ban companies from charging people upfront fees for so-called debt settlement services.

Madigan’s lawsuits allege First American and Broadsword Student Advantage have advertised heavily on the radio in Chicago and downstate, offering consumers a myriad of options to ease their debt burden based on the companies’ alleged expertise and false affiliation with the U.S. Department of Education to consolidate or forgive their loans.

The companies are alleged to offer to cut student loan payments in half or eliminate them entirely, and specifically offer public service employees a loan debt forgiveness program for which the companies could not qualify them. The lawsuit against First American specifically advertises an “Obama forgiveness program” that is not an actual government program.

In announcing the lawsuits, Madigan urged current and former students never to pay upfront for help with student loan debt relief. For information on legitimate sources of free assistance, consumers can contact the Consumer Financial Protection Bureau.

For problems with your student loan servicer or a debt collector, consumers can also contact the U.S. Department of Education’s Student Loan Ombudsman at 1-877-557-2575 or www.ombudsman.ed.gov.

The Consumer Financial Protection Bureau (CFPB) has filed a lawsuit in a federal district court against a Georgia-based firm, Frederick J. Hanna & Associates, claiming it is running a debt collection "lawsuit mill" that uses illegal tactics to intimidate consumers into paying debts they may not owe.

The Bureau alleges that the Hanna firm churns out hundreds of thousands of lawsuits that frequently rely on deceptive court filings and faulty or unsubstantiated evidence. The CFPB is seeking compensation for victims, a civil fine, and an injunction against the company and its partners.

“The Hanna firm relies on deception and faulty evidence to drag consumers to court and collect millions,” said CFPB Director Richard Cordray. “We believe they are taking advantage of consumers’ lack of legal expertise to intimidate them into paying debts they may not even owe. Today we are taking action to put a stop to these illegal debt collection practices.”

The Hanna firm focuses exclusively on debt collection litigation, and its three principal partners, Frederick J. Hanna, Joseph Cooling, and Robert Winter, play an active role in the company’s business strategies and practices. The firm performs debt collection activities and typically files lawsuits if those efforts do not lead to collections.

"Like a factory"

The CFPB alleges that the firm operates like a factory, producing hundreds of thousands of debt collection lawsuits against consumers on behalf of its clients, which mainly include banks, debt buyers, and major credit card issuers.

Between 2009 and 2013 the firm filed more than 350,000 debt collection lawsuits in Georgia alone. The CFPB further alleges the defendants collected millions of dollars each year through these lawsuits, often from consumers who may not actually have owed the debts.

The CFPB alleges that the defendants violated the Fair Debt Collection Practices Act (FDCPA). Among other things, the FDCPA prohibits making misrepresentations to consumers, and specifically prohibits misrepresenting to a consumer that a communication is from an attorney. 

A New York man identified as the ringleader of a child modeling scam has been sentenced to up to five years in prison for scamming 100 clients of more than $236,000 with promises of lucrative modeling and acting jobs that did not exist.

James Muniz, 45, of Smithtown, Long Island, and New Faces Development Center, Inc. (also known as Model Talent Development Corp.), were sentenced by Nassau County Court Judge William Donnino. Charges are still pending against other defendants.

“James Muniz used his business to prey upon proud, loving New York parents, even after the company was prosecuted civilly for committing similar offenses years earlier,” New York Attorney General Eric T. Schneiderman said. “His sentence sends the message that those who take advantage of unsuspecting New Yorkers will be held accountable. My office will continue working diligently to prosecute fraud, and seek restitution for those who have been victimized.”

Prosecutors said that Muniz and his employees solicited parents of children and unaccompanied teens in busy shopping malls in Queens and Long Island, telling them they qualified for modeling positions which, in fact, did not exist, and signing them up for expensive headshots, placement in supposed casting websites and other services.

"My son was stopped in a mall and told he could be a model. The agency was New Faces," said David of Bethpage, N.Y., in a ConsumerAffairs review. "We spent a lot of money for a portfolio and extras. Needless to say, he did not become a model. Still wondering how to get our money back ..."

Losses ranged from $500 to $5,100.

Quick buck

“With one broken promise after another, James Muniz and his accomplices turned the hopes and dreams of parents for a better life for their children into a money-making enterprise based entirely on taking advantage of others for a quick buck,” Nassau County District Attorney Kathleen Rice said. “It is my hope that with this sentence, these families will receive solace knowing that the man who deflated those hopes will be spending significant time behind bars.”

DA investigators arrested Muniz in October 2013 in Florida, where he fled after being charged in the case. He later waived extradition and returned to New York to face charges. A Nassau County grand jury subsequently indicted Muniz and his co-defendants.

Muniz was also sentenced to six months in jail by Judge Donnino in May after pleading guilty in an unrelated case to Criminal Contempt in the 2nd Degree for violating an order of protection for his then-wife in 2011.

The Federal Trade Commission says a Tampa group posing as payday loan brokers promised to help consumers get loans, but instead used consumers’ personal financial data to take money from their bank accounts without their consent.

Claiming to be affiliated with a network of 120 potential payday lenders, defendants Sean C. Mulrooney and Odafe Stephen Ogaga, and five companies they controlled, misrepresented that 80% of all applicants got loans within an hour, according to the FTC’s complaint.

In reality, the FTC said defendants did not lend money to consumers, and there is no evidence that they helped anyone get a loan. Instead, they allegedly used consumers' personal data to withdraw $30 from the bank accounts of tens of thousands of consumers, without authorization and without providing anything of value in return.

“These defendants deceived consumers to get their sensitive financial data and used it to take their money,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “The FTC will continue putting a stop to these kinds of illegal practices.”

No more Rolls

In a settlement with the FTC, the defendants have agreed to stop providig any credit-related products in the future. The settlement imposes a $6.2 million judgment, which is equal to the defendants’ ill-gotten gains.

The settlement requires Ogaga to surrender nearly all his assets: $50,000 in cash, and proceeds from the sale of his 2011 Rolls Royce Ghost, 2007 Lexus LS460, and 2006 Ferrari. Once he surrenders these assets, the remainder of the judgment against Ogaga will be suspended. The judgment against Mulrooney is entirely suspended, due to his inability to pay.

Hot enough for you? How many times have you heard that silly question and wished you had a snappy comeback?

While we all make jokes about hot weather, it really is a serious matter -- especially for older adults and people with chronic medical conditions. Thus, the National Institute on Aging (NIA) has some tips to help mitigate some of the dangers of hyperthermia.

Hyperthermia is an abnormally high body temperature caused by a failure of the heat-regulating mechanisms in the body to deal with the heat coming from the environment. Heat stroke, heat syncope (sudden dizziness after prolonged exposure to the heat), heat cramps, heat exhaustion and heat fatigue are common forms of hyperthermia.

People can be at increased risk for these conditions, depending on the combination of outside temperature, their general health and individual lifestyle.

Older folks at risk

Older people -- particularly those with chronic medical conditions -- should stay indoors, preferably with air conditioning or at least a fan and air circulation, on hot and humid days, especially when an air pollution alert is in effect.

Living in housing without air conditioning, not drinking enough fluids, not understanding how to respond to the weather conditions, lack of mobility and access to transportation, overdressing and visiting overcrowded places are all lifestyle factors that can increase the risk for hyperthermia.

People without air conditioners should go to places that do have air conditioning, such as senior centers, shopping malls, movie theaters and libraries. Cooling centers, which may be set up by local public health agencies, religious groups and social service organizations in many communities, are another option.

The danger signs

The risk for hyperthermia may increase from:

• Age-related changes to the skin such as poor blood circulation and inefficient sweat glands
• Alcohol use
• Being substantially overweight or underweight
• Dehydration
• Heart, lung and kidney diseases, as well as any illness that causes general weakness or fever
• High blood pressure or other health conditions that require changes in diet. For example, people on salt-restricted diets may be at increased risk. However, salt pills should not be used without first consulting a physician.
• Reduced perspiration,caused by medications such as diuretics, sedatives, tranquilizers and certain heart and blood pressure drugs
• Use of multiple medications. It is important, however, to continue to take prescribed medication and discuss possible problems with a physician.

Heat stroke is a life-threatening form of hyperthermia, occurring when the body is overwhelmed by heat and is unable to control its temperature. Heat stroke occurs when someone’s body temperature increases significantly (above 104 degrees Fahrenheit) and shows symptoms of the following: strong rapid pulse, lack of sweating, dry flushed skin, mental status changes (like combativeness or confusion), staggering, faintness or coma.

Seek immediate emergency medical attention for a person with any of these symptoms, especially an older adult.

What to do

If you suspect someone is suffering from a heat-related illness:

• Get the person out of the heat and into a shady, air-conditioned or other cool place. Urge the person to lie down.
• If you suspect heat stroke, call 911.
• Apply a cold, wet cloth to the wrists, neck, armpits and/or groin. These are places where blood passes close to the surface of the skin, and the cold cloths can help cool the blood.
• Help the individual to bathe or sponge off with cool water.
• If the person can swallow safely, offer fluids such as water or fruit and vegetable juices, but avoid alcohol and caffeine.

Few things are as heartbreaking (or nerve-wracking) as the sound of an infant crying in pain during teething.

A parent's first impulse is to do something to relieve the pain. But, is that a good idea? Not necessarily.

One thing doctors and other health care professionals agree on is that teething is a normal part of childhood that can be treated without prescription or over-the-counter (OTC) medications.

Too often well-meaning parents, grandparents and caregivers want to soothe a teething baby by rubbing numbing medications on the tot's gums, using potentially harmful drugs instead of safer, non-toxic alternatives.

That's why the Food and Drug Administration (FDA) is warning parents that prescription drugs such as viscous lidocaine are not safe for treating teething in infants or young children, and that they have hurt some children who used those products.

Drug-free teething

FDA has previously recommended that parents and caregivers not use benzocaine products for children younger than 2 years, except under the advice and supervision of a health care professional. Benzocaine -- which, like viscous lidocaine, is a local anesthetic -- can be found in such OTC products as Anbesol, Hurricaine, Orajel, Baby Orajel, and Orabase.

The use of benzocaine gels and liquids for mouth and gum pain can lead to a rare but serious -- and sometimes fatal -- condition called methemoglobinemia, a disorder in which the amount of oxygen carried through the blood stream is greatly reduced. And children under 2 appear to be at particular risk.

Safer alternatives

On average, children get one new tooth every month from 6 months of age to about age 3, for a total of 20 "baby teeth."

According to the American Academy of Pediatrics (AAP), occasional symptoms of teething include mild irritability, a low-level fever, drooling and an urge to chew on something hard.

Because teething happens during a time of much change in a baby's life, it is often wrongly blamed for sleep disturbances, decreased appetite, congestion, coughing, vomiting and diarrhea.

If your child's gums are swollen and tender,

• gently rub or massage the gums with your finger, and
• give your child a cool teething ring or a clean, wet, cool washcloth to chew on.

Chill the teething ring or washcloth in the refrigerator for a short time, making sure it's cool -- not cold like an ice cube. If the object is too cold, it can hurt the gums and your child. The coolness soothes the gums by dulling the nerves, which transmit pain.

"The cool object acts like a very mild local anesthetic," says Hari Cheryl Sachs, M.D., a pediatrician at FDA. "This is a great relief for children for a short time."

Parents should supervise their children so they don't accidentally choke on the teething ring or wash cloth.

Avoiding anesthetics

For teething, avoid local anesthetics such as viscous lidocaine or benzocaine-containing teething products except under the advice and supervision of a health care professional.

Viscous lidocaine is a prescription medication, a local anesthetic in a gel-like syrup. Doctors may prescribe it for chemotherapy patients (children and adults) who are unable to eat because of mouth ulcers that can occur with chemotherapy. Dentists may use it to reduce the gag reflex in children during dental X-rays and impressions.

Parents may have viscous lidocaine on hand if it has been prescribed to treat another family member for pain relief from conditions such as mouth or throat ulcers. But it should never be used to comfort a teething baby.

A danger to babies

The Institute for Safe Medication Practices (ISMP) -- a nonprofit organization dedicated to preventing medication errors -- has received reports of teething babies suffering overdoses of viscous lidocaine. Symptoms include jitteriness, confusion, vision problems, vomiting, falling asleep too easily, shaking and seizures.

The drug also "can make swallowing difficult and can increase the risk of choking or breathing in food. It can lead to drug toxicity and affect the heart and nervous system," says Michael R. Cohen, RPh, MS, ISMP president.

Parents have been known to apply viscous lidocaine repeatedly if a baby keeps fussing, says Cohen. They have also been known to put liquid gel forms of a topical anesthetic into a baby's formula or even soak a pacifier or a cloth in it, then put that in their baby's mouth. How much the baby gets is not measured, so it may be too much, he says. For all these reasons, FDA recommends viscous lidocaine not be used to treat the pain associated with teething.

"Teething is a normal phenomenon; all babies teethe," says Ethan Hausman, M.D., a pediatrician and pathologist at FDA. "FDA does not recommend any sort of drug, herbal or homeopathic medication or therapy for teething in children."

Hyundai Motor Company is recalling 2,138 model year 2015 Sonata vehicles manufactured May 2, 2014, through May 23, 2014.

A poor connection within the vehicle's wiring harness may result in a reduction of steering assist from the vehicle's motor driven power steering system or the inability to move the vehicle's shifter from the Park position. The reduction of power steering assist can increase the steering effort needed, increasing the risk of a crash.

Hyundai has notified dealers to suspend sales of affected Sonata vehicles and published recall bulletin 14-01-024 providing a service procedure to repair the affected vehicles. On June 7, 2014 Hyundai began to contact the affected retail customers.

Owners may contact Hyundai customer service at 1-800-633-5151. Hyundai's number for this recall is 119.

Foster Farms of Livingston, Calif.,is updating its earlier recallof an undetermined amount of chicken products to further clarify and correct “Use or Freeze by” and “Best by” date ranges.

The products may be contaminated with a particular strain of Salmonella Heidelberg.

The recalled product includes fresh and frozen chicken products sold by retailers under Foster Farms or private label brand names, with varying “use or freeze by”dates ranging from March 16 through March 31, 2014 and Aug. 29, 2015 through Sept. 2, 2015, and frozen Sunland Chicken products with “best by” dates from March 7 through March 11, 2015 and Aug. 29, 2015 through Sept. 2, 2015.

Consumers will be able to locate such dates only on fresh product retail packaging. Other dates can be found on bulk master cases of products. The products subject to recall bear the establishment number “P6137,” P6137A” or “P7632” inside the USDA mark of inspection.

The chicken products were produced from March 7 through March 13, 2014, and were shipped to Costco, Foodstuff, Kroger, Safeway and other retail stores and distribution centers in Alaska, Arizona, California, Hawaii, Idaho, Kansas, Nevada, Oklahoma, Oregon, Utah and Washington.

The list of recalled products may be accessed here.

Consumers with questions regarding the recall may contact the company’s Consumer Affairs hotline at (800) 338-8051 or by email at buckminsterfullerene.  

Have you heard the old saying about somebody who keeps “missing the forest for the trees?” Perhaps you've heard it expressed as someone “not seeing the big picture,” because they're “too focused on the details.” Or, less politely, you can just say someone's “missing the point.”

However you word it, if you get careless it's easy to slip into that mindset yourself, especially where your personal finances are concerned. There's even a money-specific proverb about it: the English spoke of people who were “penny wise and pound foolish,” which in American currency becomes “penny wise and dollar foolish.”

I suspect that, at least for some people, the problem comes from tripping over the word “save:” it means different things in different contexts, and when you confuse one meaning for the other, the consequences for your household budget can be catastrophic.

The online Merriam-Webster dictionary lists 14 different definitions for “save,” but these are the two most relevant here:

save

transitive verb

….

a: to put aside as a store or reserve : accumulate <saving money for emergencies>

b: to spend less by <save 25 percent>

So: when people say “I saved $100 today,” they could be using definition A to mean “I added $100 to my savings fund,” or definition B to say “I bought something, and spent $100 less than I might have.”

But sometimes people confuse B with A, somehow, so that “spending $100 less than I might've” gets mistaken for “increasing my savings/net worth by $100.” Worse, they manage to completely overlook the fact that buying something still requires you to spend your money — even if you did save $100 off the price.

Big "savings"

Have you strolled through one of those touristy national-chain “outlet malls” recently? You're not likely to find any truly good bargains there anymore, but you will see lots of price tags that look like this:

RETAIL PRICE: $40

OUR PRICE: $10

YOU SAVE: $30

Many manufacturers today actually produce lower-quality knockoffs of their own high-end merchandise specifically to sell in outlet stores. Last March, the Federal Trade Commission put out a “Consumer information” blog post about outlet mall shopping, and offered some examples of how this is done: “plastic might replace leather trim on a jacket, or a t-shirt may have less stitching and a lighter weight fabric.”

But, for the sake of argument, let's assume that identical, same-quality item actually is worth $40 in regular retail stores, and you buy it for $10. You have indeed saved $30, according to the earlier B definition — but you have also spent $10, which is the exact opposite of the A definition “to put aside as a store or reserve.” Now you have 10 fewer dollars to spend somewhere else (or you owe an additional 10 bucks on your credit card balance, plus interest charges if you don't pay off that balance in full when the bill next comes due).

Of course, if you already have a decent-sized emergency savings fund and are unburdened by debt, there's nothing remotely wrong with spending that $10 to buy whatever, even if you don't need it. And even if you are trying to pay down debt and build up your savings, of course you still need to buy things sometimes, and should definitely look for ways to find the best (lowest) price for those things: avoid rent-to-own or “buy now pay later” shopping on credit, stockpile non-perishable consumables when they're on sale so you never have to pay full price for them, shop secondhand or in overstock stores when you can, and so forth.

Just remember not to let those two definitions of “save” get mixed up. I'll admit: I was a little careless about that in my younger days, especially when I'd first discovered the truly amazing bargains to be found in local thrift stores.

Bargain finds

Longtime thrift shoppers like to brag about their super-amazing bargain finds, so let me share some of mine here: I routinely pay $2 to $8 per pair for various brands of blue jeans that sell new for $50 to $90. I have a few silk or velvet jackets and blazers in various colors, the most expensive of which cost me $7; and my single best thrift-shop clothing find was the day I paid $20 for a black, full-length fake-fur coat with brushed-metal buttons, in perfect condition except a couple of the buttons were loose (took less than 10 minutes to fix) – I don't know that specific coat's original retail price, but a few weeks later I saw a very similar one, with the same label, selling in an upscale department store for $980.

A thousand-dollar coat! And I got it for only 20 bucks! Which is a pretty good price to pay for a warm coat, such as I need to wear every winter, except – at the time, I already had something like six or seven beautiful winter coats, in addition to however-many jackets, blazers, cardigans, frock coats, spring coats, shawls, ponchos and two honest-to-Zod English capes, one of which nets me unsolicited compliments to this day (especially from steampunk fans).

Of course, I paid amazingly low, brag-worthy prices for every single one of those useful and lovely garments (my other coats and the capes all cost between $3 and $10 apiece), but the truth is: in those days I was still in debt, with an abysmally low cash reserve, and occasionally wondered why my finances were so poor when I was always so thrifty, never paying anywhere close to full price for clothes and home décor and other necessities … why, remember the time I saved 960 bucks on just one gorgeous winter coat … not until I literally ran out of closet and drawer space to hold any more garments did it finally sink in: “I'm not saving money buying all these things, even if they are great bargains and individually not-expensive; I'm spending money, and most of it on stuff  I don't need.”

So even if you consider yourself a frugal bargain shopper, take care to avoid the trap of confusing one form of saving for another.