Consumer Action INSIDER - September 2017

Table of Contents


What people are saying

The Train the Trainer session on Finding the Right Job Training School was very informative. Each of the three guest speakers provided in-depth details in choosing between a four-year college, a community college and the Department of Labor’s apprenticeship program...As a military veteran and advocate familiar with the use of the GI Bill veterans education benefits, I can honestly say that the info we received was right on point. — Joe Wynn, President, The VETS Group, Inc.

Did you know?

Many people are getting calls from alternative energy suppliers with offers to switch from their local utility company to a competitor. (Some states let you choose your energy supplier for electricity.) Unfortunately, some of the consumers who have opted to go with the alternative suppliers have been locked into long contracts that actually increase their monthly power bills. To find out more about what's allowed in your state, contact your state utility regulator. And before you make a move, check out the Federal Trade Commission’s questions to ask the callers.

How one housing agency uses our free resources to help its clients

Habitat for Humanity of the Mississippi Gulf Coast (HFHMGC), in Gulfport, Mississippi, builds and sells affordable housing, rehabilitates existing housing and provides free one-on-one financial coaching and group education.

Before 2007, Harrison County Habitat for Humanity and Habitat for Humanity of Jackson County were separate affiliates, building no more than three houses each per year. In January 2007, they merged and created Habitat for Humanity of the Mississippi Gulf Coast. Since then, the group has incorporated another nearby county in southern Mississippi (Stone County) and has directly and indirectly constructed or repaired more than 1,500 houses throughout the three counties.

In July, the agency contacted Consumer Action to thank us for the information we provided to staff who attended our When a collector calls: An insider’s guide to responding to debt collectors webinar and to let us know how its staff has used our free educational publications in every class that they teach. They also display a publication kiosk in their lobby, where consumers can pickup whichever publications interest them.

Client services program specialist Larisa Milner wrote: “Thank you for this great source of information. I am using Consumer Action publications and education materials every day. Everything is very helpful!”

We were pleased to hear the group has used a wide range of Consumer Action publications since 2008. We interviewed Milner to find out more about how she and other staff currently are benefitting from our materials. The organization’s director of client services, Tomesha Thompson, agreed to tell us more.

First, how would you describe your agency’s mission?

With the right support and resources, we believe that people can make change in their own lives, and together those individual changes can make change in a community. We believe that the experience of making change in one’s own life is a valuable experience regardless of the result. It is our mission to offer individuals in our service area the opportunity to transform and feel empowered in their day-to-day living through housing and financial opportunities.

Who is your target audience?

We serve low-to-moderate-income families.

Are there income and geographic limits to whom you serve?

There are limits for homeownership and rehab programs. We have no income or geographic limits for education and coaching.

Has your staff used Consumer Action publications in your education program?

Yes. There is a Consumer Action publication for every class we offer. We always offer the corresponding publications during and after class. We also have them readily available in our lobby area for the general public.

Has your staff attended Consumer Action trainings?

Ms. Milner has participated in six MoneyWi$e webinars and one When a Collector Calls: An Insider’s Guide to Responding to Debt Collection webinar.

Do you download our free materials or use our printed publications (or both)?

We use the printed publications, including MoneyWi$e, Checking and Savings Accounts, The Right Overdraft Protection Plan, The Fair Debt Collection Practices Act, Debtors’ Rights, Economic Survival Guide for Servicemembers and Veterans, Money Management 1-2-3, and more.

What best practices can you share regarding using Consumer Action materials?

Provide the publications to supplement and reinforce the information you are offering. The materials are easy to digest for varying education levels.

What other financial education materials do you use in your education and coaching programs?

We also use the FDIC’s Money Smart, and curriculums we have developed in-house.

Is there anything else that you would like to share about how partnering with Consumer Action has enhanced your financial education and coaching programs?

We appreciate the educational material provided by Consumer Action at no charge to our agency. It is just one more thing we can provide to our clients to help them move toward financial capability.

To learn more about Habitat for Humanity of the Mississippi Gulf Coast, visit its website.

California bill would prevent repeat of terrible Wells Fargo scam

Consumer Action is backing an important California state bill that would ensure consumers’ right to sue (and not be forced into arbitration) in cases where they unwittingly entered into a fraudulent contract, as occurred in the recent, widespread Wells Fargo scandal.

Consumer Action and several other organizations joined in Sacramento on August 21 to call upon California lawmakers to pass SB 33 (introduced by State Senator Bill Dodd). The bill would preserve consumers’ legal rights when financial institutions open bank or credit card accounts without their permission.

The recent Wells Fargo scandal is an excellent example of why SB 33 is needed. The Consumer Financial Protection Bureau (CFPB) recently penalized the bank for stealing its customers’ identities and opening 3.5 million unsolicited accounts. The damage from the scandal has been far-reaching, damaging consumers’ credit and costing them in overdraft fees. SB 33 would prevent a rerun of the scam by ensuring consumers’ legal remedies are protected.

When victims of the Wells Fargo scam came forward, the bank invoked the “forced arbitration” provision of its account agreement, which prohibits class actions and forces consumers to take disputes to secret forums rather than the courts. The irony is, that Wells Fargo says that defrauded consumers who did not agree in the first place to open accounts, must honor an arbitration clause in a contract they never signed. SB 33 would insure that defrauded consumers would have their day in court.

The consumer groups supporting SB 33 met with members and aides from the offices of over a dozen state legislators. Along with Consumer Action, organizations participating in the day of lobbying included CALPIRG, the Coalition for Humane Immigrant Rights of Los Angeles, the Student Senate for California Community Colleges, the California Employment Lawyers Association, Consumers for Auto Reliability and Safety, Housing and Economic Rights Advocates, California College Democrats, the California Commission on Aging, and the California Alliance for Retired Americans.

Some aides touched on the fact that SB 33 has been listed on the California Chamber of Commerce’s “job killer” list for—get this—“unfairly discriminating” against arbitration agreements. In our view, the only jobs lost would be those of corporate executives who knowingly commit fraud and find their activities aired in a public courtroom.

In fact, SB 33 might protect rank-and-file jobs. From 2011-2016, 5,300 Wells Fargo employees lost their jobs for participating in the fake accounts scam, which was designed and managed by higher-ups in the bank. Still others lost their jobs for refusing to go along with the scam or for blowing the whistle on illegal activities.

By demanding accountability from banks that break the law, SB 33 would protect California’s workers and consumers.

Currently, SB 33 is moving through the California State Assembly. It must pass through committee and floor votes (in this case, by Sept. 15) and be signed by the governor (by Oct. 15) in order to become law. Click here for information about the bill’s current status.

Hotline Chronicles: Hate robocalls? You can help stop them

Carrie* from Wisconsin, like millions of other consumers, told our hotline that she is livid about the repeated automated calls she has been receiving from companies trying to sell her things—in this case, extended auto warranties. Even though Carrie added her phone number to the national Do Not Call Registry, she still gets unwanted recorded calls and messages known as “robocalls.” (Robocalls use a recorded message instead of a live person. Telemarketing sales calls with recorded messages are generally illegal unless you have given specific permission to be called.)

The Do Not Call Registry is a great way for consumers to stop marketing calls from legitimate companies that honor the law. (Register your home and/or mobile phones for free at Regulators say, however, that the drastic increase in robocalls to consumers on the registry is from disreputable entities that ignore the law. These companies often use autodialers that can send out thousands of phone calls every minute for an incredibly low cost and typically don’t, as required by law, screen for numbers on the registry in order to avoid calling them.

While there have been several high-profile enforcement actions, the people behind these calls can be difficult to track down and prosecute. So the Federal Trade Commission (FTC) created a “black list” of phone numbers from consumer complaints and will soon be making it available to phone companies so that they can block the calls before your phone ever rings. The success of this effort, however, depends on YOU!

Check your Caller ID for the numbers associated with unwanted calls and report the phone numbers to the FTC online or at 877-FTC-HELP (382-4357). Online, choose “Unwanted Telemarketing, Text, or SPAM” from the menu and follow the directions to submit your complaint. In addition to the numbers, the data the FTC asks for will include the dates and times you received the unwanted calls and the general subject matter (debt reduction, warranties, home security, etc.).

The FTC will add the phone numbers you complain about to a list that is updated every business day, in order to help telecommunications carriers and other industry partners develop free call-blocking solutions.

If you answer a robocall, hang up the phone and never, ever (even if prompted) press phone keys to speak to a live operator or to get your number off the list. If you respond by pressing any number, it will probably just lead to more robocalls.

Be aware that the Do Not Call Registry prohibits only sales calls. You still may receive political, charitable, debt collection and survey calls. Some purely informational pre-recorded messages are permitted—for example, you may receive calls to let you know your flight’s been cancelled, reminders about an upcoming scheduled appointment or messages about a delayed school opening. Unless exempt, a telemarketer is not permitted to use a robodialer to send a prerecorded message to a cell phone (consumer or business) or to a consumer's land line without prior express written consent.

In addition, even if you are on the Do Not Call Registry, companies that you do business with may call you. You have the right, however, to ask any company trying to sell you something not to call again. Record the date of your request so that if the company continues to call, you can report it to the FTC.

“Sharing the critical information from consumers’ unwanted call complaints with carriers will enable industry innovators to stop illegal robocalls,” said Acting FTC Chairman Maureen K. Ohlhausen.

We certainly think so!

*Not this consumer’s real name

Trump administration shutters valuable savings, investing program

Late last month, the U.S. Treasury Department (under the Trump administration) announced the closure of an Obama-era government-sponsored retirement savings program known as myRA. The four-year-old Roth IRA-style program served as a starter account for low- and middle-income earners without an employer-sponsored retirement savings option (e.g., restaurant and retail employees). The program charged no fees, had no minimum balance requirement, allowed payroll deduction, and paid a modest—but guaranteed—interest rate. Contributions to a Roth IRA are made with after-tax dollars (i.e., no immediate tax benefit), but qualified withdrawals (typically in retirement), including account earnings, are tax-free.

Consumer Action helped the U.S. Treasury (under the last administration) publicize the program, both among the general public and to our network of community-based organizations, which could recommend it to their clients. Ultimately, 20,000 people participated in the program, saving a total of $34 million. The median savings amount was $500.

“Unfortunately, the myRA program, which could have helped countless non-saving households start a savings habit, was shut down by the current administration, which, along with its efforts to deregulate the financial industry, has proven to be alarmingly hostile to the average consumer,” said Linda Sherry, Consumer Action’s director of national priorities.

According to the myRA website, existing accountholders can continue to manage their accounts for now, but eventually they’ll have to close or transfer them. The program administrator will contact participants “over the coming weeks” with deadline information and next steps.

If you are invested in myRA, you will need to move your investments over to a new Roth IRA account with a company that offers them (virtually every bank, discount broker and mutual fund company). The myRA website offers advice on how to do this. And the consumer financial advice website NerdWallet lists their picks for best Roth IRA providers (those with good customer service, low or no account minimums, low fees, etc.).

In addition, we recommend that consumers check out the latest issue of Consumer Action News, which serves as an easy-to-understand guide for those looking to start saving and investing in an increasingly complex financial services environment.

Consumer conference offers sponsorship, exhibitor opportunities

On Nov. 15-16, Consumer Action hosts its annual invitation-only National Consumer Empowerment Conference just outside of Chicago, in Rosemont, IL. The two-day event, now in its eighth year, provides a valuable opportunity for community educators and consumer advocates—from cooperative extension offices and social service agencies to veterans advocates and credit and housing counselors—to learn from some of the country's top subject matter experts, regulatory and industry representatives and other key stakeholders in the consumer advocacy arena.

As in previous years, the lineup of expert presenters will address critical consumer issues and share best practices in consumer education and empowerment. Some of the sessions on this year’s agenda include:

  • Consumer protections at risk (Joe Valenti, director of consumer finance for the Center for American Progress)
  • Data tracking: when your TV watches you (Pam Dixon, executive director of World Privacy Forum)
  • Inspiring youth to build wealth (LaShawnda Thorton, associate director of programs and policies for Achieving the Dream; Yolanda Waldon of America Saves for Young Workers, a campaign of the Consumer Federation of America; and Margaret Libbey, executive director of MyPath)

The complete conference agenda will be available for download on Consumer Action’s website by Nov. 1.

This year, Consumer Action will offer a pre-conference reception and fintech exhibits on Nov. 14. The fintech exhibit area will also be open on Nov. 15.

The invitation-only National Consumer Empowerment Conference brings together the most effective community group partners from Consumer Action’s nearly 7,000-member network of consumer educators, advocates and program administrators.

Contributions from Consumer Action’s generous sponsors cover all attendee expenses (including meals), and Consumer Action provides a travel stipend to ensure that transportation costs do not prevent invitees from attending. TracFone, 1-800 CONTACTS, Microsoft, Walmart and a number of other companies have made pledges to support the conference.

Consumer Action is still accepting sponsorships; sponsors will be acknowledged in the conference program booklet and at the event. They will also have the opportunity to participate in all event activities. To learn more about sponsorship opportunities, please visit the conference website, or contact Ken McEldowney by .(JavaScript must be enabled to view this email address) or phone (510-333-4886).

Fintechs interested in exhibiting, and readers who have questions regarding the conference or wish to become a network partner, should contact Audrey Perrott by .(JavaScript must be enabled to view this email address) or phone (800-999-7981, ext. 750).

Coalition Efforts: Advocates fight to protect the vulnerable

Cutting Pell Grant funds will hurt millions of low-income students. Forty organizations, representing students, consumers, colleges, workers and others, urged House appropriators to oppose the $3.3 billion Pell Grant funding cut included in the Fiscal Year (FY) 2018 Labor, Health and Human Services, and Education appropriations bill. Even at its current rate, the maximum Pell Grant covers less than one-third of the cost of attending a four-year public college—the lowest share in more than 40 years. And absent Congressional action, FY18 will be the first time in six years that the grant will not increase enough to even keep pace with inflation. Learn more

Call on House to oppose pro-pyramid scheme amendment. A broad coalition of consumer advocacy organizations is calling on the House of Representatives to defeat efforts to weaken the Federal Trade Commission’s ability to protect consumers from fraudulent pyramid schemes. An anti-consumer amendment offered by Congressman John Moolenaar (R-MI) was added to the House Financial Services and General Government Appropriations FY 2018 bill. The amendment would eliminate long-standing requirements for direct selling companies to establish a viable retail business (i.e., sell actual products) instead of profiting from new recruits (who must themselves purchase the products and recruit others to qualify for “rewards”). Learn more.

Making mortgages more accessible to limited-English speakers. In 2014, approximately 25.3 million individuals, or roughly 9 percent of the U.S. population, were considered limited English proficient (LEP). Despite these numbers, the language needs of many current and potential homeowners are left unmet in the mortgage marketplace. Eighty-six organizations recently called on the Federal Housing Finance Agency to improve language access in the mortgage market by providing in-language loan documents, translation services and more. Learn more.

Don't take away seniors’ rights to sue. Dozens of groups in the Fair Arbitration Now Coalition [] submitted public comments to the Centers for Medicare & Medicaid Services (CMS) opposing the agency’s proposal to eliminate protections for seniors who are harmed by mistreatment and legal violations in nursing homes. If the CMS proposal is approved, vulnerable seniors who are victims of nursing home neglect, abuse and other malfeasance will be forced into arbitration proceedings (losing the option of a lawsuit). Learn more.

Caller ID authentication provides protection against illegal and unwanted calls. The Federal Communications Commission (FCC) acknowledges that consumers receive an unacceptably high volume of calls that, in the best case, are an annoyance, but often result in fraud and money loss. One particularly disturbing category of spam calls is spoofed robocalls, in which the caller ID is fake (i.e., hiding the caller's true identity). Consumer advocates recently applauded the FCC’s rollout of proposed new rules that aim to stop spoofed calls and support implementing caller ID authentication, which will aid in the agency's attempt to curb robocall scams. Learn more.

CFPB Watch: Debt collection tips, overdraft fees and class action rights

The CFPB has spelled out a three-step action plan to help consumers deal with debt collectors when they come calling. The Bureau recommends you:

  • Know your rights. Under the Fair Debt Collection Practices Act (FDCPA), collectors cannot harass you, lie about what you owe and/or threaten to arrest you.
  • Make sure the debt is yours. Consumers should find out the amount owed, the original creditor and the collector’s contact information.
  • Act quickly. If you’re not sure the debt is yours, ask for more information. If the debt is not yours, dispute it in writing immediately.

The Bureau has sample letters that you can customize and send to a collector if you don’t owe a debt, don’t want the collector to contact you anymore or just want more information about an outstanding bill.

You can also learn about your rights under the FDCPA, which governs the collection of mortgage, credit card, medical and other personal debts.

Overdraft: Know Before You Owe

Results from a recent CFPB study show that consumers who choose to accept (“opt in” to) overdraft coverage on debit and ATM transactions pay almost $450 more in fees per year compared to frequent overdrafters who have not opted in. Overdrafts occur when there is not enough money in the account to cover a transaction but the bank or credit union covers it anyway. Typically, consumers are charged about $34 per overdraft, and more if the negative balance is not repaid within days.

Overdrafts on ATM withdrawals and most debit card transactions—and the resulting fees—require a consumer’s prior approval, or the transaction will be declined. However, overdrafts resulting from checks and online bill payments can be allowed by the bank, and result in a fee, without the accountholder’s consent. Overdraft fees are per-transaction, so if a consumer bounces several checks, or numerous electronic bill payments are presented, numerous overdraft fees can be charged in a single day.

The Bureau has created four model forms to help clearly explain to consumers the costs and risks of overdrawing their accounts. The draft forms explain the different types of overdrafts and associated fees, detailing the different costs based on a consumer’s choice. The model forms spell out a simplified way for consumers to learn about and choose their best overdraft option. You can go to the CFPB website to review the overdraft disclosure forms. You also can tell the Bureau about your experiences with overdraft fees.

The CFPB returns consumers’ right to their day in court

The Bureau issued a final rule last month banning banks, payday lenders, credit card companies and other financial industry players from preventing consumers from banding together to sue when they’ve been financially wronged.

Class action bans are frequently found in mandatory arbitration agreements buried in the fine print of the financial contracts that consumers are forced to agree to in order to use a financial product or service.

Instead of prohibiting binding arbitration clauses altogether, the Bureau decided it would be more effective to prevent an aspect of the clauses known as “class action bans,” which prevent customers from joining class action lawsuits. During five years of study, the CFPB concluded that no matter how many people are injured, if the per-victim financial stakes are small (say, multiple $35 overdraft fees), individual consumers often are unable to spend the time and money required to fight these injustices.

“Class actions are a vital source of consumer protection, since consumers can join together to fight big business,” said Linda Sherry, director of national priorities for Consumer Action. “The CFPB’s rule is critical for protecting consumer rights, and Consumer Action applauds the fact that the Bureau has drawn a line in the sand, making prohibitions on collective redress illegal.”

While it doesn’t ban binding individual arbitration clauses, the CFPB “arbitration rule” removes some of the secrecy around the ultimate disposition of such arbitration cases by establishing a public record of arbitration claims and outcomes.

Before the August recess, the House of Representatives voted to repeal the CFPB’s arbitration rule. Upon its return, the Senate will decide whether to hold a vote on the repeal. Consumer Action, along with scores of other groups, is fighting to maintain the CFPB decision to allow consumers the ability to join class action suits to hold companies accountable for harmful practices.

Class Action Database: Cruisin’ for a lawsuit

Class action settlements involving Skeeter Snacks and Lyft were among six new settlements added to Consumer Action’s Class Action Database in August.

A Lyft driver filed a class action lawsuit charging the ridesharing service with breach of contract (Keara Nieves v. Lyft Inc.). Nieves accused Lyft of using different criteria for ride lengths in order to underpay drivers.

Lyft charges its riders based on an estimation of the time and distance it will take to complete a ride, but pays its drivers according to a separate calculation based on actual miles and minutes driven. Nieves argued that, in accordance with its contract with drivers, Lyft is obligated to pay drivers based on the fares it charges riders.

If you have driven for Lyft and are interested in joining the class action, please .(JavaScript must be enabled to view this email address) the law firm Mashel Law, LLC.

Also of note this month is the class action Charvat v. Resort Marketing Group, Inc. et al. The plaintiffs filed a class action against Resort Marketing Group (RMG), Carnival, Royal Caribbean and Norwegian alleging that the companies violated the Telephone Consumer Protection Act (TCPA).

Plaintiffs claim that RMG made robocalls to cell phones and landlines offering a free cruise with Carnival, Royal Caribbean and Norwegian, violating the TCPA. A robocall is a recorded message instead of live person. (See our Hotline Chronicles article in this issue for more information on the government’s latest efforts to combat robocalls.) If the robocall is a sales message and the consumer didn’t give written permission to receive such calls from the calling company, the calls are illegal under the TCPA.

The defendants denied the allegations but agreed to a settlement to avoid the burden, expense and risk of continuing the lawsuit.

You are a member of the settlement class if you received a robocall from RMG offering a free cruise with Carnival, Royal Caribbean and Norwegian on your landline or cell phone between July 2009 and March 2014 and your phone number is in the RMG call records. The settlement provides up to $300 cash per call, with a maximum payout for three calls per telephone number ($900). At the claims page you can check if your phone number is in the RMG call records. The claims deadline is Nov. 3, 2017

About Consumer Action

Consumer Action is a non-profit 501(c)(3) organization that has championed the rights of underrepresented consumers nationwide since 1971. Throughout its history, the organization has dedicated its resources to promoting financial and consumer literacy and advocating for consumer rights in both the media and before lawmakers to promote economic justice for all. With the resources and infrastructure to reach millions of consumers, Consumer Action is one of the most recognized, effective and trusted consumer organizations in the nation.

Consumer education. To empower consumers to assert their rights in the marketplace, Consumer Action provides a range of educational resources. The organization’s extensive library of free publications offers in-depth information on many topics related to personal money management, housing, insurance and privacy, while its hotline provides non-legal advice and referrals. At, visitors have instant access to important consumer news, downloadable materials, an online “help desk,” the Take Action advocacy database and seven topic-specific subsites. Consumer Action also publishes unbiased surveys of financial and consumer services that expose excessive prices and anti-consumer practices to help consumers make informed buying choices and elicit change from big business.

Community outreach. With a special focus on serving low- and moderate-income and limited-English-speaking consumers, Consumer Action maintains strong ties to a national network of nearly 7,000 community-based organizations. Outreach services include training and free mailings of financial and consumer education materials in many languages, including English, Spanish, Chinese, Korean and Vietnamese. Consumer Action’s network is the largest and most diverse of its kind.

Advocacy. Consumer Action is deeply committed to ensuring that underrepresented consumers are represented in the national media and in front of lawmakers. The organization promotes pro-consumer policy, regulation and legislation by taking positions on dozens of bills at the state and national levels and submitting comments and testimony on a host of consumer protection issues. Additionally, its diverse staff provides the media with expert commentary on key consumer issues supported by solid data and victim testimony.




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