Table of Contents

• What people are saying
• Did you know?
• Awardees chosen for our 2012 annual event
• Building a trusted environment for app users
• Hotline Chronicles: Payphone credit card fees can hurt!
• Advocacy and coalition efforts update
• Multilingual guides to choosing and using prepaid cards
• Are older adults getting online?
• About Consumer Action

What people are saying

We are making sure that all of the Family Self Sufficiency participants in our Section 8 program are provided [with Consumer Action’s educational] materials. We also provided them at a participant conference last month. They are a great resource for our clients. — Stacey Benson, City of Scottsdale, AZ

Did you know?

Borrowers who’ve been financially harmed during the foreclosure process, in 2009 or 2010, have the right to request an independent foreclosure review. If mortgage servicer error is found, borrowers may be eligible for financial compensation—even if they have already lost their home. The deadline to request a foreclosure review is July 31, 2012. Click here to learn more.

Awardees chosen for our 2012 annual event

Consumer Action has chosen three honorees for its annual fundraising benefit and awards ceremony on Oct. 2 at the Rayburn House Office Building on Capitol Hill in Washington, DC. We have begun our fundraising efforts and hope that INSIDER readers will consider providing financial support this year. Click here to learn more about our plans and sponsorship levels, pledge donations and buy individual tickets.

At the event, Consumer Action will honor three distinguished awardees making major contributions to protect consumers.

• Postal Regulatory Commission (PRC) Chairman Ruth Y. Goldway, a dedicated consumer advocate serving her third term as a PRC commissioner, will receive our 2012 Consumer Excellence Award in the Regulatory category. We honor Chairman Goldway for her considerable contributions to protecting postal consumers during a time of unprecedented change and challenges for the U.S. postal community. She has played a key role in the Postal Service’s adoption of the “Forever Stamp” to ensure that stamp buyers can use existing stocks even when rates rise, offered creative suggestions on how to save the nation’s beloved post offices and postal services and developed a particular expertise about the disparate impacts of postal policy on first-class stamp buyers and low-income, elderly and rural postal clients.
• The American Library Association's Office for Intellectual Freedom (ALA OIC) will receive our 2012 Consumer Excellence Award in the Community Organization category. We honor the ALA OIF because of its outstanding efforts to educate consumers on their privacy rights via participation in privacy coalitions, Choose Privacy Week at local libraries and development of the Privacy Revolution (privacyrevolution.org) website. For 2012 Choose Privacy Week the office made an excellent short video called “Vanishing Liberties,” which focuses on the loss of privacy and civil liberties for immigrant communities.
• Reporter and author Bob Sullivan, who writes The Red Tape Chronicles on MSNBC.com, will receive our 2012 Consumer Excellence Award in the Media category. We honor Sullivan because of his consumer-rights focused reporting and exposés on fraud and identity theft. Sullivan, who has written more than 100 articles about identity fraud since 1996, is the author of best-selling non-fiction titles Gotcha Capitalism, which details how consumers are confused, deceived and overcharged by big business, and Stop Getting Ripped Off, containing advice that consumers can use to get the best deals and avoid losing money.

In its long history, Consumer Action has been a relentless advocate for underrepresented consumers across the country. It has been a sometimes difficult and challenging path, but we have held true to our course and made a difference for thousands of people who would otherwise be without support.

Consumer Action works to level the playing field for all consumers. We place a special focus on financial education that empowers low- to moderate-income and limited-English-speaking individuals to prosper financially. Through financial education materials in multiple languages, a free national hotline and investigations into consumer financial services, we help consumers assert their rights in the marketplace and make financially savvy choices. More than 8,000 community and grassroots organizations benefit annually from our extensive outreach programs, training materials and support.

Please make the most generous contribution you can afford. Each dollar you give allows us to aggressively pursue our mission to empower underserved individuals and families to participate in and succeed in today’s complicated consumer environment.

Building a trusted environment for app users

In April, Consumer Action's DC-based Senior Associate for National Priorities Michelle De Mooy traveled to Silicon Valley for a conference convened by the Future of Privacy Forum in partnership with the Application Developers Alliance and the Stanford Law School Center for Internet and Society. The Future of Privacy Forum is a Washington, DC-based think tank. Consumer Action sits on its advisory board.

The conference was a groundbreaking event, bringing small and large developers of applications (or apps) together with policymakers and advocates to discuss how to improve both privacy protection and consumer experience using apps.

"In DC, there are few opportunities to speak to technology people from the ground up about consumer expectations when it comes to privacy," said De Mooy. "It was enlightening to learn about the challenges facing small app developers as they build products for consumers."

De Mooy said many app developers told her they deal with enormous pressure to build and release apps quickly, which can make it hard to "bake in" consumer privacy protections. App developers often are unsure which types of personal information people might object to being shared or subjected to third-party use, said De Mooy, even while they agree that protections should be stronger.

De Mooy facilitated a discussion about location-based services at the conference. Location-based apps, like Google Maps, can offer valuable services to consumers but need location to function properly and may pose a greater privacy threat if misused or lost in a breach. In addition, consumers are unaware that location information is sometimes collected or used without their consent. Developers and advocates talked about how to provide consumers with real-time, easy-to-understand notification when information about their location is used, as well as the importance of only using location for apps when it is necessary (for example, a bingo game app would not need a consumer's location to function).

Hotline Chronicles: Payphone credit card fees can hurt!

Patty*, a Virginia consumer, called Consumer Action’s hotline to complain that she had used her credit card to make a call at a payphone in West Virginia and was charged a $35 fee for the convenience.

Patty didn’t have her credit cad statement with her when she called us, but we advised her to check it for the billing entity’s name, then file a complaint about the company with the West Virginia Public Service Commission (called “public utilities commissions” in some states) and the Better Business Bureau. Our counselors also suggested she call the credit card company and dispute the charge.

Patty’s problem is not an isolated incident. The Internet is full of almost identical complaints, many centered on a single San Diego company, BBG Communications, which under various names including FairCall provides credit card processing and operator services for payphone owners. (Click here to learn more names that the company bills under.)

BBG has been hit with several lawsuits alleging that the company hides its rates to mislead people into making expensive calls. One high-profile class action lawsuit filed last year claims BBG charged U.S. military personnel fees up to $41 a minute for making payphone calls from an airport in Leipzig, Germany. The cases are pending.

The Better Business Bureau of San Diego gives BBG a failing grade in its online business review, stating that over the last three years it has received more than 450 complaints about BBG’s billing practices at payphones in airports, hotels and cruise ships, most of them unresolved.

Consumer Action recommends that consumers without cell phones carry change with them for local calls. Another way to avoid the high fees for using a credit card is to purchase a prepaid phone card (or prepay for minutes online) from a company that offers low rates via access numbers in the U.S. and abroad. Shop carefully, as many such products carry hidden fees.

*Not this consumer's real name.

Advocacy and coalition efforts update

Improving protections for prepaid card users, opposing a reduction in debt collector liability and ensuring ATM fee disclosures remain are a few of the things Consumer Action's DC office has been working on in the past month.

Reg E for prepaid cards! Consumer Action has created a Change.org petition calling on the Consumer Financial Protection Bureau to extend Electronic Funds Transfer Act (Regulation E) protection to general-purpose prepaid cards. The Electronic Funds Transfer Act applies to debit cards but does not apply to general-purpose reloadable prepaid cards. Many unbanked people are being urged to buy and use prepaid plastic payment cards. People who load money on these cards have to rely on voluntary industry protections to resolve errors or limit liability for lost or stolen cards and unauthorized use of the funds on the card. The issuers could change the rules at any time. Click here to sign our Reg E for prepaid cards! petition at Change.org.

Debt collector liability. A few weeks ago, Consumer Action and other organizations signed on in support of a letter written by the National Consumer Law Center and the National Association of Consumer Advocates expressing serious concern with HR 4101, Fair Debt Collection Practices Clarification Act, introduced by Rep. Barney Frank. The groups allowed that the bill contained positive measures that would help consumers, including limits on the use of binding mandatory arbitration and a ban on voicemail messages left by debt collectors. However, the bill also proposed to replace the current strict liability for collectors who violate the Fair Debt Collection Practices Act (FDCPA) with the looser “good faith standard.” This would require that consumers prove that debt collectors had acted in bad faith when consumers assert their rights under the FDCPA. HR 4101 was recently modified and reintroduced as HR 5794, but still poses the same concern for the consumer groups. The revised bill can be found here.

ATM fee disclosures. Consumer Action opposes HR 4367, which proposes to eliminate the requirement to provide a notice of ATM fees on cash machines. The ATM fee sign is the only warning that a consumer may receive about the possibility of a fee being charged by the consumer’s bank and the owner of the ATM. Without this posted sign, a consumer may engage in the transaction before knowing the fee. This may particularly be the case for consumers who use prepaid cards.

‘Accredited investor’ rulemaking. Consumer Action joined Fund Democracy, the Consumer Federation of America, the AFL-CIO and Americans for Financial Reform in comments to the Securities and Exchange Commission (SEC) regarding rulemaking for the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”), which requires that the SEC remove the ban on general solicitation and advertising (“GS&A”) for private offerings made to “accredited investors.” SEC rules permit certain private and limited investment offerings to be made without registration, and without requiring consumer protection disclosures, if sales are made only to “accredited investors.” One way individuals may qualify as accredited investors is by having a net worth, alone or together with their spouse, of at least $1 million. The Dodd-Frank Act requires that the value of a person’s primary residence be excluded from the net worth calculation used to determine accredited investor status. In their comments to the SEC, the consumer groups stated that extraordinary care would need to be taken by the SEC to ensure that such offerings aren’t made to the general public (investors whose net worth is below $1 million). And, despite industry arguments to the contrary, the consumer groups stated that the SEC must hold firm and identify the “reasonable steps” that issuers must take to ensure that they are selling only to accredited investors. Click here for a PDF of the comments.

Lifeline reform deadline could 'hang up on' vulnerable households. Consumer Action joined leading senior, consumer, disability and minority organizations to ask FCC Chairman Julius Genachowski to give states until Jan. 1, 2013 to modernize the low-income Lifeline phone subsidy program. The groups warned that without an extension of the current June 1 deadline, many states will effectively close Lifeline to new applicants. Besides Consumer Action, the letter was signed by Alliance for Generational Equity; California Alliance for Retired Americans; Community Action Partnership; Maryland Consumer Rights Coalition; National Consumers League; National Grange; National Hispanic Media Coalition; and the World Institute on Disability. The FCC announced the new rules in February 2012 and required the states to have centralized databases in place for the coordinated handling of applicant eligibility by June 1. A number of states need additional time to put database solutions in place, while some states haven’t even begun the process. Click here for our press release.

Multilingual guides to choosing and using prepaid cards

Prepaid cards are the financial tool of the moment for a growing number of consumers. They are helping consumers to manage their finances, pay bills and take advantage of direct deposit services—all without a bank account. But choosing a card can seem overwhelming.

A new free education series, produced in partnership by American Express and Consumer Action, includes an easy-to-read multilingual booklet, two short videos and a question-and-answer guide. For consumers who rely on cash and checks, prepaid is often a good alternative, and those who primarily use debit and credit cards may also find them useful for online shopping, budgeting and distributing funds to family members.

The brochure is available in English, Spanish, Chinese, Korean and Vietnamese. It explains how the cards work and offers advice for selecting the right card, controlling costs and managing the card successfully. For those who want to delve deeper, there’s an in-depth question-and-answer guide.

The two short videos are available to the public on Consumer Action’s YouTube Channel and on the American Express YouTube Channel.

• Reloadable Prepaid Cards: An overview of prepaid cards, including how they work and their pros and cons.
• Choosing and Managing a Reloadable Prepaid Card: A five-minute guide to narrowing your card options, reducing or avoiding fees and managing your card wisely.

All materials are freely available for non-profit and community use and they can be reproduced for educational purposes. You can order printed materials and download the lesson plans. The videos are available online but for community groups without high-speed Internet, Consumer Action will send a DVD of the videos upon request. Send an email to .(JavaScript must be enabled to view this email address) to learn more.

Are older adults getting online?

Project GOAL (Getting Older Adults Online) was the co-host of the May Broadband Breakfast, a gathering of top telecommunications executives in Washington, DC. Consumer Action’s Linda Sherry is an advisory board member for Project Goal, founded by Debra Berlyn, president of Consumer Policy Solutions. Project GOAL’s mission is to help promote the adoption of broadband services by older adults, to raise the profile of the challenges confronting the use and adoption of technology within the older community and to create a new voice representing these issues.

Sherry noted, “Unlike with other populations, relevancy can be a bigger barrier than cost. This is why it’s so important to help seniors understand the benefits of broadband.”

In 2010, Pew Charitable Trusts found that Americans age 65+ are among the least likely groups to go online, but once online, they are enthusiastic emailers, gamers and information seekers. The same study found that only 38% of adults age 65 and older go online, a significantly lower rate of adoption than the general population (74%).

Anthony Wilhelm, director for Broadband Technology Opportunities Program (BTOP) at the U.S. Department of Commerce’s National Telecommunications & Information Administration (NTIA) was keynote speaker. “Seniors need to be online to be productive and to be full participants in our society,” said Wilhelm. “It’s not so much what the Internet can do for seniors but what seniors can do for the Internet…seniors are the most experienced and some of the most creative members of our economy.”

At the morning get-together at Clyde’s restaurant in DC, government, corporate and non-profit panelists addressed “What Lessons Are We Learning in Getting Older Adults Online.” Josh Smith, a staff reporter at the National Journal served as moderator of the panel of experts that included Josh Gottheimer of the Federal Communications Commission; John Horrigan of TechNet; Tom Koutsky of Connected Nation; Elizabeth Crocker of the Foundation for Rural Services and Thomas Kamber of Older Adults Technology Services (OATS). Horrigan and Kamber also serve on the Project GOAL advisory board.

Gottheimer, Senior Counselor to FCC Chairman Julius Genachowski, said there are many benefits to helping seniors get online, from the social benefits of connecting with family and friends through social networking, email, webcam chats and photo sharing to the health benefits of remote monitoring. He noted that the U.S. is lagging behind global peer nations in broadband connectivity. Gottheimer said that the FCC has proposed a rule to fund digital literacy through Universal Service Fund reform. Other efforts include “intergenerational mentoring” programs using high school students to teach computer skills at senior gathering places; keeping school computer labs open in the evening to serve the community and encouraging Eligible Telecommunications Carriers (ETCs) to partner with nonprofit organizations and others and pass through funds to help sustain innovative local programs.

While much of the conversation focused on seniors and the use of emerging technologies such as mobile and tablets, Kamber suggested the focus remain on teaching people the basics, like getting online and using email.

Koutsky said personal connections are most important when getting seniors to connect online. However, he noted that the FCC has only proposed to offer digital literacy in group settings, which he said is not a viable option for many seniors.

Other members of the Project GOAL advisory board include Lynn Mento of AARP; Sandy Markwood of the National Association of Area Agencies on Aging (n4a); Brian Mefford of Connected Nation; Nicol Turner-Lee of the Joint Center for Political and Economic Studies; Jonathan Linkous of the American Telemedicince Association, and Graham Richard, a former mayor of Fort Wayne, IN.

About Consumer Action

Consumer Action is a nonprofit organization that has championed the rights of underrepresented consumers nationwide since 1971. Throughout its history, the organization has dedicated its resources to promoting financial 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.

Financial Education. To empower consumers to assert their rights in the marketplace, Consumer Action provides a range of education resources. The organization’s extensive library of free publications offers in-depth financial information, while its hotline provides non-legal advice and referrals. Consumer Action also publishes an unbiased Annual Credit Card Survey that exposes 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- to moderate-income and limited-English-speaking consumers, Consumer Action maintains strong ties to a national network of more than 8,000 community-based organizations. Outreach services include training and free mailings of financial education materials in many languages, including English, Spanish, Chinese, Korean and Vietnamese. Consumer Action’s rapidly expanding 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, regulations and legislation by taking positions on almost 200 bills per legislative session and testifying at least three times per year. Additionally, its diverse staff provides the media with expert commentary on key consumer issues supported by solid data and victim testimony.

Click here to learn more about our staff.