Consumer Action INSIDER – October 2011

 

Save the Date

What people are saying

Consumer Action has been our partner for many years with their resources complimenting our topics and service delivery. It is extremely important to provide consumers the latest financial information and “be in the know.” Our HUD certified counselors share the materials and we have a lobby where material is displayed. CCCS-OC values the educational and advocacy of Consumer Action! We value the partnership and the opportunity to leverage resources to benefit consumers. – Sahara Navarro-Garcia, Director of Education, Consumer Credit Counseling Service of Orange County

This month's consumer tip: Avoid the lure of social media scams

Have you received a Facebook message from a friend who lost his wallet while traveling and needs some money wired, pronto? That’s just one example of scams that can come your way via social networks. To learn more, see our Consumer Alert on the subject.

Web spotlight: Looking back at Consumer Action’s milestones

The story begins in 1971 with a group of volunteers with a single telephone in a church basement in San Francisco. During its first year in operation, the small but determined cohorts published the first issue of the Consumer Action News newsletter and launched the consumer advice and assistance hotline. “We saw what Ralph Nader was accomplishing and we wanted to join the consumer movement,” recalled founder Kay Pachtner in a 1994 interview with Consumer Action’s Linda Sherry.

Pachtner and the other volunteer advocates hit the ground running. Just a few short years after its inception, Consumer Action led its memorable “lemonstration” protesting the sale of defective cars at British Motors in San Francisco. Defeating a $6 million counter lawsuit, Consumer Action won the right for aggrieved individuals to picket businesses, and the seeds were sown for the local group to grow into a national force in the consumer movement.

As we celebrate 40 years of service, we look back on the events and accomplishments that have shaped Consumer Action with a timeline of milestones and achievements. From its groundbreaking publication of “Break the Banks: A Shopper's Guide to Banking Services” to its first federal grant to help the Federal Trade Commission (FTC) draft new consumer protection regulations to its impact on historic credit card legislation, Consumer Action has doggedly advocated for strong consumer rights in ethnic communities, legislative corridors, the media and industry dialogues.

The timeline of events and accomplishments can be found under “About” on our website. “Looking back at Consumer Action’s milestones” shows where the organization came from and where we stand today. Click here to read the timeline.

MoneyWi$e in the nation’s capital

The fundamentals of solid money management were on stage when Consumer Action and Capital One hosted free, financial empowerment training for community-based organizations in Washington, DC on Sept. 8. Close to 50 representatives of community agencies from the DC metro area, including Maryland and Virginia, attended.

The groups included academic institutions, government agencies and faith-based groups, as well as agencies focusing on the formally incarcerated, youth enrichment, veterans, supportive housing, community development, workforce development and financial education.

Michael Pugh, a senior vice president of branch distribution for Capital One provided welcoming remarks to the attendees. Pugh is a regional executive supporting 75 Capital One branches in Washington, DC, and eastern Maryland.

The meeting featured sessions on money management and credit. Bert Davis, senior associate for financial education at Capital One, kicked off the morning with an interactive session on teaching adults. Davis has trained community groups and Capital One staff around the country on presentation facilitation and financial education.

Consumer Action’s Linda Williams led the session on money management. She discussed basic money management concepts including setting goals, developing a savings plan, having a spending plan and conducting a financial check-up. Williams laid the groundwork for participants to evaluate the financial situation of a fictional character, Sally Walker, and make their own recommendations for Sally’s financial situation. (The Sally Walker exercise is available for free download and can be used to teach the fundamentals of money management and budgeting. It provides the tools required to train clients on how to accomplish their financial goals. [Click here to download the exercise.]

Nelson Santiago of Consumer Action led the session on good credit, prompting attendees to think about what steps they can take to build credit, and the importance of shopping around to compare credit offers, using credit wisely and obtaining and reviewing credit reports regularly.

The day ended with a “Teachback” session. The Consumer Action team asked participants to break in to groups, review condensed versions of the MoneyWi$e modules and prepare presentations to teach some of the financial education concepts presented in the modules. The activity allowed participants to practice training skills, enhance their own training styles and observe other participants’ training styles.

The training evaluations were positive, with some participants expressing interest in having a longer training and others suggesting additional MoneyWi$e topics for future trainings. Even the few participants who had attended MoneyWi$e trainings in the past commented that they had learned new concepts.

For information on these and other trainings, visit the Outreach section of the Consumer Action website.

New resource: How to Complain

In honor of its 40th Anniversary, Consumer Action has updated its perennial favorite guide, “How to Complain.” The free and comprehensive booklet, designed to help consumers complain effectively and get results, was unveiled concurrently with the latest quarterly issue of Consumer Action News, which is also devoted to helping consumers complain effectively.

Updated for settling disputes in the Internet age, “How to Complain” includes a sample complaint letter and email, as well as advice on:
  • how to approach businesses with a complaint;
  • escalating a complaint through customer service and a company’s executive offices;
  • writing emails and letters about your complaint; and
  • documenting your complaint.

The guide is available here and is available for free download.

You may also want to check out our Consumer Services Guide, an online database of agencies and organizations that can assist consumers in resolving complaints.

An update on our fair housing project

The denial of housing opportunities to people because of race, color, religion, sex, national origin, because they have minor children or because they have a disability is known as housing discrimination, and it is illegal. For 2011-2012, Consumer Action received a $1 million grant to create a campaign to educate consumers on their fair housing rights. The campaign includes educational brochures, public service advertisements, posters in five languages (English, Spanish, Vietnamese, Korean and Chinese), and the training of community-based organization (CBO) staff on best practices for using the educational materials in their communities.

Consumer Action is working with three consultants (The Hastings Group, Sage Communications and IWG, Inc.) to produce the mass-market TV, radio and Internet public service advertising campaign.

The educational module was produced in-house. The free, multilingual module features two brochures, a training curriculum, PowerPoint slides, classroom learning exercises and a uniform evaluation form. The two brochures, now being translated, are:

  • Know the Signs of Housing Discrimination, which educates consumers about fair housing rights under the federal Fair Housing Act; and
  • Filing a Housing Discrimination Complaint outlines the process for filing a housing discrimination complaint with HUD.

The trainings for CBO staff will be held in San Francisco, Chicago and Atlanta, locations in which HUD has regional offices.

“We are gearing up to distribute the brochures and training materials and conduct the trainings,” said Audrey Perrott, associate director of outreach and training. “The CBOs in our network will receive order forms for the materials and, if the groups are located in or near the three trainings, an invitation to attend one of the meetings.”

Stay tuned for more about our fair housing project. Meanwhile, if you believe you were a victim of housing discrimination, be aware that you have a right to file a housing discrimination complaint with the U.S. Department of Housing and Urban Development (HUD). Call HUD at 800-669-9777 (TTY: 800-927-9275), or visit www.hud.gov for information about filing a complaint.

Hotline chronicles: Don't buy a used car with a lien on it

This episode of Hotline Chronicles is a cautionary tale about CiCi* from San Francisco, who paid $7,000 cash to buy a car from a “private party.”

The previous owner signed the Certificate of Title (commonly referred to as the “pink slip”) indicating that the car had been sold and transferred to CiCi. Only afterward, when CiCi tried to register the car, did she understand that the previous owner still owed money on his car loan. CiCi would need a “lien release” from the lender before the title could be transferred and she could register the card.

At the Department of Motor Vehicles, it was pointed out to CiCi that there was an outstanding loan of $1,000 shown on the pink slip. Unfortunately, she had failed to notice that there was a lender’s lien on the car.

Our hotline counselors advised CiCi that she is in a vulnerable position. The lender could come and repossess the car and she could lose $7,000. Even if no one comes to repossess the car, CiCi won’t be able to get insurance on the car if she can’t get the title in her name. The counselors told her to:
  • Attempt to contact the seller, and ask him to work with her to get the lien released. However, in many such cases, the seller simply disappears with the cash and has no interest in helping the buyer resolve the issue. (If this happens, file a police report.)
  • Secondly, try to contact the lender listed on the pink slip and ask how she can pay off the balance of the loan on the car. If the lender will accept payment, she can get a lien release letter from the lender.

Bottom line: Do your homework before you buy a used car. There are many pitfalls to purchasing a used car from a private individual or a dealership. Many states do not require individuals to guarantee that their vehicles will pass state inspection, nor do they require that cars sold by individuals carry an implied warranty.

Click here for more information about transferring the title on cars in California.

Visit the Federal Trade Commission for advice on buying a used car.

Consumers for Auto Reliability and Safety (CARS) also offers great advice for car buyers.

Consumer Action’s hotline counselors are happy to help point you to helpful educational resources before you buy a car or make any major consumer purchase. To contact our hotline counselors, click here or call 415-777-9648.

*Not this consumer’s real name

Survey says Consumer Action’s hotline is delivering

In an effort to provide the very best advice and referrals, Consumer Action conducts a follow-up survey of the people who contact our hotline. The numbers are very positive, with more than three quarters (77%) of respondents agreeing that we had provided appropriate advice and referrals to handle their consumer complaints. We also got high marks for timely responses from 83% of respondents.

In questions designed to provide feedback on our services, 68% of those who took the survey said that our free advice via telephone and e-mail is important to them. Forty-three percent agreed that it was a winning strategy to share key complaints with the media if the respondents gave permission. About a third (32.6%) expressed a desire for active representation of consumer protection issues in Congress.

We also want to acknowledge that 15% of the respondents were not satisfied with the assistance we provided. The majority of those who gave us poor marks said they were looking for individualized mediation and resolution services or that they had already contacted the agencies we provided and got no help.

Consumer Action wishes we could provide this level of individualized service as we recognize such assistance is not easily found elsewhere, but the cost would be astronomical and securing funding for the hotline has been difficult. “We are pleased that so many consumers see the value in the advice and referrals we offer,” said Linda Sherry, Consumer Action’s director of national priorities. “It’s frustrating that Consumer Action has been relatively unsuccessful in raising money from foundations to support this valuable service. It has always been an uphill battle to fund our hotline, despite the great need we can show for the service.”

Still, it’s satisfying to know that we are helping people who are pleased with the hotline service. As one consumer wrote, “Just to have someone respond back with an answer was wonderful.” Today, that kind of service is missing from many industries.

Court rules in Ardon v. City of Los Angeles

The class action lawsuit Ardon v. City of Los Angeles argued that the Los Angeles Telephone Users’ Tax (TUT) was unconstitutional, and that taxpayers have the right to file a class action lawsuit seeking refunds when taxes are collected inappropriately. Despite opposing rulings by lower courts, the taxpayers’ position was validated when in July the California Supreme Court ruled in favor of the plaintiff, Estuardo Ardon and other members of the class.

Consumer Action signed onto an amicus brief in support of the class action, which alleged that Los Angeles had illegally collected taxes and refused to refund those levies.

In 2006, Ardon discovered the city had been collecting TUT on long distance and bundled services despite legal rulings that the federal telephone tax did not apply to these services. Ardon filed an administrative refund claim on behalf of himself and other taxpayers. The claim was rejected, prompting Ardon to file for relief, citing an earlier case called City of San Jose v. Superior Court as a precedent. In a 2008 Second Appellate district case the court ruled that class action claims in the San Jose case to recover local taxes were permissible. Nonetheless, the same appellate court refused to apply the City of San Jose ruling to the Ardon case.

The plaintiffs petitioned the California Supreme Court to review the state Court of Appeal’s opinion and clarify the discrepancy between the two cases. In July, the high court ruled that taxpayers have the right to file class claims for refunds even where there is no refund procedure in place.

Consumer Action has added a new section to its website listing amicus briefs it has participated in. This section can be located under the “About” section of our home page. Click here to view the section.

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, Vietnamese, and others. 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.

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