Consumer Action INSIDER - October 2023


What people are saying

"Thank you! Consumer Action's Disparities in Debt: Understanding the case for economic equity [webinar] was excellent. The presenters were knowledgeable and great communicators. It gave me hope for America's economy in these challenging days. I will be sharing it with my network of over 7,000 contacts. Keep up the substantive good work." —Jackie Wright, CEO, Wright Enterprises, San Francisco, CA (view our webinars and videos on our YouTube channel)

A summer of multilingual outreach to address energy poverty

By Monica Steinisch

Consumer Action has just closed out a very full summer schedule of events to let low-income households in the Bay Area and nearby Stockton and Sacramento know about programs that can make it easier for them to maintain utility service. The work is part of a two-year education and outreach project to reduce energy poverty, funded by a grant from PG&E, California’s largest gas and electricity provider. Energy poverty—the inability to pay household energy bills—can be the result of high energy costs, low income and poor energy efficiency. Consumer Action is working to increase enrollment in PG&E’s various money- and energy-saving programs.

From June through September, Consumer Action’s bilingual community outreach managers, Nelson Santiago and Jamie Woo, gave presentations and provided one-on-one assistance at more than two dozen in-person events and a handful of virtual ones. Through a partnership with the San Francisco Public Library and relationships with community-based organizations, they covered all corners of San Francisco—the Mission District, Visitacion Valley, Hunters Point, Mission Bay, the Portola District, the Sunset and the Richmond, and Chinatown. 

Woo (far right) and Santiago (second from right) introduce Sac State students to PG&E’s energy discount programs during the university’s Basic Needs Resource Fair

Beyond San Francisco, Santiago staffed a table at the Mexican Consulate in San Jose twice a month during the summer. The central location allowed us to reach low-income Spanish-speaking residents from several cities and counties on the Peninsula and in the South Bay that the Consulate serves, and drew consumers from as far away as Fresno and Napa. Santiago also “tabled” at the drive-thru Stockton Food Bank in June, and, with support from Consumer Action’s Ricardo Perez, invited arriving food bank clients to visit with PG&E staff who were on hand to provide direct bill assistance. In late September, Woo and Santiago staffed a table at California State University Sacramento’s Basic Needs Resource Fair.

The ability to communicate with consumers in English, Spanish, Cantonese and Mandarin was vital for presenting program benefits and eligibility criteria, helping attendees complete program applications, and engendering trust. Also indispensable was Consumer Action’s work with in-language media to get the word out about several of the many customer assistance programs. Woo, who is frequently interviewed by local Chinese-language media, worked to ensure that China Press newspaper and Sing Tao Chinese Radio had the information they needed to let readers and listeners know about San Francisco library events. And Spanish-language Telemundo aired an interview with Santiago announcing a day-long event at San Francisco’s Gilman Park and showcasing PG&E’s Arrearage Management Plan (AMP), a repayment plan that includes debt forgiveness of up to $8,000 for customers with past-due energy bills of more than $500.

"The PG&E project has provided Consumer Action an invaluable opportunity to reconnect with consumers one-on-one and in small groups—particularly welcome after the long years of virtual-only interactions due to COVID," Santiago said about his recent work on the project. "We are so glad to be able to help consumers take advantage programs that can save them hundreds—even thousands—of dollars. Just a bit of extra knowledge about available assistance can be so valuable.”

Though summer has ended, the project work has not. Santiago will continue to visit the Mexican Consulate in San Jose this fall, and the team will be at two Head Start locations in San Francisco in October and November, as well as at San Jose’s Eastridge Mall on Oct. 7 for the kick-off of Binational Health Week.

For consumers with PG&E service, Consumer Action has created a landing page where you can access downloadable program applications and other resources. If you don’t have PG&E, check with your energy provider about assistance programs it may offer, including those that might provide discounts for consumers with a medical need for extra energy, regardless of income—like PG&E’s Medical Baseline Program. You can also check with your state utility regulator to find out what money- and energy-saving programs exist.

Coalition Efforts

By Monica Steinisch

Consumer Action and its allies recently called on policymakers and regulators about these important issues:

An AI Bill of Rights. While crediting the Biden-Harris administration for moving aggressively to address the challenges and opportunities of artificial intelligence (AI), a broad coalition of advocacy groups called upon the administration to also implement an AI Bill of Rights. In particular, the groups agree that AI tools must be demonstrated to be safe and effective and free from algorithmic discrimination—two of the core principles of the AI Bill of Rights. It is also essential that the White House require that government deployment and use of AI centers around equity and civil rights. Further, the coalition believes that the AI Bill of Rights should be a requirement for all AI systems used by all federal agencies, contractors and grantees, without exemption for any part of the federal government, including law enforcement or the national security community. Read the letter here.

Bank CEOs' unkept commitments to close racial wealth disparity. Consumer Action was one of a hundred organizations that signed on to letters to the CEOs of more than 40 U.S. banks urging them to make good on promises made following the widespread racial justice protests of 2020 to close racial wealth disparities and invest in traditionally underserved communities. The letter highlights the contradictions between the commitments made by bank CEOs then and the 2022 lawsuit filed by the American Bankers Association, the Consumer Bankers Association and the U.S. Chamber of Commerce against the Consumer Financial Protection Bureau over a policy update meant to combat discrimination in banking. Additionally, the five-page letter expresses concern regarding recent actions of banking trade associations that are at odds with public commitments made by heads of banks to anti-discrimination principles, consumer protection, racial and gender equity, and community health and investment. Banks can have a significant impact on BIPOC and low-income communities, both positively and negatively, the letter points out, and banking institutions must take meaningful actions toward promoting equity and anti-discrimination principles. Three years after the CEOs’ comments and pledges, the racial wealth gap still persists, and has even grown larger by some measures. Read the letter here.

Breaking up Visa-Mastercard duopoly. Consumer Action joined allies in a letter urging lawmakers to swiftly pass the bipartisan Credit Card Competition Act, designed to address the market domination of Visa and Mastercard. Due to this duopoly’s unchecked market power in the U.S., Americans pay 10 times the swipe fees that consumers in Europe pay. These interchange fees far exceed the actual cost of handling the transactions. Due to the anticompetitive practices of Visa and Mastercard, which set both the rules and prices for merchants to accept electronic payments, merchants are forced to pass along the high credit card transaction costs to consumers through higher prices. These fees impose the greatest hardship on the most vulnerable consumers, who predominantly use cash but end up subsidizing others’ card usage by paying inflated prices for their groceries, gas, and other goods and services. The Credit Card Competition Act would open the door for other payment networks to compete on price and other features, leading to a decrease in swipe fees and improving security and efficiency. Read the letter here.

Maintaining agencies' power to protect consumers. Allied organizations wrote to U.S. Senators Patty Murray and Susan Collins to urge the lawmakers to oppose Senate Amendments 1121, 1126, 1128 and 1142 to the Fiscal Year 2024 Military Construction, Veterans Affairs, and Related Agencies Appropriations Act. Under these amendments, agencies such as the Veterans Administration, Department of Defense, Department of Transportation, and others within the jurisdiction of the Act could not enforce a “major” rule—a rule with a large economic impact—unless both houses of Congress affirmatively approved it. These agencies’ non-controversial rules would be subject to new, unnecessary delays, and could potentially even be blocked. Such a change to the regular legislative process would do nothing to improve protections for the American public, but instead would benefit only those corporations that wish to game the system and evade standards. Congress should be searching for ways to ensure that federal agencies are able to enforce laws designed to protect Americans—not putting up roadblocks to sensible safeguards. Read the letter here.

CFPB Watch

By Ruth Susswein

In a few short days, the U.S. Supreme Court will hear a case alleging that the CFPB is “unconstitutional” simply because it receives its funding from the Federal Reserve rather than from Congress.

Congress consciously chose to fund the CFPB that way to avoid the ability of Congress to use its power of the purse to defund the Bureau in years its detractors are in charge. Instead, the CFPB—like all other federal financial regulators (Federal Reserve, OCC, FDIC, NCUA, etc.)— has an independent source of funding and does not rely on annual appropriations from Congress.

Payday lenders used the funding argument to sue the CFPB, and Trump-appointed judges in the Fifth Circuit sided with the lenders. (Under the Trump administration, the goal of the CFPB’s acting director was to dismantle the Consumer Bureau.) The case goes before the Supreme Court on Oct. 3.

Since 2011, the CFPB has returned $17.5 billion in financial relief to about 200 million consumers from companies that treated them unfairly. The federal consumer watchdog has written rules to make mortgages fairer and more understandable, has sued giant financial corporations for predatory lending and mismanagement (such as Wells Fargo’s fake accounts), and has used individual consumer complaints to identify and root out harmful trends in financial services.

Today’s Supreme Court will decide whether the same rules that apply to other financial regulators will still apply to the CFPB. If they hold the Consumer Bureau to a different standard, this could hurt consumers and the many decent businesses that rely on the CFPB to set industry standards, hold companies accountable and curb deceptive financial practices. A decision in this case will be released in June 2024.

Actual reasons for credit denial required

The CFPB has issued new guidance making it clear that lenders must be “specific” and indicate the “principal reason(s)” an applicant was denied credit or a loan.

Overly broad or vague explanations of why an applicant was not approved for credit or why credit was reduced will not be sufficient in today’s lending environment, where artificial intelligence (AI) and complex algorithms are relied upon to make lending decisions.

Data gathered outside of an application or credit file can sometimes be the key factor in denying a person credit, but vague terms offer no help to the applicant. When consumers can understand the actual reason(s) for a credit denial, it is possible for them to improve their credit profiles and, therefore, their chances of accessing credit in the future. The Bureau’s guidance to require specificity also applies to denials of housing.

Credit repair companies illegally harvested billions in fees

The nation’s largest credit repair companies—Lexington Law and—will be banned from telemarketing their credit repair services for the next 10 years, once a court finalizes the CFPB’s settlement with these firms.

Credit repair companies promise to improve your credit score for a fee. However, it is illegal under the Telemarketing Sales Rule to charge upfront fees. A credit repair firm cannot ask for or receive payment until six months after it provides you with written proof from a credit report that it actually achieved the results it promised, says the CFPB., Lexington Law, and the companies’ marketing affiliates were found guilty of charging consumers upfront fees in 2019 and again in 2023.

These credit repair companies were hit with a whopping $2.7 billion judgment by the court, but immediately filed for bankruptcy protection. The Bureau is considering using its victims relief fund to compensate harmed consumers.

Tuition payment plans can add risk

After studying 450 institutions, the CFPB has concluded that many college tuition payment plans are riddled with befuddling disclosures and confusing repayment terms that put students at risk of more costly payments.

Payment plans that spread tuition costs over time typically charge no interest, but the CFPB found that fees are commonplace. For example, 89% of schools had an enrollment or set-up fee.

Some schools have a clause allowing a no-interest plan to be converted into an interest-bearing loan if a payment is missed. At some schools, students who miss payments can be kicked off of meal plans or removed from classes.

Transcripts were also withheld from students who were behind on payments, according to the Bureau’s report. Denying students access to a transcript can put job opportunities at risk. The CFPB considers the withholding of transcripts to be illegal.

Class Action Database: Vivint Smart Home settles over not-so-smart credit report scheme

By Monica Steinisch

Among recent settlements added to the Consumer Action Class Action Database is the $30 million Indivior will pay to settle allegations that the pharmaceutical company conspired with other companies to raise the price of Suboxone, an opioid addiction treatment. If you indirectly purchased or paid for Suboxone and/or its generic equivalents between Dec. 22, 2011, and Aug. 21, 2023, in any state other than Indiana or Ohio, you may be eligible for payment. The deadline for claims is Feb. 17, 2024.

Of note is the $20 million settlement reached in a Federal Trade Commission (FTC) case alleging that Vivint Smart Home, Inc., a Utah-based home security and monitoring company, misused the credit reports of entirely unaware third parties to help qualify prospective customers for financing. The FTC alleged that some of Vivint's door-to-door salespersons, when selling products to prospective customers who did not qualify for financing, would engage in a practice known as "white paging." This involved using the White Pages app to find another consumer with the same or a similar name to the prospective customer and using that other consumer’s credit history to qualify the unqualified customer. Vivint sales representatives also sometimes asked customers to provide the name of someone they knew who had better credit, such as a relative, and then added that uninformed third party as a co-signer to the account without their permission, and used their credit history to qualify for the financing. The FTC also alleged that Vivint was aware of the problem, and, in fact, terminated many sales representatives for misconduct, only to rehire some of them shortly thereafter. If you did not sign up for Vivint home security and monitoring services but had a Vivint account opened in your name between 2016 and 2019, you may be eligible for a payment. The deadline for claims is Oct. 9, 2023.

We also wrote about Vivint’s shady practices in the most recent issue of SCAM GRAM, which you can read here.

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 and consumer literacy and advocating for consumer rights both in 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. At, visitors have instant access to important consumer news, downloadable materials, an online “help desk,” the Take Action advocacy database, and more. Our in-language media outreach allows us to share scam alerts and other timely consumer news with a wide non-English-speaking audience.

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 more than 6,500 community-based organizations. Outreach services include in-person and web-based training and dissemination 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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