November 23, 2015

Is Your Vehicle Part of a Safety Recall?

Safety recalls require vehicle manufacturers to provide free repairs to correct known automotive defects. This includes cars, trucks, motorcycles and motorhomes. These defects often affect the use and value, as well as the safety, of the vehicle. Typically, the manufacturer must notify affected owners by mail. However, the manufacturer only gives notice of the recall to the first purchaser or lessor in most instances. It could do a search of DMV records, but that is an expensive option that the government recall order normally does not require. The public media announces many of the recalls, but certainly not all.

Despite the offer of repairs at no cost, statistics show that most people ignore the recall notices. Shockingly, this is true even where they involve defects that increase the risk of great bodily harm. Maybe the unopened envelope gets put in the junk mail pile. Or, it is inconvenient to schedule a repair appointment. Or, the parts needed for the fix are back-ordered due to demand. It seems such a nuisance in our busy lives. Nonetheless, failure to have the recall performed leaves the car owner and passengers in danger. And, in cases of defective components involving steering, stalling, acceleration and brakes, unperformed recalls leave the entire driving public at risk.

nhsta.jpgSo, what do you do if you bought a truck used from a private party? Or you are the second lessor of an SUV? Or you have moved three times without a forwarding address? Or you think the printed notice was tossed out with the trash?

The National Highway Traffic Safety Administration hosts a webpage to help with this problem. Find your VIN on the registration and research the recall history right here.

November 10, 2015

Stopping the Telemarketers

Sometimes it seems like they will just never stop. Robocalls morning, noon, and night. Even worse than hearing an actual human read from a sales script is hearing a disembodied prerecorded message to which you can't reply. At least you can tell a human to quit calling you. It is beyond annoying when the phone rings and a computerized voice announces you have won a cruise, need your windows washed, can save money on utility bills, must renew a magazine subscription, or don't want to miss out on a weekend sale. You ignore them during dinnertime and your voicemail overflows.images.png

It would be bad enough if these calls were made only to landlines. Robocalls and text messages to your cell phone, and unwanted faxes spewing out of your copy machine, all cost you money on the receiving end. Unless you have an unlimited data plan, you may very well be charged fees or minutes for the incoming calls. That adds expense to annoyance.

Federal agencies like the FTC (Federal Trade Commission) and the FCC (Federal Communications Commission) are doing the best they can - with limited resources and reduced funding from Congress - to enforce consumer protections against the intrusion and nuisance of robocallers. It is a huge problem, because automatic dialers can place thousands of calls to whole phone books, without human intervention on the caller's part.

The Telephone Consumer Protection Act ("TCPA" for short) also provides rights and remedies to consumers who have not consented to be called by telemarketers. Often consumers don't realize that they inadvertently consented in the past (for example, by ignoring a bill stuffer, or the fine print on a sales slip, or "terms & conditions" in an online purchase). The good news is that even if you consented to be called in the past, you can expressly revoke that consent. In addition to actions by the regulatory agencies, the TCPA allows a private right of action for telemarketing abuses and private attorneys bring cases on behalf of individuals and class actions to enforce the law. In some cases you may be entitled to $500.00 per each and every unwanted call.

One way to avoid the calls and to make it crystal clear that that you never consented to them in the first place is to make sure you have taken steps to place all of your phone numbers on the federal Do Not Call list. On the FTC website, just fill in your phone number and email, and follow the instructions. If you have multiple phone lines, you can put in up to three numbers, including land lines, cell phones, and separate fax numbers.It is easy to do this right here.

November 7, 2015

New York Times Exposes Dark Side of Arbitration

The New York Times has published an in-depth, 3-part series lambasting forced arbitration of civil disputes. The piece is the result of months of impressive investigative journalism, during which reporters plowed through documents from more than 25,000 arbitrations that took place from 2010 - 2014. The team of top reporters conducted hundreds of interviews of participants, lawyers, arbitrators, and judges in 35 states. Concluding that the effort had "uncovered many troubling cases," the articles explain the unfairness of the secretive system of private judging in examples from case after case after case. stoparb.jpgThese troubling cases included "everything from botched home renovations to medical malpractice."

Part I of the series, entitled "Arbitration Everywhere, Stacking the Deck of Justice" appeared Sunday November 1, 2015, followed by "In Arbitration, A Privatization of the Justice System" on November 2, and "In Religious Arbitration Scripture Is the Law " November 3. The series begins here.

Together the articles explain in plain language the real harm corporations and other powerful insitutions manage to achieve by controlling the language of fine print in everyday contracts. It should be a huge wake-up call for the American public. The system is designed to strip consumers and employees of their rights to sue corporations for serious misconduct - fraud, car safety defects, sexual harrasment, workplace abuse, harmful drugs, tainted food, you name it. Finally, the mainstream media has taken on corporate power in a way that most politicians have shied away from.

Part III of the series demonstrates a little-known and unsettling twist on the issue. Religious institutions have begun their own private arbitration programs, and not necessarily only for those practicing that faith. What if the fine print of an employment contract said that in the event of a dispute, the parties would submit to arbitration conducted by elders applying sharia law? If that sounds far-fetched, the Times reports that a court enforced a clause requiring people leaving Scientology to arbitrate their claims before a panel of Scientologists. The plaintiff called it a farce. Demand for Christian arbitrations is tucked way in thousands of contracts, not just those involving the churches themselves, but goods and services as diverse as hardwood floors and group homes. It all sounds a bit crazy. However, to the people whom the New York Times interviewed it was no joke, but a bizarre reality.

The entire New York Times series is a must-read, because it reveals a widespread effort on the part of corporations and other institutions to create and control an alternate system of justice, forcing Americans out of courts where the civil justice system has evolved over centuries to provide safeguards against biased judging and corruption. Courts themselves have failed to stop the practice. The political process has failed to stop the practice. But public opinion is beginning to turn, and the New York Times article is a convincing voice for change.

November 4, 2015

FTC Crackdown on Debt Collectors

Debt collection abuse is a serious problem. Just last year the Federal Trade Commission got 280,000 complaints about deceptive debt collection practices. These include reports of harassment, abuse and flat-out fraud. Harassment by telephone is particularly offensive. While many debt collectors are just trying to obtain payment for legitimate debts, many others are simply scam artists.FTC%20%20logo.jpg

Debt that has been bundled into portfolios and sold in bulk, sometimes know as "down-stream debt," is particularly troublesome. The same is true when lenders farm out collection to agents called "servicers." In either case, the borrower does not recognize the name of the person or entity demanding payment. Sometimes the same debt is even being collected by two people at once. In other cases, borrowers are subjected to calls from automated systems or disembodied recorded messages and other forms of "robo-callers." The system is rife with scams.

Today the FTC announced a coordinated nationwide program to combat illegal debt collection practices. “Being in debt is stressful enough for many Americans without also being subjected to intimidation and false threats,” FTC Chairwoman Edith Ramirez said. “Debtors have certain rights and rogue collectors that step outside the law will face the consequences of illegal behavior.”The program, known as “Operation Collection Protection,” is the first collaboration of its kind, combining federal, state and local law enforcement resources. It plans to work with state attorneys general.

While the FTC combines efforts with law enforcement, many of these deceptive practices give rise to remedies through private lawsuits brought to enforce state and federal fair debt collection practices laws. In addition, the federal Telephone Consumer Protection Act makes it illegal to harass debtors through the use of robo-calling or calls to cell phones without the borrowers' consent. If you are the victim of debt collection abuse or robo-calling, make a complaint to the Federal Trade Commission or seek private legal advice. Meanwhile, you can read the FTC press release here

October 30, 2015

When Banks Put Their Own Spin on Money Matters

It starts with the difference between checking and savings accounts. But your bank manager can make even that distinction fuzzy, especially when interest rates are low and minimum balances are high. Of course he will urge you to get a credit card when he secretly gets a commission if you say "yes." The auto finance guy will promote credit as opportunity, without revealing the obligations of debt. Relying on banks to teach financial literacy is a bad idea.

The basics of managing money, creating a personal budget, understanding the arithmetic of interest rates, comprehending the relationship between credit and debt, knowing how and when to negotiate the price of a car - all of this can be overwhelming. Overwhelming at age 18. Or at age 28. Or even atage 58. Too many people go numb at the sight of numbers. But basic financial literacy is essential for living the American life.

The recession that started with the crash of 2008 raised the issue of financial literacy to a new level. But no sooner did the banks receive their bailout funds, than they began to hijack financial literacy programs. Finance companies which were promoting such programs in high schools and colleges across the country had their own interests at stake. Banks and credit card companies wanted to make sure the next generation got just as hooked on easy credit as their parents had done. Instead of teaching kids the dangers of debt, financial institutions turned the curriculum into an infomercial for banking products from which lenders continue to profit.

Washington Post writer Michelle Singletary says, "I go nuts when I see lesson plans that say getting a credit card can help students manage their money. No, it doesn’t. It teaches them the ways of a debtor — even a good one — too early in life." Singletary is absolutely right. A lesson plan like that is almost certainly part of a program promoted, written, or produced by a profit-driven bank.

The best financial literacy program out there is called FoolProof, says Singletary. "It’s such a complete program for teachers (even the grading is done for them), and it clearly favors the consumer protection of students. Too many of the materials I see don’t note enough of the dangers of debt." Teachers can get more information on Foolproof here.

Other resources are available through the website of the Consumer Financial Protection Bureau . But anyone interested in teaching financial literacy needs to take two precautions: (1) consider the source and (2) consider the delivery. The Foolproof program rates high on both counts. The non-profit organization is run by an independent board; and it is funded through private donations, grants, and court-approved cy pres from the residue of consumer class actions. Foolproof's message of fiscal responsibility comes through strong and clear in the voices of young people who ditch legal jargon and tell it like it is.

When banks put their own spin on money matters, their conflict of interest taints the curriculum, instilling the bad habit of perpetual debt. Programs like Foolproof provide an independent alternative. High school and college administrators should choose it and use it.

October 20, 2015

FTC Attacks False Advertising By Car Dealers

The difference between "puffing" and outright fraud can be a fine line when it comes to buying cars. But the brazen false advertising of a pair of Nevada car dealers has strained the Federal Trade Commission's patience to the breaking point. This week the FTC finalized a consent order against Las Vegas Nissan and Hyundai dealers for false advertising of discount prices and other terms in automotive sales and leases. The federal agency sent a strong message that if you want to play liar's dice, keep it in the casino. You can read more about the federal agency's consent order here

The important thing to realize is that these dealer practices are not unique. California car dealers also try to mix the terms of sales and leasing to make the deal look more attractive to the unwary consumer. Sales and leases of motor vehicles are very different financing arrangements. Leases can be easily structured to look cheaper, particularly with a lower monthly payment, when in fact they are rarely a better deal for the consumer overall.

The FTC was particularly critical of the use of fine print that the dealers were using to explain away or counter what appeared in large type. Similarly, in verbal advertisements on radio or TV the announcer's rapid patter becomes unintelligible to the listener, and is usually an effort to limit or restrict the offer that sounds like such a bargain.

In an article entitled "Are Car Ads Taking You For A Ride?" posted on its website, the Federal Trade Commission has a page of useful tips for buying or leasing cars. Bookmark this page to review before you respond to any ad or promotion - in print or TV or even online - if you are in the market for a new set of wheels.

October 15, 2015

Nursing Homes Bury Elder Abuse In the Fine Print

seniors.jpg Americans are turning 65 at the rate of 10,0000 every day, as the Baby Boomer generation moves into retirement. Thus, nursing homes and senior community living has become Big Business. Wall Street investment - largely private equity money - is invading the community service model. Even the difference between faith-based groups and for-profit corporations is thinning. With that change in ownership comes a change in attitude and management. The temptation to increase profits all too often results in less care or a lower quality of care.

Most providers are adequate and some are excellent in filling important needs for seniors and society. But, as with any industry, there is fraud and abuse in the system. When nursing home care is substandard, those on the receiving end of inadequate treatment are some of the most vulnerable among us. Those suffering from dementia, stroke, drug-induced stupor, or just frailty literally have no voice. When care is not merely inadequate, but negligent, the result can be premature death or debilitating injury.

Families soon learn that the harm can be financial as well as physical. It adds insult to injury when the nursing home delivers an outrageous final invoice for tens of thousands of dollars to the bereaved family members who have just lost mom or dad. Often these final charges are fraudulent or false. Just to make it impossible to challenge these costs, Wall Street lawyers representing nursing and retirement homes are increasingly slipping mandatory arbitration clauses into the contracts.

Financial abuse of the elderly - including institutional fraud - is on the rise. Mandatory arbitration clauses imbedded in the fine print assure that injured or defrauded seniors will be blocked from enforcing their rights in court. Their surviving family members will be left without access to the civil justice system to enforce consumer protection laws that were meant for the benefit of their loved ones.

In a powerful piece appearing this week in the Huffington Post, the Executive Director of Public Justice, writes that "The Obama Administration is seriously considering doing something about this. The Centers for Medicare and Medicaid Services has an opportunity to say that nursing homes can no longer receive federal funding if they use arbitration clauses in their contracts." You can read Paul Bland's excellent article entitled "Corporate America's Latest Target: Nursing Home Patients" here.

October 7, 2015

2016 VW Cars Quarantined As Scandal Widens

U.S. regulators announced this week that 2016 diesel Volkswagens will be quarantined at the port of entry after the beleaguered company disclosed those models contain additional suspect software that would deceptively help exhaust systems run cleaner during government tests. This software, called an "auxiliary emissions control device," is not exactly the same as the "defeat" devices discovered in 2009-2015 model VWs and Audis, which were the subject of last month's cheating scandal. VW says the 2016 device is different. Regulators say: not different enough. port-EU.jpg

After disclosing the new "auxiliary" software to the EPA and California regulators on Sept. 29, Volkswagen hastily withdrew applications for approval to sell the 2016 cars in the U.S.

The revelation that Volkswagen and Audi used a “defeat device” to cheat on environmental testing shocked the car buying public and regulators in the US and Europe last month. This is not a mere technicality. Many are beginning to argue for strong punishment of the individuals at the apex of corporate management, in part because of the widespread harm to society as a whole. “We won’t ever know how many people have died as a result of Volkswagen cheating on the emission controls of its diesel engines. But the pollutants emitted by diesel engines do kill just as surely as other poisons…” wrote editors in an opinion piece in the Guardian UK.

A looming question is whether VW is alone. Early research showed that other vehicle makes and models did not demonstrate the level of discrepancies found in VWs and Audis. But that testing is incomplete. Now, German sources report that European examiners are looking further. Europe’s largest motor vehicle organization, the Bavarian-based Adac, performed new lab-based tests on a wide range of diesel models and found a surprising range of excessive NOx emissions. These new testing methods more realistically represent true driving conditions.

Although there may be no current evidence of using a “defeat device,” there are several other auto makers whose emissions in TDI or “turbo diesel injection” engines are thought to exceed applicable regulatory standards. The testers are bound to be looking at other forms of "auxiliary" devises this time round. Adac is expected to take a closer look at the following makes and models: Nissan X-Trail 1.6 cDi, Jeep Renegade 2.0, Hyundai i20 1.1,Volvo S60 D4 and V60 Cross Country D3, Ford Focus 1.5 TDCi, BMW 520d, Hyundai Santa Fe 2.0 CRDi. These manufacturers’ responses ranged from facial assurances that the companies abided by current testing methods to “no comment.”

None of these European models are the subject of current sales restrictions in the United States. However, America can expect more rigorous testing of NOx emissions from the EPA and state regulators like the California Air Resources Board in the coming days.

October 7, 2015

Banks Cannot "Sidestep the Courts" by Banning Class Actions

Today the Consumer Financial Protection Bureau ("CFPB") laid out draft terms of its long-awaited ruling on forced arbitration. Director Richard Cordray said, “Consumers should not be asked to sign away their legal rights when they open a bank account or credit card.” He explained, “The proposals under consideration would ban arbitration clauses that block group lawsuits so that consumers can take companies to court to seek the relief they deserve." The proposed new rule would prohibit banks and other financial institutions from banning class actions by way of arbitration clauses. Such clauses are commonly hidden deep in the small print of form contracts where consumers will not see them and where they appear in confusing legal language no consumer would understand.

Consumer advocates have long fought against mandatory arbitration provisions, which basically lock ordinary people out of court. Without access to the courts, borrowers have no realistic means to challenge deceptive lending practices, abusive foreclosure measures, or even outright fraud. Statistics have shown private arbitration is unfair and one-sided against consumers.

class.jpgIndividual forced arbitration is bad enough, but lenders - emboldened by courts that upheld preprinted arbitration clauses - began to insert class action waiver language inside the arbitration clauses. This meant that consumers were not only barred from the courthouse, but limited to bringing cases one at a time in the private forum. Since many illegal banking practices are simply unknown to borrowers, and involve relatively small amount of theft on the part of the banks, class actions are the only way to enforce consumer protection laws. Without consumer class actions, banks can get away with cheating and fraud just because people do not know their rights or cannot challenge such practices on a one-to-one basis.

That may be about to change.

Today at a hearing in Denver, Colorado, the CFPB unveiled a draft of its proposed new rule. This rule is the agency's response to a study of arbitration which came out last March. Among other problems with mandatory arbitration, that study showed that arbitration clauses restrict consumers’ relief for disputes with financial service providers by allowing companies to block group lawsuits. You can read the full report here.

The current proposal would not ban arbitration of individual cases, but would ban class action waivers, thereby allowing consumer borrowers to seek collective redress of lending abuses. CFPB Director Richard Cordray said, "Companies are using the arbitration clause as a free pass to sidestep the courts and avoid accountability for wrongdoing." That is certainly true. While consumer advocates are disappointed that the CFPB is not prepared to ban forced arbitration completely, they applaud the important step of restoring the right to class actions.

Financial institutions have profited greatly by blocking judicial scrutiny of their practices. During the Bush administration, regulation was lax. Without a public justice system to enforce consumer protection laws, banks can - and did - act with impunity in breaking the law. If being a banker was considered an honorable profession before the 2008 bailout, many people felt that myth was debunked by events of the recent recession. The CFPB was enacted as part of the Dodd-Frank Act in the aftermath of that financial crisis and one of its original mandates was to address the issue of forced arbitration in consumer finance. The banking industry has had more than 100 lobbyists attacking the CFPB since its inception and that lobby is bound to go into overdrive to attack this proposed ruling.

Meanwhile, Paul Band, Executive Director of the consumer advocacy group Public Justice, and a longtime critic of forced arbitration, called the proposed rule "an enormous step toward protecting consumers." Consumer borrowers throughout the country can only hope the CFPB will keep up its stride.

October 1, 2015

Diesel Sucio

Volkswagen (VW) y Audi han sido capturados engañando al público estadounidense. El escándalo ha destruido la imagen populista de Volkswagen. Millones de coches se ven afectados. Miles de millones de dólares en multas están en juego. Los propietarios de automóviles están furiosos. La revista alemana Der Tagesspiegel informa que el CEO Martin Winterkorn ha resignado. Demandas de la clase de acción, sanciones del gobierno, y posiblemente cargos criminales seguirán. ¿Qué, exactamente, está pasando? VW.jpg

El viernes pasado, la Agencia de Protección del Medio Ambiente (EPA) envió Volkswagen AG, junto con sus afiliados Audi AG y del Grupo Volkswagen, un Comunicado de Violación en relación con su uso de un "dispositivo manipulador" ilegal, que se utiliza para evadir las pruebas de emisiones. Usted puede leer esa carta en ingles aquí.

La EPA explica: "Estos coches tienen software que desactiva los controles de emisiones durante la conducción normal, y los prende cuando el coche está pasando por una prueba de emisiones. Conocido como un" dispositivo manipulador," esta característica de diseño resulta que los coches emitan hasta 40 veces la cantidad de emisiones de NOx que las reglamentos permiten. Estándares de NOx están en su lugar para asegurar que la salud pública este protegida." El uso de un "dispositivo manipulador" de este tipo es ilegal.

Tan pronto como este anuncio llegó a la prensa, VW admitió su mala conducta. Que sólo ahora está admitiendo sus prácticas de engaño intencional y deliberado es chocante. Aunque el escándalo recién se hizo público, VW sabía que sus prácticas fueron descubiertas ya en mayo de 2014. Y, sin embargo, continuó a instalar los dispositivos en los coches nuevos que vendían.

VW nunca pensó que sería descubierto, y el hecho de que alguien se dio cuenta tuvo un poco de un golpe de suerte.

Daniel Carder, un profesor de la Facultad de Ingeniería Statler de la Universidad de West Virginia, y un equipo de cinco personas, incluyendo dos estudiantes de posgrados, realizaron un estudio que encontró mucho más altos niveles de emisiones de diesel en la carretera para los vehículos de VW que habían reportado los probadores oficiales estadounidenses. Al principio no podían creer los resultados, pero las pruebas de confirmación produjeron evidencia que Volkswagen estaba engañado las pruebas de emisiones de vehículos en Estados Unidos. Ese estudio fue financiado por la organización no lucrativa del Consejo Internacional sobre Transporte Limpio (ICCT). Estaban buscando comprobación de que el diesel podría ser un combustible limpio. Los resultados sorprendieron a todos, incluso los probadores. Puedes leer más sobre el ICCT en ingles aquí.

"Las pruebas que hicimos abrieron la caja de Pandora," dijo Daniel Carder, el investigador apacible de West Virginia que lidera el equipo de investigación. Eso es una atenuación.

El estudio, finalizado en mayo de 2014, fue posteriormente corroborado por la Agencia de Protección Ambiental de los Estados Unidos y el California Air Resources Board.

VW ha fuertemente comercializando sus pequeños coches diesel como la alternativa Clean Green por años. Pero mientras lanzaban una campaña en los medios para atraer a los compradores quienes les importa el medio ambiente, VW fue equipando descaradamente más de 11 millones de vehículos con el dispositivo engañosa durante un período de más de 6 años. Los modelos de vehículo de diesel afectados incluyen:

Jetta (MY 2009 – 2015)
Jetta Sportwagen (MY 2009-2014)
Beetle (MY 2012 – 2015)
Beetle Convertible (MY 2012-2015)
Audi A3 (MY 2010 – 2015)
Golf (MY 2010 – 2015)
Golf Sportwagen (MY 2015)
Passat (MY 2012-2015)

Los consumidores pueden obtener más información de la EPA en ingles aquí.

Los consumidores pueden obtener información sobre los casos legales presentados en California por medio de poniéndose en contacto con la oficina de abogados de Kemnitzer Barron y Krieg en

Traducido por Rosa Baum del artículo de 22 Septiembre 2015 (Nancy Barron), ©Kemnitzer, Barron & Krieg, LLP