FTC Announces 21 Enforcement Actions
The Federal Trade Commission today issued its eighth quarterly announcement summarizing the agency’s enforcement efforts against telemarketing fraud and abuse. The quarterly enforcement update lists significant case developments in 21 federal district court cases occurring between February and April 2005.
A Web page containing the “Quarterly Update for April 2005” also contains a list of enforcement actions involving telemarketing that have seen developments since October 1, 2002, with links to press releases related to each of these actions. The Web page now contains information about 148 actions involving the use of the telephone to market goods or services. This information covers cold-call outbound telemarketing, as well as inbound calls generated from advertisements or other solicitations to purchase products or services.
The quarterly enforcement update issued today can be found on the FTC’s Web site.
Thursday, April 28, 2005
Wednesday, April 27, 2005
CPSC and JC Penney Recall 218,000 Children's Bodysuits
Retailer J.C. Penney and the United States Consumer Product Safety Commission today announced the recall of 228,000 bodysuits worn by newborns and infants. The government agency reported that an applique applied to the suit can be detached and become a choking hazard.
Three incidents have been reported of children choking on the applique, but no injuries have been attributed to the problem. The product was sold as the Okie Dokie® Striped Bodysuits with Puffy Appliqué between October 2004 and February 2005 for approximately $6.
Consumers are instructed to stop using the clothing and contact J.C. Penney toll-free at (888) 333-6063 for further instructions.
Retailer J.C. Penney and the United States Consumer Product Safety Commission today announced the recall of 228,000 bodysuits worn by newborns and infants. The government agency reported that an applique applied to the suit can be detached and become a choking hazard.
Three incidents have been reported of children choking on the applique, but no injuries have been attributed to the problem. The product was sold as the Okie Dokie® Striped Bodysuits with Puffy Appliqué between October 2004 and February 2005 for approximately $6.
Consumers are instructed to stop using the clothing and contact J.C. Penney toll-free at (888) 333-6063 for further instructions.
Tuesday, April 26, 2005
Commercial Alert Fights Sale of Junk Foods In Schools
Commercial Alert filed a petition for rule-making today with the U.S. Department of Agriculture requesting that it strengthen the enforcement of federal rules prohibiting the sale of soda pop and some types of candies in school cafeterias across the country.
USDA rules currently prohibit the sale of “foods of minimal nutritional value” during mealtimes in school cafeterias. But the enforcement provisions for these rules are extremely lax, so some schools may not take them seriously.
“We’re asking the USDA to side with parents who want their kids to grow up healthy, not with the junk food companies that want to stuff our children with sugar and caffeine,” said Gary Ruskin, executive director of Commercial Alert. “The USDA should strengthen existing rules against the sale of junk food in school – before the childhood obesity epidemic gets any worse.”
Copies of the petition to USDA for rule-making are available at http://www.commercialalert.org/fmnvpetition.pdf.
USDA admitted last month in a report that it does not know whether schools are complying with prohibitions against the sale of foods of minimal nutritional value during school mealtimes. The report stated, “it is unclear to what extent federal and state regulations [against the sale of foods of minimum nutritional value] are enforced at the local level.”
Foods of minimal nutritional value are defined as soda pop, water ices, chewing gum, and certain types of candies, such as hard candies, jellied candies, licorice and marshmallows.
According to a Wall Street Journal poll in February, 2005, 83% of American adults “believe public schools need to do a better job of limiting children's access to unhealthy foods like snack foods, sugary soft drinks and fast food.”
Commercial Alert filed a petition for rule-making today with the U.S. Department of Agriculture requesting that it strengthen the enforcement of federal rules prohibiting the sale of soda pop and some types of candies in school cafeterias across the country.
USDA rules currently prohibit the sale of “foods of minimal nutritional value” during mealtimes in school cafeterias. But the enforcement provisions for these rules are extremely lax, so some schools may not take them seriously.
“We’re asking the USDA to side with parents who want their kids to grow up healthy, not with the junk food companies that want to stuff our children with sugar and caffeine,” said Gary Ruskin, executive director of Commercial Alert. “The USDA should strengthen existing rules against the sale of junk food in school – before the childhood obesity epidemic gets any worse.”
Copies of the petition to USDA for rule-making are available at http://www.commercialalert.org/fmnvpetition.pdf.
USDA admitted last month in a report that it does not know whether schools are complying with prohibitions against the sale of foods of minimal nutritional value during school mealtimes. The report stated, “it is unclear to what extent federal and state regulations [against the sale of foods of minimum nutritional value] are enforced at the local level.”
Foods of minimal nutritional value are defined as soda pop, water ices, chewing gum, and certain types of candies, such as hard candies, jellied candies, licorice and marshmallows.
According to a Wall Street Journal poll in February, 2005, 83% of American adults “believe public schools need to do a better job of limiting children's access to unhealthy foods like snack foods, sugary soft drinks and fast food.”
Monday, April 25, 2005
Hybrid Vehicle Registrations Increase 81 Percent In 2004; R. L. Polk & Co. reports Prius as dominant leader with 64 percent market share
Nationwide registrations for new hybrid vehicles rose to 83,153 in 2004 – an 81 percent increase from 2003 according to R. L. Polk & Co. The Toyota Prius recorded 53,761 new hybrid vehicle registrations in 2004, a 33 percent increase over 2003. The Prius occupies 64 percent of the hybrid market, a sizeable lead over the Honda Civic, which had 25,586 registrations and 31 percent market share. Since the introduction of hybrid vehicles in 2000, the market has grown by more than 960 percent.
"Expectations of continuing high gas prices, combined with the introduction of new models to the consumer market, have heightened interest in hybrid vehicles," said Lonnie Miller, director of Polk’s Analytical Solutions. "Hybrids offer improved fuel efficiency and lower emissions while maintaining the functionality and convenience of gasoline-powered vehicles. Hybrid technology is also easy to produce and works within the existing transportation infrastructure."
Hybrid vehicles are automobiles powered by internal combustion engines, but are also equipped with batteries recharged during driving and an electric motor to assist with power demand. There are different levels of hybrids, ranging from minor systems to "full hybrid" systems. Hybrids do not need to be plugged in, yet they deliver superior mileage and are considered environmentally-friendly alternatives to traditional internal combustion vehicles.
HYBRID BUYER OPTIONS EXPANDING
The range of hybrid vehicle choices continues to expand. In addition to the Toyota Prius; Honda Civic, Accord and Insight, and Ford Escape, several new hybrid models were introduced in the past few months including the Dodge Ram, Lexus RX 400h and the Mercury Mariner. The 2006 model year will expect to see the introduction of a hybrid version of the Saturn VUE, Toyota Highlander and the Nissan Altima. Major manufacturers are planning a total of almost a dozen new hybrid vehicles in the next three years.
REGIONAL STRENGTHS
California strongly outpaces all other states in new hybrid vehicle registrations. In 2004 there were 25,021 new hybrid vehicle registrations in California, about 4.5 times that of second place Virginia with 5,613. Washington came in third with 3,441; Florida came in fourth with 3,272 and Maryland rounds out the top five with 3,238 new hybrid vehicle registrations in 2004.
Similarly, Los Angeles remains the top metropolitan area for hybrid vehicles with 10,399 new hybrid vehicle registrations in 2004, more than doubling the total from 2003. San Francisco came in second at 8,051 followed by Washington D.C. with 6,473 new hybrid vehicle registrations. New York came in fourth at 3,779 followed by Seattle with 2,857 new hybrid vehicle registrations in 2004. Each of these markets experienced significant growth in the number of new hybrid vehicle registrations compared with the previous year, a confirmation of the robust strength of this new vehicle segment.
Nationwide registrations for new hybrid vehicles rose to 83,153 in 2004 – an 81 percent increase from 2003 according to R. L. Polk & Co. The Toyota Prius recorded 53,761 new hybrid vehicle registrations in 2004, a 33 percent increase over 2003. The Prius occupies 64 percent of the hybrid market, a sizeable lead over the Honda Civic, which had 25,586 registrations and 31 percent market share. Since the introduction of hybrid vehicles in 2000, the market has grown by more than 960 percent.
"Expectations of continuing high gas prices, combined with the introduction of new models to the consumer market, have heightened interest in hybrid vehicles," said Lonnie Miller, director of Polk’s Analytical Solutions. "Hybrids offer improved fuel efficiency and lower emissions while maintaining the functionality and convenience of gasoline-powered vehicles. Hybrid technology is also easy to produce and works within the existing transportation infrastructure."
Hybrid vehicles are automobiles powered by internal combustion engines, but are also equipped with batteries recharged during driving and an electric motor to assist with power demand. There are different levels of hybrids, ranging from minor systems to "full hybrid" systems. Hybrids do not need to be plugged in, yet they deliver superior mileage and are considered environmentally-friendly alternatives to traditional internal combustion vehicles.
HYBRID BUYER OPTIONS EXPANDING
The range of hybrid vehicle choices continues to expand. In addition to the Toyota Prius; Honda Civic, Accord and Insight, and Ford Escape, several new hybrid models were introduced in the past few months including the Dodge Ram, Lexus RX 400h and the Mercury Mariner. The 2006 model year will expect to see the introduction of a hybrid version of the Saturn VUE, Toyota Highlander and the Nissan Altima. Major manufacturers are planning a total of almost a dozen new hybrid vehicles in the next three years.
REGIONAL STRENGTHS
California strongly outpaces all other states in new hybrid vehicle registrations. In 2004 there were 25,021 new hybrid vehicle registrations in California, about 4.5 times that of second place Virginia with 5,613. Washington came in third with 3,441; Florida came in fourth with 3,272 and Maryland rounds out the top five with 3,238 new hybrid vehicle registrations in 2004.
Similarly, Los Angeles remains the top metropolitan area for hybrid vehicles with 10,399 new hybrid vehicle registrations in 2004, more than doubling the total from 2003. San Francisco came in second at 8,051 followed by Washington D.C. with 6,473 new hybrid vehicle registrations. New York came in fourth at 3,779 followed by Seattle with 2,857 new hybrid vehicle registrations in 2004. Each of these markets experienced significant growth in the number of new hybrid vehicle registrations compared with the previous year, a confirmation of the robust strength of this new vehicle segment.
Friday, April 22, 2005
Maytag Shares Tumble On Lower Sales, Higher Costs
A week after Maytag announced a recall of more than 636,000 vacuum cleaners, the company reported that its first quarter sales were down 80% and that costs were higher than expected.
Investors punished the stock today, dropping the share price 28%, the lowest that price has been in more than a decade. The company warned investors that its future earnings would be lower.
Despite the massive recall, the company's web sites still do not include recall information even when selecting customer service options.
A week after Maytag announced a recall of more than 636,000 vacuum cleaners, the company reported that its first quarter sales were down 80% and that costs were higher than expected.
Investors punished the stock today, dropping the share price 28%, the lowest that price has been in more than a decade. The company warned investors that its future earnings would be lower.
Despite the massive recall, the company's web sites still do not include recall information even when selecting customer service options.
Thursday, April 21, 2005
Thimerosal Under Fire From NIH, University Study
A study funded by the National Institutes of Health (NIH) and conducted by University of Washington researcher Thomas M. Burbacher, PhD concludes that the mercury-based vaccine preservative thimerosal is more hazardous than medical professionals previously believed. SafeMinds, Sensible Action For Ending Mercury Induced Neurological Disorders, urges further research into the health risks created by the presence of thimerosal in vaccines administered to children and pregnant women.
Some health officials have suggested that the mercury in thimerosal is less toxic than other forms of mercury such as methylmercury, the highly toxic environmental form of mercury. This groundbreaking study, however titled "Comparison of Blood and Brain Mercury Levels in Infant Monkeys Exposed to Methylmercury or Vaccines Containing Thimerosal," is the first of its kind to show that thimerosal's mercury may actually be more harmful than methylmercury. The reason is the type of mercury in thimerosal - ethylmercury - quickly crosses the blood-brain barrier where it converts to a form that is unable to leave the brain. Dr. Burbacher's study shows that twice as much mercury remains trapped in the brain from doses of ethylmercury in thimerosal compared to equal doses of methylmercury.
"These new findings undermine the position of vaccine makers, who have long denied harm from exposing a generation of children to excessive levels of mercury as a needless additive in vaccines," said Sallie Bernard, co-founder of Safe Minds. "This study is yet another step in the complete reversal of scientific assumptions about the effects of thimerosal."
The Institute of Medicine issued a report in 2004 that stated that there was no causal link between thimerosal and neurological disorders like autism. Inorganic mercury, which is what thimerosal leaves behind in the brain, contributes to microgliosis, a recently reported finding in the brains of those with autism. In light of these new findings Safe Minds recommends a complete reevaluation of this issue by the Institute of Medicine.
"This study contradicts the assumption that mercury from thimerosal (ethylmercury) is safer than environmental mercury (methylmercury) from eating fish and emissions from coal-fired power plants," said Mark Blaxill, a board member of Safe Minds and an expert cited in the Burbacher study. "This study should compel government agencies to retract their flawed and premature conclusions regarding thimerosal and stick to the facts."
A study funded by the National Institutes of Health (NIH) and conducted by University of Washington researcher Thomas M. Burbacher, PhD concludes that the mercury-based vaccine preservative thimerosal is more hazardous than medical professionals previously believed. SafeMinds, Sensible Action For Ending Mercury Induced Neurological Disorders, urges further research into the health risks created by the presence of thimerosal in vaccines administered to children and pregnant women.
Some health officials have suggested that the mercury in thimerosal is less toxic than other forms of mercury such as methylmercury, the highly toxic environmental form of mercury. This groundbreaking study, however titled "Comparison of Blood and Brain Mercury Levels in Infant Monkeys Exposed to Methylmercury or Vaccines Containing Thimerosal," is the first of its kind to show that thimerosal's mercury may actually be more harmful than methylmercury. The reason is the type of mercury in thimerosal - ethylmercury - quickly crosses the blood-brain barrier where it converts to a form that is unable to leave the brain. Dr. Burbacher's study shows that twice as much mercury remains trapped in the brain from doses of ethylmercury in thimerosal compared to equal doses of methylmercury.
"These new findings undermine the position of vaccine makers, who have long denied harm from exposing a generation of children to excessive levels of mercury as a needless additive in vaccines," said Sallie Bernard, co-founder of Safe Minds. "This study is yet another step in the complete reversal of scientific assumptions about the effects of thimerosal."
The Institute of Medicine issued a report in 2004 that stated that there was no causal link between thimerosal and neurological disorders like autism. Inorganic mercury, which is what thimerosal leaves behind in the brain, contributes to microgliosis, a recently reported finding in the brains of those with autism. In light of these new findings Safe Minds recommends a complete reevaluation of this issue by the Institute of Medicine.
"This study contradicts the assumption that mercury from thimerosal (ethylmercury) is safer than environmental mercury (methylmercury) from eating fish and emissions from coal-fired power plants," said Mark Blaxill, a board member of Safe Minds and an expert cited in the Burbacher study. "This study should compel government agencies to retract their flawed and premature conclusions regarding thimerosal and stick to the facts."
Wednesday, April 20, 2005
CPSC, Honda Recall 200,000 ATVs
The United States Consumer Product Safety Commission announced with Honda that 200,000 units of the Honda 2004-2005 FourTrax All-Terrain Vehicles (ATVs) have been recalled.
The vehicle's steering rods can separate, causing the driver to lose steering control. This could cause the ATV to crash and pose a risk of serious injury or death. The CPSC says that Honda has reported more than two dozen instances of the problem, but no one has been injured to date.
The recalled vehicles are red, olive, yellow or blue and have “Honda” written on the fuel tank. Consumers who suspect their vehicle might have been recalled can call Honda toll-free at (866) 784-1870 between 8:30 a.m. and 5 p.m. PT Monday through Friday.
The United States Consumer Product Safety Commission announced with Honda that 200,000 units of the Honda 2004-2005 FourTrax All-Terrain Vehicles (ATVs) have been recalled.
The vehicle's steering rods can separate, causing the driver to lose steering control. This could cause the ATV to crash and pose a risk of serious injury or death. The CPSC says that Honda has reported more than two dozen instances of the problem, but no one has been injured to date.
The recalled vehicles are red, olive, yellow or blue and have “Honda” written on the fuel tank. Consumers who suspect their vehicle might have been recalled can call Honda toll-free at (866) 784-1870 between 8:30 a.m. and 5 p.m. PT Monday through Friday.
Tuesday, April 19, 2005
IRS Improves Security, But GAO Still Finds Holes
An April 15 report by the United States Government Accountability Office found that the Internal Revenue Service had corrected 32 of 53 weaknesses cited in a 2002 review of the agency information security structure.
The GAO announced that in addition to the IRS' failure to correct 21 deficiencies, the tax agency has 39 "security control weaknesses" that "impair....confidentiality, integrity, and availability of its sensitive financial and taxpayer data." The GAO report states that the IRS cannot completely assure taxpayers that their personal information is secure.
The full text of the 30 page report can be found in a PDF at:
http://www.gao.gov/new.items/d05482.pdf
An April 15 report by the United States Government Accountability Office found that the Internal Revenue Service had corrected 32 of 53 weaknesses cited in a 2002 review of the agency information security structure.
The GAO announced that in addition to the IRS' failure to correct 21 deficiencies, the tax agency has 39 "security control weaknesses" that "impair....confidentiality, integrity, and availability of its sensitive financial and taxpayer data." The GAO report states that the IRS cannot completely assure taxpayers that their personal information is secure.
The full text of the 30 page report can be found in a PDF at:
http://www.gao.gov/new.items/d05482.pdf
Monday, April 18, 2005
Bayer Told To Pull Incomplete Levitra Ads
Drug giant Bayer and its marketing partners have been instructed by the U.S. Food and Drug Administration to cease some advertising for Levitra, the firm's hit impotence drug.
In a four page letter sent by a regulatory review officer at the agency, the Levitra ads does not disclose the drug's side effects and makes claims that the FDA believes are unsubstantiated.
Specifically, the FDA wrote, "The TV ad fails to include the specific indication for the drug (namely, treatment of erectile dysfunction) or the required risk information. The TV ad also fails to make adequate provision for dissemination of the FDA-approved labeling.
Bayer has been given until April 27, 2005 to respond to the FDA in writing with its plans to cease promoting Levitra in this fashion.
Drug giant Bayer and its marketing partners have been instructed by the U.S. Food and Drug Administration to cease some advertising for Levitra, the firm's hit impotence drug.
In a four page letter sent by a regulatory review officer at the agency, the Levitra ads does not disclose the drug's side effects and makes claims that the FDA believes are unsubstantiated.
Specifically, the FDA wrote, "The TV ad fails to include the specific indication for the drug (namely, treatment of erectile dysfunction) or the required risk information. The TV ad also fails to make adequate provision for dissemination of the FDA-approved labeling.
Bayer has been given until April 27, 2005 to respond to the FDA in writing with its plans to cease promoting Levitra in this fashion.
Friday, April 15, 2005
The FTC Shares The Truth About Cell Phones and The Do Not Call Registry
If you’ve received an e-mail telling you that your cell phone is about to be assaulted by telemarketing calls as a result of a new cell phone number database, rest assured that this is not the case. Telemarketing to cell phone numbers has always been illegal in most cases and will continue to be so. In response to recent e-mail campaigns urging consumers to place their cell phone numbers on the National Do Not Call Registry, the Federal Trade Commission and Federal Communications Commission issue this advisory to give consumers the facts.
One e-mail making the rounds says:
“JUST A REMINDER...In a few weeks, cell phone numbers are being released to telemarketing companies and you will start to receive sale calls. YOU WILL BE CHARGED FOR THESE CALLS... To prevent this, call the following number from your cell phone: 888/382-1222. It is the National DO NOT CALL list. It will only take a minute of your time. It blocks your number for five (5) years. PASS THIS ON TO ALL YOUR FRIENDS...”
Another version claims:
“The Federal Trade Commission has set up a "do not call" list. It is called a cell phone registry. To be included on the "do not call" list, you must call from the number you wish to register.”
Here’s what you need to know about the National Do Not Call Registry program:
FCC regulations prohibit telemarketers from using automated dialers to call cell phone numbers. Automated dialers are standard in the industry, so most telemarketers are barred from calling consumers on their cell phones without their consent.
The federal government does not maintain a national cell phone registry. Personal cell phone users have always been able to add their numbers to the National Do Not Call Registry — the same Registry consumers use to register their land lines — either online at http://www.donotcall.gov/ or by calling toll-free 1-888-382-1222 from the telephone number they wish to register. Registrations become effective within 31 days of signing up and are active for five years. There is no cut-off date or deadline for registrations.
Business-to-business calls are not covered under the Registry.
If you’ve received an e-mail telling you that your cell phone is about to be assaulted by telemarketing calls as a result of a new cell phone number database, rest assured that this is not the case. Telemarketing to cell phone numbers has always been illegal in most cases and will continue to be so. In response to recent e-mail campaigns urging consumers to place their cell phone numbers on the National Do Not Call Registry, the Federal Trade Commission and Federal Communications Commission issue this advisory to give consumers the facts.
One e-mail making the rounds says:
“JUST A REMINDER...In a few weeks, cell phone numbers are being released to telemarketing companies and you will start to receive sale calls. YOU WILL BE CHARGED FOR THESE CALLS... To prevent this, call the following number from your cell phone: 888/382-1222. It is the National DO NOT CALL list. It will only take a minute of your time. It blocks your number for five (5) years. PASS THIS ON TO ALL YOUR FRIENDS...”
Another version claims:
“The Federal Trade Commission has set up a "do not call" list. It is called a cell phone registry. To be included on the "do not call" list, you must call from the number you wish to register.”
Here’s what you need to know about the National Do Not Call Registry program:
FCC regulations prohibit telemarketers from using automated dialers to call cell phone numbers. Automated dialers are standard in the industry, so most telemarketers are barred from calling consumers on their cell phones without their consent.
The federal government does not maintain a national cell phone registry. Personal cell phone users have always been able to add their numbers to the National Do Not Call Registry — the same Registry consumers use to register their land lines — either online at http://www.donotcall.gov/ or by calling toll-free 1-888-382-1222 from the telephone number they wish to register. Registrations become effective within 31 days of signing up and are active for five years. There is no cut-off date or deadline for registrations.
Business-to-business calls are not covered under the Registry.
Thursday, April 14, 2005
636,000 Hoover/Maytag Vacuum Cleaners Recalled
The United States Consumer Product Safety Commission and Maytag jointly announced a recall of 636,000 vacuum cleaners manufactured by Maytag under the Hoover name.
According to the CPSC, "the recalled vacuums have defective on-off switches that can overheat the handle and toolholder areas of the vacuum, resulting in a fire hazard." The government report also stated that 249 cases of vacuums overheating had been reported to Maytag.
The vacuum cleaners were sold between May 1998 and July 2000 at various outlets throughout the country. The affected models are:
U6423-900
U6425-900
U6425-950
U6445-900
U6445-960
U6449-900
U6450-900
U6451-900
U6455-900
The recalled models include serial numbers 0598xxxxxxxx through 1199xxxxxxxx, with the first four digits of the serial number indicating the month and year of production (e.g., 0598xxxxxxxx is May 1998).
Consumers should contact Maytag directly at (800) 250-6075 between 8 a.m. and 5 p.m. ET Monday through Friday if they own one of these appliances.
The United States Consumer Product Safety Commission and Maytag jointly announced a recall of 636,000 vacuum cleaners manufactured by Maytag under the Hoover name.
According to the CPSC, "the recalled vacuums have defective on-off switches that can overheat the handle and toolholder areas of the vacuum, resulting in a fire hazard." The government report also stated that 249 cases of vacuums overheating had been reported to Maytag.
The vacuum cleaners were sold between May 1998 and July 2000 at various outlets throughout the country. The affected models are:
U6423-900
U6425-900
U6425-950
U6445-900
U6445-960
U6449-900
U6450-900
U6451-900
U6455-900
The recalled models include serial numbers 0598xxxxxxxx through 1199xxxxxxxx, with the first four digits of the serial number indicating the month and year of production (e.g., 0598xxxxxxxx is May 1998).
Consumers should contact Maytag directly at (800) 250-6075 between 8 a.m. and 5 p.m. ET Monday through Friday if they own one of these appliances.
Wednesday, April 13, 2005
Group Releases Big Pharma Campaign Contributions To California Legislators Before Drug Vote
Members of the California Senate Health Committee -- who will vote on unnecessary and potentially harmful prescription drug legislation today -- have received $116,563 in campaign contributions from drug manufacturers since 2003, according to the Foundation for Taxpayer and Consumer Rights (FTCR).
FTCR said the bill is not necessary because it provides a voluntary drug discount program that drug manufacturers could participate in if they choose, without legislation. FTCR said that the bill is being used as a roadblock to future reforms.
"The drug industry is pushing a poison pill to give the perception that the problem of overpriced prescription drugs has been solved. This sham proposal relies on voluntary discounts from an industry that will stop at nothing to make a profit," said Jerry Flanagan of FTCR.
The drug proposal to be voted on today, SB 19, is backed by Gov. Schwarzenegger who has received $373,200 from drug manufacturers since announcing his candidacy. Senate pro Tem Don Perata, who will play a key role in shepparding bill through the Senate if it is approved by the health committee today, has received $26,600 from drug manufacturers since 2003. Assembly Speaker Fabian Nunez has received $17,209 from drug manufacturers since 2003.
"The state legislature and the governor's office is suffering from a bipartisan addiction to drug company money," said Flanagan.
The California Senate Health Committee includes 11 members, 7 Democrats, and 4 Republicans:
Liz Figueroa (D-Sunol) -- $25,313
Sam Aanestad (R-Grass Valley) -- $20,200
David Cox (R-Fair Oaks) -- $17,200
Abel Maldonado (R-Santa Maria) -- $15,900
George Runner, (R-Antelope Valley) -- $8,000
Deborah Ortiz, (D-Sacramento) -- $7,500
Sheila Kuehl (D-Santa Monica) -- $5,250
Elaine Alquist (D-Santa Clara) -- $5,000
Gloria Romero (D-Los Angeles) -- $4,700
Edward Vincent (D-Inglewood) -- $4,000
Wesley Chesbro (D-Arcata) -- $3,500
Drug companies, whose profit are 4-5 times greater than the Fortune 500 average, have pledged to contribute $10 million to pay for a website and call center promoting the program.
In the summer and fall of 2004, the FTCR sponsored two chartered train trips, dubbed the "Rx Express," that took seniors and other patients to Canada to purchase prescription drugs at 60 percent discounts. The Rx Express raised public awareness about the potential cost savings of a U.S. prescription drug bulk discount program open to all patients. A U.S.-wide prescription drug purchasing pool would be 10 times larger than the entire Canadian program and could negotiate deeper discounts. For more information visit http://www.RxExpressCanada.org.
The state of Wisconsin has implemented a new bulk purchasing program based on a model policy developed by FTCR which would allow any patient to have access to the same discounts available to legislators and state employees.
Drug prices are lower in Canada, Ireland, England, France, and Germany because those countries negotiate bulk discounts on behalf of all patients. The U.S. Department of Veteran Affairs (USDVA) operates a similar bulk purchasing program on behalf of the nation's 39 million veterans and saves 50 percent and more off the list price of prescription drugs.
Members of the California Senate Health Committee -- who will vote on unnecessary and potentially harmful prescription drug legislation today -- have received $116,563 in campaign contributions from drug manufacturers since 2003, according to the Foundation for Taxpayer and Consumer Rights (FTCR).
FTCR said the bill is not necessary because it provides a voluntary drug discount program that drug manufacturers could participate in if they choose, without legislation. FTCR said that the bill is being used as a roadblock to future reforms.
"The drug industry is pushing a poison pill to give the perception that the problem of overpriced prescription drugs has been solved. This sham proposal relies on voluntary discounts from an industry that will stop at nothing to make a profit," said Jerry Flanagan of FTCR.
The drug proposal to be voted on today, SB 19, is backed by Gov. Schwarzenegger who has received $373,200 from drug manufacturers since announcing his candidacy. Senate pro Tem Don Perata, who will play a key role in shepparding bill through the Senate if it is approved by the health committee today, has received $26,600 from drug manufacturers since 2003. Assembly Speaker Fabian Nunez has received $17,209 from drug manufacturers since 2003.
"The state legislature and the governor's office is suffering from a bipartisan addiction to drug company money," said Flanagan.
The California Senate Health Committee includes 11 members, 7 Democrats, and 4 Republicans:
Liz Figueroa (D-Sunol) -- $25,313
Sam Aanestad (R-Grass Valley) -- $20,200
David Cox (R-Fair Oaks) -- $17,200
Abel Maldonado (R-Santa Maria) -- $15,900
George Runner, (R-Antelope Valley) -- $8,000
Deborah Ortiz, (D-Sacramento) -- $7,500
Sheila Kuehl (D-Santa Monica) -- $5,250
Elaine Alquist (D-Santa Clara) -- $5,000
Gloria Romero (D-Los Angeles) -- $4,700
Edward Vincent (D-Inglewood) -- $4,000
Wesley Chesbro (D-Arcata) -- $3,500
Drug companies, whose profit are 4-5 times greater than the Fortune 500 average, have pledged to contribute $10 million to pay for a website and call center promoting the program.
In the summer and fall of 2004, the FTCR sponsored two chartered train trips, dubbed the "Rx Express," that took seniors and other patients to Canada to purchase prescription drugs at 60 percent discounts. The Rx Express raised public awareness about the potential cost savings of a U.S. prescription drug bulk discount program open to all patients. A U.S.-wide prescription drug purchasing pool would be 10 times larger than the entire Canadian program and could negotiate deeper discounts. For more information visit http://www.RxExpressCanada.org.
The state of Wisconsin has implemented a new bulk purchasing program based on a model policy developed by FTCR which would allow any patient to have access to the same discounts available to legislators and state employees.
Drug prices are lower in Canada, Ireland, England, France, and Germany because those countries negotiate bulk discounts on behalf of all patients. The U.S. Department of Veteran Affairs (USDVA) operates a similar bulk purchasing program on behalf of the nation's 39 million veterans and saves 50 percent and more off the list price of prescription drugs.
Tuesday, April 12, 2005
Lexis-Nexis Security Breach Higher Than Thought
Information services company Lexis-Nexis, which admitted last month that its security had been breached, has drastically revised its estimate of the number of consumers impacted.
Lexis-Nexis originally projected in March that 32,000 consumers were affected by multiple security breaches. Today, the company revealed that the actual number was 310,000 -- nearly ten times the number of consumers originally thought to be at risk.
The company was quick to point out that no instances of identity theft had been linked to the security breach at its Seisint subsidiary, but consumer advocates warn that identity theft sometimes does not occur for several months after the initial release of information.
Lexis-Nexis announced that it would write an additional 278,000 consumers and notify them of the potential threat to their identity records. The company has previously offered free credit checks to consumers in similar situations.
Information services company Lexis-Nexis, which admitted last month that its security had been breached, has drastically revised its estimate of the number of consumers impacted.
Lexis-Nexis originally projected in March that 32,000 consumers were affected by multiple security breaches. Today, the company revealed that the actual number was 310,000 -- nearly ten times the number of consumers originally thought to be at risk.
The company was quick to point out that no instances of identity theft had been linked to the security breach at its Seisint subsidiary, but consumer advocates warn that identity theft sometimes does not occur for several months after the initial release of information.
Lexis-Nexis announced that it would write an additional 278,000 consumers and notify them of the potential threat to their identity records. The company has previously offered free credit checks to consumers in similar situations.
Monday, April 11, 2005
FTC Finds Weight Loss Ad Problems Shrinking
According to a Federal Trade Commission staff report released today the number of obviously false weight-loss claims in television, radio, and print advertisements for dietary supplements, topical creams, and diet patches appears to have dropped from almost 50 percent in 2001 to 15 percent in 2004.
With the rapid increase in obesity in America, many Americans look to weight-loss ads for products to trim pounds. Industry sources estimate that consumers spend billions of dollars each year on products and services that purport to promote weight loss. Many of these products, however, do not deliver what they promise.
In a 2002 report, the FTC staff had found that nearly half of weight-loss ads surveyed in 2001 made claims that clearly were false. To help stem this tide of deceptive weight-loss advertising, in 2003, the FTC asked the media not to run ads containing obviously false weight-loss claims.
To judge the effectiveness of its call for media screening, the FTC staff conducted the non-scientific Weight-Loss Advertising Survey: 2004. Although the decline in deceptive ad claims is significant, the survey results show there are still areas for improvement. The FTC will continue its efforts to encourage the media voluntarily to screen out clearly false weight-loss advertisements.“Good media screening is good business,” said FTC Chairman Deborah Platt Majoras. “I encourage the media to continue their efforts to identify and reject clearly false weight-loss advertising.”
The survey reviewed the nature and frequency of weight-loss advertising for certain products available over-the-counter running on television and radio or in newspapers and magazines – all media that can screen out ads before running them. In general, the 2004 survey results show a significant decline in clearly false weight-loss product claims in the advertisements surveyed.
BACKGROUND
In September 2001, the FTC conducted a non-scientific survey of weight-loss ads in selected print, television, and radio media. The FTC released a staff report entitled Weight-Loss Advertising: An Analysis of Current Trends, which analyzed the claims and techniques used in more than 300 weight-loss advertisements that ran throughout all media. The 2001 survey found that nearly half of the ads for dietary supplements, creams, wraps, devices, and patches that appeared in radio, television, or print media contained at least one clearly false claim.
In November 2002, the FTC held a workshop to explore new approaches to reducing deceptive weight-loss advertising. Following the workshop, the FTC issued a staff report, Deception in Weight-Loss Advertising Workshop: Seizing Opportunities and Building Partnerships to Stop Weight-Loss Fraud. The report contained a list of seven claims that are not scientifically feasible for non-prescription weight-loss products. The Commission also announced its “Red Flags” initiative, which, through outreach and business education, encourages the media to reject weight-loss product advertising that contains any of these seven false claims, called “Red Flag” claims.
In 2004, after working with the media on the Red Flag initiative, the FTC staff conducted a new survey, and analyzed ads in broadcast and cable television (including infomercials), radio, magazines, newspapers, supermarket tabloids, and free-standing inserts from February to May 2004. The 2004 report released today provides the results of that survey.
The 2004 Report
The 2004 survey results cover advertisements for certain non-prescription products: dietary supplements, creams, wraps, devices, and patches. The survey results found that 15 percent of the ads reviewed in 2004 made one or more of the clearly false Red Flag claims – a significant drop from the 2001 survey that showed 49 percent of similar ads contained at least one Red Flag claim. In addition, FTC staff compared ads that appeared in the February through May 2004 issues of certain national magazines with ads that appeared in the same magazines in 2001. This comparison showed that while the volume of weight-loss ads increased slightly from 2001, fewer of those ads contained Red Flag claims.The report shows that:
Five percent of the ads contained the Red Flag claim that users could lose two pounds or more per week (over four or more weeks) without reducing caloric intake and/or increasing their physical activity. In the 2001 survey, 43 percent of the ads contained such claims.
Four percent of the ads contained claims that consumers who use the product could lose substantial weight while enjoying unlimited amounts of high calorie foods. (Weight-Loss Survey Report--04/11/05)
Four percent of the ads contained claims that weight loss would be permanent (even when the user stops using the product).
Three percent of the ads contained claims that the weight-loss product would cause substantial weight loss by blocking the absorption of fat or calories.
Three percent of the ads made claims that users could safely lose more than three pounds per week without clearly conveying the need for medical supervision.
Four percent of the ads stated that users could lose substantial weight through use of the advertised product that is worn on the body or rubbed into the skin.
Four percent of the ads stated that the product causes substantial weight loss for all users.
Although the survey gives a positive report card, the FTC staff concludes that there is still work to be done. The report also provides several caveats: neither the 2001 nor the 2004 survey was designed to produce results that can be generalized to all weight-loss advertising; the absence of Red Flag claims does not mean that the advertisements contained no deceptive weight-loss claims at all; and although the results suggests that there has been significant improvement in the occurrence of Red Flag claims since 2001, they do not prove that this improvement is the result of the Red Flags initiative. Nevertheless, the FTC staff believes that report results support the FTC’s continuing to encourage the media to screen out clearly false weight-loss advertisements.
According to a Federal Trade Commission staff report released today the number of obviously false weight-loss claims in television, radio, and print advertisements for dietary supplements, topical creams, and diet patches appears to have dropped from almost 50 percent in 2001 to 15 percent in 2004.
With the rapid increase in obesity in America, many Americans look to weight-loss ads for products to trim pounds. Industry sources estimate that consumers spend billions of dollars each year on products and services that purport to promote weight loss. Many of these products, however, do not deliver what they promise.
In a 2002 report, the FTC staff had found that nearly half of weight-loss ads surveyed in 2001 made claims that clearly were false. To help stem this tide of deceptive weight-loss advertising, in 2003, the FTC asked the media not to run ads containing obviously false weight-loss claims.
To judge the effectiveness of its call for media screening, the FTC staff conducted the non-scientific Weight-Loss Advertising Survey: 2004. Although the decline in deceptive ad claims is significant, the survey results show there are still areas for improvement. The FTC will continue its efforts to encourage the media voluntarily to screen out clearly false weight-loss advertisements.“Good media screening is good business,” said FTC Chairman Deborah Platt Majoras. “I encourage the media to continue their efforts to identify and reject clearly false weight-loss advertising.”
The survey reviewed the nature and frequency of weight-loss advertising for certain products available over-the-counter running on television and radio or in newspapers and magazines – all media that can screen out ads before running them. In general, the 2004 survey results show a significant decline in clearly false weight-loss product claims in the advertisements surveyed.
BACKGROUND
In September 2001, the FTC conducted a non-scientific survey of weight-loss ads in selected print, television, and radio media. The FTC released a staff report entitled Weight-Loss Advertising: An Analysis of Current Trends, which analyzed the claims and techniques used in more than 300 weight-loss advertisements that ran throughout all media. The 2001 survey found that nearly half of the ads for dietary supplements, creams, wraps, devices, and patches that appeared in radio, television, or print media contained at least one clearly false claim.
In November 2002, the FTC held a workshop to explore new approaches to reducing deceptive weight-loss advertising. Following the workshop, the FTC issued a staff report, Deception in Weight-Loss Advertising Workshop: Seizing Opportunities and Building Partnerships to Stop Weight-Loss Fraud. The report contained a list of seven claims that are not scientifically feasible for non-prescription weight-loss products. The Commission also announced its “Red Flags” initiative, which, through outreach and business education, encourages the media to reject weight-loss product advertising that contains any of these seven false claims, called “Red Flag” claims.
In 2004, after working with the media on the Red Flag initiative, the FTC staff conducted a new survey, and analyzed ads in broadcast and cable television (including infomercials), radio, magazines, newspapers, supermarket tabloids, and free-standing inserts from February to May 2004. The 2004 report released today provides the results of that survey.
The 2004 Report
The 2004 survey results cover advertisements for certain non-prescription products: dietary supplements, creams, wraps, devices, and patches. The survey results found that 15 percent of the ads reviewed in 2004 made one or more of the clearly false Red Flag claims – a significant drop from the 2001 survey that showed 49 percent of similar ads contained at least one Red Flag claim. In addition, FTC staff compared ads that appeared in the February through May 2004 issues of certain national magazines with ads that appeared in the same magazines in 2001. This comparison showed that while the volume of weight-loss ads increased slightly from 2001, fewer of those ads contained Red Flag claims.The report shows that:
Five percent of the ads contained the Red Flag claim that users could lose two pounds or more per week (over four or more weeks) without reducing caloric intake and/or increasing their physical activity. In the 2001 survey, 43 percent of the ads contained such claims.
Four percent of the ads contained claims that consumers who use the product could lose substantial weight while enjoying unlimited amounts of high calorie foods. (Weight-Loss Survey Report--04/11/05)
Four percent of the ads contained claims that weight loss would be permanent (even when the user stops using the product).
Three percent of the ads contained claims that the weight-loss product would cause substantial weight loss by blocking the absorption of fat or calories.
Three percent of the ads made claims that users could safely lose more than three pounds per week without clearly conveying the need for medical supervision.
Four percent of the ads stated that users could lose substantial weight through use of the advertised product that is worn on the body or rubbed into the skin.
Four percent of the ads stated that the product causes substantial weight loss for all users.
Although the survey gives a positive report card, the FTC staff concludes that there is still work to be done. The report also provides several caveats: neither the 2001 nor the 2004 survey was designed to produce results that can be generalized to all weight-loss advertising; the absence of Red Flag claims does not mean that the advertisements contained no deceptive weight-loss claims at all; and although the results suggests that there has been significant improvement in the occurrence of Red Flag claims since 2001, they do not prove that this improvement is the result of the Red Flags initiative. Nevertheless, the FTC staff believes that report results support the FTC’s continuing to encourage the media to screen out clearly false weight-loss advertisements.
Friday, April 08, 2005
CASE STUDY: Consumer Help Web Convinces Company To Refund $5,500
Consumer Help Web acted quickly once Ruby contacted the consumer advocacy company in February 2005. A letter was immediately sent to senior management demanding a full refund of the down payment based on the salesperson’s promise. That letter, written by Consumer Help Web President Joan Bounacos, demanded the full and immediate return of the $5,500. Consumer Help Web also posted details about the complaint on its popular web site and invited the company to have the complaint removed from the site upon a successful resolution of the case.
The company responded several weeks later, and Ruby’s mother received a check for the full amount on March 7, 2005.
What The Participants Had To Say
Ruby initially praised Consumer Help Web in a note she sent shortly after her mother received the check. She later told the company, “There are so many victims out there who feel they have no one to turn to when they are taken advantage of by consumers. It is a blessing to know there are people out there like you and your organization that can help them.”
“Ruby’s mother was very lucky,” admits Joan Bounacos. “The company recognized the value of standing behind their salesperson’s promise, but without having that promise in writing, this matter could easily have gone to court and dragged on for a long time. The bottom line for consumer is that any contract they sign is typically binding unless their state provides a ‘cooling-off” period.”
Consumer Help Web, the web’s leading complaint resolution service, strongly recommends that consumers compel salespeople to add an addendum to any contract they sign when special provisions or promises are made. “If the salesperson is unwilling to commit to their promise in writing, walk away from the transaction,” advises Bounacos.
Ruby B. is a Virginia consumer who wrote Consumer Help Web on February 11, 2005 about a $5,500 down payment her mother had placed on a mobile home in Alabama.
The Facts
The funds were issued to the temporary home building company via a personal check dated November 26, 2004. The sales agent had reportedly promised Ruby’s mother that the down payment would be returned if she could not obtain financing.
Within a day, Ruby learned that her mother could not qualify for a loan in the amount that had to be financed. A refund was requested, but the manager insisted that Ruby’s mother had signed a contract and there was nothing more to discuss. To make matters worse, he hung up the telephone while still talking to Ruby.
The Facts
The funds were issued to the temporary home building company via a personal check dated November 26, 2004. The sales agent had reportedly promised Ruby’s mother that the down payment would be returned if she could not obtain financing.
Within a day, Ruby learned that her mother could not qualify for a loan in the amount that had to be financed. A refund was requested, but the manager insisted that Ruby’s mother had signed a contract and there was nothing more to discuss. To make matters worse, he hung up the telephone while still talking to Ruby.
The company responded several weeks later, and Ruby’s mother received a check for the full amount on March 7, 2005.
What The Participants Had To Say
Ruby initially praised Consumer Help Web in a note she sent shortly after her mother received the check. She later told the company, “There are so many victims out there who feel they have no one to turn to when they are taken advantage of by consumers. It is a blessing to know there are people out there like you and your organization that can help them.”
“Ruby’s mother was very lucky,” admits Joan Bounacos. “The company recognized the value of standing behind their salesperson’s promise, but without having that promise in writing, this matter could easily have gone to court and dragged on for a long time. The bottom line for consumer is that any contract they sign is typically binding unless their state provides a ‘cooling-off” period.”
Consumer Help Web, the web’s leading complaint resolution service, strongly recommends that consumers compel salespeople to add an addendum to any contract they sign when special provisions or promises are made. “If the salesperson is unwilling to commit to their promise in writing, walk away from the transaction,” advises Bounacos.
Thursday, April 07, 2005
Government To Set Standards For Cigarette Lighters
The U.S. Consumer Product Safety Commission (CPSC) voted unanimously (2-0) on April 1, 2005, to move forward with the first of three steps in developing a new mandatory safety standard for cigarette lighters. The vote to approve an Advanced Notice of Proposed Rulemaking, which is open for public comment, sets the Commission on a path to consider a way to prevent most mechanical malfunctions of lighters and reduce the fire hazard associated with some lighters.
CPSC already has a mandatory standard for child-resistant cigarette lighters that addresses the hazard of children under 5 years of age starting fires with lighters. That standard for child-resistance applies to imported as well as domestically-manufactured disposable and novelty lighters.
“Fires are a leading cause of consumer product related deaths, and reducing residential fire deaths is one of our top priorities,” said CPSC Chairman Stratton. “By developing fire safety standards for mattresses, upholstered furniture, and cigarette lighters, CPSC can help save many lives while maintaining reasonable cost to consumers and manufacturers.”
The Commission could pursue one of three options during the rulemaking process: 1) a mandatory standard based either on the current voluntary “Standard Consumer Safety Specification for Lighters” (ASTM F-400) or on other performance requirements; 2) a mandatory labeling rule; or 3) a decision to defer to the voluntary standard.
There are nearly one billion cigarette lighters sold in the U.S. annually. Over 700 million lighters are imported each year, with about 400 million coming from China. From 1997 through 2002, CPSC estimated that more than 3,000 people went to hospital emergency rooms for injuries resulting from malfunctioning lighters. Most of these injuries involved thermal burns to the face, hands, and fingers. For the same time period, CPSC received 256 incident reports related to cigarette lighter malfunctions and failures; 65 percent of these cigarette lighter failures resulted in fires, leading to 3 deaths and 6 serious injuries.
The voluntary standard for lighters addresses the risk of fire, death, and injury associated with mechanical malfunctions of lighters. However, it is unclear how many lighters sold in the U.S. actually comply with the voluntary standard.
Fire deaths associated with children playing with lighters dropped dramatically since the mandatory standard for child-resistance became effective in July 1994 – from 230 in 1994 to 130 in 1998. Children under age 5 accounted for 170 of the deaths in 1994 and 40 of the deaths in 1998. In 1994, there were 11,100 residential fires associated with children playing with lighters. By 1998, that number declined to 6,100 fires.
Even lighters with child-resistant mechanisms are not child-proof, so all lighters should always be kept out of the reach of children.
The U.S. Consumer Product Safety Commission (CPSC) voted unanimously (2-0) on April 1, 2005, to move forward with the first of three steps in developing a new mandatory safety standard for cigarette lighters. The vote to approve an Advanced Notice of Proposed Rulemaking, which is open for public comment, sets the Commission on a path to consider a way to prevent most mechanical malfunctions of lighters and reduce the fire hazard associated with some lighters.
CPSC already has a mandatory standard for child-resistant cigarette lighters that addresses the hazard of children under 5 years of age starting fires with lighters. That standard for child-resistance applies to imported as well as domestically-manufactured disposable and novelty lighters.
“Fires are a leading cause of consumer product related deaths, and reducing residential fire deaths is one of our top priorities,” said CPSC Chairman Stratton. “By developing fire safety standards for mattresses, upholstered furniture, and cigarette lighters, CPSC can help save many lives while maintaining reasonable cost to consumers and manufacturers.”
The Commission could pursue one of three options during the rulemaking process: 1) a mandatory standard based either on the current voluntary “Standard Consumer Safety Specification for Lighters” (ASTM F-400) or on other performance requirements; 2) a mandatory labeling rule; or 3) a decision to defer to the voluntary standard.
There are nearly one billion cigarette lighters sold in the U.S. annually. Over 700 million lighters are imported each year, with about 400 million coming from China. From 1997 through 2002, CPSC estimated that more than 3,000 people went to hospital emergency rooms for injuries resulting from malfunctioning lighters. Most of these injuries involved thermal burns to the face, hands, and fingers. For the same time period, CPSC received 256 incident reports related to cigarette lighter malfunctions and failures; 65 percent of these cigarette lighter failures resulted in fires, leading to 3 deaths and 6 serious injuries.
The voluntary standard for lighters addresses the risk of fire, death, and injury associated with mechanical malfunctions of lighters. However, it is unclear how many lighters sold in the U.S. actually comply with the voluntary standard.
Fire deaths associated with children playing with lighters dropped dramatically since the mandatory standard for child-resistance became effective in July 1994 – from 230 in 1994 to 130 in 1998. Children under age 5 accounted for 170 of the deaths in 1994 and 40 of the deaths in 1998. In 1994, there were 11,100 residential fires associated with children playing with lighters. By 1998, that number declined to 6,100 fires.
Even lighters with child-resistant mechanisms are not child-proof, so all lighters should always be kept out of the reach of children.
Wednesday, April 06, 2005
JetBlue Tops Airline Quality Rankings For Second Straight Year
JetBlue topped the 15th annual Airline Quality Rankings for the second straight year, an example of the rankings achieved by low cost "no frills" carriers. Four of the five top spots in this year's survey, announced this week, went to newer airlines that may not offer as many amenities or destinations as traditional "legacy" carriers.
The research is based on weighting elements such as on-time arrivals, baggage handling, customer complaints and denied boardings. Research teams at Wichita State University and the University of Nebraska at Omaha conduct the study.
The study also found that overall quality diminshed throughout the industry, and only four carriers (Air Tran, Atlantic Southeast, JetBlue and United) improved their scores from 2003.
The authors have published their entire study complete with statistics, charts and graphs in a PDF file on the web. The overall rankings for those consumers who don't want to delve into the details are:
JetBlue
AirTran
Southwest
United
Alaska
America West
Northwest
American
Continental
ATA
Delta
US Airways
American Eagle
SkyWest
COMAIR
Atlantic Southeast
JetBlue topped the 15th annual Airline Quality Rankings for the second straight year, an example of the rankings achieved by low cost "no frills" carriers. Four of the five top spots in this year's survey, announced this week, went to newer airlines that may not offer as many amenities or destinations as traditional "legacy" carriers.
The research is based on weighting elements such as on-time arrivals, baggage handling, customer complaints and denied boardings. Research teams at Wichita State University and the University of Nebraska at Omaha conduct the study.
The study also found that overall quality diminshed throughout the industry, and only four carriers (Air Tran, Atlantic Southeast, JetBlue and United) improved their scores from 2003.
The authors have published their entire study complete with statistics, charts and graphs in a PDF file on the web. The overall rankings for those consumers who don't want to delve into the details are:
JetBlue
AirTran
Southwest
United
Alaska
America West
Northwest
American
Continental
ATA
Delta
US Airways
American Eagle
SkyWest
COMAIR
Atlantic Southeast
Tuesday, April 05, 2005
Supreme Court Protects IRA Accounts From Bankruptcy Proceedings
Dealing a harsh blow to the consumer finance industry, the Supreme Court unanimously voted yesterday to exempt IRA accounts from bankruptcy proceedings.
The Court, which originally heard in the case in December 2004, found that two critical provisions of three elements be met. Those provisions are:
1) the right to receive payment must be from a stock bonus, pension, profitsharing (sic), annuity, or similar plan or contract, and
2) the right to receive payment must be "on account of illness, disability, death, age, or length of service"
Writing for the Court, Justice Clarence Thomas noted that the tax penalty imposed on individuals who withdraw funds from an IRA prior to age 59 1/2 is "substantial".
"We're pleased," said Jean Constantine-Davis, a senior lawyer for AARP, in a statement. "It's really important to encourage people to contribute savings in their working years and to keep those savings sacrosanct."
Dealing a harsh blow to the consumer finance industry, the Supreme Court unanimously voted yesterday to exempt IRA accounts from bankruptcy proceedings.
The Court, which originally heard in the case in December 2004, found that two critical provisions of three elements be met. Those provisions are:
1) the right to receive payment must be from a stock bonus, pension, profitsharing (sic), annuity, or similar plan or contract, and
2) the right to receive payment must be "on account of illness, disability, death, age, or length of service"
Writing for the Court, Justice Clarence Thomas noted that the tax penalty imposed on individuals who withdraw funds from an IRA prior to age 59 1/2 is "substantial".
"We're pleased," said Jean Constantine-Davis, a senior lawyer for AARP, in a statement. "It's really important to encourage people to contribute savings in their working years and to keep those savings sacrosanct."
Monday, April 04, 2005
COOL Seafood Labels Take Effect Today, Humane Society Boycotting Canadian Seafood
New regulations take effect today that require supermarkets to label seafood with its country of origin and indicate whether the food has been farm-raised or caught in the wild.
The COOL program, which stands for country-of-origin-label, was passed by the U.S. Congress three years ago, but the Department of Agriculture took until late 2004 to finalize the regulations and their enforcement. Individual supermarkets can be fined thousands of dollars if they are found to be selling improperly labeled seafood.
Some consumer advocates have expressed a desire for the new labels to include more information, including FDA warnings about seafood believed to be dangerous for certain groups of people. Meanwhile, the Humane Society is using the new labels to help target a boycott of Canadian seafood because the group believes the country permits hunting of seals, including baby seals.
Regardless of how the new labels are used, additional consumer information is always welcome, even if it arrives years after the legislation passed.
New regulations take effect today that require supermarkets to label seafood with its country of origin and indicate whether the food has been farm-raised or caught in the wild.
The COOL program, which stands for country-of-origin-label, was passed by the U.S. Congress three years ago, but the Department of Agriculture took until late 2004 to finalize the regulations and their enforcement. Individual supermarkets can be fined thousands of dollars if they are found to be selling improperly labeled seafood.
Some consumer advocates have expressed a desire for the new labels to include more information, including FDA warnings about seafood believed to be dangerous for certain groups of people. Meanwhile, the Humane Society is using the new labels to help target a boycott of Canadian seafood because the group believes the country permits hunting of seals, including baby seals.
Regardless of how the new labels are used, additional consumer information is always welcome, even if it arrives years after the legislation passed.
Friday, April 01, 2005
Debt Services Operations Settle FTC Charges
Three operations that scammed consumers out of more than one hundred million dollars by falsely promising easy debt relief have settled Federal Trade Commission charges that their business practices were illegal. According to the FTC, in some cases, consumers’ debt, interest rates, and penalties increased and some consumers were forced into bankruptcy. The companies and their principals will pay more than $6 million combined in consumer redress and are permanently barred from making deceptive claims about debt-related services. Two of the operations and their principals also are barred from engaging in abusive telemarketing practices, following FTC charges that they repeatedly called consumers on the National Do Not Call Registry.
“Consumers who want to get out of debt are looking for services to help relieve their financial troubles, not make them worse,” said Lydia Parnes, Acting Director of the FTC’s Bureau of Consumer Protection. “The FTC is committed to ridding the debt services industry of companies who shatter consumer confidence and hurt legitimate businesses’ ability to help consumers.”
National Consumer Council Actions
In May 2004, the FTC filed a complaint against a group of companies and individual defendants, fronted by “National Consumer Council” (NCC), a purported nonprofit organization, that solicited customers through an aggressive telemarketing and direct mail advertising campaign that falsely promised free debt counseling. In fact, NCC’s role in the scheme was simply to generate leads for the other defendants, who then charged consumers thousands of dollars in fees to enroll in their debt negotiation programs. The defendants deceptively claimed these programs were an effective way to stop creditors’ collection efforts and eliminate their debts. The FTC alleged that the defendants failed to disclose important information to consumers before they enrolled, including the fact that very few people were able to reduce their debts through the debt negotiation programs; consumers would suffer late fees, penalties, and other charges; and that participation in the program might hurt their credit rating. A court-appointed receiver determined that less than two percent of the consumers who enrolled in the defendants’ debt negotiation programs – 638 out of 44,844 consumers – actually completed them.
The FTC’s complaint also alleged that the defendants violated the Telemarketing Sales Rule (TSR), including the National Do Not Call Registry provisions, by calling consumers who had placed their phone numbers on the Registry and claiming that NCC was a nonprofit organization exempt from the Do Not Call requirements. The complaint further alleged that some of the defendants violated the Gramm-Leach-Bliley (GLB) Act by failing to inform consumers how their personal financial information would be used.
At the FTC’s request, a federal district court appointed a receiver over defendants National Consumer Council, an Arizona corporation; National Consumer Council, a California corporation; National Consumer Council, a Nevada corporation, London Financial Group; National Consumer Debt Council, LLC; Solidium, LLC; J.P. Landis, LLC; Financial Rescue Services, Inc. (FRS); Signature Equities, LLC; M&L Springfield Trust; PC Hailey Trust; Via Lido Trust; and United Consumers Law Group. The receiver has returned approximately $24 million in consumer funds held in defendants’ trust accounts. The receiver also is winding down the corporations’ business operations.
Consumer Help Web Reaction
Consumer Help Web spoke with a consumer advocate who wished to remain nameless about the companies. "I saw them working the crowd at a well known consumer conference," he said. "They seemed more interested in the public relations aspect of consumer affairs, but I knew something was wrong when they began badmouthing the BBB." The advocate reported that he later found out the Better Business Bureau had given the National Consumer Council an unsatisfactory rating.
Three operations that scammed consumers out of more than one hundred million dollars by falsely promising easy debt relief have settled Federal Trade Commission charges that their business practices were illegal. According to the FTC, in some cases, consumers’ debt, interest rates, and penalties increased and some consumers were forced into bankruptcy. The companies and their principals will pay more than $6 million combined in consumer redress and are permanently barred from making deceptive claims about debt-related services. Two of the operations and their principals also are barred from engaging in abusive telemarketing practices, following FTC charges that they repeatedly called consumers on the National Do Not Call Registry.
“Consumers who want to get out of debt are looking for services to help relieve their financial troubles, not make them worse,” said Lydia Parnes, Acting Director of the FTC’s Bureau of Consumer Protection. “The FTC is committed to ridding the debt services industry of companies who shatter consumer confidence and hurt legitimate businesses’ ability to help consumers.”
National Consumer Council Actions
In May 2004, the FTC filed a complaint against a group of companies and individual defendants, fronted by “National Consumer Council” (NCC), a purported nonprofit organization, that solicited customers through an aggressive telemarketing and direct mail advertising campaign that falsely promised free debt counseling. In fact, NCC’s role in the scheme was simply to generate leads for the other defendants, who then charged consumers thousands of dollars in fees to enroll in their debt negotiation programs. The defendants deceptively claimed these programs were an effective way to stop creditors’ collection efforts and eliminate their debts. The FTC alleged that the defendants failed to disclose important information to consumers before they enrolled, including the fact that very few people were able to reduce their debts through the debt negotiation programs; consumers would suffer late fees, penalties, and other charges; and that participation in the program might hurt their credit rating. A court-appointed receiver determined that less than two percent of the consumers who enrolled in the defendants’ debt negotiation programs – 638 out of 44,844 consumers – actually completed them.
The FTC’s complaint also alleged that the defendants violated the Telemarketing Sales Rule (TSR), including the National Do Not Call Registry provisions, by calling consumers who had placed their phone numbers on the Registry and claiming that NCC was a nonprofit organization exempt from the Do Not Call requirements. The complaint further alleged that some of the defendants violated the Gramm-Leach-Bliley (GLB) Act by failing to inform consumers how their personal financial information would be used.
At the FTC’s request, a federal district court appointed a receiver over defendants National Consumer Council, an Arizona corporation; National Consumer Council, a California corporation; National Consumer Council, a Nevada corporation, London Financial Group; National Consumer Debt Council, LLC; Solidium, LLC; J.P. Landis, LLC; Financial Rescue Services, Inc. (FRS); Signature Equities, LLC; M&L Springfield Trust; PC Hailey Trust; Via Lido Trust; and United Consumers Law Group. The receiver has returned approximately $24 million in consumer funds held in defendants’ trust accounts. The receiver also is winding down the corporations’ business operations.
Consumer Help Web Reaction
Consumer Help Web spoke with a consumer advocate who wished to remain nameless about the companies. "I saw them working the crowd at a well known consumer conference," he said. "They seemed more interested in the public relations aspect of consumer affairs, but I knew something was wrong when they began badmouthing the BBB." The advocate reported that he later found out the Better Business Bureau had given the National Consumer Council an unsatisfactory rating.
