Wednesday, February 27, 2008
[travel] Airlines Raise Baggage Fees
Forget the number of carry-on pieces and the long lines. Air travel is about to get more interesting as US Airways joins United in charging
extra for a second piece of luggage.
Consumers quickly (and too easily) rolled over for weight limits on buggage that continued shrinking. Two major US carriers are now saying that they will charge extra for a second piece of luggage,
even on international flights.
While I've taken plenty of one or two day international flights for business, I can't imagine that carrying a second piece of luggage if I travel to Europe or the islands is going to cost me more.
But it is. The new rules go in effect May 5, coincidentally just in time for peak travel season.
Labels: luggage, travel, United Airlines, US Airways
[scams] FTC Takes Aim At BlueHippo's Finance Scheme
The Federal Trade Commission announced that it has won a settlement from a company called Blue Hippo that financed consumer electronics like computers and televisions for people with bad credit. This is similar to the rent-to-own world, but even worse.
According to the federal agency, Blue Hippo did not deliver goods to some consumers and violated multiple federal laws, including those covering Truth in Lending and the Mail Order Rule.
Court filings show unbelievable sales pitches such as "Do you want to own a computer, but have less than perfect credit? No problem. If you have a checking account, a home phone and can afford a weekly payment of just $35 for only 12 months, BlueHippo Funding says you're approved, guaranteed."
If you are reading this and considering such an offer, stop now. The axiom of "too good to be true" is accurate. If you can't afford it, don't put yourself in debt exceeding your means for instant gratification. You'll just make others wealthier.
Meanwhile, look for our upcoming article on the Mail Order Rule that discusses its growing importance in the age of Internet shopping.
Labels: Blue Hippo, financial, FTC, rent-to-own
Tuesday, February 26, 2008
[mortgage] Nevada, California, Florida Top Foreclosure Increase, Slower Than 2007 Rate
News about mortgage foreclosure rates jumping 57% in January 2008 when compared to January 2007 seems destined to dominate today's headlines. But one mortgage expert thinks there might be a silver lining in the gloomy numbers.
RealtyTrac CEO James J. Saccacio, whose company performs the analysis for multiple media outlets thinks some
promising mortgage news is mixed in with the big number.
"January's foreclosure numbers demonstrate that foreclosure activity is continuing on its upward trend, substantially increasing from a year ago in many states," said Saccacio in a statement. "However, the 8 percent monthly increase in January is not as precipitous as the 19 percent spike we saw in January of 2007, and several key states actually experienced decreasing foreclosure activity from the previous month."
RealtyTrac's cautiously optimistic outlook on the mortgage market is worth noting, especially for context. As radios and television blare that 57% number in the coming days, remembering that context may prove very beneficial.
Meanwhile, if you are behind in making mortgage payments, contact the lender and talk with them about how to create a payment plan that keeps you in your home. Your local consumer regulatory agency also has information about appropriate credit counseling services. Don't simply choose one from the phone book or an online search -- get advice from the pros. The FCIC maintains a
free online list of consumer agencies on their website.
Labels: FCIC, mortgage, RealtyTrac
Monday, February 25, 2008
[safety] As Recalls Pile Up, Legislative Inaction Hampers CPSC
The Consumer Product Safety Commission, a federal agency operating with only 2 of 3 commissioners, continues to fumble through its mission while Congress, consumer advocates and the public swirl around the group in a messy
melange of ideas.
CPSC staffing levels have dropped through the years to half of where they were when the agency was founded three decades ago. President Bush's attempt last year to fill temporary agency head Nancy Nord's role with a manufacturing lobbyist was met with derision and quickly withdrawn. Nord continues as Acting Chair of the agency while the House of Representatives and Senate consider legislation that would fund the organization to approximately $80 million while giving the group broader powers or potentially entangling the agency's mandate with states rights.
Our issues with the agency's rules are that recalls still remain voluntary and penalties are relatively minor. We support broadening the agency's role while giving informed consumers tools with which they can make good choices. Provisions for consumer databases exist in the Senate's floor bill (S. 2045) while legislation that passed the House calls for mandatory recalls.
"Both the Senate bill and the House bill passed earlier include important safety provisions that will help CPSC's ability to keep our children safe. We hope that the final conference bill will take the strongest language from both and give the agency the funding, staff and teeth they so desperately need," said Nancy Cowles, Director of
Kids in Danger.
Kids in Danger has created a safety poster we'll be sharing later this week that shows recently recalled items that place children in harm's way.
In our opinion, neither piece of legislation is the best answer in its current form. Rather than throwing brickbats at the agency itself, we hope lawmakers will take a fresh look at this legislation and all safety issues.
Problems with jurisdiction already exist at the federal level. Complicating the matter by involving state Attorney Generals might be a recipe for more dangerous products being sold for longer periods of time. Other consumer advocates feel differently, but ultimately, this is more than an issue of stalled legislation. Consumer safety crosses race, gender and economic lines.
Labels: CPSC, KidsinDanger.org, legislation, safety
Saturday, February 23, 2008
[privacy] ChoicePoint Gets A New Parent
We have been highly critical of information services company ChoicePoint (
NYSE: CPS) for years, ever since
they admitted selling private consumer data in early 2005. Identity theft was starting to ramp up as an American consumer's worst nightmare, data was sometimes being lost or stolen, but this was the first time in recent memory that a company collecting the data admitted that it sold more than 140,000 consumer records to individuals posing as businesses.
The timeline grew as gruesome as one might expect. Only one week later, ChoicePoint admitted that they
knew about their data breach as early as October 2004, but were working with law enforcement. We were critical and remain critical of the decision to suppress news from consumers about a deliberate breach of consumer information.
Congress justifiably got involved, but little came out of the federal government's queries, something we see repeated too often. This time, however, the Federal Trade Commission stepped in and chased down ChoicePoint's processes. A year later, the company announced it would pay a
$15 million fine, including $5 million for consumers, to settle the FTC's complaint that ChoicePoint did not have adequate safeguards in place.
The only time we believed the company was being harshly treated was when a coalition made up of nearly every state bellied up to the trough and
beat another $500,000 out of ChoicePoint. We said then and believe now that this was just a money and headline grab gambit and did little to help consumers.
Now an even bigger information company, Reed Elsevier (
NYSE: RUK) which owns information company Lexis-Nexis among others, has stepped in with $4 billion or so to buy ChoicePoint. The premium being paid for the information housed in Georgia-based ChoicePoint is staggering. Less than one month ago, the market value of the company (as determined by its stock price) was about $2.3 billion. While stocks have been battered and there are value buys out there, this is akin to Microsoft trying to take on Yahoo!
We can (and do) argue both sides of consolidation at Consumer Help Web. Concentrating data in a few companies allows for more stringent regulation, tighter controls and a wider spotlight. At the same time, the mess our nation's three major bureaus have created finally caused the government to legislate that consumers receive free access to each company's report every year to examine the report for errors. That is a lot of power to put in the hands of a for-profit entity.
We see the same issue with Google now. We adore Google for its groundbreaking contributions to Internet searching. At the same time, multiple consumers in multiple consumers have expressed to us their concerns that the search company is gathering a picture of consumers that is too detailed. Indeed, search queries and other information are associated with Google accounts and create a history of what was searched for by a person. That's not a marketer's fantasy, but a consumer's nightmare. Every unimaginable intensely private search query is dutifully logged by massive computer centers and tied to an individual.
That is why we are not fans of Google's proposed Health offering, why we think Microsoft's Health offering has failed to gain traction and why we are very concerned about the merger of two giants like Reed Elsevier and ChoicePoint, even if the latter has been learned a painful lesson.
Labels: ChoicePoint, data breach, Google, Microsoft, privacy, Reed Elsevier
Friday, February 22, 2008
[customer service] CareFirst Forgets Their First Name
Today was one of the days we saw a major company's contact center operations take a giant step back. Listening to those are sad -- especially when so much attention is being made of customer satisfaction.
During a routine call to healthcare giant CareFirst, a customer service representative told me that my provider had been paid for multiple claims I was being billed for by the provider. Interestingly enough, CareFirst's own computer system showed my coverage as lapsed because I had switched from one group to another, and the old group's coverage still showed on the record.
"That's IT's problem," said our rep, whom we call Cheryl, since that's the only name she provides.
No, actually, it's the company's problem, but what do we do about this bill?
Well, says Cheryl, it's your doctor's fault.
[Stop when you sense a trend developing]
But I want to speak with a supervisor. Cheryl says that doesn't happen because there are none. Apparently Cheryl, whose supervisor uses the name Ms. Taylor, is working by herself tonight. All of CareFirst's 3 million policyholders are apparently being cared for by Cheryl tonight because a supervisor can only call back within 24-48 hours. That's an awesome responsibility.
Later, we get force-transferred (that's what call center reps call the process when they transfer your call without permission). We have to give Cheryl credit though. She forced us into a provider queue for doctors and hospitals. With no id code to enter, we couldn't go anywhere. No buttons transferred us out and without a code, we couldn't get connected to anyone.
The only choice? Hang up.
The First Company, the one originally known as CareFirst, apparently meant healthcare, not customer service care.
As consumers you don't have to accept that kind of behavior when it is inflicted upon you. In our case, a letter is already on its way to "Interim CEO" David D. Wolf. This will allow Mr. Wolf and his team in Owings Mill, Maryland to relieve Cheryl of her awesome responsibility in supervising the company for the next 48 hours.
Mr. Wolf will also presumably fix "the IT problem" and "my doctor's problem". Because this happened to a Consumer Help Web person (and we were fair to say this was going on the web), we won't list CareFirst under our pending complaints, nor will we put a negative one next to their score in our databases.
Yet.
We'll keep you posted on what happens, however, to this real life case study where we can freely use the customer's name and experiences. Our demand letter to Mr. Wolf is very simple and requires that CareFirst update its computer systems to show our family's updated coverage and rescind the letter sent to our doctor demanding a refund for money they already paid him.
A simple resolution request laser-targeted to the senior executive gets results. We get those results and help hundreds of consumers. If this happened to you, let us
help you resolve your complaint too.
Labels: call center, CareFirst, customer satisfaction, David Wolf, healthcare
Monday, February 18, 2008
[safety] Is USDA's Beef Recall Hogwash, Bull or Neither?
The United States Department of Agriculture ratcheted up the heat on consumer safety issues by issuing a recall of 143 million pounds of beef from Hallmark/Westland Meat Packing Company. That organization supplies food distributors, including federal food programs, with ground beef.
As with many recalls, this one seems more about the timing than consumer safety. The USDA dumped this news on the American public during the Sunday of a 3 day holiday weekend. The agency conceded by Monday that "most" of the meat had likely already been eaten and that the
meat company had voluntarily ceased operations on February 1.
Consumers don't need a sundial to know that this issue was news at least 16 days ago, and one therefore becomes concerned about the timing and any potential motivation.
Perhaps the worst part of this scare headline is that
consumers have no way of knowing if tainted beef is in their freezer. We don't understand why the scare headlines were pushed out more than two weeks after the plant's closure and before a way of identifying retail purchases existed. What we do know is this that is a great tactic that buys everyone some time but still beats the wardrums of consumer safety.
Except in this case, consumers can do nothing to ensure their safety, if a threat even exists, because they can't identify any potentially contaminated food.
When news is made for the apparent sake of making news, one wonders about motivation. Wouldn't an announcement when the company voluntarily ceased operating almost three weeks ago have been appropriate? That's almost a month's worth of possible consumption allowed to go by when the company and the government knew there were potential safety issues.
We'll be addressing the issues surrounding the CPSC and Congressional attempts to legislate safety that seem oddly akin to the economic stimulus package, but for now, we'll just skip the burger for a turkey burger and wait to hear the all clear sign.
By our reckoning, that should be in May, just in time for a nice Memorial Day barbeque.
Labels: ground beef, recall, USDA
Tuesday, February 12, 2008
Weight Loss Lawsuits Continue [healthcare]
The Federal Trade Commission is again chasing the makers of a reported weight-loss drug. This chase is court, however, and reminiscent of last year's actions against Cortislim and Xenadrine.
As American waistlines grow, marketers continue looking for the magic pill that replaces diet and exercise. Now a California company has been accused of marketing weight loss product that the government says are ineffective for weight loss.
The products are sold with the brand names
Zyladex Plus, Questral AC, Questral AC Fat Killer Plus, Rapid Loss 245, and
Rapid Loss Rx.
The federal agency says the marketing claims for these products are unsubstantiated and filed suit in San Francisco last week.
We reported over a year ago that the
government filed complaints against CortiSlim and three other products. At the time, FTC Chair Deborah Platt Majoras said, "You won't find weight loss in a bottle of pills that claims it has the latest scientific breakthrough or miracle ingredient. Paying for fad science is a good way to lose cash, not pounds."
By October 2007,
Cortislim customers had a settlement offer. The deadline for filing for redress in that case was October 27, 2007 (a good reason to subscribe to our blog if you missed it).
Meanwhile, we've contacted representatives for the defendant in this case and will share any comments they make about their products.
Labels: diet, FTC, medical
Monday, February 04, 2008
Smoking Cessation Drug May Cause Problems [health]
The U.S. Food and Drug Administration is warning consumers using a medication doctors prescribe to help people stop smoking may cause behavioral changes, depression and even suicide. The federal agency said that Chantix is effective in helping people kick their cigarette habit but may pose serious mental health issues.
Chantix has been approved for use since May 2006 and amazingly enough can block the effects of nicotine in a smoker's brain if the smoker resumes smoking. That effect reportedly enables people to avoid smoking because neurological effects are neutralized. Now there is concern that Chantix also causes serious neurological effects beyond blocking nicotine's effects.
The FDA is working with Pfizer, Inc (
NYSE: PFE) to create a patient guide and to change the medication's labeling so that warnings about the drug's use are more prominent. "Health care professionals should closely monitor patients for behavior and mood changes if they are taking this drug," said Dr. Bob Rappaport of the FDA in a statement.
Consumers were also cautioned to tell their physician about any history of psychiatric illness or changes in mood or behavior after using the drug.
Labels: Chantix, FDA, healthcare, Pfizer
