In June 2019, the Federal Trade Commission (FTC) charged that two defendants, Douglas Filter and Marcio G. Andrade, using such trade names as Deletion Experts, Inquiry Busters, and Top Tradelines, used deceptive websites, unsolicited emails, and text messages to target consumers with false promises of substantially improving consumers’ credit scores by claiming to remove all negative items and hard inquiries from consumers’ credit reports.
The defendants also falsely claimed to substantially improve consumers’ credit scores by promising to add consumers as “authorized users” to other individuals’ credit accounts. In most instances, however, the defendants were not able to substantially improve consumers’ credit scores. The complaint also alleges that the defendants charged illegal upfront fees and failed to provide consumers with required disclosures about their credit repair services.
The defendants often used illegal remotely created checks to pay for the credit repair services they offered through telemarketing, according the FTC’s complaint.
For more information, click here.
- Ask students to prepare a list of federal laws that protect consumers from operators of fake credit repair schemes.
- What is the best advice before you sign with such companies as, Grand Teton Professionals, LLC; to repair your poor credit?
- What is a household to do if it is experiencing problems in paying bills, thus resulting in poor credit scores?
- What are your options, if you are having problems paying your bills and need help?
- Discuss the statement, “Only time and a conscientious effort to pay your debt in a timely manner will lead to the success of improving your credit report.”
If you’re overwhelmed by debt, it’s crucial to find a solution.
FDIC Consumer News offers a few tips.
- Contact your lender immediately if you think you won’t be able to make a loan payment.
- Reputable credit counseling organizations can help you develop a personalized plan to solve a variety of money problems.
- Be very careful of “debt settlement” companies that claim they can reduce what you owe for a fee.
- Avoid scams.
- Remember that you have rights when it comes to debt collection.
For more information, click here.
- Ask students if they know anyone who has had financial difficulties and how they resolved their problem.
- Ask students to review the main provisions of the federal Fair Debt Collection Practices Act and how the law protects consumers from unfair debt collectors.
- Why is it critical to contact your mortgage lender immediately if you think you can’t make a loan payment on time?
- In what ways reputable credit counseling organizations can help you develop a personalized plan to solve financial problems?
- What are the warning signs of possible fraud by a debt settlement company or credit counselor?
Ring, ring. “This is Equifax calling to verify your account information.” Stop. Don’t tell them anything. They’re not from Equifax. It’s a scam. Equifax will not call you out of the blue.
That’s just one scam you might see after Equifax’s recent data breach. Other calls might try to trick you into giving your personal information. Here are some tips for recognizing and preventing phone scams and imposter scams:
- Don’t give personal information. Don’t provide any personal or financial information unless you’ve initiated the call and it’s to a phone number you know is correct.
- Don’t trust caller ID. Scammers can spoof their numbers so it looks like they are calling from a particular company, even when they’re not.
- If you get a robocall, hang up. Don’t press 1 to speak to a live operator or any other key to take your number off the list. If you respond by pressing any number, it will probably just lead to more robocalls.
For more information about the Equifax breach, go to Equifax’s website.
- Ask students if they know someone who has received such a call. If so, how the victim responded to the imposter?
- What advice can you provide to a victim of a scam?
- What should you do, if you have already received a call that you think is fake?
- What must you do if you gave personal information to an imposter?
- What can you do to protect yourself from such scams?
Know someone who’s behind on their bills? Maybe debt collectors are calling for payment? The Federal Trade Commission’s new debt collection video can help you understand your legal rights – and may lower your stress level. In the video, you’ll see how bad debt collectors try to get you to pay up. Bad debt collectors will say anything to get you to pay – and they’ll make it feel urgent to get you to pay immediately. But there are laws to protect you. Debt collectors:
- Can’t call you before 8 a.m. or after 9 p.m.
- Can’t use profanity, threaten violence or harass you to pay
- May not lie or pretend to be someone they’re not
- Cannot ask you to pay a debt that doesn’t even exist
- Can’t threaten you with arrest or deportation
- Cannot tell anyone – except your spouse or attorney – about your debt
If a debt collector calls and uses any of these tactics, hang up and report it to the FTC. Remember: you have the right to be treated fairly – no matter what.
For more information go to: consumer.gov/debt.
To view the video, click here.
- Ask students to summarize the steps they may take if a debt collector calls.
- Let students make a list of danger signals of potential debt problems.
- Which federal law regulates debt collection activities and protects consumers from abusive collection practices?
- Does the law erase the legitimate debts consumers owe?
Every day American consumers report tens of thousands of illegal robocalls to the Federal Trade Commission, and now the FTC is helping put that information to work boosting industry efforts to stop unwanted calls before they reach consumers.
Under a new initiative announced by the FTC, when consumers report Do Not Call or robocall violations to the agency, the robocaller phone numbers consumers provide will be released each day to telecommunications carriers and other industry partners that are implementing call-blocking solutions.
Unwanted and illegal robocalls are the FTC’s number-one complaint category, with more than 1.9 million complaints filed in the first five months of 2017 alone. By reporting illegal robocalls, consumers help law enforcement efforts to stop the violators behind these calls. In addition, under the initiative announced today, the FTC is now taking steps to provide more data, more often to help power the industry solutions that block illegal calls.
For more information, click here.
- Ask students if they have received robocalls and what was their response to such illegal calls?
- Let students debate the issue of whether robocalls should be outlawed.
- Why is the consumer complaint data so crucial for the FTC to call-blocking solutions?
- How will the FTC attempt to stop unwanted robocalls before they reach consumers?
In late July 2016, filed as part of Operation Collection Protection, the Federal Trade Commission (FTC) charged that BAM Financial used lies, threats, intimidation, and other illegal practices to extract payments from consumers. When obscene language, incessant calls, and harassment of family members didn’t get the results they wanted, the defendants got personal. For instance, the defendants told the parent of one purported debtor “No wonder your daughter is in such predicament with a mother like you.” The FTC alleges that they falsely stated to another consumer’s 84-year-old mother that they had a warrant for her daughter’s arrest and later told the consumer they were bounty hunters.
The FTC says BAM’s letters and phone calls were riddled with false threats of litigation. The complaint also charged that in numerous instances, the defendants didn’t follow up within five days of their initial communications with proper validation notices as the law requires.
The settlement with BAM Financial, Everton Financial, Legal Financial Consulting, Luis O. Carrera, and Robert Llaury bans them for life from debt collection agency industry.
For more information, click here.
- Ask students what consumer rights they have when dealing with debt collection agencies.
- Ask students to list important provisions of the Fair Debt Collection Practices Act.
- Nearly 30 million Americans have their accounts in collection, and debt collectors make as many as one billion contacts with people every year. Are these contacts legal?
- What types of debts are covered under the Fair Debt Collection Practices Act?
- How can you stop a debt collector from contacting you?
Based on a recent study, chip-enabled cards used without appropriate technology and tax ID theft are the fastest-growing and most costly consumer complaints. People are often contacted by someone claiming to be from the IRS, a utility company, or a tech-support company, and asked to send money or provide personal information. This is a common danger sign of fraud as reported in a recent study of consumer complaints by the Consumer Federation of American and the North American Consumer Protection Investigators.
This report identified the following as the top ten most common sources of consumer complaints:
- Motor vehicle misrepresentations in advertising along with sales of new and used cars, lemons, faulty repairs, leasing and towing disputes
- Home improvement, such as inferior work, and failure to start or complete the job
- Utility service problems and billing disputes
- Credit and debt concerns, such as billing and fee disputes, mortgage fraud, credit repair, debt-relief services, predatory lending, abusive debt-collection tactics
- Retail sales problems related to deceptive ads, defective goods, problems with gift cards and certificates, rebates and coupons
- Services with poor or incomplete work, lack of licensing
- Landlord-tenant concerns, such as unsafe or unhealthy conditions, lack of repairs, and unfair eviction
- Furniture, appliances, and household products that are faulty or not properly repaired
- Health products and services with misleading claims
- Fraud and scams, such as phony sweepstakes, work-at-home schemes, deceptive online sales
Two additional recently reported scams are the “grandparent scam,” in which a phony grandchild calls an older person claiming to need quick cash for an emergency. With the CEO scam, employees are contacted with what appears to be an email from their company asking them to wire money to a foreign supplier for a deal that needs to close immediately with a promise to be reimbursed.
For additional information on current frauds and scams, go to:
- Have students present a talk with actions that might be taken to avoid consumer scams.
- Have students create a list of common consumer complaints among their friends.
- Why are people often victims of consumer frauds?
- What are common suggestions for avoiding various consumer scams and frauds?
In January 2015, the U.S. Department of Justice sued a Texas-based Commercial Recovery System, Inc., a debt collection company that allegedly impersonated attorneys, law firm staff, judicial employees and mediators. The company threatened people with lawsuits, seizure of their property, or wage garnishment. All these practices are against the law. Under federal law, debt collectors–including collection agencies, lawyers who collect debts, and companies that buy delinquent debts and then try to collect them–can’t use abusive, deceptive or unfair practices to collect from you.
For additional information, click here.
- Ask students to check a local Consumer Credit Counseling Service to learn about their services provided to consumers.
- Ask students to compile a list of places a person can call to report dishonest credit practices, get advice and help with credit problems.
- Which federal law(s) protect your rights if you are ever contacted by a debt collector?
- If you need help regaining control of your finances, what resources are available to you?
How can a person contact an auto manufacturer with a concern about a motor vehicle? Where would a person file a complaint about deceptive investments? What state consumer protection agencies are available to help consumers in Missouri?
These, and many other, questions are answered in the Consumer Action Handbook, published by the U.S. General Services Administration. Updated each year, this free reference book offers consumer buying tips on everything from consumer credit and environmental-friendly products to travel and utilities along with extensive lists of contact information for major companies, trade associations, and federal, state, and local consumer agencies.
The Consumer Action Handbook may be accessed at::
online version – http://www.usa.gov/topics/consumer/consumer-action-handbook-online.shtml
download version – http://www.usa.gov/topics/consumer/consumer-action-handbook.pdf
order form for print copy – http://www.usa.gov/consumer-action-handbook/order-form.shtml
video – https://www.youtube.com/watch?v=eHhm5arq1RY
- Have students obtain a copy of the Consumer Action Handbook (print or PDF version) and have them select information about which they were not previously aware.
- Have students talk to others to determine their main sources of consumer information when making a purchase or when having a consumer complaint.
- Why do an extensive number of consumer problems occur in our society?
- Explain the actions a person might take when encountering a consumer complaint.
- In addition to the Consumer Action Handbook, what information sources might consumers use when planning a purchase or encountering a consumer problem?