For-profit debt settlement companies often make big promises to consumers that they can’t keep. They target consumers in financial trouble with promises to negotiate with their creditors to reduce or even erase debts, encouraging consumers to stop paying their creditors and start paying the debt settlement company instead. But oftentimes, consumers are left worse off after signing up for “debt settlement” than before, with possibly even more debt and lawsuits from debt collectors.
In 2017, Dean Schreiber turned to Bedrock, a debt settlement services company, for help managing his debts. Mr. Schreiber received a welcome guide brochure from Bedrock which…
The Texas winter storm in February and the escalating energy prices that followed have drawn scrutiny to the promises of the deregulated energy markets in Texas and 16 other states. In a deregulated energy market, consumers purchase power from suppliers while their local utility delivers the electricity. Free market proponents argued that energy deregulation and more competition would lead to lower electricity rates for consumers.
Researchers have shown the opposite to be true, that deregulation has not led to lower rates, but reportedly has led to aggressive and deceptive sales tactics to get consumers to switch from their local utility…
Sen. Catherine Cortez Masto (D-Nev.) today introduced the End Double Taxation of Successful Consumer Claims Act, which would amend the tax code so that individuals who win consumer cases are no longer expected to pay income tax on funds, specifically reimbursed legal expenses, that they do not receive. The proposal is similar to a previous 2004 amendment to the tax code that protects victims of discrimination.
“Sen. Cortez Masto recognizes that there is a barrier to justice under our current tax system for wronged consumers who seek redress for their harms,” said Ira Rheingold, executive director of the National Association…
Natural and man-made disasters — a deadly hurricane, a sudden winter storm, a destructive tornado, and a ruinous oil spill — upend people’s lives. Families and communities often need help coping in the aftermath.
Below are some pointers and consumer resources for the days and weeks following a disaster:
•Make use of federal and state resources — The U.S. President may declare a major disaster as President Biden did in Texas, unlocking emergency aid. This may include “grants for temporary housing and home repairs, low-cost loans to cover uninsured property losses and other programs to help individuals and business owners…
Like most credit card companies, American Express’ nonnegotiable fine-print traps its customers with restrictions that limit their right to sue. Consumers with legal claims against the corporation must take their complaints into private arbitration on an individual basis, and cannot band together with other potentially harmed customers in class actions.
But in a twist, a customer who said she tried but was ignored multiple times to go to arbitration to resolve an ongoing dispute with American Express, is now baffled that the credit card company is now trying to force her into arbitration on its own terms.
Here’s the background…
Arbitration Clause in the App Bars Individual Suits in Court
The investment app Robinhood is facing accusations of market manipulation by aggrieved traders, and despite the app’s fine print, the claims could manage to go before a judge and jury.
On the morning of January 28, 2021, Robinhood’s 13 million users logged on to find new restrictions on trades of certain stocks including GameStop Corp. (GME), and AMC Entertainment Holdings Inc. (AMC). In a statement posted on their website, Robinhood claimed the restrictions were to help its customers navigate market volatility.
The announcement of these restrictions was poorly received to…
This month, a district court in Pennsylvania ruled for cable company Comcast to enforce an arbitration clause against a consumer who said he never had a Comcast account. The consumer had filed a class action suit against Comcast for allegedly pulling his credit report without permission, a violation of the Fair Credit Reporting Act.
James Shelton claimed that Comcast called him in 2018 to solicit him to purchase Comcast services. Mr. Shelton’s father opened the family Comcast account in 2006 and was the only one who signed the Subscriber Agreement. According to Mr. Shelton, Comcast never indicated that it would…
Washington, D.C. — Misrepresentations and failure to disclosure vehicle defects; fraud and trickery in financing; and deceptions in advertising, pricing, and warranty coverage, are the most prevalent areas of harm for consumers in vehicle transactions, according to a National Association of Consumer Advocates survey of attorneys who assist consumers affected by risky auto industry practices.
In a year marked by the COVID-19 pandemic and its resulting financial shock for millions of households, this survey sheds light on harms connected to vehicle purchases, the second highest national consumer expense after housing.
“There is an ocean of fraud and unfair practices in…
By Sophia Huang
Editor’s Note: The Consumer Financial Protection Bureau’s final rule on debt collection practices released on October 30, 2020 no longer contains a safe harbor for debt collection attorneys who sue consumers with insufficient information.
In a 2015 enforcement action against Pressler & Pressler, a New Jersey-based debt collection law firm, the Consumer Financial Protection Bureau (CFPB) alleged that the firm’s attorneys spent as little as 30 seconds reviewing a case before filing a lawsuit against a consumer to collect a debt. …
With millions of American still struggling to make ends meet, concerns are growing over the pandemic’s long-term effect on consumers’ credit. Additionally, some lenders have reportedly misrepresented consumers’ loan status on their credit reports, misconstruing the federal protections passed earlier this year.
Indeed, credit reporting problems have long led consumer complaints at the Consumer Financial Protection Bureau (CFPB), and they are surging in the COVID-19 era.
Consumers can take steps now to protect their credit:
• Talk to creditors early — Under the federal CARES Act, creditors cannot make negative reports about consumers who receive pandemic-related accommodations such as forbearance…
NACA
National Association of Consumer Advocates (NACA) is a nonprofit association of attorneys and advocates committed to representing customers’ interests.
