Consumer Action INSIDER - November 2020

What people are saying

Thank you so much for this webinar. I wasn't sure if it would be a good use of my time, but was so glad I signed up after attending. Thanks also for the resource sheet, as I did find I couldn't keep up in taking notes and was worried I missed things. You do great work! —Lynette Plander, Financial Empowerment Director, Iowa Able Foundation

Did you know?

Peer-to-peer (P2P) mobile payment platforms, like Zelle, Venmo and Cash App, might be a fast and convenient way to pay bills, transfer money and reimburse friends and family, but, unfortunately, they also have become useful for scammers out to steal your money. As we pointed out in last month’s SCAM GRAM newsletter, fraudsters have created a number of different app-related rackets, including simply tricking users into paying for all sorts of bogus items, but also, more cleverly, sending direct-to-user texts and emails “from” the app to obtain users' account/login info, or to upload malware to victims’ phones and drain their accounts. The Privacy Rights Clearinghouse offers tips for reducing risk when using these platforms.

Health Is Wealth promotes affordable, transparent health care

Consumer Action celebrated 49 years of consumer successes during its annual convening and awards ceremony, held in late September via a series of virtual panels and an award ceremony, with advocates, allies and experts from the nonprofit, corporate and government sectors participating. Titled Health Is Wealth, the occasion featured two timely panels—one detailing the problem of surprise medical bills and medical debt collection, and the other covering telemedicine and medical data protection—and Consumer Action’s Consumer Excellence Awards. The anniversary awards ceremony, which capped off the two-day event, honored Commonwealth of Pennsylvania Insurance Commissioner Jessica Altman, for her regulatory work defending consumers’ right to fair health care; KHN (formerly Kaiser Health News), for its informative media coverage that helps consumers make good medical and healthcare decisions; and Families USA, for its work to keep healthcare coverage accessible and available to all.

Coming at a critical time—during a pandemic, with prescription drug costs and medical debts rising, and the current administration ramping up its fight to destroy the Affordable Care Act—Consumer Action chose the “health is wealth” theme to focus attention on the work of the individuals and organizations fighting on the frontlines for solutions to the problems impacting both the physical health and, by correlation, the financial health of those living in the U.S., especially the most vulnerable among us, including seniors, those with chronic illness, people of color, and those with low or no income.

Emmy Award-winning reporter and top consumer advocate (“Consumer Man”) Herb Weisbaum emceed both panels, featuring consumer, health care, legal and privacy experts from Families USA, the National Consumer Law Center (NCLC), the Better Medicare Alliance, Clover Health (a Medicare Advantage provider), the Mid-Atlantic Telehealth Resource Center and the World Privacy Forum. Weisbaum kicked off the event by describing how medical debt is now the number one reason people file for bankruptcy in the U.S.

“Worrying about medical debt is actually making people sick!” Weisbaum proclaimed. “They’re putting off going to the doctor, they’re cutting back on their meds. In some cases, it’s causing depression.” As Weisbaum and the panelists noted, this avoidance of care leads to more serious medical problems and increased costs to the system. When medical issues aren’t dealt with when they’re small, consumers, terrified of the ensuing costs, end up rushing to the emergency room when their health deteriorates. There, they often incur insurmountable debts.

Panelist Jenifer Bosco, a staff attorney with NCLC (and contributor to NCLC’s “Surviving Debt,” which is free to read during the pandemic), added: “We hear a lot of stories about people having their wages garnished for medical debt, being sued for medical debt and in some cases having civil arrest warrants issued if they don’t show up in court.”

“There are a number of rights that consumers do have to avoid incurring and fight back against medical debt,” Bosco continued, pointing out that before a consumer gets to the point of a debt being referred to collections, they should explore whether or not there are financial assistance programs in place to help them. Nonprofit hospitals, for instance, are required to have “charity care” policies for low-income patients, while some states have laws that apply to for-profit hospital pricing as well. There may be insurance options that help with costs.

Panelists also emphasized the importance of reviewing all medical bills prior to making payments, and asking for itemized bills for a deep dive, since they frequently contain errors.

Some states offer legal protections against one of the worst types of medical debt—“balance billing” (i.e., “surprise” medical bills that result in balances owed when, unbeknownst to a consumer, their health insurance didn’t cover the entire cost of care). Consumer Action covered the topic in our Consumer Action News Summer 2020 issue, “Health and wealth: The connection,” where we list additional tips for dealing with medical debt.

“The bottom line is that Congress needs to address this,” said panelist Jane Sheehan, director of federal relations at Families USA, a national leader on healthcare issues impacting consumers. As Sheehan pointed out, regulations must occur at a federal level; most states have no protections against harmful billing practices, and there are many loopholes even in the states that do have such protections.

The next day’s panel addressed the related issues of medical data privacy and telemedicine, which has become increasingly utilized during the COVID outbreak—so much so that Consumer Action just released, in time for the convening, a new Telemedicine: What to know about virtual doctor visits fact sheet. Panel topics discussed included the effectiveness of, and access to, virtual healthcare; who can benefit from telehealth access (e.g., people in rural and underserved areas without access to broadband connections); new models for providing care (e.g., allowing patients to take their own blood pressure); and if and when services are covered by health insurance. The session also covered a disconcerting recent federal waiver giving “business associates” of entities subject to federal HIPAA health privacy guidelines greater authority to use and disclose patient data without approval from the HIPAA-covered entity that hired them. This of course raises serious concerns about the likelihood for misuse of patient data.

“I don’t think it is going to go back to the way it was before,” said panelist Sarah Green, vice president of commercialization for NextGen Healthcare, of access and coverage being limited to in-person doctor visits. Green cited the many benefits of telemedicine, “on the provider side, but certainly on the patient side.”

“Even in a COVID-free world, we want people to have the flexibility to get the care they need,” added panelist Dr. Kumar Dharmarajan, a cardiologist, geriatrician, and chief scientific officer at Clover Health. He pointed out that now is the time for patients to speak out regarding telehealth polices and concerns, particularly around what types of appointments are covered, how to access online appointments (through services like WhatsApp, Skype, etc.) and data privacy protections. “We are in a time period of great flux, and it’s really, at the end of the day, about your health, and your access, and your stories,” Dr. Dharmarajan told viewers.

After the panelists were done presenting, the third, and final, session—Consumer Action’s 2020 Consumer Excellence Awards ceremony—kicked off with Troy Clair, senior policy manager at Amazon and chair of the event host committee, in the role of emcee. Clair recognized the event sponsors, including presenting sponsor Amazon and underwriters JPMorgan Chase, Comcast, Facebook and TracFone. Find all sponsors listed here.

Clair introduced the first presenter, public interest antitrust attorney David Balto, who presented Consumer Action’s 2020 community award to Families USA Executive Director Frederick Isasi, for the nonprofit’s tireless work to strengthen and expand Medicare and Medicaid, obtain adequate funding for the Children’s Health Insurance Program (CHIP), pass the Affordable Care Act, and more.

“We’ve had so many victories over the last years,” Isasi said, before adding that, in particular, “The last four years have been so difficult, a fight in every corner to maintain and protect the victories of the last decades. And then the COVID pandemic has laid bare the terrible inequities that exist in our society…We as a nation can and must be more just and fair and equitable.”

Los Angeles Times consumer columnist David Lazarus presented the award for media to KHN (Kaiser Health News) Editor-in-Chief Elisabeth Rosenthal, for not just helping consumers stay on top of the latest news, but also helping them to understand the many moving parts of the healthcare equation, including the impact of the most recent healthcare developments and policies.

Doug Heller, an insurance expert with the Consumer Federation of America, introduced the final awardee, Pennsylvania Insurance Commissioner Jessica Altman, for consumer excellence in the regulatory arena.

“Within the last year, my department has responded to the COVID-19 pandemic and worked tirelessly to ensure the insurance marketplace continued to meet consumers’ needs and adapt to a changing world,” Altman said. “Health care shouldn’t be a political issue, and no American should have to choose between their health and their rent, medication, or food on their family’s table.”

“We want to thank all of our generous sponsors, speakers and attendees, during these very difficult times, for your continued support of Consumer Action’s mission to protect and defend consumers—a mission that is more important now than ever,” concluded Consumer Action’s executive director, Ken McEldowney.

The virtual events raised $258,000. “We want our supporters to know that their generous donations will help us provide our newsletters and other crucial free information to consumers during the pandemic,” noted McEldowney.

Coping with COVID-19: From housing, to health care, to rebooting your savings

Earlier this year, when it became clear that the coronavirus pandemic would profoundly affect our lives, raising daunting challenges for consumers across the country, Consumer Action launched our COVID-19 Educational Project. Approximately six months into the year-long effort, we’ve just published our sixth fact sheet in the project’s “Coping with COVID-19” series.

Establishing or replenishing savings” covers why and how to create or add to an emergency fund. While having a financial cushion has always been essential, the record unemployment caused by the coronavirus pandemic has made evident just how crucial it is to have reserves to fall back on. The four-page fact sheet, funded by the Wells Fargo Foundation, covers how much you should aim to sock away, what to consider when choosing where to keep your emergency fund, savings tips and inspiration, and a list of FinTech tools that can help savers get and stay on track.

“While it seems like the most difficult time to save money, it’s also the most important time—and it can be done, slowly but surely, even during these trying times,” said Consumer Action’s executive director, Ken McEldowney.

Other fact sheets in the “Coping with COVID-19” series include:

Telemedicine: What to know about virtual doctor visits: The pandemic has driven people to forgo non-urgent in-person doctor visits in an effort to suppress the spread of COVID-19. As more people receive medical care remotely, via smartphone, tablet or computer, it's important to understand when and how virtual visits might be an option, whether they're covered under private and government-sponsored health plans and what privacy issues they raise.

Making a job or career transition: The pandemic has put millions of Americans out of work, with many others reevaluating their job and career choices in light of how different industries are faring. This guide will help workers identify job opportunities, weigh their education and training options, make wise choices, and understand where to get more information. (Funded by the Wells Fargo Foundation.)

Estate planning: Critical decisions for uncertain times: The COVID-19 pandemic has driven home the wisdom of making critical end-of-life decisions before a crisis strikes. This publication outlines the key estate planning decisions everyone should make now (i.e., what happens to your body and belongings in the event of your death), explains which documents and tools help ensure that your wishes are carried out (e.g., wills and advance directives), and provides resources for learning more, getting help and taking next steps. (Funded by the Wells Fargo Foundation.)

Fair housing rights for those affected by the pandemic: The federal Fair Housing Act protects rental housing applicants, tenants, homeowners and prospective homebuyers from various forms of discrimination. This publication explains how these same rights may protect you from discrimination related to the COVID-19 pandemic (e.g., a landlord attempting to evict you because you’ve had the virus), and the steps to take if you do experience unfair treatment.

Financial assistance for undocumented workers: Millions of undocumented workers don’t qualify for the federal economic aid available to U.S. citizens during the COVID-19 pandemic (even if they’re paying taxes). This publication provides tips and resources for finding state, local and private financial assistance programs that are designed specifically for undocumented immigrants (or that don’t ask for immigration status when determining eligibility). (Funded by the Wells Fargo Foundation.)

All fact sheets are available for free download from Consumer Action’s COVID-19 Educational Project website, and we’re planning on releasing more fact sheets in the coming months (on topics to be determined based on the changing pandemic/needs of consumers).

The project also includes a library of webinars, as well as a regularly updated guide to resources to help consumers deal with the challenges of pandemic-related job loss, housing and food insecurity, health care, debt repayment and more. The COVID-19 Educational Project is made possible with major funding from Wells Fargo and additional support from AT&T, Bank of America, Capital One, JPMorgan Chase & Co. and Square.

Hotline Chronicles: Customer service in the age of COVID

Hana* from suburban Maryland contacted Consumer Action’s hotline about her experience trying to shut off her service with Atlantic Broadband, a cable company serving areas throughout the East Coast. Hana wrote: “I have contacted their cancellation department about six times already, but nobody has picked up my calls AT ALL. I have tried all the numbers associated with this company, but to no avail.” She added, “I’ve even emailed customer service via the ‘contact us’ button, but the email was returned as ‘undeliverable.’”

So, on her seventh call, she chose “upgrade” (as in, to upgrade her service) rather than “cancel” from the menu. This time, the phone was answered within five minutes. The employee said that she would transfer Hana to the right department for cancellations. After holding for a half-hour, Hana (virtually) sighed, “I had a feeling that I was being sent back to square one, and I was right.”

In a good move, Hana searched for corporate contacts on the company’s website, but could locate nothing about reaching higher-ups.

“This is simply not good enough,” said Linda Sherry of Consumer Action. “I’ve had several similar experiences trying to reach companies during the pandemic.” Particularly frustrating, said Sherry, are repetitive phone recordings advising customers to handle all their customer service needs online. “I suspect that I am not alone in having gone through tedious online ‘chats’ with customer service reps, or bots, who don’t understand my questions and who aren’t qualified to help even if they understand what the issue is.”

Our counselors advised Hana to take to social media to get the company’s attention. We find that this sometimes works, although it may require another phone call, as most companies answer social media messages with direct messages asking customers to call in. Another tip is to figure out the corporate parent company’s contact information, which can sometimes be found under “investor relations,” rather than on the company’s customer-facing website.

For example, we learned that Atlantic Broadband is a subsidiary of Cogeco Communications Inc., a publicly traded company, and found its headquarters address and phone number located in Montréal, Canada. (Shout out to Chris Elliott, a consumer advocate who runs the very helpful Elliott Advocacy website, where you can find a list of company contacts for some of the country’s largest firms!)

“We know that it’s outside most people’s desire, and maybe ability, to have to spend time to find higher-ups and let them know about customer problems, but it can be an important exercise in defending your rights as a consumer and speaking truth to power,” said Sherry. “We find that executives rarely hear about customer frustrations, probably because customer service management tries to prevent negative information from reaching all the way to the top. But this is not fair, and is actually shortsighted, because it is the customers who make—or break—a company.”

We don’t know if Hana tried to go into a local brick-and-mortar Atlantic Broadband office, particularly since many people (understandably) want to limit public contact during the pandemic, but visiting an office is another recommendation, particularly during less…viral times.

We advised Hana that if, after all this, she’s still not able to reach anyone to cancel the service, she should write a letter to the company to cancel on a specific date and send it via the U.S. Postal Service as certified mail with “return receipt requested.” If Hana continues to be billed for the service after the letter is received, she will have evidence that she cancelled.

If billing persists, we advised Hana to then file a complaint with the Federal Communications Commission (FCC) and to contact the Maryland Office of the Attorney General (AG) Consumer Protection Division. (You can find your state AG here.)

Need ideas about solving thorny consumer issues? Our comprehensive “How to Complain” guide is free, and you can download it here.

* Not this consumer's real name

Trapped in a pandemic: Domestic violence and financial abuse

“What you may not know is that 65% of all murder-suicides are perpetrated by intimate partners, which is shocking and terrifying,” Gretchen Shaw, deputy director of the survivor-led National Coalition Against Domestic Violence (NCADV), stated during Consumer Action’s “Domestic violence and financial abuse during COVID-19” webinar on Oct. 6, which was attended and watched by 689 viewers. Shaw was one of two speakers at the webinar, including attorney Maclen Stanley, who specializes in pursuing claims of sexual assault, sexual harassment and gender discrimination.

Consumer Action’s Linda Williams kicked off the webinar by introducing both speakers and pointing to a survey revealing that 75% of women in domestic violence shelters reported staying with their abuser longer that they knew was wise due to financial concerns. (The number one reason victims stay with abusers is the inability to afford to get or stay safe.)

The “key thing” about domestic violence? It’s about “maintaining power and control,” Shaw said, emphasizing that domestic violence is a “conscious choice” on the part of one person to abuse another. So, what’s making perpetrators choose to abuse, and at a much higher rate during the pandemic? Since the pandemic began, Stanley explained, there has been a 10-15% increase in calls to the police regarding domestic violence.

Stanley explained how the many negative psychosocial effects of COVID-19 in particular have caused the “perfect storm” of heightened abuse, including increases in divorce (traffic has jumped by about 25% on websites describing “how to divorce”), substance misuse (including alcohol abuse) and unemployment.

“Domestic violence is like a weed,” Stanley described. “It needs very little to grow.”

Indeed, statistics show that domestic violence rates always increase during stressful times, like the holidays. And there are higher rates in both the amount and severity of violence when national disasters and crises occur—for instance, after hurricanes, tsunamis and…pandemics. Sadly, the pandemic violence also is not just more common, but also more severe, with an unusually high number of stabbings and blunt force trauma injuries to the chest—the type of serious physical harm that is correlated with a 900% greater chance of the abuse resulting in an eventual homicide.

And, of course, pandemics lead to isolation, which makes it easier for abusers to abuse. “Now, isolation is socially imposed...state sanctioned even,” Stanley said. “Abusers don’t even need to try to isolate, it’s already happening for them.” Quarantine mandates also lead to what Stanley described as “forced togetherness.” The typical routes for asking for and obtaining help—visiting friends and family, fleeing to domestic violence shelters—have been shut down (due in part to concerns over spreading infection).

Furthermore, numerous studies have proven that domestic violence is much more likely in households with economic stress, in particular. Researchers have discussed how this phenomenon can get particularly bad when the male partner is the one who has lost his job. “The failure to provide for the family, the failure to be the breadwinner,” can “threaten the masculine identity,” Stanley explained. “And in order to regain control in a relationship, abusers will resort to violence in order to ‘gain the upper hand’.”

Of course, alcohol inhibits one’s ability to regulate existing aggression, and as the nation has stayed at home, alcohol sales have skyrocketed—according to one study, by over 240%! Additionally, due to concerns with in-person contact, there have been declines in mental health appointment attendance, which play an important role in helping victims to leave abusers and providing stressed individuals with tools to handle anger without resorting to substance abuse or violence.

Terrifyingly, throughout all of this, gun sales have quite literally been exploding. “In homes where there is a gun and domestic violence is present, victims are 400% to 500% more likely to be killed with that firearm,” NCADV’s Shaw explained, before outlining what, exactly, constitutes the types of financial abuse and coercion that can trap victims in relationships with angry gun-owners.

The list may surprise you. Financial abuse isn’t just denying a partner access to family income. Examples of financial abuse include: applying for credit cards or loans or opening accounts in the partner’s name without their approval and then racking up debt, not paying it down or defaulting on loans (also known as “coerced debt”); forging a partner’s name on checks and other financial documents; making them account for every expenditure; refusing to pay home utilities; stopping child support payments; stealing and using your partner’s credit card; and dragging an ex through extensive and costly family court or divorce proceedings. Refusing to provide available health insurance or assist with childcare, and damaging property that requires costly fixes, are also roundabout ways of abusing a partner financially. Often, abusers end up ruining a victim’s credit, making the victim even more dependent on them, since no one will rent the victim an apartment, issue them a car loan, etc.

It’s hard to leave an abuser when you’re also the victim of financial abuse, particularly today: Shaw pointed out that 100% of service providers have reported that survivors are having challenges with money and resources specifically due to the pandemic. And survivors themselves have referenced the new financial challenges brought on by COVID-19: 40% have mentioned concerns about receiving their stimulus checks, which may be necessary in providing the financial resources to leave an abuser, and many have had difficulties finding a bed at crowded and underfunded domestic violence shelters.

So, what can be done about the horrors of financial (and physical) abuse? Survivors should work with a domestic violence advocate to create a financial safety plan. Shaw repeatedly instructed anyone experiencing domestic violence to reach out to the free and very confidential National Domestic Violence Hotline. One should also consider transferring existing financial assets (or putting new assets) into a bank account that the abuser cannot access and isn’t even aware of; closing jointly-owned accounts; terminating all old leases/utilities; freezing credit and setting up fraud alerts; and getting new PINs, among other suggestions. Shaw also recommended reaching out to the Center for Survivor Agency and Justice, which she described as doing “fantastic work” around combatting coerced debt. Finally, you can find your state NCADV coalition here for more local support.

Consumer Action’s “Domestic violence and financial abuse during COVID-19” is part of our ongoing COVID-19 Educational Project and made possible with support from Wells Fargo. Find the recorded version of all Coping with COVID webinars here.

Coalition Efforts: Flight cancellations and Medicare complications

DOT’s Aviation Advisory Committee is asleep at the wheel. In a letter sent to Department of Transportation (DOT) Secretary Elaine Chao, consumer groups expressed their deep frustration with the Department’s Aviation Consumer Protection Advisory Committee, which is composed largely of airline industry insiders. The letter notes that the committee is ignoring pressing airline passenger complaints and concerns during the COVID-19 pandemic. Americans are not only worried about the risk of contracting coronavirus while flying, but also, as the letter points out, “the disruption in travel plans brought on by the pandemic has led many…to seek refunds for tickets that they were unable to use.” The airlines, however, have been refusing to provide these refunds for cancelled flights, leading to a record 50,000 consumers filing complaints with the DOT. Regardless, the committee neglected to address these pressing topics at its most recent meeting, which represents only the second such meeting since the Committee was reconstituted in the fall of 2018! Learn more.

Advocates to the CFPB: Stop allowing violations of the Fair Credit Reporting Act! Consumer Action joined a coalition of 20 advocacy groups in urging the Consumer Financial Protection Bureau (CFPB) to revoke permission that it had granted the credit reporting industry to ignore a 30-day deadline imposed by the Fair Credit Reporting Act (FCRA) for investigating consumer credit report disputes. The Bureau said it did so to give the industry help in easing the “burden” of business operations during the start of the coronavirus pandemic. However, advocates say now is not the time to allow delays. Given the severe financial difficulties that the COVID-19 pandemic has inflicted on millions of American consumers, as well as the fact that there has been a dramatic 550% increase in credit dispute complaint submissions to the CFPB, it’s more important than ever that these disputes are resolved in a timely manner. Learn more.

Seniors deserve a simplified Medicare enrollment process. Consumer Action joined the Better Medicare Alliance (BMA), a leading research and advocacy organization supporting Medicare Advantage, in unveiling a new white paper that contains a set of comprehensive recommendations to reimagine Medicare enrollment and empower beneficiaries to make better sense of their coverage options. Unfortunately, Medicare beneficiaries (primarily older adults) often describe stress and confusion when becoming eligible for Medicare, and there are financial penalties for making the “wrong” choices in coverage during the complicated initial enrollment process. The coalition’s five-pronged plan, “Empowering Beneficiaries and Modernizing Medicare Enrollment,” offers bold recommendations for reform, including shifting all Medicare enrollment responsibilities to one single government entity: the Department of Health and Human Services. Currently, new beneficiaries experience confusion about the roles of two federal agencies—the Centers for Medicare & Medicaid Services (CMS) and the Social Security Administration (SSA)—in Medicare enrollment. Learn more.

ED must stop funding fraudulent and predatory for-profit colleges. Consumer, student and veteran advocates wrote to U.S. Department of Education Secretary Betsy DeVos asking her to withhold federal funding from schools managed by the Center for Excellence in Higher Education. A Colorado state district court judge recently ruled that numerous private, for-profit schools managed by the “nonprofit” organization had lied to prospective students about graduates’ earnings, job placement opportunities and loan repayment options. Recruiters for the Center “advertised starting salaries associated with specific programs that were twice as high as the actual starting salaries achieved by the Center’s graduates.” Advocates noted that the Higher Education Act bars institutions from receiving federal student aid funding if they have “been judicially determined to have committed fraud.” The letter also encourages regulators to investigate the Center for violations of its nonprofit status. Learn more.

CFPB Watch: Phantom debt, rulemaking roadmaps and a website refresh

The Consumer Financial Protection Bureau (CFPB) recently joined the Federal Trade Commission (FTC)—along with a number of other federal and state agencies—to protect consumers from “phantom debt collection.” This often-criminal activity occurs when “collectors” pressure people to pay debts that they don’t owe or that the company the collector claims to represent has no right to collect.

The crackdown, called “Operation Corrupt Collector,” included more than 50 enforcement actions against companies like National Landmark Logistics LLC, which the FTC sued (along with four related companies) for threatening to haul consumers to court if they didn’t make an immediate payment on an overdue debt that the consumers didn’t owe in the first place. National Landmark’s allegedly fraudulent collectors used victims’ actual credit or bank account numbers, Social Security numbers or family members’ personal information to convince victims that the debt was legitimate. The company is accused of illegally collecting more than $12 million in debts under various names, such as Tristar Legal Services.

Regulators also charged another firm, Absolute Financial Services LLC, with illegally collecting $5.2 million in debts, in part by threatening to arrest consumers who hesitated to pay up instantly. The FTC claims Absolute employed some of the same pressure tactics, including citing personal information, as National Landmark.

If you are being harassed for a debt you don’t owe, report it to the CFPB and the FTC. If you get a call about a debt you don’t recognize, the agencies are advising you to:

  • Get the collector’s name and contact info;
  • Ask the collector to “validate” the debt by detailing how much you allegedly owe and to whom you originally owed it (collectors have five days to provide these details);
  • Not respond to threats, and report the collectors to the CPFB and FTC; and
  • Dispute the debt in writing with the collector if you don't owe some or all of it.

The Bureau offers sample letters you can use to respond to a debt collector, including when you don’t owe the debt or simply want the collector to stop contacting you while it’s in dispute.

Unfortunately, the CFPB is expected to release an inadequate rule any day that would allow debt collectors to harass debtors (online, by text, phone, etc.). Under the rule, collectors could “call consumers seven times a week” and “send unlimited texts and emails. It would also prohibit companies from suing to collect on debt they knew or should have known is past the statute of limitations.”

Weighing in with the CFPB

One of the CFPB’s many responsibilities is to write rules governing the major players in the mortgage, student loan, credit reporting, debt collection and other financial services industries.

While the proposed debt collection rule (we mention above) has received thousands of comments online, many consumers don’t know how to weigh in on it and other rules like it that could end up affecting their lives. Fortunately, there’s now new information on how the rulemaking process works. When the Bureau proposes a rule, it usually asks the public for input. Consumers, industry representatives and other interested parties can then weigh in on the plan. The CFPB is required to review and consider all comments it receives.

An attorney who was previously in charge of CFPB rulemaking (in the agency’s Office of Regulations) has created a one-page chart to make the bureaucratic commenting process a bit more understandable. The Consumer Rights Regulatory Engagement and Advocacy Project also has created a plain-English glossary to explain how the system works.

Anyone can contribute their feedback to the Bureau, and that feedback does not have to be formal. Remember: Rules that are open for comment represent an opportunity to use your voice to influence the agency’s decisions!

Website refresh

The Bureau has stated that it is making changes to its website to improve usability and searchability, and to make the site more interactive. For starters, it’s reorganizing how it presents information.

Materials are divided into sections (scroll down the homepage) for CFPB rules, enforcement (i.e., lawsuits, which now contains a subsection called “payments to harmed consumers”) and supervision (i.e., compliance with the rules).

The Bureau’s consumer resources section contains educational information broken down by financial topic (such as debt collection, mortgages, and credit reports and scores).

Site visitors can scroll down to the Bureau’s data and research section to locate its consumer complaint database, a valuable tool for submitting thorny complaints about financial services providers.

Now, the Bureau will archive all reports, press releases and blogs that are two years or older. The agency says that no data will be removed from its site, just relocated under a new archive section.

We’ll keep you posted on future changes, and on our efforts to urge the Bureau to restore the complaint details (narratives) tab on its site (after burying this critical information during an earlier revision to its website).

Class Action Database: Facebook pays for illegal use of facial recognition

A class action settlement involving the Samsung Galaxy S4 smartphone’s speed was among nine new settlements added to the Consumer Action Class Action Database during October.

Of note this month is the class action In re Facebook Biometric Information Privacy Litigation.

The plaintiffs filed the suit against Facebook, alleging that the social media giant violated the Illinois Biometric Information Privacy Act (“BIPA”). BIPA forbids companies from collecting, storing or giving out biometric data unless they first give written notice of the specific purpose and length of the collection/storage and get written consent from Illinois residents.

BIPA defines biometric data as voiceprints, fingerprints or face scans. Plaintiffs claim Facebook’s face recognition technology, which creates and stores face templates to identify users in photos, violates BIPA. Specifically, Facebook created its “tag suggestions” tool to scan and identify the individuals in photos uploaded by its users. When a Facebook user uploaded a photo without a person’s name associated with it, the tag tool would recognize the person’s face (from Facebook’s database) and suggest that the corresponding name/user account be “tagged” (or, associated) with the face. Unless the target to be tagged had gone into privacy settings and opted out of the “service,” users were automatically prompted to tag those identified in the photos (and many users did so).

Facebook denied the allegations but agreed to a $650 million settlement to “avoid the burden, expense and risk of continuing the lawsuit” (typical language used by companies to avoid accepting responsibility for their actions). Last year (likely due to anticipated settlement requirements), Facebook got rid of the tag suggestion tool—it’s since been replaced by broader facial recognition across the board, an alert to users that they are “in” the facial recognition system, and an option to explicitly say “yes” or “no” to the question “Do you want Facebook to be able to recognize you in photos and videos?” If you answer “no,” Facebook deletes your “face recognition template” as well.

You are part of the class if you lived in Illinois for at least six months after June 7, 2011, and Facebook created and stored a “face template” of you (i.e., you were tagged in a photo) after June 7, 2011. For more information on eligibility, click here. If eligible, you can receive a payout of $200 to $400 from the fund created by the class action (depending on the number of valid claims filed).

Furthermore, class members who are inactive on Facebook for three years will have their face template deleted by Facebook.

The claims deadline is Nov. 23, 2020.

About Consumer Action

Consumer Action is a non-profit 501(c)(3) organization that has championed the rights of underrepresented consumers nationwide since 1971. Throughout its history, the organization has dedicated its resources to promoting financial and consumer literacy and advocating for consumer rights in both the media and before lawmakers to promote economic justice for all. With the resources and infrastructure to reach millions of consumers, Consumer Action is one of the most recognized, effective and trusted consumer organizations in the nation.

Consumer education. To empower consumers to assert their rights in the marketplace, Consumer Action provides a range of educational resources. The organization’s extensive library of free publications offers in-depth information on many topics related to personal money management, housing, insurance and privacy, while its hotline provides non-legal advice and referrals. At, visitors have instant access to important consumer news, downloadable materials, an online “help desk,” the Take Action advocacy database and seven topic-specific subsites. Consumer Action also publishes unbiased surveys of financial and consumer services that expose excessive prices and anti-consumer practices to help consumers make informed buying choices and elicit change from big business.

Community outreach. With a special focus on serving low- and moderate-income and limited-English-speaking consumers, Consumer Action maintains strong ties to a national network of more than 6,000 community-based organizations. Outreach services include training and bulk mailings of financial and consumer education materials in many languages, including English, Spanish, Chinese, Korean and Vietnamese. Consumer Action’s network is the largest and most diverse of its kind.

Advocacy. Consumer Action is deeply committed to ensuring that underrepresented consumers are represented in the national media and in front of lawmakers. The organization promotes pro-consumer policy, regulation and legislation by taking positions on dozens of bills at the state and national levels and submitting comments and testimony on a host of consumer protection issues. Additionally, its diverse staff provides the media with expert commentary on key consumer issues supported by solid data and victim testimony.




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