Released: January 05, 2015

Consumer Action INSIDER - January 2015

Table of Contents

• What people are saying
• Did you know?
• Five and counting for Consumer Action’s National Conference
• Forced arbitration documentary premieres in San Francisco
• Hotline Chronicles: Bill collectors contacting family members
• Using data effectively to build a ‘Culture of Health’
• Bringing consumer perspective to the Internet of Things
• CFPB Watch: Medical debt and student debt ‘relief’ scrutinized
• Is your ‘Check credit report’ light blinking?
• Class Action Database: Mortgage ‘options’ cause loan balance to grow
• Coalition Efforts: Corinthian, Ring Pops and auto finance
• About Consumer Action

 

What people are saying

This is just the kind of information we need for our clients. Your Consumer Empowerment Conference has been great. Thank you so much! — Barbara M. Henza, Cornell Cooperative Extension, Cortland County, NY

Did you know?

The U.S. Food and Drug Administration (FDA) mandates that by next year at this time calorie and nutrition information for food and alcohol must be listed on menus and menu boards at restaurants and retail food establishments that are part of a chain of 20 or more locations. Drinks mixed at the bar won't have to be labeled unless they are listed on the menu. The rule is aimed at countering the rising obesity epidemic. Will your nine-ounce Mai Tai be so refreshing when you know it has 600+ calories? Learn more at the FDA website.

Five and counting for Consumer Action’s National Conference

Now in its fifth year, the Consumer Action National Consumer Empowerment Conference is a hub for community activists who help individuals assert their consumer and privacy rights in the marketplace, avoid fraud and manage their money more effectively.

The invitation-only two-day event in Chicago featured a popular session on data security that highlighted the transition from magnetic stripe credit cards to the increased security of cards embedded with computer chips. Most credit cards are expected to make the switch by October 2015, when liability for counterfeit fraud will transfer from card issuers to merchants who haven’t upgraded their terminals to accept the new "chip cards." (Fraud protection and liability remains the same for consumers.)

Attendees heard about digital profiles and privacy from experts Ed Mierzwinski of U.S.PIRG, Seeta Peña Gangadharan of New America Foundation and Tiffany George of the Federal Trade Commission (FTC). The experts discussed the potential harms and opportunities of massive collection of information online and from connected devices (Big Data). The difficulty in knowing who is collecting and using personal data, particularly for underserved communities, was discussed, as was the lack of consumer control over sensitive personal information and how it may be used to discriminate against some consumers in the marketplace. Panelists spoke of the need for fair information practices, which include preventing personal information from being used in ways consumers would not expect. The panelists also pointed to the need to regulate data brokers, companies that collect, buy and sell our information without our knowledge or consent.

Student loans

Seven in 10 college students graduate with an average $29,000 of debt, according to Pauline Abernathy from TICAS (The Institute for College Access and Success). She cautioned groups about the extra cost and lack of consumer protections on private student loans, and the dangers of converting federal loans into private loans when consolidating debt to modify payments. Abernathy offered tools to help families compare college costs before applying, such as net price calculators and reputable opportunities to refinance federal student loans

Credit reporting

According to the Federal Trade Commission, five percent of errors in credit reports result in denials of credit or higher interest rates, said speaker Chi Chi Wu of the National Consumer Law Center (NCLC). She argued that we wouldn’t find that error rate acceptable in the cars we drive or planes we fly in and we shouldn’t for credit reports, given the huge effect they have on our financial lives. Wu explained the need to improve the dispute process, which is automated and whittles down complaints to a simple code. Wu recommended that consumers mail disputes (rather than submit them online), with return receipt requested, to credit bureaus and the company that furnished the wrong information. (This also can help avoid losing your legal rights, as complaints submitted online might be subject to mandatory arbitration clauses.)

Prepaid cards

The same consumer protections that apply to a lost or stolen debit card were recently proposed by the Consumer Financial Protection Bureau (CFPB) to be extended to general-purpose prepaid cards. Susan Weinstock of Pew Charitable Trusts detailed the CFPB proposal to limit consumer’s liability to $50 with “registered” prepaid cards, make fees clearer upfront and extend protections to cover peer-to-peer and electronic payments, like those made with Google Wallet or PayPal.

Financial services

Attendees also heard of alternative ways to access financial services. These included Walmart’s nearly no-fee Bluebird prepaid card, Bank of America’s Safe Balance checkless checking account and the U.S. Postal Service’s innovative plan to include banking services at post offices around the nation. San Francisco City Treasurer Jose Cisneros explained the city’s push for safer banking through direct deposit with its CurrenC SF campaign.

A panel discussing bank alternatives included, from left, Angie Garcia Lathrop of Bank of America, Daniel Eckert of Walmart and David Williams, U.S. Postal Inspector.

Debt collection

The second day featured warnings not to ignore communications from debt collectors, who are taking more consumers to court—even when they don’t have proof that the debt is owed—and winning default judgments when consumers don’t show up. Lisa Stifler of the Center for Responsible Lending (CRL) advised people to ask for proof of the debt and to dispute it with the collector within 30 days.

The CFPB is expected to release preliminary debt collection rules in 2015. Corey Stone, an assistant director at the Bureau, told conference attendees that most consumers who complain to the CFPB about medical debts argue that the amount owed is wrong or the debt is not theirs. A large percentage of those with outstanding medical debts have no other overdue debts and no reason to be labeled as credit risks. (See “CFPB Watch” in this INSIDER issue.) In a separate session, the CFPB presented some of its latest tools, including Your Money, Your Goals, to help consumers better manage their money and debt.

Auto loans

Fifty percent of car dealer profits come from car loans, and 80 percent of loans are made at the dealer, said Chris Kukla of CRL. “Dealer markups,” where car dealers tack extra interest onto a loan, are often higher for African Americans and Latino customers—even those who attempt to “negotiate” a better interest rate.

Foreclosure prevention

The conference wrapped up with innovative approaches to saving families and communities from foreclosure. Advocates Trina Scordo (New Jersey Communities United) and Amy Schur (Alliance of Californians for Community Empowerment) explained how they are working in California and Newark, NJ to use eminent domain to return wealth to cities and communities. This involves eminent domain purchase by cities of failing, underwater mortgages at their current value and repackaging of the loans to affordable levels for homeowners. This also helps save blighted communities. During this session, an attendee from a community-based organization shared the group’s success in helping homeowners re-purchase their homes from mortgage securitizer Fannie Mae at an affordable rate. “That’s an outcome with far-too-rare results worth shouting about,” said Consumer Action’s Ruth Susswein.

Consumer Action’s National Conference is free to invited attendees (including travel expenses) because of the generosity of conference sponsors: American Express, AT&T, Bank of America, Capital One, Chase, Citi, Comcast, Enterprise, Facebook, Google, Microsoft, MyWireless.org, TracFone, Verizon, Visa and Walmart. Representatives of many of the sponsors also attended the conference and shared important information with attendees.

Forced arbitration documentary premieres in San Francisco

“Lost in the Fine Print,” Alliance for Justice's new short documentary about forced arbitration, narrates the stories of three people whose lives were impacted by forced arbitration clauses found in everyday agreements. Consumer Action co-hosted the San Francisco premiere Nov. 10 at Impact Hub, which was followed by a reception provided by Italian Colors restaurant—the lead plaintiff in the landmark arbitration case featured in the film.

The 20-minute documentary can be viewed online at the Lost in the Fine Print website.

Nicole Mitchell, one of the consumers profiled in the film, was a U.S. Air Force Reserve member who also worked as a meteorologist for The Weather Channel. According to the film, NBC Universal purchased The Weather Channel in 2008, and new management was unhappy with Mitchell taking time off for military service. In 2010, after returning from annual military training, Mitchell learned that her contract would not be renewed. Mitchell tried to sue her employer for violations of the federal law that would have protected her against any penalty for taking time off for military service. But, because her employment contract contained a forced arbitration clause, Mitchell's case never went to court. An arbitrator decided against her, and she had no right to appeal.

The documentary also features the story of Debbie Brenner, an aspiring surgical technologist who enrolled at Lamson College, a for-profit vocational school, to pursue her career. Contrary to claims made by the college before she enrolled, Brenner realized that classrooms were overcrowded, professors underqualified and local hospitals unwilling to hire the college's graduates. Brenner and 13 fellow students were unable to sue for breach of contract and fraud due to a forced arbitration clause in their enrollment forms. An arbitrator ruled against Brenner and required that she and other students pay hundreds of thousands of dollars in legal fees to the college’s parent company. Neither the arbitrator's ruling nor the legal fees award could be challenged in court.

The final story in the film was that of Alan Carlson, owner of Italian Colors restaurant. Carlson, along with other merchants, sued American Express over high credit card swipe fees, alleging antitrust violations. When American Express claimed that Carlson and the other merchants were bound by forced arbitration clauses, the group challenged the clause in court. A federal appeals court sided with the merchants. However, the matter made its way to the U.S. Supreme Court, where the arbitration clause was upheld.

University of California-Berkeley public policy professor and former U.S. Secretary of Labor Robert Reich narrated the documentary. In one segment, Reich explains that forced arbitration clauses send consumers to arbitration firms chosen by the company and that, according to one study, these forums rule for companies over consumers 94 percent of the time. “It’s a rigged system that helps companies evade responsibility for violating anti-discrimination, consumer protection and public health laws,” says Reich.

The film's screening was followed by a panel discussion moderated by Rebecca Hamburg Cappy, West Coast director of Alliance for Justice. Panelists included Alan Carlson, the owner of Italian Colors, and his attorney Edward Zusman; employment and civil rights attorney Cliff Palefsky; and California Court of Appeal Justice J. Anthony Kline. One key point made during the discussion was that it was important for consumers to voice their opposition to forced arbitration through petitions and emails to policymakers, especially if Congress doesn't fix the problem. Also raised was the issue of sitting judges aspiring to one day become arbitrators and how this might influence how they rule on court cases.

Consumer Action’s Nelson Santiago attended the screening. “I highly recommend that consumers watch this 20-minute documentary and explore the resources on forced arbitration posted at www.LostInTheFinePrint.org. The documentary is short, informative and likely to teach viewers something new.”

Hotline Chronicles: Bill collectors contacting family members

Tessie* of Smyrna, DE contacted the Consumer Action hotline to complain about a debt collection company that had called her several times. She responded to the first call but, while speaking to a man who started to shout and threaten her, she hung up and stopped responding. A week later she learned that the company had called extended family members that she has no contact with in an effort to locate her. “A family member I haven’t spoken with in more than 10 years called me today because he received a call from this company and they said they were looking for me because I owed money.”

Tessie, who is in poor health, said learning that distant relatives had been contacted “caused me great stress.” She wanted to know her rights and file a complaint against the company. “Can debt collectors legally call my distant relatives?”

Yes, under the federal Fair Debt Collection Practices Act (FDCPA), debt collectors may contact third parties, such as relatives, neighbors or co-workers, but only in an attempt to locate you. Having reached her once, it appears that the collector already knew how to contact Tessie. Also, collectors cannot reveal to third parties that they believe you owe a debt. Since Tessie’s distant relative was told the call was in connection with a debt she owed, it appears that she has a legitimate complaint.

Tessie’s complaint is strengthened by the fact that she was treated rudely and threatened when she returned the first call from the debt collector. Under the FDCPA, debt collectors are not allowed to use abusive language or profanity, do things to harass or publicly embarrass you, or threaten you with violence, property damage, arrest, jail, harm to your reputation, etc.

There are penalties for collectors who violate the FDCPA. We advised Tessie to file a complaint with the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB). The FTC enforces the FDCPA, while the CFPB regulates the collection industry.

• Consumer Financial Protection Bureau (CFPB): 855-411-CFPB (2372)
• Federal Trade Commission (FTC): 877-FTC-HELP

Tessie should also contact her state’s Attorney General (AG) to find out if the collector has violated state law. Find your state AG online at the National Association of Attorneys General.

Consumers also may be able to sue the collector in federal or state court for damages and attorney’s fees. (Some states have laws that are even stronger than the FDCPA.) Consumer attorneys who specialize in FDCPA violations sometimes are willing to take your case on “contingency,” meaning they don't expect to get paid until you win the case. To find a local consumer attorney, visit the National Association of Consumer Advocates and use the “Find an Attorney” search tool.

Consumer Action offers two brochures that outline consumer rights around debt collection. Click here for The Fair Debt Collection Practices Act. Click here for Debtors’ Rights: Protecting yourself from debt collection lawsuits.

*Not this consumer’s real name.

Using data effectively to build a ‘Culture of Health’

Rapid advances in technology have enabled the collection of large amounts of data that could help society make better decisions about how to improve health. On a five-city listening tour to learn how to better use data to improve health, the Robert Wood Johnson Foundation stopped at San Francisco’s Mission Bay Conference Center, where it heard from government officials, consumer and privacy advocates and experts in health, technology, community development, etc.

Consumer Action’s Audrey Perrott attended the meeting, the fourth stop on the five-city tour, which also convened in Philadelphia, Phoenix, Des Moines and Charleston.

Dr. Ivor Braden Horn, medical director at the Center for Diversity and Health at Seattle Children’s Hospital, primed the discussion by relating how a close relative returned from active military duty suffering from an illness. Because data was shared on a regional level about others with the same syndrome, doctors were able to give the best care and treatment for her relative. Dr. Horn, a leading thinker on how social media and mobile health technology can be used to improve health outcomes in underserved populations, emphasized the importance of having the family of the patient advocate for the best care possible.

Andrew Rosenthal of Jawbone, a consumer technology and wearable device company that builds products and software powered by data science, was a speaker. Rosenthal said that data has proved useful to health researchers since the time of John Snow, the father of epidemiology who traced the outbreak of cholera in London in the 1850s using data he collected going door-to-door. Rosenthal discussed how tech companies and others are able to tell a lot more about consumers’ health since the invention of biometric activity trackers. Wearable activity trackers allow device owners to track body signs such as heart rate and to input information about sleep patterns, exercise patterns, caffeine consumption, calorie intake, etc.

Examples of using data to improve community health from the Robert Wood Johnson Foundation include:

• In Oregon, a city planner with access to information about traffic injuries and bike routes tracked by apps determined where to install bike lanes and other bicycle safety measures to improve safety and health.
• In Buffalo, NY, using data gathered from 911 calls, population density maps and other sources, city officials are able to pinpoint areas most in need of services and allocate and prioritize resources to these neighborhoods.

While everyone in the room seemed to agree that the right kind of data could be harnessed to improve health, there was disagreement on how much data should be collected and for what purposes. Concerns were raised about the accuracy and privacy implications of big data. While data use and collection is inevitable, attendees wondered about such perennial questions as “Who owns the data?” and “What impact does self-reporting of my health through social media, apps or peer-to-peer exchange have on my health or my privacy?” At the end of the day, listening-tour attendees agreed that data for health is important, but users need control over the information collected about them. Watch streaming video of the San Francisco event.

Consumer Action offers a free, multilingual educational module on Health Records Privacy.

Bringing consumer perspective to the Internet of Things

Consumer Action’s Linda Sherry joined a panel—“The ‘people’ side of the Internet of Things”—at the 2nd Annual Internet of Things Global Summit in late October in Washington, DC. The term "Internet of Things" is widely used to describe devices and other technologies that connect to the Internet and with each other. From the now-ubiquitous smartphone to Nest thermostats to FitBit body monitors, the Internet of Things industry is capable of generating huge amounts of data about consumers that could allow prying eyes into our lives in a way never before imagined.

Sherry said, “If we really want to realize the promise to society—public health and safety, energy savings and better healthcare delivery among them—consumers are going to have to trust the smart environment. While consumers are quickly adopting these technologies, there could be backlash if privacy isn’t a chief consideration of developers. It could be ‘Once burned, twice shy’ if the wrinkles are not worked out.”

Sherry’s fellow panelists were Mark Eichorn of the Bureau of Consumer Protection at the Federal Trade Commission; Daniel Castro of the Center for Data Innovation; and Stephen Pattison of ARM Holdings, a multinational semiconductor IP supplier. Dan Caprio of McKenna Long & Aldridge LLP was the moderator.

Data about consumers is collected from an increasingly broad array of sources, often in close to real time. Companies can draw on user behavior and base business decisions, including those regarding access to goods and services and customer pricing, on it. “Connecting everything may disenfranchise those who aren’t connected,” said Sherry. “This data discrimination could lead to digital redlining and disadvantage poor and unconnected people financially and in other ways. Is all this data going to result in greater inclusion—or more exclusion? The jury’s still out.”

Sherry suggested that this high-speed world of ever-more connected devices be “slowed down” so that its long-term implications could be better understood. Pattison, who spoke next, said he disagreed with the need to slow down. “I believe we want to speed up the Internet of Things as an instrument of transformation,” said Pattison, who compared the place the industry is at with “cars in 1900.” Things seemed incredibly chaotic then, he said, but ultimately society developed “rules of the road” that allowed the technology to grow.

In her presentation, Sherry suggested consumer protections are crucial because when people rapidly adopt “convenient” technologies they may overlook the ramifications. Some devices and technologies have the capability to generate particularly sensitive personal information, she said, such as biometric data like facial recognition, fingerprints and retinal scans. While consumers might be comfortable with one particular use of such data, the possibility exists that it might later be used for purposes the individual hasn’t agreed to. This makes strong data retention and use restrictions especially important. “Unless strong data privacy protection regulations are developed and people are well informed about what’s at stake, consumer acceptance may falter,” she said.

CFPB Watch: Medical debt and student debt ‘relief’ scrutinized

More than half the overdue debt on credit reports (52%) is tied to medical bills, according to a new study released by the Consumer Financial Protection Bureau (CFPB). The consumer bureau says that one in five credit reports—for 43 million Americans—contain medical debt in collections.

Medical debt can be complex and difficult to get a handle on given that there are often multiple players, including medical providers, insurers, debt collectors, credit bureaus and others, making the system rife with inconsistencies. According to CFPB Director Richard Cordray, medical debts may be turned over for collection anywhere from 30 to 180 days after billing, with no standard for when these debts are reported to credit bureaus. The Bureau says that many consumers complain that they do not owe the medical debts on their credit reports.

The CFPB will now require major credit reporting bureaus to submit accuracy reports as part of their regular examinations so it can review how consumer disputes are handled. The financial watchdog wants credit bureaus to investigate why certain companies (furnishers) have many more disputes. Furnishers are the companies that provide collections information on consumer credit reports—they can be health care providers or collection agencies. Through its examinations of credit reporting agencies, the Bureau will require information about furnishers with particularly high disputes relative to their industry peers.

At a CFPB field hearing in Oklahoma City last month focused on medical debt, Fair Isaac, provider of the FICO credit score model, explained that its latest scoring model reduces the impact of medical debt on individual credit scores. (The competing VantageScore also limits the effect of medical debts.) Scoring companies have come to believe that medical debt does not predict a problem paying future debts.

Cordray said the Bureau supports a proposal by the Internal Revenue Service (IRS) for non-profit hospitals to give consumers 120 days before starting debt collection actions or reporting debts to a credit bureau.

Click here to read the CFPB medical debt collection report.

Relief from student debt ‘relief’

The CFPB cracked down on debt “relief” scams that tricked students into paying illegal upfront fees to resolve their student loan debts. These consumers were charged fees of $195 to $2,500, even if they didn’t qualify for loan consolidation. Before a debt settlement fee can be charged, federal law requires that a debt be renegotiated, reduced or settled, and that both the consumer and the lender sign off on the new arrangement.

The Bureau charged that College Education Services, operating online under the URLs CollegeDefaultedStudentLoan-dot-com and HelpStudentLoanDefault-dot-com, falsely promised students lower payments and quick relief from default or wage garnishment. The CFPB and the Florida Attorney General have asked a federal court to permanently ban the company from offering debt relief services.

The CFPB has also sued an online company with the URL StudentLoanProcessing.us for charging illegal upfront fees, misleading consumers about its monthly service fees and implying an affiliation with the U.S. Department of Education. (Its home page features a government-like seal with U.S. flags and the domain .us. Registrants of .us domains must be U.S. citizens, residents or organizations or a foreign entity with a presence in America.)

Avoid paying for loan modification help you can get for free. Enrollment in the federal Income-Based Repayment Plan or the Pay As You Earn program is available for free to federal student loan borrowers. Visit the U.S. Department of Education website for more information.

The CFPB warns consumers not to provide your four-digit federal student aid personal identification number (PIN) unless you are sure you are on a U.S. Department of Education website. Sharing your PIN could put you at risk of identity theft, and for-profit companies with access to the PIN could make changes to your student loans that are not in your best interest.

Is your ‘Check credit report’ light blinking?

By Linda Williams

I was in my new car tooling down a wide-open freeway—and believe me, in Southern California that’s a rare thing—when a light on the dashboard began to blink. I ignored it and kept driving, thinking I would take care of it later. But after several miles, the front end of my car began to shake violently. When I finally stopped to investigate, the damage was done. That light had been warning me of a problem with one of my tires. By ignoring it, I destroyed the tire and was driving on the rim. That thing was bald—I couldn’t even see that a shred of rubber had ever graced the hard metal rim. Mea culpa—the cost for ignoring that flashing light was astronomical.

Don’t ignore the warning light!

So as you take down the holiday lights, pack away the holiday decorations, and welcome the New Year in with a toast and cheerful chorus of Auld Lang Syne, make sure that your “Check credit report" light isn’t blinking. Make one of your New Year’s resolutions to check your credit reports. The cost of not checking your reports also could be astronomical.

Why should you check your credit reports?

Consumers should check their credit reports for errors, to detect signs of ID theft, and to understand what information is in their credit report. By checking your reports, you will exercise an important federal consumer right—to receive a free copy of your report from each of the three major credit reporting bureaus every year.

Most consumers don’t realize the impact that a credit report can have on their financial lives. Credit information increasingly has become a part of the data-gathering process for lenders, potential employers, insurance companies, landlords and utility companies. The information contained in consumer reports is used to predict your future behavior as a borrower, employee, tenant or insured individual, yet a recent poll by WisePiggy found that a third of Americans hadn’t checked their credit reports in the past year.

What if the information in your report is incorrect?

A study conducted by the Federal Trade Commission (FTC) found that about one in five, or an estimated 40 million consumers, has an error on at least one of their three credit reports. As reported by Consumers Union, more than five percent—about 10 million people—had an error that could cause them to pay more interest on new loans. Regularly checking your credit report can help you catch these errors.

Most of us have heard of identity, or ID, theft, a crime in which an imposter steals your personal information and takes out credit in your name, leaving you to clean up the mess. The most troubling fact about ID theft is that you can be a victim and not realize it until considerable damage has been done to your credit history and your reputation.

Account fraud and account “takeover” are the two most severe types of ID theft. They occur when someone obtains your information and opens new accounts in your name or makes unauthorized transactions on current accounts.

With the news of the recent data breaches at Target, Home Depot, Lowes, Staples, the White House and Sony, the need to protect one’s personal information in this digital age is becoming more crucial. The Identity Theft Resource Center defines a data breach as an incident in which an individual name plus a Social Security number, driver’s license number, medical record or financial record (credit/debit cards included) is potentially put at risk because of exposure. As of Dec. 16, the Center reported 744 data breaches during 2014, resulting in close to 82 million U.S. consumer records being exposed. Read the report.

According to Javelin Strategy & Research, consumers who are notified that their Social Security numbers were compromised in a data breach incident are five times more likely to become a victim of fraud than all other consumers, and 14 times more likely to become a victim of new account fraud.

Checking your credit report regularly will reveal not only recent activity on your active accounts but also show any new accounts that may have been opened without your permission.

So, what information is on your credit reports?

Your credit report contains information about your borrowing activity, your bill repayment history and the status of your credit accounts. This information includes how often you make your payments on time, the amount of credit available to you, how much credit you are using and whether a debt or bill collector has you in its sights.

If you are a renter, credit reports can contain rental payment information. They also may contain public records such as liens, judgments and bankruptcies. Also on file is your personal information—your name, date of birth, Social Security number, current and previous addresses and current and previous employers. Inquiries—a list of third parties such as lenders, landlords or insurance companies that have requested your credit report—are also included. Some inquiries reflect applications you have made for new credit while others are regular checks done by your current creditors, such as credit card companies or mortgage lenders.

The reports also contain helpful summaries of the negative information in your report. Negative information could affect your ability to get new credit and could cause your credit score to tank.

Each credit reporting agency creates its own report, and these reports don’t always agree. Regularly checking all three of your credit reports will help you catch serious issues.

Why should you order a copy of your report?

By not checking your credit report regularly, you miss the opportunity to catch an error or incident of ID theft or account fraud early. But the best reason to check your credit reports yearly is that all three reports are free. You have a right to free reports—so be proactive and exercise that right.

Without opening your wallet or breaking out your payment card, you can obtain your credit reports from the three major agencies (Equifax, Experian and TransUnion) through the official website AnnualCreditReport.com. If you haven’t looked at your reports in the last couple of years, you may want to order all three at once. However, if you suspect that you may be a victim of ID theft or if your Social Security number is compromised in a data breach, consider staggering your reports by ordering one every four months.

When ordering your reports, you may be asked some personal multiple-choice questions about your existing credit accounts. Be sure you answer the questions correctly or you may not be able to access your report online. (If that happens you can still order it by mail or phone.) Common questions include the amount of your fixed mortgage payment, the names of lenders who issue your car loan or credit cards, or past addresses you have lived at. The questions can seem a little tricky, so take your time, and know that “None of the above” is an acceptable answer if you don’t recognize any of the choices.

If you haven’t checked your credit report within the last year, your “Check credit report" light might be blinking. Don’t drive blindly on—start the New Year off right. Order your free credit reports now.

Class Action Database: Mortgage ‘options’ cause loan balance to grow

Class action settlements involving Bank of America (late fees) and Honda (brake pads) were among 14 new cases added to the Consumer Action Class Action Database during December. Visit the Class Action Database.

One notable class action we posted is Peel et al v BrooksAmerica. At issue are approximately 16,600 option adjustable rate mortgages (“option ARMs”) in California that were originated by BrooksAmerica and acquired by Washington Mutual Mortgage Securities Corporation (WMMSC) or WaMu Asset Acceptance Corporation (WAAC) and serviced by Washington Mutual Bank.

An option ARM loan is an adjustable rate mortgage with several possible payment choices. In this instance, Timothy and Cheryl Peel and other named plaintiffs claim they were not informed that making only the minimum monthly loan payments would cause the principal balance to increase (negative amortization). Most mortgage balances go down (decrease) as payments are made.

California borrowers who obtained an option ARM loan between Jan. 16, 2004 and Dec. 2, 2014 that was acquired by WMMSC or WAAC may be eligible for payments ranging from $239 to $716. The amount of the payments will depend on the original loan balance and length of time WMMSC/WAAC owned the loan.

If the settlement is approved, class members will automatically receive the settlement check. If you have moved since you had the mortgage, you can contact the attorneys via the settlement page. The final approval hearing is scheduled for March 27, 2015.

Coalition Efforts: Corinthian, Ring Pops and auto finance

There is power in numbers! Consumer Action welcomes the opportunity to partner with its allies on a myriad of important issues, from consumer rights to privacy to marketplace disclosure requirements. Here’s a list of our recent coalition activities:

Concerns raised about Corinthian sale. A coalition of 46 student, consumer, veterans and civil rights groups wrote to the Obama Administration and U.S. Department of Education to oppose the proposed sale of 56 Corinthian Colleges campuses to ECMC, a non-profit student loan guarantee agency. Learn more and read the letter.

Complaint alleges children’s privacy law violations. Consumer Action joined privacy colleagues in urging the Federal Trade Commission (FTC) to investigate the Topps candy and trading card company for violating the Children's Online Privacy Protection Act (COPPA) by encouraging children to post on its Candy Mania website. Advocates charge Topps collected personal information, including photos and online contact information, from users who were under 13 years old without providing notice to parents or obtaining verifiable parental consent. Learn more and read the complaint.

Expand CFPB oversight in the auto lending industry. In light of the Consumer Financial Protection Bureau's recent supervision report detailing auto-lending discrimination uncovered at banks, the Bureau is proposing to oversee larger nonbank auto finance companies for the first time at the federal level. Advocates are united in making that happen. Learn more and read the letter.

Don’t mess with Country of Origin Labeling. Advocates from over 200 farm, faith, environmental, labor, rural and consumer organizations delivered a letter to the Senate urging the legislators to reject any effort to repeal, rescind or weaken Country of Origin Labeling (COOL) in any federal spending legislation. Advocates argue COOL has been embraced by consumers who want to know where their food comes from and by family farmers who are proud to provide that information. Learn more and read the letter.

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 Consumer-Action.org, visitors have instant access to important consumer news, downloadable materials, an online “help desk,” the Take Action advocacy database and nine 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 nearly 7,500 community-based organizations. Outreach services include training and free 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.