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The U.S. Food and Drug Administration is warning consumers about a scam to purchase drugs from an international location.  The callers claim to be FDA “special agents” and apparently target  consumers who use mail order pharmacies or similar services.

After an order is placed, the agency says the consumer receives a call several days later demanding money for a “fine” because of the order.  Consumers are threatened during the call and even told they can be jailed.

If you have been contacted or know someone who has, please call the FDA toll-free at (800) 521-5783.

Posted under Health, Privacy

This scam must take the cake.

Iowa Attorney General Tom Miller is warning consumers that some rocket scientists are calling Iowans and reporting they are from the power company.

What do you think happens next in mid-July?  That’s right.  The poor consumer is told their electric service will be cut off if payment is made by phone.

That would be a terrific service for late paying customers if the story were true.  Unfortunately, the scam is simply the latest wrinkle in the “Scare Them ‘Til They Give You Money” contests.

“Our utilities never operate like that,” Miller said. “Don’t be buffaloed into giving out your credit card account number, bank account, Social Security number, or other personal information. This scam appears to be hitting all over Iowa.”

Miller has also asked consumers to immediately contest the charges if they have given this information to a company and said that his office and utility companies want to know when the call comes, even if a consumer did not divulge any information.

Anyone receiving a call should contact their utility company and the state’s Iowa consumer regulatory authorities at 888-777-4590 (281-5926 if calling from Des Moines). You can also send an email to the Iowa Attorney’s General office.

Posted under Privacy

We’re proponents of “opt-in” marketing — email and other contact a consumer requests.  Unfortunately, as unwanted email continues to flood consumers’ Internet services, the Federal Trade Commission has just tightened up email restrictions.

Four new provisions to the federal government’s CAN-SPAM rule were approved by a 4-0 vote yesterday.  The plain English version of the new provisions:

1)  Someone sending email cannot require payment or additional information beyond the email address for a consumer to demand that their email be removed from the organization’s future efforts.

2)  There are new ways to identify who sent an email if multiple organizations are advertising in that same email.

3)  One for the businesses (and a good one too that we use):  Organizations can provide a mailing address that is a post office box or similar postage handling service to identify the company’s location.

4)  When is a person not a person?  When a “person” is an email recipient.  Email addresses, not people, are protected by CAN-SPAM.

On a related note, the folks at StopPoliticalCalls.org continue to do great work with their free list to tell politicians not to call.  While the country’s attention is naturally focused on the presidential race, there will be many races in local and state governments and candidates who use “robo-calling” to automatically call consumers.  These calls are NOT covered by the federal Do Not Call Registry.

When we last checked in with the folks at the free don’t call me registry, multiple political candiates and members of Congress had taken the organization’s pledge to not call consumers on the list.  Those candidates are in states as diverse as Missouri, North Carolina, Kansas and Idaho.  Even one of the companies supplying the service has agreed to honor consumer wishes.

It’s not too late to register free and make sure your phone number is protected from unwanted political spiels during dinner.

Posted under Privacy

Consumer goods giant SC Johnson repeated its consumer warning that a letter sent to consumers is not from the company.

The first warning was issued two weeks ago by the maker of Windex, Pledge, Glade and more cleaning products. The letter is from a “Consumer Rewards Program” allegedly being administered by MBT Financial Services.  Recipients are sent a fake check with a false signature from the company’s founder.  The company is now reporting a second letter is making the rounds, this one from an entity called “Domino Financial Trust”.

As is often the case with email, this paper phishing scam asks consumers to supply banking information.  The company has asked consumers to contact their local law enforcement office.  Calling US postal inspectors isn’t a bad idea either.  Save the envelope and all inserts, and please don’t send anyone your banking information unless you already have a financial arrangement with them.

Posted under Privacy

Washington State Attorney General Rob McKenna has announced a settlement with three California-based businesses that resolves allegations they installed software that took control of a consumer’s computer by launching aggressive and persistent pop-ups that demanded payment for a movie download service. The software was installed after users signed up for a seemingly anonymous free trial for the service.

“Under this settlement, Movieland.com and its associated companies agree to cease offering anonymous free trials to Washington consumers for their movie download service,” said Attorney General Rob McKenna “Additionally, the defendants must receive express consent from Washington consumers before installing any billing software on the user’s computer, disclose whether the software will cause any pop-ups and clearly state all important contract terms in any advertisement.”

The state filed its original lawsuit last summer following an investigation by the Attorney General’s Consumer Protection High-Tech Unit. The suit accused the following of violating Washington’s Computer Spyware and Consumer Protection acts: Digital Enterprises of West Hills, doing business as Movieland.com; AccessMedia Networks of Los Angeles; Innovative Networks of Woodland Hills; and Alchemy Communications of Los Angeles.

Allegations against Alchemy were subsequently dismissed and the state reached a stipulated agreement with the remaining defendants that was filed today in King County Superior Court. Two company officials, Digital Enterprises’ Easton A. Herd, and Alchemy’s Andrew M. Garroni, are also parties to the settlement, which does not include a finding or admission of wrongdoing.

The defendants agreed to pay a total of $50,000 to resolve the allegations. They also agreed to provisions that limit their business practices.

According to the state’s complaint, the defendants promoted a movie download service through Web sites including movieland.com, moviepass.tv and popcorn.net that offered consumers a free three-day trial. Billing software was then downloaded onto the personal computers of consumers who accepted the offer.

After the trial period, defendants remotely activated the billing software, causing a popup window to appear that indicated the trial period had expired. Consumers who clicked on a “Continue” link on the pop-up were then shown a 40-second video that recurred hourly and told them that they were legally obligated to purchase a subscription. A statement on the company’s Web site also indicated that failure to pay “may result in an escalation of collection proceedings that could have an adverse effect on your credit status.”

The Attorney General’s Office is offering a refund program for consumers who believe they have been subject to the defendants’ practices. Washington residents who believe they are eligible for a refund should file a complaint with the Attorney General’s Consumer Protection Division online at www.atg.wa.gov or call 1-800-551-4636 (number only available in-state) to request a complaint form.

Posted under Privacy

The Federal Deposit Insurance Corporation (FDIC) is alerting the public to questionable solicitations directed at homeowners. Consumers have contacted the FDIC with questions and complaints after receiving solicitations suggesting there is a “Community Reinvestment Act (CRA) Program” that entitles certain homeowners to cash grants or equity disbursements. Some of these solicitations may imply that the FDIC endorses or supports the offers they contain.

These solicitations appear to be a deceptive effort to encourage consumers to apply for a mortgage loan secured by the consumer’s home. The FDIC does not endorse or sponsor mortgage loan programs. In addition, the federal law known as the Community Reinvestment Act, or CRA, does not require programs as described in the solicitations, nor do such programs exist. The FDIC cautions the public about loan solicitations or other offers from lenders or mortgage brokers that offer consumers cash as part of a “Community Reinvestment Act (CRA) Program.”

The Community Reinvestment Act is a federal law that was enacted in 1977. It encourages depository institutions to help meet the credit needs of their communities, including low- and moderate-income neighborhoods, in ways that are consistent with safe and sound banking operations. The CRA does not entitle individuals to any grants or loans.

Consumers should be very suspicious of conducting business with lenders or mortgage brokers that make deceptive claims. Individuals who are considering taking out a loan using their house as security are urged to compare various programs. Comparing loan programs offered by a variety of different lenders can help consumers make a well-informed decision and

secure the best program to meet their needs. Useful information on shopping for home loans can be found on the FDIC’s Web site at http://www.fdic.gov/consumers/looking/index.html.

Questions about these solicitations may be directed to the FDIC’s toll-free Central Call Center at 1-877-275-3342 or 1-877-ASK-FDIC (1-800-925-4618 or 202-942-3147 for the hearing impaired). Questions may also be submitted to the FDIC’s Web site using the Online Customer Assistance Form found at http://www2.fdic.gov/starsmail/index.html.

Posted under Finance, Privacy

Consumer Help Web shared information with readers about a massive data theft earlier this year. The company’s president, Joan Bounacos, was quick to point out that this incident, involving TJX, the owners of Marshall’s and TJ Maxx stores was different because it was a clear theft, not a “data breach”.

“You could simply tell right away that this wasn’t a case of a missing laptop, but a sophisticated criminal enterprise,” the consumer advocate said in a statement. “There was too much data, over too long a period of time for consumers to be cavalier about this incident.”

In a filing with the United States Securities and Exchange Commission yesterday, TJX admitted that the data breach had gone on longer than previously reported and that the company itself took longer to report the incident to the public. Citing multiple thefts going back years, the company spent pages of its filing to provide its version of details related to the theft, calling it a “computer intrusion”.

“The most disappointing information in the filing is the attitude the company seems to have,” Bounacos said. “While admitting that some evidence exists the data is now being used to steal identifies, the company says it will vigorously defend litigation and claims against it. That might be good for stockholders, but not for the tens of millions of people now at risk.”

In February, Consumer Help Web called for TJX, which posted net income last year of more than $700 million, to work with consumers to provide free credit monitoring services after the records were stolen. “A company with $17 billion in revenue is forcing consumers to pay for credit monitoring fees,” Bounacos said. “They seem to display an unusually cavalier attitude rather than accepting responsibility for a multi-year, multiple event theft from their company. Consumers shouldn’t have to pay for the company’s lack of proper technology security.”

Posted under Finance, Privacy

Washington consumers filed 18,354 complaints with the Attorney General’s Office in 2006. Consumers reported fewer complaints about online auctions while communications companies and retailers, which have held the No. 1 and No. 2 spots for at least the last six years, continued to top the list.

The Attorney General’s Consumer Protection Division released its annual Top 20 list of consumer complaint categories this month. At the same time, Attorney General Rob McKenna acknowledged the division’s work in recovering $12.5 million for consumers through litigation, complaint mediation, and the Lemon Law program during the 2005-2006 fiscal year.

Online auctions slipped in the rankings from No. 6 to No. 19. Consumers reported 319 complaints about online auctions last year, compared to 774 in 2005 – the first year in which data was available.

Conversely, consumer complaints concerning electronic shopping shot up from No. 9 in 2005, when 532 complaints were reported, to No. 5 last year, when 819 were reported. The category held the No. 3 spot in 2004 and 2003.

Consumer Protection Division staff said the data seems to suggest that more people are shopping online, but the online auction frenzy is waning. A longer period of time is needed to positively identify trends, however; and some of the difference can be attributed to how complaints were categorized. The Attorney General’s Office also noted that complaints about online auction fraud outnumber all other issues reported by Washington state consumers last year to the FBI’s Internet Crime Complaint Center.

“Complaints received by our office suggest that consumers are becoming more careful about bidding for merchandise in online auctions,” McKenna said, “but risk is still there. The Internet is ripe for fraud and some consumers are blindly shopping on sites they are not familiar with. Shoppers should only visit reputable sites in order to ensure trouble-free transactions and reduce the likelihood of becoming victims of identity theft.”

“Last year, the Attorney General’s Office ramped up our enforcement efforts in a number of important areas including fighting high-tech fraud,” McKenna added. “We started the year by filing our first case under Washington’s Computer Spyware Act and ended the year by settling for $1 million. We’ve since filed four other cases under the anti-spyware statute.”

Also in 2006, the Consumer Protection Division:

* Settled its first federal anti-spam law with two companies accused of blanketing the Seattle School District and nonprofit organizations with junk e-mails.
* Reached a $325 million multi-state settlement with Ameriquest Mortgage Company concerning predatory lending allegations.
* Settled an important case in the area of consumer health and fitness with the operators of LA Weight Loss diet centers. The substantial increase in consumer complaints about health and diet clubs can be attributed to this settlement, as consumers were encouraged to file complaints with the Attorney General’s Office in order to be eligible for refunds.

The office also expanded its outreach efforts:

* Consumer protection staff made 195 presentations to consumer groups in 2006, reaching more than 13,375 attendees. Identity theft was the most frequently requested topic.
* McKenna created LEGIT, Washington’s Law Enforcement Group against Identity Theft, last year. The group is working on several initiatives to reduce identity theft.
* McKenna also convened two statewide Latino Consumer Education Conferences, bringing together expert consumer advocates and a diverse group of participants with a shared goal of helping protect Washington’s Latino consumers from fraud. Following that success, Norma Chavez, of the Consumer Protection Division, recently conducted two workshops in Spanish in South Seattle in conjunction with National Consumer Protection Week.
* The Attorney General’s Office, AARP, Microsoft and the Federal Trade Commission teamed up in 2006 to present a Cyber Safety Campaign to educate the public about online hazards such as phishing scams, viruses and spyware.

The Consumer Protection Division is focusing its enforcement efforts on ten key areas considered the most critical to consumers: Internet commerce; privacy and identity theft; senior fraud; automobile sales and the Lemon Law; credit and financial industries; health and drugs; telecommunications issues; charitable solicitations; emergency home repair contractors and emerging marketplace issues.

Top 20 Complaint Categories for 2006

Posted under Privacy

TJX, which owns retailers TJ Maxx, Marshalls, Home Goods and AJ Wright, has reported a data breach and says that transaction data from 2003 and 2006 was stolen.

“Unfortunately, the public is becoming used to data breaches,” said Consumer Help Web President Joan Bounacos. “This one is more serious than a company simply missing data,” she added. “The company admits that the data was stolen, yet strangely has not offered free credit monitoring to its customers for that time.”

TJX has established a toll free customer help line. Callers from the United States may reach the help line at (866) 484-6978.

Posted under Privacy

Sony BMG Music Entertainment has agreed to settle Federal Trade Commission charges that it violated federal law when it sold CDs without telling consumers that they contained software that limited the devices on which the music could be played, restricted the number of copies that could be made, and contained technology that monitored their listening habits to send them marketing messages.

According to the FTC, the software also exposed consumers to significant security risks and was unreasonably difficult to uninstall. The proposed settlement requires Sony BMG to clearly disclose limitations on consumers’ use of music CDs, bars it from using collected information for marketing, prohibits it from installing software without consumer consent, and requires it to provide a reasonable means of uninstalling that software. The settlement also requires that Sony BMG allow consumers to exchange the CDs through June 31, 2007, and reimburse consumers for up to $150 to repair damage to their computers that they may have suffered in trying to remove the software.

“Installations of secret software that create security risks are intrusive and unlawful,” said FTC Chairman Deborah Platt Majoras. “Consumers’ computers belong to them, and companies must adequately disclose unexpected limitations on the customary use of their products so consumers can make informed decisions regarding whether to purchase and install that content.”

According to the complaint detailing the charges, Sony BMG embedded in its music CDs content protection software, also known as Digital Rights Management software, which installed itself on consumers’ computers to restrict the number of times the audio files could be copied. It also prevented the music from being played on certain portable digital devices. The music could not be transferred directly to iPods, for example. In addition to restricting the use of the CDs on computers using the Windows Operating System, the software, which was concealed from consumers, created security vulnerabilities that could allow hackers and other third parties to gain access to consumers’ computers.

The FTC alleges that the installation of software without consumer consent that exposed consumers’ computers to security risks was unfair and violated federal law. In addition, the complaint alleges that hiding the software from consumers and failing to provide a means to uninstall it also were unfair practices in violation of federal law.

The agency charged that it was deceptive for Sony BMG to fail to disclose adequately that software would be installed on consumers’ computers, and that the software would limit consumers’ copying and use of the CDs on their computers. The FTC also alleged that it was deceptive, in violation of federal law, to fail to disclose that Sony BMG’s monitoring technology, included on many of its CDs, monitored consumers’ music listening preferences and sent targeted marketing ads to their computers.

The settlement requires clear and prominent disclosure on the packaging of Sony BMG’s future CDs of any limits on copying or restrictions on the use of playback devices. It bars the company from installing content protection software without obtaining consumers’ authorization, and, if Sony BMG conditions consumers’ use of its CDs on installation of the content protection software, it must disclose that requirement on the product packaging.

In addition, the settlement bars Sony BMG from using the information on consumers’ listening preferences that it has already gathered through the monitoring technology it installed and bars them from using the information to deliver ads to those consumers. For future CDs containing such technology, the agreement requires that, before transmitting information about consumers, their computers or their use of the CD, Sony BMG must clearly disclose on consumers’ computer screens what the technology will do, and obtain consumers’ consent. If it conditions consumers’ use of its CDs on their agreement to have information collected, Sony BMG must disclose that condition clearly on the CDs’ packaging.

The settlement bars Sony BMG from installing or hiding content protection software that prevents consumers from finding or removing the software, and requires that it provide a reasonable and effective way to uninstall any content protection software. It requires that for two years, Sony BMG provide an uninstall tool and patches to repair the security vulnerabilities created on consumers’ computers by previously installed software. The company is required to advertise these free fixes on its Web site.

As part of the settlement, Sony BMG will allow consumers to exchange CDs containing the concealed software purchased before December 31, 2006 for new CDs that are not content-protected, and will be required to reimburse consumers up to $150 to repair damage that resulted directly from consumers’ attempts to remove the software installed without their consent. Sony BMG is required to publish notices on its Web site describing the exchange and repair reimbursement programs.

Sony BMG also is required to provide financial inducements to retailers to return the CDs that create security problems for consumers’ computers. For CDs already in its stock that are sold to retailers, Sony BMG is required to disclose on the product packaging the restrictions on use and the security vulnerabilities.

Finally, the settlement contains record-keeping and reporting provisions designed to allow the agency to monitor compliance with its order.

The Commission vote to accept the proposed consent agreement was 5-0. The FTC will publish an announcement regarding the agreement in the Federal Register shortly. The agreement will be subject to public comment for 30 days, beginning today and continuing through March 1, after which the Commission will decide whether to make it final.

Posted under Privacy