Archive for the ‘Consumer Forum’ Category

There’s no doctor-patient confidentiality on the Internet

CONSUMER FORUM

Posted March 01, 2015, at 10:03 a.m.

Click image for Norton’s information on Internet Privacy

Internet watchers have long been warning consumers about the privacy implications of tracking. Now, one researcher says simple online searches for health information could be much more harmful than previously thought.

Timothy Libert was a doctoral student at the University of Pennsylvania’s Annenberg School for Communication when he wrote his study last fall. Libert had developed a software tool he used to track Hypertext Transfer Protocol, or HTTP, activity between websites and third parties, including advertisers and data brokers.

He found that 91 percent of visits to websites triggered HTTP requests to third parties. Say you were looking for information on influenza and you clicked on “severity in winter” to learn more. The site you visited probably sent your request on to one or possibly several third-party sites interested in your searches.

Seventy percent of the third-party transmissions included information about specific symptoms, diseases or treatments. Libert designed his study to deliver results from all websites, not just health-centered ones.

Libert dug deep into the data and found that Google is the clear winner in third-party requests, collecting user information from 78 percent of pages searched; other leaders are comScore (38 percent) and Facebook (31 percent). He found data brokers Experian and Acxiom on thousands of pages as well.

While many of us still think the Internet can be searched anonymously, Consumer Affairs writer Truman Lewis says the interests people demonstrate through searching might be linked with their names. This could happen if the info is accidentally leaked, if hackers or other crooks get access to the data, or if data brokers collect the information and sell it.

Libert’s research found that a small fraction (3.24 percent) of the pages he analyzed used secure HTTP. The rest used non-encrypted HTTP connections “and thereby potentially transmitted sensitive information to third parties.”

Libert cited a critical U.S. Senate committee report on the data broker industry in 2013. One company was reportedly using “proprietary models” to create and sell lists of “domestic abuse victims,” “rape sufferers” and “HIV/AIDS patients.”

Advertisers like to assure us their data collections are anonymous. But ad tracking can discriminate in subtle ways. Sorting searchers into a category of high spenders on medical needs means those consumers likely will have less to spend on non-essential consumer goods; the trackers might consider them “undesirable” and be less likely to advertise special offers or prices to them.

The ad industry is investing serious money in computer modeling, the better to sort consumers into “buyer” and “other” categories.

Don’t look for existing law to change things. The Health Insurance Accountability and Portability Act contains strong language about the ways doctors and insurers handle your health information; those protections don’t apply to web searches.

Libert suggests that nonprofit entities — with nothing to gain from third-party exchanges — tighten systems so data leaks are avoided. For commercial concerns with a profit motive, regulators and legislators might see broad public support for applying rules about how various kinds of data may be used and how long they can and should be saved.

He also urges engineers to spend more time creating intelligent filters that keep sensitive data confidential.

Consumers might do well to use separate web browsers and email accounts with unique, strong passwords when investigating health issues.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

Easier to lose money than weight

CONSUMER FORUM

By Russ Van Arsdale, executive director Northeast CONTACT Posted Feb. 22, 2015, at 10:09 a.m.

Here’s a recipe for making millions on unsuspecting consumers. Buy green coffee bean extract from China for about 50 cents per bottle plus shipping, sell each bottle for $30 to $48 and gross an estimated $16 million to $26 million.

To rack up those sales, you’ll need to pass off an unscientific study as “proof” people can lose “an astounding amount of fat and weight” simply by downing your product. Advertise that there’s no need to reduce calories or increase exercise; just swallow the extract along with the seller’s worthless promises. You’ll need some TV promotion to build credibility. An appearance on the “Dr. Oz” show should do the trick. Add a few websites with names that will trigger lots of hits for your wonder product, and you’re on your way.

Dr. Oz scolded at hearing on weight loss scams (click image for FoxDC.com story)

Just don’t get caught. The Federal Trade Commission said last year the “as seen on TV” campaign was false and misleading. In May 2014, the FTC charged NPB Advertising of Tampa, Florida, with making “false and unsupported advertising claims” and with failing to disclose its news sites and testimonials were phony. The case is pending. Then, in September, the FTC charged that Applied Food Sciences of Austin, Texas, used a study it should have known was flawed to make “false and unsubstantiated weight-loss claims” to deceive consumers and sell its extract. The company settled that case for $3.5 million. In September, Dr. Oz announced on his website the study had been retracted. “This sometimes happens in scientific research,” Oz wrote at the time. Last month, the FTC settled charges against Lindsey Duncan and two companies he controls: Pure Health LLC and Genesis Today Inc. Under the settlement, Duncan and his companies have to pay $9 million in consumer redress and refrain from making deceptive claims about green coffee bean extract or any other dietary supplement or drug product. Several critics of the settlement cited a “chilling effect” and voiced fears other manufacturers might hesitate to advertise true claims about products. In a statement, FTC Chairwoman Edith Ramirez said she and the other two commissioners supporting the settlement are “more concerned about other marketers’ incentive to emulate the defendants’ conduct, believing that they will ultimately retain the lion’s share of their ill-gotten gains.” You can review a timeline of the FTC’s actions at nutritionaction.com. On the homepage, look for the article titled “Watch Out for Deceitful Marketing of Dietary Supplements” under “Daily Tips.” Then do a web search for “green bean coffee extract.” We’re betting a wide majority of the 1.58 million hits are still touting weight-loss myths. To lose weight and keep if off, eat fewer calories and increase activity. To learn more about possibly getting some money back if you bought green coffee bean extract, visit the FTC website at consumer.ftc.gov/features/feature-0008-getting-your-money-back.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

Reverse mortgages put borrower’s heirs at risk

CONSUMER FORUM 

By Russ Van Arsdale, executive director Northeast CONTACT
Posted Feb. 15, 2015, at 7:23 a.m.

The smiling actor in the commercial suggests a reverse mortgage may be the answer to all your financial concerns.

However, the Consumer Financial Protection Bureau, or CFPB, says many have been confused and frustrated by the rules that govern this unique type of borrowing. In a reverse mortgage, a home’s equity is used as a line of credit; instead of making payments, the borrower receives a monthly payment that draws down that equity.

One problem is that reverse mortgages cannot be taken over by a family member when the borrower dies. Many family members have complained to the CFPB about their inability to be added to the loan so they can keep the family home.

Another problem is the confusing process confronting many borrowers when they try to pay off their loans. When the borrower dies, heirs have three choices: sell the home, repay the balance of the loan or pay 95 percent of the assessed value.

Some people have faced delays in getting appraisals, had appraisals done improperly or seen home values inflated so they’ve had to pay more. Many also have reported problems getting responses to questions and concerns about the loans from the parties that service them.

A third problem involves property taxes and homeowners’ insurance. These are the borrower’s responsibility, and the CFPB found some time ago that nearly 10 percent of reverse mortgage holders are at risk of foreclosure for nonpayment of those overdue costs.

Some consumers reported problems stopping the foreclosure process when they tried to pay overdue taxes. Some said their loan servicers incorrectly stated that taxes were overdue.

HUD information for senior citizens

Most reverse mortgages are insured through the Federal Housing Administration’s Home Equity Conversion Mortgage, or HECM, program. Changes apply to terms of HECM loans made after Aug. 4, 2014, so nonborrowing spouses may remain in their homes after the borrowing spouse dies.

That change is not retroactive, so the CFPB urges everyone with a reverse mortgage to do three things:

— Verify who is on the loan. Ask your reverse mortgage servicer what names are listed on the loan, and make sure the records are accurate. They may help over the phone, but we prefer consumers send a letter — and keep a copy — so there’s a written record of the inquiry.

— If only one name is on the loan, make a plan for the nonborrowing spouse. After the death of a spouse, the survivor may qualify for a repayment deferral. That would allow the surviving spouse to live in the home. If not, make a plan for other living arrangements. If you or your spouse is not on the loan but think you or he or she should be, seek legal advice right away.

— Talk to your children and heirs, and make plans for any nonborrower family members who live in the home. Make sure family members know what to expect when the reverse mortgage comes due. The mortgage servicer should be able to supply written information about options. Talk these over with your family and ask questions about anything you don’t understand.

To read more in the CFPB’s guide to reverse mortgages, visit http://files.consumerfinance.gov/f/201409_cfpb_guide_reverse_mortgage.pdf.

Maine’s Bureau of Consumer Credit Protection issues a guide called “Finding, Buying and Keeping Your Maine Home.” It’s available online at maine.gov/pfr/consumercredit/documents/MortgageGuide_RevisedOnline.pdf.

Consumers can receive a printed copy by writing to 35 State House Station, Augusta, ME 04333-0035 or calling 1-800-DEFederBT-LAW (1-800-332-8529).

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

If Bruce with a foreign accent calls, offers to fix your computer, hang up

CONSUMER FORUM

Posted Feb. 08, 2015, at 3:01 p.m.

You get a call from someone claiming to be from Windows Helpdesk, Windows Service Center, Microsoft Tech Support, Microsoft Support or a similar sounding name.

The caller says he has “detected trouble with your computer” and can help you fix it. Red flags should be flying, because this is one of the most frequently perpetrated scams going. Microsoft warns consumers about these scams and offers tips for spotting fake calls.

The clues are all there. Most callers are heavily accented but give very American-sounding names. They claim your computer is infected with a virus or is operating “with a lot of errors.” They can fix this, they claim, if you’ll only turn over control of your computer to them online and send them a few hundred dollars.

It’s always a scam. No cold-caller could possibly know whether your computer is operating correctly. Those “errors” are typical operating vagaries a scammer tries to make you believe will damage your system if left alone.

Give up control of your computer to someone who calls out of the blue, and you run the risk of having your passwords, financial data and other personal details stolen. Thieves could use that information to drain bank accounts, ruin your credit and steal your identity.

If successful, they’ll probably call back and try to sell you worthless computer security software. Once a scammer succeeds, you can bet your phone number will go on other crooks’ call sheets.

The Federal Trade Commission tried to crack down on the tech support scam, as the crime has become known. In September 2012, the FTC froze the assets of 14 companies working the scam. The agency said the “repair” fees ranged from $49 to $450 and netted thieves tens of millions of dollars from innocent consumers.

That put a few crooks out of business, at least for a while. However, cheap international phone rates and sophisticated dialing programs offer criminals the means to exploit the fears of computer users.

If you let the scammers prattle on, they’ll urge you to open a Microsoft event utility viewer; it’s built into Windows and lists harmless errors legitimate repair people can use to fix operating problems. The crooks point to the “error” and “warning” messages as signs that disaster is about to strike, when in fact the computer may be operating just fine.

The caller might then try to trick you into visiting a phony website and downloading what appears to be a repair tool; in fact, it’s malware that can lock up one or more programs on your computer. The caller may later demand a ransom to allow those programs to work properly again. Or the scammers might install malicious software that turns your computer into a “zombie,” which in turn looks for more computers to infect.

If you receive such a phone call, the best thing to do is hang up. Never buy any software or services from these cold callers. Don’t give them a credit card number or other financial information. And don’t click on links at websites to which you’re directed or in emails they send you. And never turn control of your computer over to anyone other than a known representative of a company with which you already have a business relationship for computer service.

If you have given information, change passwords to your computer, main email service and any financial programs. Do an anti-virus scan to look for malware; if you’re unsure whether the scan has dealt with any problems, you may want to take the computer to a local company you trust to have it thoroughly checked out.

If you’ve shared personal or financial information with a scammer, you may want to place a fraud alert on your credit report. Get details from the Maine Bureau of Consumer Credit Protection, credit.maine.gov, or call 1-800-332-8529 (1-800-DEBT-LAW).

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

Identity thieves try to cash in during tax filing season

CONSUMER FORUM

Posted Feb. 01, 2015, at 9:53 a.m.

click image to report scams, waste and abuse

Two headlines top the news near the start of this income tax season.

Thieves who steal Social Security numbers and other personal data do so in order to file phony tax returns and claim rebates they’re not owed.

And crooks posing as Internal Revenue Service officials are calling people and, in many cases, bullying them into sending money they don’t owe.

They use common names and all kinds of tricks. They may say they’re calling from the IRS criminal division. They might have technology that will spoof a caller ID, making it appear they’re calling from a real IRS office. They threaten those they consider easier targets — such as older people and recent immigrants — with fines, jail terms, job loss, even deportation.

The crooks do their homework before calling. They might know a person’s Social Security number — or at least the last four digits — and other personal details that lend credence to their pitch. Demanding immediate payment is a tipoff it’s a scam — the real IRS first would notify you by letter of any official action — and the agency never would demand payment by a debit card or wire transfer.

Losing a one-time payment is bad enough. Thousands of taxpayers have filed their income taxes only to find a crook has stolen their identities, filed fraudulently and collected their refunds illegally.

The IRS says after such discoveries, it takes an average of four months to get a refund to its rightful recipient. That person also needs to go through the hassle associated with identity theft. Perhaps ironically, prisoners’ Social Security numbers often are tempting targets, because inmates are less apt to be on top of their tax or banking activities.

The Treasury Inspector General for Tax Administration, or TIGTA, says it has received reports of 290,000 scam calls since October 2013, and nearly 3,000 victims have lost a total of $14 million. The IRS has been working to curb these crimes, saying it spotted 19 million suspicious returns since 2011 and prevented more than $63 billion in fraudulent returns. Read about ways to spot impersonators and report scams at Treasury.gov/tigta.

Consumers can and should take all the usual steps to prevent fraud: use firewalls and antivirus software, use strong passwords and change them often on all online accounts and reveal your Social Security number only when it’s absolutely necessary.

If you become a victim, the IRS says it wants to help. Read about the agency’s prevention and detection efforts at IRS.gov/Individuals/Identity-Protection.

The IRS is also warning consumers about unscrupulous preparers who push filers to make inflated claims. Often, these preparers will demand an up-front fee; they may also refuse to give the taxpayer a copy of the return. Both are things that legitimate tax preparation pros don’t do.

You may qualify for free help preparing your income tax filings. Seniors can check with AARP or the local agency on aging. The Volunteer Income Tax Assistance, or VITA, program gives free tax help to people who make $53,000 or less, have disabilities, are older or who speak little English and need help preparing their returns.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit necontact.wordpress.com or email contacexdir@live.com.

Who keeps track of whether financial advisers give good advice?

CONSUMER FORUM

By Russ Van Arsdale, executive director Northeast CONTACT
Posted Jan. 25, 2015, at 12:18 p.m.

We’ve all heard stories about people who lose money through bad investments.

Some put money into schemes advanced by friends or family members. Other people might get “tips” from a variety of sources that promise their advice will lead to a “sure thing.” Still others might overhear investment advice from a professional but misunderstand and invest unwisely.

Smart investing is critical when planning for retirement; that’s why many people turn to professionals for investment advice. However, not all advisers are created equal, just as not all investments are right for everyone who has money to invest.

Stockbrokers and some financial advisers are held to a “suitability” standard. They recommend investment products considered “suitable” for a given client. Another standard is termed “fiduciary,” meaning the adviser must act in what’s believed to be the client’s best financial interest.

A range of investment products might meet the suitability standard, with some returning more in fees to the adviser than others. It’s in the adviser’s interest to recommend a product that will earn the pro a higher fee; even if it’s not the best fit for the client, it’s still “suitable.”

Maine’s Department of Professional and Financial Regulation cautions investors that “brokers may recommend investments that appear suitable but may not be optimal for investors’ objectives.” The PFR website goes on to say, “Because of the manner in which they are compensated, it is possible for brokers to have incentives to sell financial products that may not entirely align with clients’ goals.”

With that bit of background, we come to a proposal by the U.S. Department of Labor to update rules governing financial advising. Current rules were written during the Ford administration. Since then, total investments in IRAs, 401(k) plans and other defined distribution plans have swelled and will reach $7.3 trillion by 2016. That’s an estimate by the Securities Industries and Financial Markets Association, or SIMFA, a trade group representing securities firms, banks and asset managers.

The Labor Department has for several years proposed changing the definition of fiduciary regulation; the department said recently it will withdraw its current proposal and issue a new one shortly. A coalition of consumer and labor groups is calling for rules requiring all financial advisers to put clients’ interests first when giving retirement advice. On its website, the coalition charges that the financial advising industry “wants to continue slicing off large pieces of that pie by selling retirement investments with hefty costs, poor returns, and high risks.”

SIMFA calls the last proposed rule “overbroad” and said it would “limit investment choices and drive up costs for the individuals it is intended to protect.”

SIMFA says 149 U.S. representatives and 34 senators have written to the Department of Labor and the Office of Management and Budget in opposition to the proposed regulation and the expected new proposal.

Meanwhile, the Financial Planning Association, Certified Financial Planner Board of Standard Inc. and National Association of Personal Financial Advisers are calling for certification of financial planners who operate “with fiduciary accountability and transparency.”

This coalition argues that the “title ‘financial planner’ should be recognized as distinct from sales persons – and held to corresponding competence and ethical standards similar to those required of a CPA, doctor or lawyer.”

When choosing a financial planner, ask “How will you be compensated? What are your qualifications? What is your general philosophy on investing? What kind of client turnover have you had in recent years?”

When asking for advice on investing your money, you want to feel comfortable with answers to those and related questions.

The state of Maine licenses broker-dealers and prosecutes violations of securities laws. Learn more at www.investors.maine.gov.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit NEContact.wordpress.com or email contacexdir@live.com.

 

Consumer watchdog says credit reports for 1 in 4 Mainers are wrong

CONSUMER FORUM

Posted Jan. 18, 2015, at 9:05 a.m.

Maine’s credit watchdog agency has published the latest in its series of consumer guides, this one focusing on credit reports and credit scores.

Downeaster Guide

Click image to access report

A good deal of misunderstanding surrounds the ways credit scores are figured and the need for continually updating your credit report. Maine’s Bureau of Consumer Credit Protection (BCCP) just released the Downeaster Common Sense Guide: Credit Bureaus and Credit Reports.

Creditors, employers, banks and others with whom we have dealings use credit report information when making financial decisions. As the guide states, lenders believe someone’s credit report gives the best indication of whether that person will be able to repay a loan. Credit reports are produced by credit reporting agencies (credit bureaus); the findings of those entities may not always agree.

William Lund is superintendent of the BCCP. He says as many as one-quarter of all Mainers may have errors or incomplete information in their credit reports. One reason is because credit bureaus use different formulas to determine credit scores, the numbers that indicate our credit worthiness. The most widely used model is the Fair Isaac Corporation (FICO) score, ranging from a low of 300 to a high of 850.

Lund said a consumer needs to check his or her credit report frequently to make sure errors or omissions do not negatively affect the person’s credit rating or score.

There are three major credit reporting agencies: Equifax, Experian and Trans Union. The law allows consumers a free credit report from each of them every year. Request one in January, another in May and a third in September — or another four-month rotation — to keep a constant check on your report status.

You can order your free report online at AnnualCreditReport.com, by phone at 1-877-322-8228 or by writing to Annual Credit Report Request Service, POB 105281, Atlanta GA 30348-5281.

The guide contains several tips for improving your credit:

— Pay loans on or before the due date; set up automatic payment or payment reminders to be sure you’re current.

— Limit yourself to three or fewer credit cards; limit card balances to no more than one-third of your credit limit.

— Try to keep your oldest credit card accounts indefinitely, if the annual fees are favorable.

— Reduce debt on other loans as much as possible.

David Leach is principal examiner at the BCCP and a principal author of the guide. “Through this guide, we encourage all Maine consumers to order free copies of their credit reports each year and to carefully review them for errors and even the occurrence of identity theft.”

The guide offers some cautions, one involving co-signing for a loan. You’ll go through the same credit check as the primary borrower; if that person can’t keep up with the payments, a delinquency will appear on your credit report. You’ll then be responsible to repay the loan, and your ability to get new credit could suffer.

Another caution involves credit repair scams. People may promise to “fix” your credit if you pay up-front fees, tell them your account number and bank’s routing number or wire cash; these are all signs of scams. Trust your instincts and just say no.

You can call the BCCP for help on credit matters. The toll-free number is 1-800-332-8529. You can get copies of all the Downeaster Guides at maine.gov/pfr/consumercredit/publications.htm.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visithttps://necontact.wordpress.com or email contacexdir@live.com.

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