Archive for the ‘Department of Professional and Financial Regulation’ Category

State Says Consumer Laws Protect Against Risks Posed by Anthem Data Breach

FOR IMMEDIATE RELEASE:  FEBRUARY 5, 2015
Contact: Doug Dunbar, 207-624-8525

GARDINER — Governor Paul LePage joined officials at Maine’s Department of Professional and Financial Regulation to reassure consumers that state and federal laws will help protect them from losses due to file breaches containing personal identifying information, such as the one disclosed this week by Anthem.

The Anthem breach exposed the personal identifying information of an estimated 80 million current and former members nationally.  According to the company, information accessed included names, dates of birth, medical IDs, Social Security numbers, employment information including income data, street addresses and e-mail addresses.

“Although it’s unknown whether Maine consumers will be impacted by the Anthem data breach, I encourage people to closely monitor medical and financial records for evidence of identity theft,” Governor LePage said. “State and federal laws protect consumers from the effects of identity theft. The staff at Maine’s Department of Professional and Financial Regulation is available to provide specific information.”

The Department’s Bureau of Insurance has been in communication with Anthem’s South Portland office.  Anthem will directly contact affected individuals by mail and offer free credit monitoring and identity theft protection.  The services are expected to be available in two weeks, for a period of one year, and will be retroactive to January 27, 2015.

Anthem established a dedicated website (www.anthemfacts.com) and toll-free number (877-263-7995) to answer current and former members’ questions about the breach.

The Department’s Bureau of Consumer Credit Protection and Bureau of Financial Institutions provided the following information and suggestions:

– State law requires notification to affected consumers.  Those consumers should receive a letter from Anthem within two weeks.

– The letter will offer free credit monitoring services for a year, with instructions on how to activate those services.

– Consumers can also check their own credit reports without charge once each year at the website www.AnnualCreditReport.com.  If consumers notice any evidence that their identity has been stolen, they can obtain additional reports at no charge.

– Consumers can place a fraud alert on their credit reports, or for a small fee they can “freeze” access to their reports, blocking the opening of any new accounts.  If a consumer experiences identity theft, the credit reporting agencies must freeze and unfreeze their accounts at no charge.

– Consumers are not responsible for paying charges incurred by an identity thief.  Likewise, consumers are not responsible for charges or debits made by someone else on their credit or debit card.  Upon first noticing evidence of unauthorized charges or withdrawals, consumers should immediately call, then write, the financial institution that issued their card.

– State officials recommend that if a consumer discovers evidence of identity theft, the consumer should file a police report with their local law enforcement agency, and retain a copy of the report.  Maine law (10 MRS sec. 1350-B) requires that a law enforcement agency near a consumer’s home or work place must accept information about a crime of identity theft, and produce a report.  The report is helpful if a consumer must later demonstrate that proper steps have been taken to establish the crime.

– Consumers should be vigilant in order to notice any evidence of identity theft or unauthorized charges.  This includes careful reviews of online or paper credit card and bank statements, unexplained statements of accounts not opened by the consumer, and collection calls or letters on debts not owed by the consumer.

Individuals with questions or concerns regarding consumer financial protection issues can call the Bureau of Consumer Credit Protection at 1-800-332-8529 or the Bureau of Financial Institutions at 1-800-965-5235.  Those with questions or concerns about health insurance matters can call the Bureau of Insurance at 1-800-300-5000.

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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.

 

Phony phone cops bullied US consumers out of millions in bogus debt

CONSUMER FORUM

Posted Nov. 24, 2014, at 9:21 a.m.

Click image to learn more about phantom debt collectors

They make harassing phone calls, claiming that they are law enforcement agents. They threaten to revoke your driver’s license, prosecute you and lock you up. All for debts that aren’t yours.

The National Consumers League says on its website ( www.fraud.org) that thousands of consumers are being bullied into paying debts they don’t owe.

There are many variations, but all scams boil down to one harsh message: wire us money or be in big trouble.

The perpetrator of one such scam received a harsh message last week. A complaint filed by a U.S. attorney in New York charged Williams Scott and Associates of Georgia with scamming $4 million from 6,000 consumers in all 50 states. The complaint charges that over a five-year period, the company had employees pose as police officers, Justice Department officials or FBI agents.

An affidavit filed by a real FBI agent says callers claimed falsely that people owed money for payday loans or had committed fraud.

The affidavit says the scheme involved up to 87 different phone numbers, changing when the scammers realized there were too many complaints. One script seized in an FBI raid includes this exchange between a caller and a frightened woman.

“You think an eight months pregnant woman wants to go to jail?”

“I don’t care if you’re nine months pregnant. I have a job to do.”

When I called Maine’s Bureau of Consumer Credit Protection, principal examiner David Leach was helping a woman whom scammers had tried to dupe.

The scammer had claimed to be from the “Kennebec County Private Locating Service” and said there was legal action pending. When the consumer called the Kennebec County court clerk’s office, she found nothing pending and no record of the “locating service.”

“Scam collectors will do anything to collect money,” Leach told me. He said the fake phone calls “started in Maine sometime in the summer of 2014 and may have peaked somewhere in October.”

However, Leach said this is the most frequent consumer complaint his office deals with.

In some cases, people have taken out payday loans from illegal, unlicensed lenders and repaid the money. The lenders sell their names and other personal information to illegal, unlicensed collectors who then put their defrauding machinery to work.

Consumers may believe these calls are real because the scammers have some personal details about them. If you get such a call, ask for the caller’s name and address, company name and original creditor, if you do have an outstanding loan.

If the caller demands a lot more than you owe, it’s likely a scam. If you have questions about the status of a real loan, hang up and call the number on your loan paperwork.

If you get a call and are uncertain, ask the caller to send a written notice of the debt; then say you don’t want to be called again. That request must be honored, according to the Fair Debt Collection Practices Act.

You can find sample letters drafted by the Consumer Financial Protection Bureau at the “self-help/action letters” tab on our blog ( necontact.wordpress.com).

Some consumers hire an attorney. Giving callers the attorney’s name and number usually stop such calls, when scammers realize the person isn’t an easy target. Report suspicious calls to the Maine Attorney General’s Consumer Protection Division, 1-800-436-2131 or email consumer.mediation@Maine.gov.

Advise the Federal Trade Commission at www.ftc.gov/complaint.

The federal prosecutor says it’s likely that more cases will be brought in the future. He says payday lenders may be among those prosecuted.

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.

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WABI Interview w/ Wayne Harvey

State Officials Issue Consumer Protection Alert Following Data Breach Announcement by Shaw’s Parent Company

Press Release

GARDINER – Governor Paul R. LePage joined officials at Maine’s Department of Professional and Financial Regulation to reassure consumers that state and federal laws are in place to protect them from major losses due to file breaches containing debit and credit card information, such as the one disclosed August 14 by AB Acquisition LLC, which operates Shaw’s supermarkets in Maine and other states.

 

Although it’s unknown whether consumers will be impacted by the data breach involving Shaw’s, the company indicates that stores in Maine were among those affected,” Governor LePage said. “I encourage people to closely monitor their credit and debit card statements, and to contact the financial institution that issued the card promptly if questionable charges appear.  Staff at Maine’s Department of Professional and Financial Regulation is also available to provide information and guidance.” 

The Bureau of Financial Institutions and Bureau of Consumer Credit Protection at the Department of Professional and Financial Regulation outlined the following information and guidance for consumers responding to news of a financial data breach:

  • Consumers should always thoroughly review credit and debit card statements from the card issuer, and also review all other account statements from their bank or credit union.
  • If consumers have online access to their credit or debit card information, they should review account activity as soon as possible, rather than waiting for the statement to arrive in the mail.
  • If a credit or debit card was used at a business that has experienced a data security breach, or there is uncertainty about whether a card was used, consumers should be especially diligent in evaluating charges or withdrawals on their statement.
  • Since the data breach involving Shaw’s reportedly began in June, consumers should review statements covering June to the present.
  • If unknown charges or other suspicious activity appear on the account, consumers should notify the financial institution that issued the credit or debit card.
  • Consumers do NOT need to contact the company that experienced the data breach, such as Shaw’s.
  • Consumers’ liability for unauthorized use of a CREDIT CARD is limited to $50.  If account numbers have been stolen, consumers have no liability for unauthorized use.  
  • Consumers noticing unauthorized activity on their DEBIT CARD resulting from a data breach have sixty (60) days from when the bank or credit union sent the statement to report it.  If consumers fail to notify the bank or credit union of unauthorized transactions within this time, they are liable for the amount of the unauthorized transactions. This 60 day timeframe applies ONLY when the card’s data has been compromised through a data breach, as in the Shaw’s case.  See below for details about when a DEBIT CARD has been lost or stolen.
  • When a DEBIT CARD has been lost or stolen, consumers have two (2) business days after learning of the loss or theft to notify their financial institution in order to limit their liability to $50. If they do not notify their bank or credit union about the lost or stolen DEBIT CARD within two (2) business days, consumers may be liable for up to $500 of the unauthorized transactions. If consumers do not notify their financial institution within sixty (60) days after being provided a monthly statement that lists a fraudulent debit, they can be liable for unauthorized withdrawals of any amount that occur after that 60 day period.
  • To be safe, DEBIT CARD holders should act immediately if they notice unauthorized withdrawals.
  • If impacted by unauthorized charges or withdrawals, consumers should first call the bank or credit union that issued the credit or debit card, and then follow up in writing to explain the problem.
  • Some banks and credit unions may issue new cards to customers whose credit or debit card numbers are known to have been compromised through a data breach.
  • Consumer may ask a financial institution to re-issue a new card if they have concerns about their account.
  • Again, consumers do NOT need to contact the business that was subject to the data breach; and they need to contact the bank or credit union that issued their credit or debit card ONLY if they notice suspicious activity on their statement.
  • For more information, contact the Bureau of Financial Institutions toll-free at 1-800-965-5235, or the Bureau of Consumer Credit Protection is 1-800-332-8529.

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Home Improvement Scams – WABI-TV

Russ spoke with Joy about keeping an eye out for scammers when looking to find some home improvement workers.

There are three Maine laws that deal with transient sales and home repairs. They are explained in detail in the Consumer Law Guide published by the Attorney General’s office (visit www.maine.gov/ag. See chapter 17 of the Guide for laws relating to construction. Chapter 13 deals with transient sales).

Among the key pieces of advice are these.

Always have a written contract for any job costing more than $3,000. There’s a three-day cooling off period before work starts; if you decide you don’t want the job done within those three days, you can cancel the deal. You and the contractor may–but you don’t have to–agree to settle any disputes that might arise through mediation or arbitration.

Don’t sign a contract that includes any blank spaces (to be filled in later). And Maine law says the contractor cannot ask for more than one-third of the total contract amount as a down payment. The Attorney General has a model contract for home construction (see chapter 18 of the Guide).

You’ll likely want to check out a number of contractors before hiring one. Ask each of them how many jobs like yours they’ve done in the past year, and ask for references. Find out what kinds of insurance they carry. Beware of those who demand more than the one-third up-front payment or insist on cash. Also, be wary if the contractor asks you to get the building permit.Transient sellers must be licensed by the state, and an unlicensed contractor may not want to show up at your town hall.

For information on professions requiring a state license, visit www.maine.gov/pfr.

Be extra wary of transient repair “pros” who “spot a problem” you had not noticed. Once inside your home, they may break something and then point out that it “needs fixing.” The shady contractor may insist you come with him to inspect something, while one of his associates steals your valuables.

Those last few points are among the National Consumers League’s top 10 red flags of home repair scams. Read more at www.nclnet.org.

See the Federal Trade Commission’s reminder at www.ftc.gov/scam-alerts

The road to quick-fix driveway repairs is paved with bad intentions

CONSUMER FORUM

Posted May 25, 2014, at 10 a.m.

Click for top 10 red flags of home repair scams

If the birds are singing and some guy offers to seal your driveway for 200 bucks, it must be spring.

Our long-awaited break of winter’s grip means the home improvement scammers are making the rounds again. One of them actually visited us last summer, saying he had “just enough material from another job in the neighborhood” to give me a great deal. We sent him packing.

His fellow con artists are carrying on the tradition, going door to door offering “rock-bottom prices” and saying they’ve “never had a dissatisfied customer.”

If that’s true, why are they always in such a hurry? Why do they need to do the work immediately? Why must they be paid in cash?

The reason is simple. They need to get running, to stay ahead of the people who enforce the laws they are breaking.

There are three Maine laws that deal with transient sales and home repairs. They are explained in detail in the Consumer Law Guide published by the attorney general’s office (visit www.maine.gov/ag. See chapter 17 of the Guide for laws relating to construction. Chapter 13 deals with transient sales).

Among the key pieces of advice are these. Always have a written contract for any job costing more than $3,000. There’s a three-day cooling-off period before work starts; if you decide you don’t want the job done within those three days, you can cancel the deal. You and the contractor may — but you don’t have to — agree to settle any disputes that might arise through mediation or arbitration.

Don’t sign a contract that includes any blank spaces (to be filled in later). And Maine law says the contractor cannot ask for more than one-third of the total contract amount as a down payment.

The attorney general has a model contract for home construction (see chapter 18 of the Guide). For information on professions requiring a state license, visit www.maine.gov/pfr.

You’ll likely want to check out a number of contractors before hiring one. Ask each of them how many jobs like yours they’ve done in the past year, and ask for references.

Find out what kinds of insurance they carry. Beware of those who demand more than the one-third upfront payment or insist on cash.

Also, be wary if the contractor asks you to get the building permit. Transient sellers must be licensed by the state, and an unlicensed contractor may not want to show up at your town hall.

Be extra wary of transient repair “pros” who “spot a problem” you had not noticed. Once inside your home, they may break something and then point out that it “needs fixing.” The shady contractor may insist you come with him to inspect something, while one of his associates steals your valuables.

Those last few points are among the National Consumers League’s top 10 red flags of home repair scams. Read more at www.nclnet.org.

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.

 

New state program helps fight elder financial abuse

CONSUMER FORUM

By Russ Van Arsdale, Executive Director Northeast CONTACT
Posted Feb. 16, 2014, at 10:20 a.m.

A family member moved in to help an ailing 75-year-old Penobscot County woman with housework. After just two days there, she persuaded the older woman to sign the home over to her, saying this would help if the woman needed long-term care. Three months later, an eviction notice came.

In Androscoggin County, a woman convinced her 78-year-old mother that it was time to sell her house and move in with her daughter and the daughter’s husband. The couple promised to look after her medical and financial needs. Soon afterward, in the heat of summer, the woman moved her elderly mother into a camper trailer in the couple’s backyard. More than two years, the couple spent all her money and left her homeless and unqualified for Mainecare. Her health declined to the point that she needed nursing home care.

These two examples of the financial abuse of older Mainers are repeated, not just daily but many times every day. In these two cases, the victims complained to Legal Services for the Elderly, and that group’s intervention helped to ease the impact. But thousands more cases are reported every year, and many more cases go unreported.

The Bangor Daily News reported last week on a new effort to head off elder financial abuse. The initiative, called Senior$afe, aims to train employees of banks and credit unions to spot signs of financial abuse at the teller’s window, drive-through or other places where relatives or others might make transactions that are not in the best interest of the account holder.

Financial abuse can happen when a senior gives power of attorney to a family member, friend or other trusted person. That power can be abused when it’s used to take advantage of the senior’s credit, secure their property or the proceeds of sales, and even threaten harm if seniors don’t hand over cash.

The Senior$afe program will provide training to front-line employees to watch for unusual activity, such as a series of checks written to one person or large cash withdrawals. Officials say 200 people have been trained and would share their new knowledge with others at their workplaces.

For example, if a suspected victim comes into a bank or credit union alone and asks to make a large cash withdrawal, the employee might try to engage the senior in casual conversation. If someone else is with the senior, the employee might instead refer the matter to authorities who could begin an investigation.

Senior$afe is spearheaded by the Maine Council for Elder Abuse Prevention, Maine Bankers Association, Maine Credit Union League, the Maine departments of Professional and Financial Regulation and Health and Human Services, and Legal Services for the Elderly. Training is also planned for financial institution managers, who might refer troubling matters to authorities.

Jaye Martin is executive director of Legal Services for the Elderly and a member of the Maine Council for Elder Abuse Prevention. She says Senior$afe is the first program of its kind in the country. Maine Securities Administrator Judith Shaw, who co-chairs the council, said the effort will help.

“Giving front line bank and credit union personnel the tools to identify suspected elder abuse will help protect Maine’s seniors before the financial damage becomes too great,” Shaw says.

If you suspect that a senior is being abused, financially or otherwise, you can call Maine Adult Protective Services at www.maine.gov/dhhs/oads/aging or call 1-800-624-8404.

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 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

 

 

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