Disputing a Fraudulent Transaction on a Credit Card

It is not uncommon to hear that a family member, friend, or a colleague was a victim of credit card fraud. In 2017, the Federal Trade Commission received more than one million fraud reports.[1]The report separates individuals by age groups.  Individuals between the age of 20-29 account for 40% of fraud reports while individuals between 60-69 account for 20 % of fraud reports. While these percentages account for reported frauds, there are many that go unreported. One possible explanation for higher report rates in the 20-29 age group is the digitalization of banking resources. These resources include notifications of suspicious bank activity and so on. These positive aspects of the digitalization of banking are a step towards consumer empowerment. However, digital trends resonate more heavily with newer generations than that of previous generations.

Under the Fair Credit Billing Act (FCBA), a fraudulent transaction that appears on the account can be disputed. What qualifies as a fraudulent transaction?  A transaction is fraudulent if the card holder had no knowledge of the transaction and did not approve the charge. For instance, a transaction that appears on the account that was not authorized by the card holder is fraudulent. The FCBA grants consumers various protections: (1) If the card was lost or stolen and reported before any unauthorized charges were made, the liability is $0; (2) Within 2 business days after you learn about the loss or theft, the liability might be $50; (3) More than 2 business days after you learn about the loss or theft, but less than 60 calendar days after your statement is sent to you, the liability might be $500; or, (4) More than 60 calendar days after your statement is sent to you all the money taken from your ATM/debit card account, and possibly more; for example, money in accounts linked to your debit account.[2]

It is important to know that if you are victim of fraud you have rights. It is also important to note that time is critical to limit your liability. Once you discover the fraudulent transaction, contact your bank immediately. While banks and credit card companies might expand a customer’s rights, you are provided basic protection under the FCBA.

For further information about disputing fraudulent credit card transactions, please visit https://www.consumer.ftc.gov/articles/0219-disputing-credit-card-charges



Common Scams that Target Veterans

Unfortunately, Veterans are often targets for a wide variety of scams. Being able to identify a potential scam is vital in protecting oneself from a wide variety of risks including identity theft, loss of assets or income, or even the loss of a home. Below are three of the common scams that often target Veterans as well as the possible risks and damages involved.

Pension Advance Scam

With this scam, the Veteran is asked to exchange his or her monthly pension for a one-time lump sum of money. Interest rates on this lump sum can be extremely high, even over one hundred percent. Furthermore, the exchange may end up being less than the amount the veteran’s pension would have added up to over the years. This advance also requires strict budgeting so that the Veteran doesn’t run out of money. In an emergency situation this advancement may seem like the only option, but it is beneficial to discuss other alternatives with a financial advisor or research other potential options before making a decision.

VA pension is a benefit that many Veterans depend on for monthly income. However, when a Veteran gets in a bind, the car breaks down or the air conditioner breaks, for example, this scam can seem extremely attractive. Considering how a pension advance will affect future income is a must before committing to the advance.

Phishing Scam

Like many phone call scams, the main goal of this scam is to retrieve personal information. Here, the scammer calls the Veteran and states that he or she works for the VA and needs to update the Veteran’s information within the VA’s system. Then, the scammer asks the Veteran for sensitive personal information such as social security numbers or banking information. From there, the scammer can use that information to commit identity theft or drain the Veteran’s bank accounts. The VA will never ask for a Veteran’s personal information over the phone. If someone calls acting as the VA and asks for this kind of information please report the incident to the VA.

Phishing scams have been going on for quite some time. For Veterans of a younger generation, like Millennials, this scam may be easy to catch as the younger generation is accustomed to technology and the frequency of these types of calls. However, for older Veterans, such as Vietnam Veterans, this may not seem like a scam at all. Widespread education on the subject enables those that understand to realize the importance of teaching others while also hopefully reaching those that may not understand.

Mortgage Scam

Most likely the most notorious scams aimed at veterans are those involving mortgages. These scams can promise special deals such as extremely low interest rates or “no-payment” reverse mortgages to veterans. These advertisements can be very misleading as the fine print may dramatically increase interest rates after a short period of time. Likewise, a no-payment reverse mortgage still requires the homeowner to pay taxes and insurance on the property, and if these amounts are not paid, the homeowner is considered to be in default, risking a loss of the home. Many of these scammers often use logos that look very similar to those used by the VA in their logos. However, the VA does not advertise the loans they offer. It is vital to seek outside advice before entering into one of these mortgages.

As technology advances more and more scams are going to present themselves. It is unfortunate that many of these scams target those that have sacrificed for and served our country. Seeking further education on new scams and seeking advice on investment opportunities or loan options and always refraining from giving out personal advice over the phone is the best way to combat scams and the risks that they impose.

Below are links to website’s discussing common scams that Veterans run into:

Scam Alert: Top Five Veteran Swindles

Scams that Target Veterans


Legislation to Curtail Robocalls!

Recently, I was interviewed by KOMU, local NBC affiliate, on Robocalls.  In the full interview, I discussed new legislation — but that part did not end up in the broadcast.  I nonetheless wanted to follow up and share the information.

A bipartisan bill has been introduced and reintroduced in Congress to address the growing problem of “spoofed” robocalls that use fraudulent caller identification information to disguise the caller’s true identity.

As the National Consumer Law Center announced:  “Led by Senators Thune (R-S.D.) and Markey (D-Mass.), the Telephone Robocall Abuse Criminal Enforcement and Deterrence (TRACED) Act (S. 151) would direct the Federal Communications Commission (FCC) to develop rules requiring providers of telephone voice services to implement an effective framework for authenticating calls to better enable them to identify and stop unwanted calls before they reach the consumer. It would also increase potential civil forfeitures and criminal fines for intentional violations of the Telephone Consumer Privacy Act (TCPA).

Consumer Reports, the National Consumer Law Center, Consumer Federation of America, and Consumer Action welcomed the progress in the effort against unwanted robocalls.

“Unwanted robocalls harass Americans every day, too often with scams that take advantage of consumers, and yet phone companies drag their feet and fail to truly solve the problem,” said Maureen Mahoney, policy analyst for Consumer Reports. “The TRACED Act takes an important step in ensuring that all phone companies implement technology that will help stop “spoofed” calls, a technique employed by scammers to foil robocall mitigation efforts. Consumer Reports supports this bipartisan effort to address the robocall problem.”

“Once passed, this bill will help tens of millions of Americans reclaim the use of their telephones from the scourge of unwanted and fraudulent robocalls,” said Margot Saunders, senior policy counsel for the National Consumer Law Center. “On behalf of our low-income clients, we strongly support this bill and very much appreciate the efforts of Chairman Thune and Senator Markey to address the serious problem of caller-id spoofing.”

“Authenticating that a call is coming from the source that it purports to be is crucial in the fight against illegal robocalls, which often fraudulently spoof their caller ID,” said Susan Grant, Director of Consumer Protection and Privacy at the Consumer Federation of America. “This bill will move carriers forward to implement call authentication and provide stronger enforcement tools to use against robocallers who flout the law.”

“Spoofed robocalls are the reason that consumers are unwilling to answer their phones these days,” said Consumer Action’s Deputy Director of National Priorities Ruth Susswein. “The TRACED Act is the kind of legislation that consumers have been waiting for – with tools to curb invasive robocalls, hold abusers accountable and help consumers block bad actors from their phone lines.””

See the Press Release at https://www.nclc.org/media-center/pr-consumer-groups-urge-action-on-bipartisan-legislation-to-stop-misleading-spoofed-robocalls.html.

Consumer Complaints in Missouri

Often people forget that they can file consumer complaints with the state.  For example, in Missouri, consumers should let the state Attorney General’s Office know about unscrupulous businesses and individuals. They rely on consumers to act as partners in rooting out fraud and helping  bring criminals and scammers to justice.

As it says on https://ago.mo.gov/civil-division/consumer/consumer-complaints: “The Consumer Complaint Form is available for online submission or pdf format. If possible, please complete the PDF form by computer. If you don’t fill it out by computer, type or hand-print clearly in dark ink. Incomplete or unclear forms will be returned. Be sure to enclose copies of important documents concerning your transaction such as contracts, invoices, warranties, brochures and canceled checks. Do not send originals.

Call the Consumer Protection Hotline at 1-800-392-8222 for more information about filing a complaint.”

Check this out:  Top 10 Consumer Complaints.

Consumer Tips in Bottom Line

Professor Amy J. Schmitz was interviewed for a feature article, “Secrets of Getting What You Want When You Complain to Customer Service,”  which appeared in both the print and online publication of Bottom Line Personal (https://bottomlineinc.com/money/household-expenses/secrets-getting-what-you-want-when-you-complain-customer-service).  For her part, Professor Schmitz provided ideas and advice for consumers seeking to obtain remedies. She based these ideas on many years of researching consumer law and behavior.  Professor Schmitz will teach a new Consumer Empowerment class in spring of 2019 that will be an interdisciplinary service-learning class in concert with the schools of law and social work!

Chalk One Up For Consumers!

Chalk one up for consumers! The California Supreme Court unanimously held that interest rates may render a consumer loan unconscionable even in the absence of a statutory interest rate cap. http://www.courts.ca.gov/opinions/documents/S241434.PDF. The ruling has also been covered in the LA Times and the American Banker.  This allows courts to take into account the facts and equities of each case, and not simply rely on a statutory rate.  The Court and the Amicus Brief filed by the consumer advocacy organizations cited Embracing Unconscionability’s Safety Net Function, 58 ALA. L. REV. 73-117 (https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1270836) in understanding the contract doctrine of unconsionability’s historical roots in courts of equity.

Consumer Law Professors Join Forces to Protect the Complaints Database

Professor Amy J. Schmitz joined forces with other consumer law experts Prof. Pamela Foohey of Indiana University Maurer School of Law and Prof. Angela Littwin of University of Texas School of Law to serve as the primary drafters of a response to the Consumer Financial Protection Bureau (CFPB)’s request for information regarding the CFPB’s reporting practices of consumer complaint information. The response explains how publicly releasing information about consumer complaints is essential to the CFPB’s primary purpose of ensuring that “markets for financial products and services are fair, transparent, and competitive.” The response primarily focuses on the benefits of the CFPB’s public consumer complaint database. The response also details the benefits of adding more data to the database, of continuing to publish reports based on complaint data, of publishing more tailored reports based on the complaint data, and of evaluating the design of the online interfaces through which consumers lodge complaints and access the database. These improvements will further enhance the operation of a fair, transparent, and efficient marketplace. The response has been submitted to the CFPB, but is also available to the public at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3190797.”

Consumer Complaints

The Washington Post recently interviewed Professor Amy J. Schmitz on her research related to consumer protection, and means for obtaining remedies.  You can read the article in the Washington Post at https://www.washingtonpost.com/lifestyle/home/a-complaint-guide-for-unhappy-consumers/2018/06/18/39d7a536-6b5e-11e8-bea7-c8eb28bc52b1_story.html?utm_term=.555798b0c1f1.

New Changes to Protections for Borrowers of Private Student Loans

Section 601 of Public Law No. 115-174 amends the Truth in Lending Act by prohibiting a private student loan lender from declaring a default or accelerating a debt against a student loan borrower on the basis of the co-signer’s bankruptcy or death. A second provision releases the co-signer’s obligation upon the student’s death.  Nonetheless, these protections only apply to loans extended after November 20, 2018. In addition, the protections do not apply to private student loans consolidating other private student loans or to spouse co-signers where the spouse’s signature is needed to perfect the security interest in a loan.

Under another provision, students who successfully complete a loan rehabilitation program may request that negative credit reporting information about a private student loan be excluded from the consumer’s report. A loan rehabilitation program is one where the student makes a number of consecutive on-time payments on the loan.

Despite this, one should be aware that private student loan lenders are not required to offer a loan rehabilitation program and there are no specific standards for such a program.  In fact, the lender apparently is not even required to help remove the default in the student’s credit file even when the student completes the program and requests the changes in the student’s credit report.

At the same time, the rehabilitation program adds an additional risk for students. If a student begins making payments under such a program after the statute of limitations has run on the private student loan, then the payments may revive the limitations period.  This means that the student could again be subject to a collection lawsuit.

Marriott Beware!

Be aware that hidden deep in their restrictions, Marriott does not award points if you book through any sort of third party website or agent. I had been lured to believe that they would award points for a recent stay by Marriott via email bef0re my stay, but they are now denying points.  Moreover, the phone call was excruciating, as they do not assist callers. They put you on hold for very long periods of time, only to say the same thing over and over again.

My consumer tip of the day is “Beware” of the fine print with this company and realize that they will not help you when you call!