It may be tempting for a payment processor to look the other way about a client’s business practices, figuring it’s the merchant’s job to get proper consumer authorization for charges submitted for processing. But donning blinders can lead to regrettable results, as an FTC action against a payment processor shows.
Blog Posts Tagged with Credit and Finance
In celebration of Halloween — and with apologies to Edgar Allen Poe — here’s our take on what companies can do to make sure spooky business practices don’t come back to haunt them.
Once upon a midnight lawful
Pondering practices, good and awful,
Reading through the U.S. Code
For dos and don’ts I parse and claw.
I came upon the Trade Commission’s
Section 5 with all revisions.
Usually it’s the process server who uses a disguise — pretending to be a delivery man or repair person to catch someone off guard. But in a
Next time you’re at the grocery store and flip around a package to check out the ingredients or calorie count, take the opportunity to remember the contribution of Virginia Knauer, who served Presidents Nixon, Ford, and Reagan in high-level consumer affairs positions.
Ms. Knauer held some pretty daring opinions in her day. At a time when sellers of dog food — but not people food — had to disclose what was inside the package, she advocated for detailed product labeling.
Between the picture of the President and Vice-President standing in front of the American flag and the references to government funds to stabilize the economy, it’s understandable that people who signed up for the service advertised on the Grant Connect website thought they were on their way to landing a grant. Promoters even described Grant Connect as “a unique, consumer-friendly US government grant program that delivers all of the tools for the consumer to search multiple databases, write grant proposals, and deliver polished plans. . .”
It’s unusual for an FTC court document to come with a warning label, but the allegations contained in a recent debt collection case against an outfit doing business as Rumson, Bolling & Associates aren’t for the faint of heart. According to the FTC, the defendants harassed debtors with abusive and profane language, including threats to harm their family members, kill their pets, and desecrate the bodies of their deceased loved ones. And that’s just for starters.
FTC watchers will remember Phillip A. Flora. In the first case of its kind, the FTC alleged that Mr. Flora was a One-Man Message Machine, churning out a “mind-boggling” number of unsolicited commercial text messages pitching mortgage modification services. How many did he send? According to the FTC, <Carl Sagan voice> millions and millions </Carl Sagan voice>.
If you’re one of the businesses nationwide deceived by Oregon-based outfits that peddled questionable debit and credit card processing services, a refund check could be in the mail ranging from $100 to as much as $25,000 — depending on what you paid.
If you or your clients accept payment by credit or debit card, mark October 1st on your calendar. That’s the day new rules go into effect that could help lower your costs. The rules, part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, cover four areas that could affect the day-to-day operation of your business.
According to the Consumer Services Protection Commission’s website, it’s a “National consumer protection agency and works For the Consumer to help avoid fraud, deception, and/or unfair business practices in the financial assistance marketplace.” The site went on to talk about the agency’s role in enforcing the law and educating consumers about how to “spot and avoid fraud and deception.” On the right was a blue and gold logo with the scales of justice and the winged wheel of commerce.
The FTC just announced more settlements with companies that falsely promised to help homeowners facing foreclosure. “Not relevant to our business,” you say? Think again.
“You can settle your credit card debt for pennies on the dollar without filing for bankruptcy.”
For people struggling to stay afloat, Debt Relief USA’s national TV ads must have seemed like a lifeline. When consumers called the company, representatives assured them that low monthly payments to Debt Relief USA would cover both the settlement of their reduced debts and the company’s fees. For the service to work, said the reps, people had to stop making payments to their creditors — and stop talking to them at all.
OK, now that it’s just us, here’s a reminder that most resources in the BCP Business Center are in the public domain. Thus, according to 17 U.S.C. § 105, they’re not subject to copyright restrictions. (Sorry for the citation. Sometimes we just can’t help ourselves.) So you’re free to download, link, paste, tweet, like, dislike, and otherwise use FTC materials.
Savvy executives like to stay in the loop on FTC activities that could affect their industry. They make it a habit to scan the headlines or check for relevant workshops or reports. But there’s a third category of information a bit less understood: closing letters from BCP staff.
In the spirit of transparency, the agency posts them online. Here in the BCP Business Center, recent letters appear in the Compliance Documents section of each topic area.
If there were a master list of topics that need to be addressed gingerly, death and debt would rank at the top. For debt collectors attempting to collect the debts of a deceased consumer, a recent policy statement issued by the FTC addresses changes in state probate procedures and emphasizes debt collectors’ obligation to make sure they’re acting within the law.
Thinking about using a pre-checked box to obligate buyers in an online transaction? Maybe you’re considering a negative option arrangement without clearly and conspicuously disclosing the details of the deal. Or perhaps you’re an affiliate marketer who’s concluded that legal compliance is somebody else’s responsibility. A $4.8 million judgment entered by a federal court in California suggests you might want to reconsider those strategies.
It’s called the MAP Rule — and it will help chart the course for people in the market for a mortgage by banning deceptive claims about mortgages in advertising and other commercial communications. If you’re in the mortgage business, it’s worth your time to find out more about the rules of the road.
As businesses executives have noticed, recent changes in the credit laws reflect a move toward more transparency. For example, it’s generally lawful to factor a consumer’s credit history into your decision about what rate to offer them. But last year, the FTC and Federal Reserve Board shed a little more light on that process by implementing the Risk-Based Pricing Rule.
Homeowners in financial trouble aren’t getting a lot of great news these days. But 450,177 of them will be getting a check in the mail that represents their share of the FTC’s $108 million settlement with mortgage giant Countrywide. And companies that take advantage of Americans struggling to pay the bills will be getting a little something, too: a strong message from the FTC that unfair or deceptive practices targeting cash-strapped consumers won’t be tolerated.
Perhaps you see cops on the beat when they pass by your office. Maybe you serve on a committee with the Chief of Police or have a relative in the Sheriff’s Department. However you cross paths with local law enforcement, do them — and yourself — a favor by telling them about Consumer Sentinel.