FOR THE CONSUMER
The FTC's monthly newsletter for the Congressional community
It's the news you - and your constituents - can use.
Volume 8- Number 3
IN THIS ISSUE
STIMULUS SCAMS. The FTC is warning consumers to stay away from websites that claim the stimulus package gives out easy-to-get grants for almost anyone that applies. These ads, which feature photos of President Obama and Vice President Biden, show up on social networking sites, streaming video sites, search engines and more. Any site that says you have to pay money to get free money is a scam. Press release: www.ftc.gov/opa/2009/03/stimulusscam.shtm.
DOWN IN THE DUMPS-TER. CVS Caremark will settle FTC charges that it failed to take reasonable and appropriate security measures to protect the sensitive financial and medical information of its customers and employees. The FTC opened its investigation into CVS Caremark following media reports from around the country that pharmacies were throwing trash in open dumpsters ---- trash that contained personal information including patient names, addresses, medication, dosages, employment applications, social security numbers, and payroll, credit card, and insurance card information. In a related case, the company agreed to pay $2.25 million to resolve Department of Health and Human Services allegations that it violated the Health Insurance Portability and Accountability Act (HIPAA). Press release: www.ftc.gov/opa/2009/02/cvs.shtm.
BY THE MINUTE. Alternatel, Inc., a prepaid calling card company, its affiliates, and their principals have agreed to pay $2.25 million to settle FTC charges that they lied about the number of minutes of talk time people would get on their prepaid calling cards. The FTC’s testing revealed that people got only about half the minutes advertised. The companies targeted their advertising at recent immigrants. Press release: www.ftc.gov/opa/2009/02/alternatel.shtm.
TOP COMPLAINTS of 2008. The FTC has released its “Consumer Sentinel Network Data Book for January-December 2008.” For the ninth year in a row, identity theft was the number one consumer complaint category — 26 percent of the complaints consumers filed during 2008. The report breaks out complaint data state-by-state, and contains data about the 50 metropolitan areas reporting the highest per capita incidence of fraud and other complaints. Press release: www.ftc.gov/opa/2009/02/2008cmpts.shtm.
FUEL RULE . The FTC is seeking comments as part of its review of the Fuel Rating Rule, which requires refiners, importers, and producers of auto fuels to determine the fuels’ ratings before transferring them to a distributor or retailer. Press release: www.ftc.gov/opa/2009/02/fyi0224.shtm.
PAY FOR DELAY. The FTC wants a federal court to undo a deal between Solvay Pharmaceuticals and two generic drug makers to delay the roll-out of a generic testosterone replacement in exchange for a share of its monopoly profits. The FDA had approved a generic formulation of Solvay’s branded AndroGel, but the drug makers agreed to delay sales until 2015 and share the profits, at a cost to consumers of hundreds of million dollars a year. The California Attorney General has joined the FTC action. Press release: www.ftc.gov/opa/2009/02/androgel.shtm.
SQUEAKY WHEEL. The FTC required Lubrizol Corporation to transfer certain assets it acquired from its rival, Lockhart Company, to restore competition in the U.S. market for chemical rust inhibitors. The FTC charged that the 2007 acquisition created a monopoly in the sale of rust preventatives containing oxidates, which have become the industry standard for long-term rust and corrosion prevention. The settlement creates a new firm to compete with Lubrizol. Press release: www.ftc.gov/opa/2009/02/lubrizol.shtm.
DEBT COLLECTION: Recommends updating the Fair Debt Collection Practices Act to require that collectors get better information so they’re more likely to pursue the right consumer for the correct debt amount, and do a better job telling people their rights under the FDCPA. Press release: www.ftc.gov/opa/2009/02/fdcpa.shtm.
BEHAVIORAL ADVERTISING: Describes the FTC’s examination of how online advertisers can best protect peoples’ privacy while collecting information about their online activities. Press release: www.ftc.gov/opa/2009/02/behavad.shtm.
NEGATIVE OPTION MARKETING: Presents five marketing principles for avoiding the unique deception issues affecting negative option offers on the Internet. Negative option marketers should disclose material terms — before people incur a financial obligation — in an understandable way, place them in spots on websites where consumers are likely to look, label them to indicate their importance and relevance, and use easy-to-read fonts and colors. Press release: www.ftc.gov/opa/2009/02/jab.shtm.
The FTC testified before the Senate Committee on Commerce, Science, and Transportation about the agency’s increased focus on protecting consumers in financial distress, including stepped-up law enforcement and consumer education efforts addressing mortgage foreclosure rescue scams, bogus debt relief and credit repair services, and unlawful debt collection. Press release: www.ftc.gov/opa/2009/02/financial.shtm.
AT THE FTC
The FTC will host the following events at its conference center at 601 New Jersey Avenue, N.W., Washington , D.C. These events are free and open to the public; a government-issued photo ID is required for entry. Pre-registration is not required.
AD IT UP. This forum on March 12, 2009 is part of the FTC’s advertising literacy initiative, which seeks to raise awareness among tweens about advertising and marketing messages; improve their ability to read, analyze, and appreciate advertisements; and show them the benefits of being informed consumers. Experts on advertising and marketing to kids will discuss what children experience in the commercial world, what they need to know to navigate it, and what they understand about their experiences. A live webcast of this workshop will be available at www.ftc.gov . Press release: www.ftc.gov/opa/2009/02/aditup.shtm.
GLOBAL DATA SECURITY. This conference on March 16-17 for policymakers, consumer advocates, industry representatives, technology experts, and academics from around the world will address how companies can manage personal data security issues internationally. A live webcast of this workshop will be available at www.ftc.gov. Press release: www.ftc.gov/opa/2008/12/datasec.shtm.
INTELLECTUAL PROPERTY. Hearings on March 18-19 will explore the operation of the IP and technology markets and the impact of patent policies on those markets. The March 18 hearing will explore how organizations and inventors from different industries use patents by enforcing exclusivity or licensing. The March 19 hearing will consider economic perspectives on IP and technology markets, and the role of notice and transparency in the IP marketplace. Additional hearings are scheduled for April 17 in Washington, and May 4-5 in Berkeley, California. Comments are due by May 15, 2009. For more information about the hearings, visit www.ftc.gov/bc/workshops/ipmarketplace/. Press release: www.ftc.gov/opa/2009/02/iphearings.shtm.
ON THE ROAD
DRM BEAT. The FTC and the Technology Law and Public Policy Clinic at the University of Washington School of Law will host a free conference on the use of digital rights management technologies (DRM), which hardware manufacturers, publishers, and copyright holders typically use to control how people access and use content. The workshop, which is open to the public, will be held March 25 from 9 am to 4:30 pm at the University of Washington Law School in Seattle. Pre-registration is not required. A live webcast will be available at www.ftc.gov . Press release: www.ftc.gov/opa/2008/12/drm.shtm.
GARNISHMENT OF FEDERAL BENEFITS: UNDERSTANDING YOUR RIGHTS. Explains what you need to know about garnishment of federal benefits from your bank account. www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt135.shtm.
DEBT COLLECTION FAQS: A GUIDE FOR CONSUMERS. Answers commonly asked questions about your rights under the Fair Debt Collection Practices Act, which requires that debt collectors treat you fairly and prohibits certain methods of debt collection. www.ftc.gov/bcp/edu/pubs/consumer/credit/cre18.shtm.
With talk of stimulus plans ruling the news, it’s no surprise a new round of stimulus scams are afoot. Scam artists are tapping into the headlines to reel in unsuspecting consumers. You've probably seen the ads: they feature photos of President Obama and Vice President Biden and claim anyone that applies can get free money. They claim the Stimulus Package gives out easy-to-get grants for virtually anyone who applies. They offer compelling testimonials describing people who used grant money to pay off their mortgages or fix their homes. The FTC is warning people that the promise of stimulus money in return for a fee or financial information is always a scam.
There’s more than one way to perpetrate a stimulus scam and the FTC offers this advice to protect yourself from one.
- Remember: free is free. Some scam artists ask you to send a small processing fee, supposedly to get a much larger check in return. That’s money you’ll never see again. Even if they tell you that you'll only need to pay $1.99 for membership, don't do it. Scammers often bury fine print on their sites and can charge you hefty fees if you don't cancel your membership.
- Beware if someone asks for your bank account number so they can “deposit” your check. They can use the information to clean out your account or open new ones using your identifying information.
- Some stimulus scams encourage you to click on links, open attached forms, or call phony toll-free numbers ---- which can install harmful software, like spyware, on your computer.
- If you get a message offering you money from the stimulus program in exchange for your personal information, ignore it, delete it, or throw it out. The IRS doesn’t send emails like this asking for personal information. Don’t trust a rebate company claiming to have stimulus payments for you. If you get an unexpected email from someone claiming to be from the IRS and asking you to call a number or email back personal information, forward it to firstname.lastname@example.org, then delete it without clicking on any links or opening any attachments.
- The government doesn't charge people to apply for a grant or to get a list of grants. If you want to apply for a government grant, check out the free list at Grants.gov.
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