FTC Completes Review of Holder Rule
For Your Information
May 2, 2019

The Federal Trade Commission announced today that it has completed its review of the Holder Rule, which protects consumers who purchase goods and services using credit obtained through a merchant.As part of its systematic review of all its rules and guides, the FTC in November 2015 sought public comment on the Holder Rule, including its efficiency, the costs and benefits of the Rule, and its impact.

The Rule, formally called the “Trade Regulation Rule Concerning Preservation of Consumers’ Claims and Defenses,” protects consumers when they purchase personal goods or services with money loaned by a merchant or by a lender who works with a merchant. The Rule requires that such loans include a provision that preserves consumers’ ability to raise the merchant’s misconduct as a reason for not repaying the loan, even if the loan is sold. The Rule prevents businesses from using financing mechanisms to collect debts from consumers in situations where the debt arises from a sale in which the merchant defrauded customers, failed to deliver the goods or services, or engaged in other misconduct.


The FTC received 19 comments, all of which urged retaining the Rule. After reviewing the comments, the Commission found that there is a continuing need for the Rule and the record did not warrant a rulemaking to modify the Rule. The Commission specifically restated a 2012 advisory opinion that affirmed that the remedies that the Rule provides are not limited to circumstances where the seller’s conduct warrants rescission of the contract, or where the goods or services sold to the consumer are worthless.


The Commission voted 5-0 to approve publication of the confirmation of the Rule in the Federal Register. It will be published in the Federal Register shortly.


The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). 

Avoid crowdfunding scams
May 6, 2019 by Lisa Lake, Consumer Education Specialist, FTC

Crowdfunding is one way to support a project you believe in and get rewards for that support. But the project you’re backing is only as good as the people behind it. Some dishonest people can take your money but produce nothing – no product, no project, and no reward.


Here’s how crowdfunding works: People called "creators" ask for small amounts of money from lots of people to fund projects through websites like Kickstarter or Indiegogo. In exchange, creators offer rewards to contributors, like a product that the creators are trying to make. Sounds great…unless the creators don’t create anything but profit for themselves.


In its lawsuit against iBackPack, the FTC says people shelled out over $800,000 via crowdfunding campaigns. The company said those funds would help it provide consumers with backpacks and shoulder bags with built-in batteries for charging mobile devices. But, according to the FTC, iBackPack’s claims that bags would soon be going out to consumers were lies. What’s more, the FTC’s investigation found that the money the creators took in from their campaigns generally didn’t go toward what they said it would. Instead, the FTC says, iBackPack’s CEO pocketed a large part of the funds for his own personal use. And when people began to complain, the CEO allegedly threatened some of them – adding that he knew their addresses and other personal information.


If you’re thinking about contributing to a crowdfunding campaign, take a minute to research the creator’s background and reviews before you pay. For example, has the creator engaged in previous campaigns? How did those campaigns turn out?

If you learn about a crowdfunding scam:

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• Report it to the Federal Trade Commission.
  
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• Report it to your state Attorney General.
  
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• Warn other people by commenting on the creator’s profile on the crowdfunding site.
  

FDIC Consumer News: Protecting Seniors from Financial Abuse
Federal Deposit Insurance Corporation -- FDIC Consumer News - April 2019

Click here for printable pdf version - April 2019 - PDF

Be organized, proactive, and aware to protect yourself, family and friends from financial abuseIt’s easier than ever to handle our finances without setting foot inside a bank with so many advances in technology, but these changes have also made fraud and financial abuse a prevalent problem for older adults. Most elder financial abuse involves scams, forgery, identity theft, or undue pressure to give someone access to property or funds by simply providing information over the phone. Older adults are often targeted for such exploitation because they may be perceived as trusting, they may be cognitively impaired, they may have more funds available after a lifetime of saving, and potentially less exposure to technological advances.


Tips for Protecting Finances

Seniors can protect themselves from financial abuse by making sure financial records are organized and being aware of how much money is in all accounts. In addition, you can protect your assets by talking to someone at your bank, an attorney, or a financial advisor to discuss your options for ensuring your wishes for managing your money and property are followed in the event you become incapacitated. Other activities to help protect yourself include:

• Carefully choosing a trustworthy person to share your financial planning matters with so they can assist you with tracking your finances if you are unable to do so yourself.


• Locking up your checkbook, account statements, and other sensitive information.


• Ordering copies of your credit report to review for suspicious activity. (You are entitled to a free copy of your credit report from each of the three major credit bureaus once every twelve months. To order your free annual reports, go to AnnualCreditReport.com or call toll- free 1-877-322-8228.)

• Never providing personal information, including your Social Security number, account numbers, or other financial information to anyone over the phone unless you initiated the call.


• Asking for details in writing and getting a second opinion from a financial advisor or attorney before signing any document you don’t understand.


• Paying with checks and credit cards instead of cash to have records of transactions.

Tips for Family and Friends

Family and friends can also help by being aware of the many ways in which an older person may be financially exploited. There are many scams and frauds that attempt to get bank account information or Social Security numbers from the elderly to steal their identity or money. Be on the lookout for signs of possible financial abuse, including:

• Unexplained account withdrawals.


• Another individual unexpectedly making financial decisions on the older person’s behalf.


• Disappearance of funds or valuable possessions.


• Unanticipated transfer of assets to another individual.


• Sudden changes to a will or other important financial documents.


• Suspicious signatures on checks.

If you suspect elder financial abuse, talk to the victim to determine what is happening and who is involved. For instance, you’ll want to know whether a new person in their life is helping them manage their money or a relative is using their credit card without permission. If financial abuse seems likely, you may want to contact your state’s adult protective services and the local police for assistance.

You should also contact any bank or other financial institution involved to notify them of the potential abuse, and they may be able to assist you. They may not be able to provide you with specific information about accounts or transactions due to privacy laws, but they have the ability to review information for potential abuse as well as the resources to report abuse.

Also be aware of consumer financial protection regulations that help protect funds withdrawn from an account without authorization. For example, most cases of fraud and identity theft are committed using an access device, such as when an individual steals an older person’s debit card and pin number to withdraw money from a checking account.

The Electronic Fund Transfer Act, which is implemented through Regulation E, protects consumers from losses that may occur as a result of certain unauthorized electronic financial transactions, such as unauthorized ATM withdrawals and point-of-sale terminal transfers in stores. If a debit card or the card number is used to make an unauthorized withdrawal from a checking or savings account, you can minimize your losses by contacting your bank as soon as possible. Your maximum liability under Regulation E is $50 if you notify your bank within two business days after learning of the loss. Additionally, many credit card issuers have zero-liability policies, meaning that customers typically do not pay for unauthorized transactions, so contact your credit card issuer as soon as you discover any.

For more information on elder financial abuse, visit:

https://www.consumer.ftc.gov/blog/2015/08/spotting-elder-financial-abuse

https://www.consumerfinance.gov/practitioner-resources/resources-for-older-adults/protecting-against-fraud/

For more help or information, go to FDIC.gov or call the FDIC toll-free at 1-877-ASK-FDIC (1-877-275-3342).

BHPH dealers are usually their own bank for holding the notes and collecting, and skirt the financial disclosure regulations in the process and in the re-titling of repos. (Assuming the title is ever placed in the buyer's name.) Often, their floor plan is private or through major auctions, and the finance arm is a wholly-owned subsidiary of the dealership.  

This particular predatory practice is not limited to the sketchy downscale boulevard dealers, but is often found in the flashy franchised used car groups, doing high volume sales with extremely detailed buyer qualification handbooks. They've been with us for years, but the increase in the mass of low income workers who need mobility 
now make the problem more visible. 

Often, the condition of the vehicles are blamed for the repo, but it's more likely to be the burden of repayment that triggers. It's a better business model to sell the best cars the particular market will bear, setting the markup aside. These dealers are selling money, and the car is just a mechanism that recognizes a need and opens the door to a payment process. It's a lot more profitable to repo a decent vehicle if you're going to resell it. 

About Us
The Institute of Student Loan Advisors Corporation (TISLA) was founded to ensure that all student loan borrowers have access to free, neutral and clear student loan advice and dispute resolution assistance. We are a 501(c)(3) non-profit who believes that these borrowers have a right to a trusted resource with industry experience to mentor, educate and advocate for them. Student loan borrowers have a right to such a resource without being charged a fee, barraged with advertisements or forced to provide personal information that may later be sold.

Our goal is to help you help yourself. We are not here to manage your student loans for you, but to give you expert advice and help you to manage them successfully. We will offer fair, neutral advice that outlines what you are eligible for that is in line with current regulation and statute.

What We Can Do For You

• Offer expert advice on your student loans
• Help you decide which repayment plan make the most sense for you
• Determine if you are eligible for loan forgiveness or discharge
• Offer guidance in any dispute you may have regarding your student loans
• Guide you through completing required forms and applications
• Help you get out of a default or delinquency status
  
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What We Cannot Do For you

• Offer legal advice
• Offer opinions on a particular company or servicer
• Fill out or submit your forms for you
• Pay your loans
• Change the law or regulations
• Manage your loan accounts for you
  
• 
  

Testimonials
From James D. August 1, 2018

“I am very happy that I found freestudentloanadvice.org. I was very frustrated with trying to solve my student loan issues on my own and Betsy was such a great help with advice and follow up. Thank you so much!”

How We Are Funded

At the core of TISLA’s values is the promise of free, neutral and transparent student loan advice. For that reason, we do not accept advertising funds from any businesses nor fees from consumers. TISLA is funded through grants, donations and our fee for service products we offer to employers, schools and associations with constituencies concerned with student debt. 

Such donations and partnerships will be listed on this page to ensure continued transparency. If you are interested in helping to fund TISLA, a 501(c)(3) non-profit organization, please contact betsy “at” freestudentloanadvice.org or donate through donorbox online.

TISLA 2018 Annual Report

Partnership Opportunities

TISLA offers several affordable and customizable packages to suit your constituencies needs for expert student loan repayment education and assistance.  These offerings are suitable for employers looking to attract and retain valuable employees or schools who wish to provide student loan assistance to their alumni, students and employees.  Our services can also be a way for associations to provide additional value to their members.  Please contact betsy “at” freestudentloanadvice.org for more information on partnering with TISLA.

Our Leadership

TISLA is currently completing its board roster. If you, or someone you know, has a passion for the issue of student debt, can contribute their business, non-profit or other expertise and influence, and would like to consider serving, please contact betsy “at” freestudentloanadvice.org

Our Mission

To make certain that all student loan borrowers have access to free, neutral and accurate resources and mentoring to ensure they can successfully manage their student loan debt.

Our Values

• Accuracy
• Clarity
• Integrity
• Professionalism
• Approachable
• Respect
• Neutrality
• Transparency
• To be of service to others

See more at https://public.tableau.com/profile/federal.trade.commission#!/

For the first time, imposter scams topped the list of consumer complaints submitted in 2018 to the Federal Trade Commission’s nationwide Consumer Sentinel database, driven in part by a jump in reports about government imposter scams.


Fraudsters operating government imposter scams falsely claim to be from the Internal Revenue Service, Social Security Administration, or another government agency to get people to turn over money or personal information. Government imposter scams made up nearly half of the 535,417 imposter scam reports to the FTC in 2018. Consumers reported losing a total of nearly $488 million to all types of imposter scams in 2018—more than any other type of fraud—and reported a median loss of $500.


Many government imposter scam reports involved fraudsters who falsely claimed to be from the Social Security Administration. These scammers typically tell people their Social Security number has been suspended, or that there is some other problem, in an effort to get them to reveal their Social Security number or pay money to “reactivate” it. In reality, Social Security numbers are never suspended and the Social Security Administration will never require you to pay to obtain one.


“If you get a call out of the blue from someone claiming to be from a government agency like the Social Security Administration or IRS asking you for personal information or money, it’s a scam,” said Andrew Smith, Director of the FTC’s Bureau of Consumer Protection. “You should hang up immediately and report it to the FTC at ftc.gov/complaint.”


Increase in Reports, Fraud Losses

In all, the FTC received nearly three million complaints from consumers in 2018. Consumers reported losing nearly $1.48 billion to fraud in 2018—38 percent more than the year before. Debt collection complaints dropped to the number two spot after topping the FTC’s list of consumer complaints for the previous three years.


Identity theft was the third most common complaint, and consistently ranks among the top consumer complaints made to the FTC. There was a 24 percent increase last year in identity theft reports that involved credit card fraud on new accounts. At the same time, there was a large drop (38 percent) in reports involving tax identity theft.


As in previous years, wire transfers and credit cards were the first and second most widely reported form of payment for fraud. In 2018, however, a growing number of consumers reported that scammers demanded to be paid with gift and reload cards. The number of consumers who said they paid with a gift or reload card grew from over 28,000 in 2017 to more than 41,000 in 2018, while the total amount paid using a gift or reload card to scammers nearly doubled to $78 million.


As in 2017, more consumers in their twenties who reported fraud said they lost money (43 percent) compared with those in their seventies (15 percent). Yet when those in their seventies reported losing money to fraud, the median amount they lost was much larger ($750), compared with those in their twenties ($400).


The data book includes national statistics, as well as a state-by-state listing of top report categories in each state, and a listing of metropolitan areas that generated the most complaints per 100,000 population. The top states in 2018 reporting fraud and other consumer issues were Florida, Georgia, and Nevada, while Georgia, Nevada, and California had the most reports about identity theft, per 100,000 population.


The FTC produces the Consumer Sentinel Network Data Book annually using reports received by the Consumer Sentinel Network. These include reports made directly by consumers to the FTC, as well as reports received by state and federal law enforcement agencies, national consumer protection organizations, and non-governmental organizations. In October 2018, the FTC began releasing consumer complaint data on a quarterly basis through a new interactive online format.


The Consumer Sentinel Network’s secure online database is currently available to more than 2,500 individual users in civil and criminal law enforcement agencies across the country and abroad. Agencies use the data to research cases, identify victims and track possible targets. Although non-governmental organizations may contribute data to the database, only law enforcement agencies can access the database. Law enforcement personnel can join Sentinel at Register.ConsumerSentinel.gov.


The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources.

CONTACT FOR CONSUMERS:  Consumer Response Center   877-382-4357