As any consumer knows, when you get a credit card, you also get documents telling you what type of account you have and what the terms of it are. The statements in these documents may be a legal contract that the credit card company has to follow. Similarly, credit card companies cannot make false statements in advertisements used to market credit cards.
For many with average credit scores or worse, it is increasingly difficult to find a company willing to issue a credit card. As a result, many times consumers unwittingly find themselves signing up for what is commonly called “fee harvester” credit cards which, without much warning, create a downward debt spiral.
When a credit card company sues a consumer to collect on a delinquent account, the consumer has four basic options:Â (1) Settle the debt for a percentage of the original amount owed; (2) Declare bankruptcy and have the debt discharged; (3) Ignore the suit, which usually results in a default (i.e. automatic) judgment for the credit card company; or (4) Defend the suit.
The Credit Card Accountability, Responsibility and Disclosure Act (“CARD Act”) was enacted in 2010 with the goal to protect consumers from longstanding unfair credit card billing practices. When the CARD Act was signed into law, it was clear the credit card industry was in need of substantial reform. Congress concluded that certain practices in the credit card industry were not fair and transparent to consumers, and the CARD Act passed with overwhelming bipartisan support in both the House and the Senate. There had been a growing sense of frustration nationwide at the confusing and perhaps deceptive rate hikes and fees levied by credit card companies for the slightest late payment or no reason at all. As President Obama said when he signed the CARD Act into law, “[w]e don’t begrudge them turning a profit, we just want to make sure that they do so while upholding basic standards of fairness, transparency and accountability.”
More than six months ago government regulators and banks first extended offers to 4.3 million homeowners facing foreclosure: to review, at no cost, the foreclosure process to check for any possible errors or misrepresentations. Homeowners can stand to collect compensation of as much as $100,000 through this process if errors are found. But thus far, only a tiny percentage of those eligible have actually signed up, only 165,000 people — fewer than 4 percent of those eligible — have applied. The original April 30 deadline has since been extended to July 31.
On May 2, 2012, Maryland Governor O’Malley signed into law a bill that protects employees and applicants against mandatory disclosure of social media passwords and other personal account information. This appears to be a first in the nation and will take effect October 1, 2012. §3-712 of the Maryland Labor and Employment Code states that an employer “may not request or require that an employee or applicant disclose any user name, password, or other means for accessing a personal account or service through an electronic communications device.” As such, an employer may not “discharge, discipline, or otherwise penalize or threaten to discharge, discipline, or otherwise penalize an employee for an employee’s refusal to disclose” any information related to social media and other personal accounts. The law also protects applicants and prohibits employers from refusing to hire applicants who refuse to provide such information.
This blog has previously discussed the oxymoronic impact of PLIVA Inc. v. Mensing on American consumers. As harrowing accounts of injuries suffered due to generic drugs fail to survive the Supreme Court’s decision, as Congress is facing a bill to reverse the decision, the First Circuit has found a way to let some claims through. In Bartlett v. Mutual Pharmaceutical Co., the Court of Appeals for the First Circuit held that while Mensing foreclosed failure to warn claims against generics on the theory that damages would be unfair if generics labeled their drug exactly as the FDA ordered, it did not foreclose design defect claims. While the former means that drugs can only be sold with one label, the latter argues that the drug need not be sold at all. In other words, Mutual Pharmacetical could have looked at the data, seen that sulindac’s benefit was far outweighed by its risk, and chosen not to market the drug. That it did sell the drug, then it is liable to consumers injured by it regardless of Mensing.
As more consumers become environmentally-conscious, more companies are spending more money and time in advertising and marketing to claim that their personal beauty and cleaning products are “green” or environmentally-friendly.   Companies make claims that their products are “biodegradable,” “non-toxic” and “natural.” Consumers are even willing to pay more for green products. However, various companies deceptively advertise and label products as being green when the products are not.
It seems like every day there is a new fee or charge associated with banking. Want to speak to a teller: Pay up. Want to have a checking account with the bank: Pay up. Between the new fees and the new ways of charging for old fees, it sometimes seems like it would be better to keep your money under your mattress. When you factor in the Wall Street bailout in 2008, the fees seem like salt on the wound for Main Street.
In 2010, new federal regulations (as as result of the Dodd-Frank Act) required banks to receive permission in writing from consumers before charging overdraft fees for one-time debit card and ATM transactions. Many consumers decided to not give that permission and chose to have their one-time debit card and ATM transactions declined. However, what some did not realize is that even by not opting-in, banks could still charge them overdraft fees for checks and certain other electronic transactions. Consumers need to be mindful that overdrafts are still an ever present risk to their checking accounts.