Consumer Law & Policy Blog

FTC settles FCRA cases against two data brokers

From the FTC’s press release:

Two data brokers have agreed to settle Federal Trade Commission charges that they violated the Fair Credit Reporting Act (FCRA) by providing reports about consumers to users such as prospective employers and landlords without taking reasonable steps to make sure that they were accurate, or without making sure their users had a permissible reason to have them.

In separate cases, the two companies – Instant Checkmate, Inc., and InfoTrack Information Services – have agreed to pay civil penalties and will be prohibited from continuing their alleged illegal practices.

Suing your bank? Prepare to pay up

...is the title of this informative story from WSJ's MarketWatch about a new study from the Pew Charitable Trusts released today. The takeaway is that although most consumers don't read banking-contract fine print (the median length of which is 44 pages),

more banks are adding verbiage to their checking account fine print that prevents customers from suing the bank individually or as part of a class-action lawsuit, a study released Wednesday by The Pew Charitable Trusts reveals. What’s more, some banks require consumers who pursue a claim against the bank to pay the bank’s expenses — regardless of the outcome of the dispute.

Among the chief dangers, as always, are mandatory arbitration clauses, which the study found were included in the fine print for 70% of checking accounts.

Check out the study itself here.

CFPB Monitor's Story on Fine Print Conference

I don't usually link to posts on Ballard Spahr's CFPB Monitor on the theory that our readers also read their blog (and if you don't, you should), but just in case that theory is incorrect as to some of our readers, here is the the story.

Goldsmith & Martin Study of Public Attitudes Towards Interest Rate Caps

Timothy E. Goldsmith of New Mexico's Psychology Department and Nathalie Martin at New Mexico's Law School have written Interest Rate Caps, State Legislation, and Public Opinion: Does the Law Reflect the Public's Desires? 89 Chicago-Kent Law Review (2014).  Here's the abstract:

In scholarly circles, debates about the benefits and burdens of high-costs lending are prevalent, as are debates about whether to cap interest on certain kinds of consumer loans. Despite this scholarly interest, few scholars actually know what the general public thinks or knows about interest rates on common consumer credit products. This article tries to close this gap through an empirical study of consumer attitudes about interest rates in the state of New Mexico, a state in which high-cost loans such as payday loans and title loans are ubiquitous. Our data show that the general public overwhelmingly supports interest rate caps both in general and for certain types of loans. We also found that many consumers are unaware that there are no interest rate caps on many forms of consumer loans. These data could be useful in explaining why consumers do not do more to change the law on interest rate caps.

CFPB obtains massive credit-card deception consent order from Bank of America

The Consumer Financial Protetion Bureau has obtained this big-dollar consent order from Bank of America (BOA) arising from the bank's unfair and deceptive credit-card practices. About 1.4 million consumers will receive refunds totalling $727 million. BOA will also pay the CFPB a $20 million civil penalty. CFPB Director Richard Cordray talked tough in announcing the settlement:

We have consistently warned companies about illegal practices related to credit card add-on products. Bank of America both deceived consumers and unfairly billed consumers for services not performed. We will not tolerate such practices and will continue to be vigilant in our pursuit of companies who wrong consumers in this market.

A detailed list of BOA's practices and the relief obtained by the CFPB appears after the jump.

What sort of people set up a business called Jerk.com?

Even aside from concerns about Facebook and privacy, the people who set up this business must truly be, well, jerks ....

On Monday, the Federal Trade Commission charged the operators of the website “Jerk.com” with harvesting personal information from Facebook to create profiles labeling people a “Jerk” or “not a Jerk,” then falsely claiming that consumers could revise their online profiles by paying $30. According to the FTC’s complaint, between 2009 and 2013 the defendants, Jerk, LLC and John Fanning, the operator of the website, created Jerk.com profiles for more than 73 million people, including children.

The FTC’s press release explains that Jerk.com “allegedly used Facebook’s application programming interfaces to download the names and photos of millions of Facebook users, which they in turn used to create nearly all the Jerk.com profiles. In addition to buttons that allowed users to vote on whether a person was a 'Jerk' or not, Jerk profiles included fields in which users could enter personal information about the subject or post comments about them. … The profiles also included millions of photos, including photos of children and photos that consumers claim they had designated on Facebook as private.”

Has Hadeed Carpet Fairly Accused Yelp of Punishing Companies That Don’t Advertise?

by Paul Alan Levy

Following the recent decision of the Virginia Court of Appeals affirming the enforcement of a subpoena to Yelp by Hadeed Carpet Cleaning, demanding the identities of seven anonymous reviewers, and our petition to the Virginia Supreme Court seeking leave to appeal, Hadeed has been trying to organize a broader crusade against Yelp by appealing to other business owners who are frustrated by negative reviews   Hadeed has obtained coverage for one claim that one sometimes hears from businesses hoping to explain away their negative reviews:  Because Yelp runs its service on an advertising model, rather than the Angie’s List type subscription model, and because Yelp is not shy about soliciting advertising from businesses that are reviewed on its web site, a number of businesses simply blame Yelp for their negative consumer reviews, claiming that the negative reviews appeared only after they refused Yelp’s invitation to advertise, and represent Yelp's retaliation.  

Maryland minimum wage will rise to $10.10

As the Baltimore Sun reports, "Maryland's minimum wage will rise to $10.10 by July 2018 under a bill granted final passage by state lawmakers Monday. The measure goes to Democratic Gov. Martin O'Malley for his promised signature."

For a good discussion of the political debate over the effects of the minimum wage, listen to this NPR story.

Web Video of Fine Print Conference Now Available

Here. I recommend the conference highly. Very informative. 

Supreme Court grants review in Class Action Fairness Act case

The case is Dart Cherokee Basin Operating Company, LLC v. Owens. Here is the question presented (and the defendant's argumentative intro to the question presented taken from its petition for a writ of certiorari):

A defendant seeking removal of a case to federal court must file a notice of removal containing “a short and plain statement of the grounds for removal” and attach only the state court filings served on such defendant. 28 U.S.C. § 1446(a). Consistent with that statutory pleading requirement, the First, Fourth, Fifth, Seventh, Eighth, Ninth, and Eleventh Circuits require only that a notice of removal contain allegations of the jurisdictional facts supporting removal; those courts do not require the defendant to attach evidence supporting federal jurisdiction to the notice of removal. District courts in those Circuits may consider evidence supporting removal even if it comes later in response to a motion to remand. Here, in a clean break from Section 1446(a)’s language and its sister Circuits’ decisions, the Tenth Circuit let stand an order remanding a class action to state court based upon the district court’s refusal to consider evidence establishing federal jurisdiction under the Class Action Fairness Act (CAFA) because that evidence was not attached to the notice of removal. (That evidence, which was not disputed, came later in response to the motion to remand.)

The question presented is: Whether a defendant seeking removal to federal court is required to include evidence supporting federal jurisdiction in the notice of removal, or is alleging the required “short and plain statement of the grounds for removal” enough?