Recent articles in the Times that bear on consumer law issues include a report in Wednesday's paper, "Papers Show Wachovia Knew of Thefts." Some excerpts:
Last spring, Wachovia bank was accused in a lawsuit of allowing fraudulent telemarketers to use the bank’s accounts to steal millions of dollars from unsuspecting victims. When asked about the suit, bank executives said they had been unaware of the thefts.
But newly released documents from that lawsuit now show that Wachovia had long known about allegations of fraud and that the bank, in fact, solicited business from companies it knew had been accused of telemarketing crimes.
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“YIKES!!!!” wrote one Wachovia executive in 2005, warning colleagues that an account used by telemarketers had drawn 4,500 complaints in just two months. “DOUBLE YIKES!!!!” she added. “There is more, but nothing more that I want to put into a note.”
However, Wachovia continued processing fraudulent transactions for that account and others, partly because the bank charged fraud artists a large fee every time a victim spotted a bogus transaction and demanded their money back. One company alone paid Wachovia about $1.5 million over 11 months, according to investigators.
“We are making a ton of money from them,” wrote Linda Pera, a Wachovia executive, in 2005 about a company that was later accused by federal prosecutors of helping steal up to $142 million.
Also on Wednesday, the Times editorialized about curing the problems with the Consumer Product Safety Commission in "The Next Step to Safety:"
Right now the commission is paralyzed because it lacks a quorum to adopt safety rules or order recalls. The White House must quickly fill at least one vacancy or Congress must quickly pass a law allowing the commission’s two members to qualify as a quorum.
There is a lot more work to be done. Congress should approve Senate legislation giving the commission the money and the authority it needs. At the very least, this would make it easier for the commission to notify consumers promptly when they have bought a hazardous product. The commission often keeps such data secret while it negotiates — for months or even years — with the manufacturer.
I've been meaning to post links to a couple of interesting articles from January. First, Bob Tedeschi's column on mortgages, "How to Get a Cheaper Loan," which ran on January 20, described how lenders deal with the fact that the three credit bureaus sometimes report different credit scores for the same consumers:
To account for those differences during the mortgage application process, loan officers review the scores from all three credit bureaus and base their loan offers on the middle number. If a couple — married or not — is jointly applying for a mortgage, the loan officer will choose the middle score of the partner with the lower score.
This was news to me. Tedeschi also reports:
Bureaus offer more than one type of report — TransUnion has its traditional report and its Vantage report, for instance. A bureau may well come up with different scores for the same borrower because each report weighs various factors like recent payment history in a slightly different way.
Finally, on January 19, the Times ran Janet Morrissey's "Your Money" column, headlined, "What's Behind Those Offers to Raise Credit Scores" about companies that, for a fee, piggy-back the credit records of people with good credit histories onto those with poor credit histories.