Archive: July, 2011
Jeff Gelles, Inquirer Business Columnist
Washington Republicans and conservative think tanks often portray consumer protection as some kind of anti-free-market plot. As the chart to your left illustrates, a new poll shows how far that diverges from the GOP and even the tea-party rank-and-file, at least when it comes to a set of basic bank-account protections promoted by the Pew Health Group.
Pew's proposal is aimed at addressing common complaints from checking-account holders about hidden fees and unexpected charges for overdrafts. It includes a simple one-page disclosure of key account terms, similar to the disclosures of credit-card terms.
“Regardless of political affiliation, the majority of Americans with checking accounts view stronger oversight of this financial product as a positive move,” Susan Weinstock, director of Pew’s Safe Checking in the Electronic Age Project, said in announcing results of the new poll conducted by a bipartisan team of polling firms. She said the results show that the new Consumer Financial Protection Bureau should make checking-account risks a priority.
Jeff Gelles, Inquirer Business Columnist
Each year, the Consumer Federation of America surveys a sample of state and local consumer-protection agencies to see what's on their radar. Auto problems and credit issues once again topped the 2010 list, which the CFA released today. Here are 2010's top 10, with the previous year's rank in parentheses and a description of key elements of complaints:
1. Auto: (1) Misrepresentations in advertising or sales of new and used cars, lemons, faulty repairs, leasing and towing disputes
2. Credit/Debt: (2) Billing and fee disputes, mortgage-related fraud, credit repair, debt relief services, predatory lending, illegal or abusive debt collection tactics
Jeff Gelles, Inquirer Business Columnist
AT&T continues to argue that knocking off - excuse me, merging with - one of its last remaining wireless competitors will somehow help competition. Sprint begs to differ.
In one of its recent filings with the Federal Communications Commission, AT&T argues that its latest economic models show the benefits of its T-Mobile takeover based on an analysis of "output and quality-adjusted price." A key part of the analysis is that gaining T-Mobile assets - in particular the wireless spectrum it owns - will enable AT&T to offer better service at the same price in 15 markets it examined.
The result: the holy grail of "net consumer benefit":
Jeff Gelles, Inquirer Business Columnist
The new Consumer Financial Protection Bureau opened for business today with a new invitation on its home page that I know some consumers will welcome: a simpler way to file a credit-card complaint.
In the long run, the CFPB's goal is to make such complaints less likely, by encouraging credit-card companies to be more straightforward and transparent. In the short run, the agency is offering an easier mechanism for filing a complaint than was ever offered by the primary banking regulator of credit cards, the Office of the Comptroller of the Currency.
It's not just easier for consumers. It's also meant to be easier for the card issuers, with a back end that routes your complaint directly to the financial institution and tracks its progress. Meanwhile, the CFPB will be learning in real time about how the marketplace is functioning.
Jeff Gelles, Inquirer Business Columnist
Amid all the political controversy over the Consumer Financial Protection Bureau, which formally launches on Thursday sans director, the new agency that Elizabeth Warren built is quietly going about its business.
Today's edition: a new CFPB report, requested by Congress in the Dodd-Frank financial-reform legislation, on the impact of variations in credit scores when the ones consumers buy may not be the ones their lenders see.
I wrote in March about one particular point of confusion: promotion by the three national credit bureaus of their own "VantageScore" to compete with the widely used FICO score. For many consumers, the mere fact that VantageScore is based on a different scale, 501 to 990, is disorienting, because they have spent years getting used to FICO's scale, which generally runs from about 300 to 850. Under FICO, a credit score in the 800s is golden. Under the VantageScore system, it's like getting a "B."
Jeff Gelles, Inquirer Business Columnist
Bernice Keebler had a simple complaint: Verizon billed her $4.19 for six "local calls" but wouldn't tell her where she'd called - not unless she got a lawyer and a subpoena.
To Keebler, that stretched the bounds of fair dealing beyond the breaking point. "I think I have the right to know what I am paying for," she told me in a column about her case last month. Keebler likened the experience to getting a tab at a restaurant with a bottom line for "food," but no details to review or question.
A Public Utility Commission judge agreed. In a decision released today by the PUC's communications office, Administrative Law Judge Mary D. Long proposed fining Verizon Pennsylvania $1,000 for failing in its duty to provide "adequate customer service":
Reach Jeff at jgelles@phillynews.com.
