• Cut taxes for working families and the middle class.
• Get rid of capital gains tax for small-businesses and entrepreneurs.
• Some kind of rollback on the changes in bankruptcy law in '05 that made it harder for people to declare personal bankruptcy.
• Get rid of unproductive tax loopholes that only benefit corporations.
• Lower health insurance premiums for all.
• Insure the uninsured with the same level of coverage Congress gives itself
• Reduce dependence on foreign oil in 10 years.
• $150 billion for renewable energy solutions and next-generation biofuels
• More sick days and paid time off.

What do you think? Can he deliver?

(Photo: BohPhoto)

Jim at Circuit City's consumer affairs division wrote,

I have some follow-up information on this matter to share with you.

Thanks to your Web posting, we have been able to determine that a few employees at one of our stores incorrectly charged a customer for work that our firedog techs did on the computer that he purchased. The manufacturer notified us that the PC in question did need a repair and we coordinated the repairs with the manufacturer. The customer should NOT have been charged.

We have reached out to the affected customer to apologize to him for any inconvenience and to make sure a refund is provided. We have also taken steps to ensure that our associates are aware of company policies on this issue.

I hope this information is helpful,
Jim

Frankly, we were suspicious that Circuit City was taking advantage of the faulty PC inventory to make a little extra money, so we're happy to see the company step up and correct this oversight so quickly.

WHO: Barack Obama
WHAT: Shortly before the opening of the Democratic National Convention, Obama assured America that Hillary was always a viable candidate in his VP search.
WHERE: Obama Dismisses Worries About Clinton Fallout [New York Times]
THE QUOTE: "'I've tried not to have long discussions about short lists, long lists...But I’ve said publicly before and I will repeat again that Senator Clinton would be on anybody’s short list, so I took her very seriously."

"Taking it seriously" is a phrase companies (and now, presidential candidates) use over and over again to appear contrite or thoughtful without actually saying or doing anything. Our series of posts documenting the phrase's attempts recurrences are our attempt to question how much seriousness-taking is actually going on.

(Thanks to Michael Belisle!)

(Photo: BohPhoto)

The commissioner, a 2006 President Bush appointee, told the Business & Media Institute the Fairness Doctrine could be intertwined with the net neutrality battle. The result might end with the government regulating content on the Web, he warned. McDowell, who was against reprimanding Comcast, said the net neutrality effort could win the support of “a few isolated conservatives” who may not fully realize the long-term effects of government regulation.

“I think the fear is that somehow large corporations will censor their content, their points of view, right,” McDowell said. “I think the bigger concern for them should be if you have government dictating content policy, which by the way would have a big First Amendment problem.”

“Then, whoever is in charge of government is going to determine what is fair, under a so-called ‘Fairness Doctrine,’ which won’t be called that – it’ll be called something else,” McDowell said. “So, will Web sites, will bloggers have to give equal time or equal space on their Web site to opposing views rather than letting the marketplace of ideas determine that?”

McDowell's scare tactics aren't new. Conservative bloggers have tried to sabotage the net neutrality debate by making a false connection to the long-dead fairness doctrine, which required regulated media outlets to give equal time to opposing views. If the government penalizes Comcast for crippling the internet, the argument goes, well then that friends is regulation; and if the government can regulate Comcast, it must, obviously, regulate the rest of the internet immediately. This kindles the fear of god in conservative talk show hosts like Rush Limbaugh, who would rather stay silent than let Al Franken take up his airtime calling him a big fat idiot.

In the spirit of fairness, Commissioner McDowell is more than welcome to respond, provided he respects our own regulations.

McDowell: Fairness Doctrine, Net Neutrality Linked [Broadcasting & Cable]
FCC Commissioner: Return of Fairness Doctrine Could Control Web Content [Business & Media Institute]
(Photo: Getty)

I'd just like to follow up with you guys after you were nice enough to post my story and get me help (incredibly quickly!). You guys were able to connect me to Lonny Paul at CompUSA who was able to support my warranty directly. I have my new adapter for my laptop (which I'm using now!), and everything is back to normal. Now, I am very satisfied by the level of support provided by the new CompUSA, however I feel Assurant Solutions is lacking. I would have a expensive Toshiba paperweight if it weren't for you guys, and I really appreciate all the help you guys have given me. Keep up the good work!

Remember, if you can't get anywhere with good-for-nothing Assurant Solutions on your TAP agreement, and you've got a legitimate repair, call CompUSA. From their director of e-commerce:

The All-New CompUSA would like to help ANYONE having issues with service and we hope they will contact our customer service department at 1-800-COMPUSA if they cannot have their issue resolved directly by Assurant.

(Photo: Getty)

CreditCards.com reports that FICO announced it changed its mind during Congressional testimony yesterday.

Back in the day, adding an authorized user to your account was mainly used by parents to help their kids develop better credit scores. As the housing bubble ramped up, private credit score boosting companies would "rent" authorized user slots to strangers with poor credit so they could qualify for loans they shouldn't have. It was a contributing factor to the subprime meltdown. When FICO developed a new scoring system, FICO 08, in direct response to the credit checking industry's failure to accurately check and score credit, they said they were going to kill piggbyacking.

"Fortunately, we were able to come up with technology that makes it much harder to game the system," said Mike Campbell, FICO COO.

That's good news for responsible consumers looking to get better rates on their credit cards, mortgages, and other loans.

'Piggybacking' gets stay of execution from FICO [CreditCards.com]
(Photo: Special*Dark)

As of June 30, the closed banks had total assets of $3.6 billion. That's down from $4.1 billion six months earlier. Most of the assets are in 1st National while First Heritage accounts for $254 million.

Calls to 1st National were referred by a receptionist to Joe Martony, an executive vice president in Scottsdale, Ariz. Martony didn't return repeated calls to his office.

In Nevada, 1st National has 10 branches and employs about 350 people. Five of its branches are in Las Vegas, three are in the Reno-Sparks area, one is in Carson City and one is in Laughlin. Notices of the closure were being posted late Friday.

Fifteen 1st National branches are in Arizona, while Newport Beach-based First Heritage has three branches in Southern California.

Customers will be able to access their cash over the weekend by writing checks, or through ATMs and debit cards. Because Mutual of Omaha has purchased the banks in their entirely, all former customers, including those who exceeded FDIC insurance limits, will recover the full value of their accounts.

90 banks remain on the FDIC's problem list, and chairwoman Sheila Bair has warned us to expect more bank failures—but consumers have absolutely nothing to worry about as long as they keep their accounts within the FDIC's insurance limits.

FDIC takes over 2 more banks, closing 28 branches [AP]
Two More Banks Fail [The Wall Street Journal]
(AP Photo/Nevada Appeal, Brad Horn)

Last week, the Labor Department reported the fastest inflation since 1991 — 5 percent for June compared with a year earlier. Energy costs soared nearly 25 percent. The price of food rose more than 5 percent.

So the minimum wage hike is "a drop in the bucket compared to the increases in costs, declining labor market, and declining household wealth that consumers have experienced in the past year," Lehman Brothers economist Zach Pandl said.

The new minimum is less than the inflation-adjusted 1997 level of $7.02, and far below the inflation-adjusted level of $10.06 from 40 years ago, according to a Labor Department inflation calculator.

25 states require employers to pay more than the national minimum wage, but 1.7 million Americans still rely on the federal government to set a wage floor. Only 20% of them are teenagers.

The nation's top financial minds can't tell us how the minimum wage effects the economy, but we're sure our beloved cadre of ever-cheerful commenters not only knows for certain, but is willing to share.

Federal minimum wage rises to $6.55 today [AP]
(AP Photo/ Ellen Wznick)

The Senator recently criticized the Office of Thrift Services for allowing banks to underwrite cruddy mortgages, and specifically mentioned that IndyMac might be in trouble. Afterwards, the bank's depositors started a run on the bank, withdrawing up to $100 million per day. According to the director of OTS, a political appointee: “The senator made comments in his letter questioning the viability of the institution. When a member of the United States Senate makes such a statement, it frightens depositors.”

Schumer responded:

If OTS had done its job as regulator and not let IndyMac's poor and loose lending practices continue, we wouldn't be where we are today. Instead of pointing false fingers of blame, OTS should start doing its job to prevent future IndyMacs.

Now, now, Senator, man up for your actions. Your persistent questions about the subprime meltdown are obviously what got us into this mess in the first place.

The bank's failure will cost the FDIC around $10 billion. IndyMac customers, like the woman who pointlessly banged on the bank's doors pleading, "please, please, I want to take out a portion," will be able to access their money via ATMs over the weekend, and will have full access by next week. The 10,000 customers who collectively deposited $1 billion above FDIC insurance limits will lose half of their uninsured funds.

The latest bank failure is a reminder that your FDIC insured bank account will always be safe, but only if you keep your deposits within FDIC limits.

Regulators Seize Mortgage Lender [NYT]
IndyMac Bank seized by federal regulators [L.A. Times]
IndyMac Seized by U.S. Regulators; Schumer Blamed for Failure [Bloomberg]
(Photo: The Associated Press)

• Buyers will be 'pre-qualified' via a series of questions.
• Customers with corporate/business plans will have to go to AT&T to purchase their phones, only phone for personal use can be purchased at the store.
• You will be required to present valid US government ID to purchase the phone
• You will be required to provide your social security number to a store employee in order to do a credit check.
• You will be required to pick a plan and pay the activation fee at time of purchase.
• Phones will be activated in the store.

The last two have already been disclosed to the press but I think the rest is new information. If true, it looks like they're really trying to cut down on iPhones being unlocked and getting resold overseas. Be sure to bring your driver's license and memorize your social security number before camping out on Thursday night.

(Photo: hanapbuhay)

Spherion had switched life insurance providers without informing Thomas. Under the new policy, employees had to work for one full day to activate their coverage. Spherion never mentioned this to Thomas, and repeatedly assured him that he didn't need to do anything to retain his coverage.

His widow said he easily could have worked a day if that was what it took to activate the new policy. Spherion could have waived the one-day-of-work provision, as it did for other employees but not for Amschwand.

When Thomas died, because the policy had never been formally activated, Spherion refunded his insurance premiums and told his widow she would receive nothing else.

The story has played out often under the federal Employee Retirement Income Security Act. Designed to protect employee benefits, the law has been used by employers as a shield against suits.

Federal appeals courts, interpreting Supreme Court decisions dating to 1993, consistently have said companies that offer health, life and retirement benefits under ERISA cannot be sued for large amounts of money, or damages. Instead, they can be sued only for typically smaller sums such as Amschwand's insurance premiums.

Several federal judges have bemoaned the unfairness even as they have felt constrained to rule in favor of employers.

"The facts ... scream out for a remedy beyond the simple return of premiums," Judge Fortunato Benavides of the New Orleans-based 5th U.S. Circuit Court of Appeals said in the Amschwand case. "Regrettably, under existing law it is not available."

The Supreme Court recently refused to hear Melissa's case. Congress has refused to act. Insurers continue scrape up lucre, and consumers are left to suffer.

Employers use federal law to deny benefits [AP]
Write Your Senator
Write Your Representative
PREVIOUSLY: How To Write To Congress
(Photo: Getty)

As an idea, risk-based pricing isn't all that bad: consumers pay for credit based on their risk. But with credit cards, only interest rates and late fees are arguably "risk-based."

Interest rates are a terrible way to counter risk. Responsible cardholders never carry balances, so fiddling with their interest rates mean nothing. Kicking consumers with retroactive penalty APRs means that creditors failed to properly assess the risk in the first place; if creditors were truly risk based, they would respond to increased risk by slashing credit lines.

Late fees are equally terrible. Most creditors have three tiers of late fees. It doesn't matter if you're late by one hour or one month, even though the two clearly show different degrees of risk.

Or as Levitin puts it:

Suffice it to say that it is a real stretch to say that credit card pricing overall is risk-based; certain elements of card pricing are partially risk-based, but many are not. Moreover, there is no empirical evidence connecting the advent of risk-based pricing to lower costs of credit to creditworthy consumers or greater credit availability to subprime borrowers. There is a study that correlates late fees and overlimit fees with banks' aggregate cardholder risk, as well as with banks' market power, but there is no research connecting fee levels, which are often one-size fits all, with individual cardholder risk. The putative benefits of risk-based pricing depend on pricing being sensitive to individual level, not aggregate level risk, so that low risk cardholders don't subsidize high risk cardholders.

In any case, the benefits that the card industry attributes to risk-based pricing are explained at least as well by other factors: lower costs of funds explain lower interest rates to creditworthy consumers (issuers’ annual net interest margin has been fairly static for the last two decades), and securitization is at least as good of an explanation for the expansion in subprime lending.

So why do credit card companies pretend to use risk-based pricing? To evade government regulation. Professor Levitin makes a convincing six-point case for the government to lasso creditors with powerful regulations, but we'll let you read the full paper for yourself to see why.

The Credit Cardholders' Bill of Rights [Credit Slips]
All But Accurate: A Critique of the American Bankers Association's Study on Credit Card Regulation [SSRN]
(Photo: Getty)

The California Public Utilities Commission and state officials believed that crisis-era pacts with San Diego-based Sempra Energy and others were costing consumers an extra $1.45 billion to $3.08 billion — an amount they had hoped to return to electricity customers, possibly by reducing or eliminating future charges.

A Washington utility had hoped to get relief from a nine-year power contract with Morgan Stanley Capital Group. Under that contract, the Snohomish County Public Utility District is paying $105 a megawatt-hour, well above the historic norm for the Pacific Northwest of $24 a megawatt-hour, but also well under the $3,300 a megawatt-hour hit at the peak of the energy crisis that spread beyond California's borders, according to the court's synopsis.

Justice Scalia scolded the states for whining about "buyer's remorse." Roger Berliner, a lawyer for Nevada utility Sierra Pacific Resources, applauded the Justice for his unrivaled ability to blind himself to reason:

"It was the failure of regulators to protect consumers from market manipulation" that caused the utilities to overpay for power. I don't think the court appreciated the extent to which the dysfunction in the market made it impossible for there to be just and reasonable contracts."

Supreme Court deals blow to states on electricity [Los Angeles Times]



(Photo: Getty)

Shrinking packaging costing you more [Fox 13]

• ETFs should be relative to the phone's cost; a $5 phone should have a lower fee than a $50
• ETFs should go down month by month
• Contract lengths should be "reasonable" (whatever that means)
• Extended a contract shouldn't refresh the ETF (no shit, they've already recouped the cost of the cellphone)
• People should be able to get their first bill and look it over before the ETF goes into effect

FCC chief lays out plan for cell phone fees [Washington Post]

"The government will never, never accept such penalty amounts," then-Nextel marketing vice president Scott Wiener wrote in an e-mail in January 2004...A spokesman for Sprint-Nextel, John Taylor, said the company determined it could not assess the termination fees in its federal contract because it would have been against the law.

Why do consumers put up with these fees, but the government won't? Why is it illegal to charge the government ETFs, but not us? Perhaps Sprint thought that if they started charging the government ETFs, someone would get wise and question the fees, and anti-ETF legislation would be enacted...

Government relieved of cancelled cellphone fees [USAToday] (Thanks to Jason!)

Our favorite polling question takes aim at people who support mandatory binding arbitration, but don't quite know what they're supporting:

A majority of those who were initially supportive or unsure of binding arbitration disapprove of arbitration when important information is given about common provisions in consumer contracts. With added information, Americans overwhelmingly disapprove of binding arbitration.

Big shift among binding arbitration supporters. Those who said they approve of, or were not sure about binding arbitration were presented the three following facts:

1. The arbitrator who decides the outcome of the dispute will be selected by the company
2. The consumer may never take legal action against the company over the dispute
3. Binding arbitration applies even in cases where the consumer has been seriously injured by the product or service

When presented with this information, two in three (66%) disapprove of binding arbitration and only one in five (21%) approve. Among those who initially said they were unsure, disapproval is very high (64% disapprove, 6% approve). Disapproval is high even among those who initially approved of arbitration (67% disapprove, 28% approve).

After learning the specifics of contract provisions, Americans overwhelmingly are against binding arbitration. When initial and final disapproval ratings are combined, binding arbitration loses by more than eight to one (81% initial/final disapproval, 10% final approval).

Congress may be unable to do anything about our unpopular President, but 64% of us want them to get off their asses and pass the Arbitration Fairness Act. When they return tomorrow, rested from their holiday break, give 'em a call and tell them to channel our collective hatred of mandatory binding arbitration into action.

New Poll: Americans Say "No Thanks" To Binding Arbitration [Consumer Law & Policy Blog]
Write Your Senator
Write Your Representative
PREVIOUSLY: How To Write To Congress

(Photo: Getty)

One local taxpayer, who asked not to be identified, reported that he had discovered an unexpected deposit of $1,800 in his bank account. He said a review of his bank records revealed that it was a deposit from the IRS bearing another taxpayer's Social Security number. He said he contacted the IRS and was told by an agent that the deposit was one of 15,000 misrouted checks sent out incorrectly as a result of a computer programming glitch.

[Internal Revenue Service spokesman Kevin McKeon] said he could not confirm that figure or that a computer problem was responsible.

The government will want its cash back, so don't giddily spend any unexpected stimulus money. Paper checks can be mailed back to the IRS, while those with direct deposit should report the error to their bank.

IRS: Some stimulus checks sent to wrong accounts [Newsday]
(Photo: Joe Shlabotnik)

While few had heard of this smalltime contender out of California until just before the tournament began, Westland/Hallmark had all the fundamentals in place: a huge scandal, public health hazards, child endangerment, animal cruelty, and video evidence. Though News Corp., (responsible for atrocities such as "MySpace") received the second most nominations of any company, they failed to deliver when the votes counted.

"It's a Cinderella story for Hallmark," said Editor, Ben Popken. "News Corp is just too big a creature to hate all at once," speculated Chris Walters, our Associate Editor.

We asked Weekend Editor, Carey G-B if the Hallmark/Westland "Mad Cows" have what it takes to contend with #34 United Health Care in the second round... Carey? Carey, are you there? He's too depressed to answer! He's burning his Rupert Murdoch T-shirt!

Congratulations to the Hallmark/Westland "Mad Cows" for this historic victory!

Here's what happened: Senate Majority Leader Harry Reid (D-NV) filed a motion for cloture—Senate-speak for shut-up and stay on topic—which requires a supermajority of 60 votes for approval. Without cloture, Senators can yack forever like a bunch of riled-up monkeys. The vote on cloture failed 49-42, empowering Republicans to filibuster our beautiful piece of legislation into the ground.

What protections have Senate Republicans stolen from you? Let's look at Senator Rockefeller's (D-WV) substitute amendment sporting the new, improved Passenger's Bill of Rights:

TITLE IV—AIRLINE SERVICE AND SMALL COMMUNITY AIR SERVICE IMPROVEMENTS

SEC. 401. AIRLINE CONTINGENCY SERVICE REQUIREMENTS.

(a) IN GENERAL.—Chapter 417 is amended by adding at the end the following:

SUBCHAPTER IV—AIRLINE CUSTOMER SERVICE ``§.41781. AIRLINE CONTINGENCY SERVICE REQUIREMENTS.

(a) IN GENERAL.—Not later than 60 days after the date of enactment of the Aviation Investment and Modernization Act of 2008, each air carrier shall submit a contingency service plan to the Secretary of Transportation for review and approval. The plan shall require the air carrier to implement, at a minimum, the following practices:

(1) PROVISION OF FOOD AND WATER.—If the departure of a flight of an air carrier is substantially delayed, or disembarkation of passengers on an arriving flight that has landed is substantially delayed, the air carrier shall provide—

(A) adequate food and potable water to passengers on such flight during such delay; and

(B) adequate restroom facilities to passengers on such flight during such delay.

(2) RIGHT TO DEPLANE.—

(A) IN GENERAL.—An air carrier shall develop a plan, that incorporates medical considerations, to ensure that passengers are provided a clear timeframe under which they will be permitted to deplane a delayed aircraft. The air carrier shall provide a copy of the plan to the Secretary of Transportation, who shall make the plan available to the public. In the absence of such a plan, except as provided in subparagraph (B), if more than 3 hours after passengers have boarded a flight, the aircraft doors are closed and the aircraft has not departed, the air carrier shall provide passengers with the option to deplane safely before the departure of such aircraft. Such option shall be provided to passengers not less often than once during each 3-hour period that the plane remains on the ground.

(B) EXCEPTIONS.—Subparagraph (A) shall not apply—

(i) if the pilot of such flight reasonably determines that such flight will depart not later than 30 minutes after the 3 hour delay; or

(ii) if the pilot of such flight reasonably determines that permitting a passenger to deplane would jeopardize passenger safety or security.

(C) APPLICATION TO DIVERTED FLIGHTS.—This section applies to aircraft without regard to whether they have been diverted to an airport other than the original destination.

(b) POSTING CONSUMER RIGHTS ON WEBSITE.—An air carrier holding a certificate issued under section 41102 that conducts scheduled passenger air transportation shall publish conspicuously and update monthly on the Internet website of the air carrier a statement of the air carrier's customer service policy and of air carrier customers' consumer rights under Federal and State law.

(c) REVIEW AND APPROVAL; MINIMUM STANDARDS.—The Secretary of Transportation shall review the contingency service plan submitted by an air carrier under subsection (a) and may approve it or disapprove it and return it to the carrier for modification and resubmittal. The Secretary may establish minimum standards for such plans and require air carriers to meet those standards.

(d) AIR CARRIER.—In this section the term `air carrier' means an air carrier holding a certificate issued under section 41102 that conducts scheduled passenger air transportation.''.

(b) REGULATIONS.—Not later than 60 days after the date of enactment of this Act, the Secretary of Transportation shall promulgate such regulations as the Secretary determines necessary to carry out the amendment made by subsection (a).

So what's different from the old versions?

• Compliance: Airlines now have 60 days, not 90 days, to get their act together and slap together a contingency plan;
• Advertising: Congress wants this Bill of Rights placed "conspicuously" on each arline's website. No burying the Bill of Rights in a site index;
• Not Just For Departures: The substitute amendment now covers delayed arrivals.

We're not wild about the absence of civil penalties, or empowering pilots to stall if they "reasonably determine" that take-off is less than 30 minutes away. As compensation for these losses, Senator Rockefeller tossed in this gem of a sweetener:

SEC. 402. PUBLICATION OF CUSTOMER SERVICE DATA AND FLIGHT DELAY HISTORY.

Section 41722 is amended by adding at the end the following:

(f) CHRONICALLY DELAYED FLIGHTS.—

(1) PUBLICATION OF LIST OF FLIGHTS.—An air carrier holding a certificate issued under section 41102 that conducts scheduled passenger air transportation shall publish and update monthly on the Internet website of the air carrier, or provide on request, a list of chronically delayed flights operated by the air carrier.

(2) DISCLOSURE TO CUSTOMERS WHEN PURCHASING TICKETS.—An air carrier shall disclose the following information prominently to an individual before that individual books transportation on the air carrier's Internet website for any flight for which data is reported to the Department of Transportation under part 234 of title 14, Code of Federal Regulations, and for which the air carrier has primary responsibility for inventory control:

(A) The on-time performance for the flight if it is a chronically delayed flight.

(B) The cancellation rate for the flight if it is a chronically canceled flight.

(3) CHRONICALLY DELAYED; CHRONICALLY CANCELED.—The Secretary of Transportation shall define the terms `chronically delayed flight' and `chronically canceled flight' for purposes of this subsection.''.

If an flight is chronically late, not only must the airline broadcast their shame on their website, but they must also warn travelers before selling tickets that their flight will likely be delayed.

The Passenger's Bill of Rights was tacked onto a much larger bill reauthorizing the FAA. Members of Congress could rip out the Bill of Rights and and pass it separately, but the Congressional calendar crowds up before elections, and our important little bill has little hope of standing out.

Like a Price Is Right Danger Price loser, we don't get the contingency plans; we don't get the food or water; and we don't get the chronically delayed flight notifications. We get nothing. Thanks, Senate Republicans!

Air safety, passenger rights bill hits dead end in Senate [AP]
On the Cloture Motion (Motion to Invoke Cloture on the Rockefeller Amdt. No. 4627 (Subst.) to H.R. 2881 ) [U.S. Senate]
(Photo: Getty)

In a surprising departure from the norm, the government is actually cracking down on some of the more egregious credit card practices. Usually they say that including more tiny print is sufficient enough consumer protection. Some things they're addressing: creating a mandatory minimum payment period, forbidding double-cycle billing, and prohibited APR from being raised on an outstanding balance. The proposals are simply that, proposals, at this point, with finalization expected by year's end, and we'll see what happens after all the exceptions and industry lobbying groups get factored in the equation. The specific anti-consumer credit card practices getting attacked, inside...

From the Office of Thrift Supervision press release:

1. Reasonable Time to Make Payments – Institutions would be prohibited from treating a payment as late unless consumers have been provided with a reasonable amount of time to make payment. The proposed rule would create a safe harbor for institutions that adopt reasonable procedures to ensure that periodic statements are mailed or delivered at least 21 days before the payment due date.

2. Payment Allocation. – When different annual percentage rates apply to different balances, institutions would be prohibited from allocating any amounts paid in excess of the minimum payment in a manner that is less beneficial to consumers than one of three methods. For example, institutions could apply the entire amount first to the balance with the highest annual percentage rate or split the amount equally among the balances. When an account has a discounted promotional rate balance or a balance on which interest is deferred, institutions would be required to use payment allocation practices that give consumers the full benefit of the discounted rate or deferred interest plan.

3. Interest Rate Increases on Outstanding Balances – Institutions would be prohibited from increasing the annual percentage rate on an outstanding balance unless certain exceptions apply. For example, an institution could increase the variable rate if a promotional rate has expired or if the cardholder’s payment is delinquent (e.g., the minimum payment has not been received within 30 days of the due date).

4. Fees from Credit Holds – Institutions would be prohibited from assessing a fee if a consumer exceeds the credit limit on an account solely due to a hold placed on the available credit – unless the amount of the transaction would also have exceeded the credit limit.

5. Balance Computation Methods (“Double Cycle Billing”) – Institutions would be prohibited from computing finance charges on outstanding balances based on balances in billing cycles preceding the most recent billing cycle. The proposed rule would prohibit institutions from reaching back to prior billing cycles when calculating the amount of interest charged in the current cycle, a practice that is sometimes referred to as two- or double-cycle billing.

6. Fees/Deposits Charged to the Account for the Issuance of Credit – Institutions would be prohibited from charging to the credit card account fees or security deposits for the issuance or availability of credit (such as account-opening fees or membership fees) if those fees or deposits utilize the majority of the available credit on the account. In addition, the proposal would require that fees or deposits that exceed 25% of the credit limit be spread over the first year, rather than charged as a lump sum at account opening. Institutions would not be prohibited from issuing credit cards that require a consumer to pay a security deposit if that deposit is not charged to the account. Such an approach can be a means of repairing or building credit.

7. Firm Offers of Credit – Institutions making firm offers of credit that advertise multiple annual percentage rates or credit limit ranges would be required to disclose in the solicitation the factors that determine whether a consumer will qualify for the lowest annual percentage rate and highest credit limit advertised.
For Overdraft Programs:

1. Opt Out – Institutions would be prohibited from assessing a fee for paying an overdraft unless they provide a consumer with: the right to opt out of payment of overdrafts; a reasonable opportunity to exercise the opt-out; and the consumer does not opt out. The proposed opt-out right would apply to all transactions that overdraw an account regardless of the whether the transaction is, for example, a check, an automated clearinghouse (ACH) transaction, an ATM withdrawal, a recurring payment, or a debit card purchase at a point of sale.

2. Fees from Debit Holds – Institutions would be prohibited from assessing an overdraft fee if the overdraft is caused solely by a hold on funds that exceeds the actual purchase amount of the transaction, unless this purchase amount would have also caused the overdraft.

Summary of Practices Addressed in Proposed Rule on Unfair or Deceptive Acts or Practices [Press Release]
Fed to Pursue Aggressive Checks on Credit Cards [Washington Post] (Thanks to Brandon!)
OTS publishes summary of unfair credit card rule proposal [U.S. PIRG Consumer Blog]

(Photo: samwilkinson)

Michael seemed as confused as us:

I'm not sure what to make of it. "Nominee for 2008 Stupidest Web 2.0 Idea" comes to mind, along with "something I'd expect from Fox News before CNN". Or maybe it's funny, if I enjoy walking around with "40-lb. hunk of metal hits driver in face" on my chest.

• Sleepy bear can't stay awake
• Baby found in house of filth
• 7-minute battle with death

Here's Philip's tale of amazing customer service:

Today I witnessed what has to be some of the most outstanding customer service ever offered.
 
This past Saturday my wife & I purchased a large amount of garden furniture at Costco. One of the items was a marble topped table and chair set. When we got the pieces home we discovered that the table top had a flaw and there were critical pieces missing from the hardware. Compounding the problem, we had returned the rented truck we used to move this very heavy piece and no longer had any help either. My wife called the store to find out what our options were. Steve called her back and said that he would come by our house Monday morning with a complete replacement set of furniture.
 
True to his word, Steve and Jay arrived Monday at 11am and proceeded to unpack a new tabletop. The replacement was also slightly marked but not as deeply as the original and a little time and elbow grease had it good as new. We then started searching through the new boxes for the missing hardware. Eventually, we all agreed the hardware was not shipped either with my original purchase and the replacement they brought out. With the Costco guys standing there, I contacted the manufacturer and was told I would have to fax a receipt and to expect a 10 day turnaround for their missing hardware!
 
At this point Steve and Jay said this was not acceptable to them and they headed off to Home Depot to see what they could source themselves. They returned about 20 minutes later with a bag of parts and proceeded to assemble the table perfectly. In all the process must have taken at least 2 hours and they would accept nothing but a glass of water. We now have a beautiful table in our backyard.
 
I really can't thank Steve, Jay & Costco enough. We have always been big fans of Costco but this really went above & beyond.

Let's see where the bill currently stands:

`Sec. 42301. Emergency contingency plans

`(a) Submission of Air Carrier and Airport Plans- Not later than 90 days after the date of enactment of this section, each air carrier providing covered air transportation at a large hub airport or medium hub airport and each operator of a large hub airport or medium hub airport shall submit to the Secretary of Transportation for review and approval an emergency contingency plan in accordance with the requirements of this section.

`(b) Covered Air Transportation Defined- In this section, the term `covered air transportation' means scheduled passenger air transportation provided by an air carrier using aircraft with more than 60 seats.

`(c) Air Carrier Plans-

`(1) PLANS FOR INDIVIDUAL AIRPORTS- An air carrier shall submit an emergency contingency plan under subsection (a) for—

`(A) each large hub airport and medium hub airport at which the carrier provides covered air transportation; and

`(B) each large hub airport and medium hub airport at which the carrier has flights for which it has primary responsibility for inventory control.

`(2) CONTENTS- An emergency contingency plan submitted by an air carrier for an airport under subsection (a) shall contain a description of how the air carrier will—

`(A) provide food, water that meets the standards of the Safe Drinking Water Act (42 U.S.C. 300f et seq.), restroom facilities, cabin ventilation, and access to medical treatment for passengers onboard an aircraft at the airport that is on the ground for an extended period of time without access to the terminal;

`(B) allow passengers to deplane following excessive delays; and

`(C) share facilities and make gates available at the airport in an emergency.

`(d) Airport Plans- An emergency contingency plan submitted by an airport operator under subsection (a) shall contain a description of how the airport operator, to the maximum extent practicable, will provide for the deplanement of passengers following excessive delays and will provide for the sharing of facilities and make gates available at the airport in an emergency.

The Senate could strengthen the bill by looking to an earlier House version. "Extended period of time" should be strictly defined as three hours, and once that extended period of time expires, airlines should be forced to deplane passengers. Failing to provide a strict time frame gives airlines too much undeserved responsibility to regulate themselves, a failing strategy that made a Passenger's Bill of Rights necessary in the first place.

Work on the bill starts tomorrow at 4:30 p.m. We'll be keeping our eye on the Senate to see what happens.

FAA Reauthorization Act Of 2007—Motion To Proceed [GovTrack]
H.R. 2881: FAA Reauthorization Act of 2007 [GovTrack]
Write Your Senator
Write Your Representative
PREVIOUSLY: How To Write To Congress
Weak Passengers Bill Of Rights Moves Through Congress
(Photo: miamabanta)

"We really do literally have five or six major corporations in this country that determine for the most part what Americans see, hear and read every day," said Sen. Byron L. Dorgan (D-N.D.), the lead sponsor of the resolution. "I don't think that's healthy for our country."

Dorgan has 25 senators behind his bill, including Democratic presidential candidates Hillary Rodham Clinton of New York and Barack Obama of Illinois, and is confident it will pass the Senate. A similar bill has been proposed in the House.

The Bush administration has threatened a veto, but Dorgan could try to attach the resolution to a must-pass bill to make it harder for the White House to block.

Senate panel moves against FCC media-ownership rules [L.A. Times]
S.J. 28 - A Joint Resolution Disapproving The Rule Submitted By The Federal Communications Commission With Respect To Broadcast Media Ownership [THOMAS]
Write Your Senator
Write Your Representative
PREVIOUSLY: How To Write To Congress
(AP Photo/Jae C. Hong)

Here's what our readers said when they nominated these two companies:

News Corp:
"The company that brings us Faux News, crappy reality series on Fox and the hive of scum (idiot self-centered teens) and villainy (sexual predators) that is MySpace. Oh yeah, and the Post too! Not only they want the WSJ, they want a piece of Yahoo! as well."
"Allah/God/SpaceInvaders have mercy on you morons that don't know why."

Hallmark/Westland Meat Packing Company:
No readers specified why, but we suspect it has to do with them putting cows they knew were sick into the food supply for little kiddies to eat for their school lunch. Just look up "downer cows."

This is a post in our Worst Company In America 2008 series. The companies nominated for this honor were chosen by you, the readers. Keep track of all the goings on at consumerist.com/tag/worst-company-in-america/

STILL OPEN FOR VOTING:
Chase vs United Healthcare
Clear Channel vs Toyota
Countrywide Home Loans vs Dish Network
Sprint vs Hewlett Packard
Blue Cross Blue Shield vs CNN
Gamestop vs Monster Cable
Bank Of America vs Toys R' Us
Toshiba vs Microsoft
US Airways vs Washington Mutual
American Airlines vs Blockbuster
Time Warner Cable vs Radioshack
Wellpoint vs Charter Cable
Dell vs Home Depot
Sears vs Citibank
Wal-Mart vs TJMaxx
Mattel vs ATT
Capital One vs Video Professor
eBay/Paypal vs COX
Apple vs SallieMae
Diebold Vs Pfizer
MTV vs TransUnion
CompUSA vs DirecTV
Target vs Best Buy
Allstate vs Verizon
DeBeers vs 1800 flowers
Starbucks vs United Airlines
Exxon vs Crocs
Google Vs Sony
Ticketmaster vs Wachovia
Facebook vs The American Arbitration Association
Comcast vs Menu Foods

Alpha Consumer, who was at the hearing, recounts:

[Susan Wones of Denver said one] of her Chase credit cards jumped from a 14.9 to 25 percent interest rate after she got close to, but didn't exceed, her $6,000 credit limit. She said the interest rate on a second Chase card similarly shot up after she went $15 over her credit limit in the middle of a billing cycle, even though the beginning and ending balances were under the limit.

The NFL does not allow one team, in the midst of the fourth quarter, to unilaterally move their end zone 20 yards in their favor just because they don't like the point spread. The rules are laid out before the kickoff, and the umpires enforce the same rules for both home and visiting teams for the whole contest. It's time for legislation at the federal level that tells the credit card industry, "Game Over" to unilateral, one-sided, rule changes.

As a registered Republican, it has typically been my philosophy that business and commerce flourish and perform better with minimal government interference. However, when an industry sector proves time and again that it is unable to police itself and behave and engage in fair and ethical trade practices, legislative intervention is required.

"credit card abuses faced by our middle class families add insult to injury ...charging interest on penalty fees is wrong...contracts are totally incomprehensible...if this problem is going to be resolved it is going to be resolved here in Congress...The fed is looking at disclosures, it's (looking is) endless."

The Credit Cardholders' Bill of Rights is a wonder-packed piece of legislation that would:

• Ban arbitrary rate increases
• Force creditors to provide 45 days notice of any rate increase
• Ban double-cycle billing
• Empower cardholders to set limits on their cards and ban over-the-limit fees once that ceiling is reached
• Ban excessive fees
• Ban lending to subprime borrowers
• Require creditors to mail bills at least 25 days before the due date, instead of 14 days as currently required
• Require creditors to apply payments first towards high interest items

The Credit Cardholders' Bill of Rights: Providing New Protections for Consumers [House Financial Services Committee]
Live blog from credit card hearing [U.S. PIRG]
Credit Card vs. Consumer [Alpha Consumer]
HR 5244 - The Credit Cardholder's Bill Of Rights [THOMAS]
Write Your Senator
Write Your Representative
PREVIOUSLY: How To Write To Congress
Credit Card Victims Muzzled, Ordered To Release Financial Histories Before Sharing Their Experiences
(Photo: the illustrious untitled13)

Imagine my surprise today when I was unable to contact my pregnant wife utilizing my Sprint cell phone.
 
I immediately called customer service when unable to make calls and spent a total of 145 minutes trying to resolve the problem. Along the way my call was misrouted to the wrong billing system (whatever that means), I was transferred to afterhours numbers, I was hung up on, I talked to three reps who had no grasp of the English language and one who insisted it was an equipment issue even when I told her it had been established that somehow my number had been ported without my consent or confirmation. You can only guess how much fun it is to have someone demand to troubleshoot an problem when it had already been done and demands to do it all over again only to have your call routed the wrong way again. Imagine being recently unemployed leaving applications for work across the last week with a number which is suddenly "dead". Better yet imagine the problem if my wife went into labor or had an accident and had no way of contacting me because for 4 hours my phone was dead except for some random California number was assigned to my account (I live in Oregon).
 
After I was finally handed off to Operator #77303 she did some checking, my number had been indeed ported out to AT&T to no one in particular it was just there. She informed me that not only would it take 4-5 days to try and get this number back if at all. She wouldn't even try and answer me when I asked what would happen if AT&T was to use my number. She gave me a "temporary" number which would be great except for the potential job prospects which no longer have my number.
 
The fact this can happen at no worse time seems to be my luck, the fact my contract was just renewed is ironic as I had read Mr. Hesse was going to turn things around and make Sprint a company that takes care of business- I actually believed what I read.
 
The fact that my number could be taken away in an instant but won't return for a week (if even at all) is disturbing. I would appreciate it if someone would contact me and restore my faith in my decision to remain solely a Sprint customer and hopefully return my limbo ported number back to me safe and sound. It's not the end of the world but when all the events fall into place like they have for me it falls very close.
 
Thank you for your time Robert

Well this morning I was contacted by the executive office and basically within the hour my old number was back and functioning. They had no clue why it had been ported other than possibly someone entered another number wrong. If it wasn't for my executive email contacts gleaned from you site I would probably be still waiting days later. Your site has made me a happy man, I can only hope someone else with similar problems is helped down the line to cut through the red tape!
 
Many Thanks! Robert

...may include some good ideas, but it is largely a re-hashed, unsubstantiated industry wish-list that seeks to eliminate state enforcement authority over insurance, securities and other financial products, without even guaranteeing strong consumer protection at the federal level.

Here's how it works:

• Search Google News: Pop the headline you want into the Google News and enjoy the link straight to the full and free content. You can alternatively build a Firefox keyword shortcut using this string:
  http://news.google.com/news?q=%s+source%3Awall_street_journal
• Use The Firefox Extension Refspoof: Step 1: Download the extension here.
  Step 2: In the refspoof toolbar's "spoof:" field, type "digg.com.
  Step 3: Also in the refspoof toolbar, click the R icon, and select "static referrer."
  That's it. Click around the site; the WSJ thinks each click is coming from Digg. The WSJ is now yours for free!

The Wall Street Journal's Web site is already (secretly) free [Salon via BoingBoing]
(Photo: Katayun)

The FTC alleged that consumers lured to ValueClick's Web sites by these promises were led through a maze of expensive and burdensome third-party offers - including car loans and satellite television subscriptions - which they were required to "participate in" at their own expense, in order to receive the promised "free" merchandise. The FTC charged that ValueClick's use of deceptively labeled e-mail offering free gifts and its failure to disclose that consumers must expend substantial sums of money to obtain the promised "free" merchandise violates the CAN-SPAM Act and the FTC Act.

The FTC also charged that ValueClick, Hi-Speed Media, and E-Babylon, misrepresented that they secured customers' sensitive financial information consistent with industry standards. The FTC alleged the companies published online privacy policies claiming they encrypted customer information, but either failed to encrypt the information at all or used a non-standard and insecure form of encryption. The agency also charged that several of the companies' e-commerce Web sites were vulnerable to SQL injection, a commonly known form of hacker attack, contrary to claims that the companies implemented reasonable security measures.

ValueClick to Pay $2.9 Million to Settle FTC Charges [FTC]

Here is what Steven Autrey planned to tell the Committee:

Thursday, March 13th, 2008
Testimony of Steven Autrey

Ladies and Gentlemen of the subcommittee, Ranking member, and Madame chair: Good morning, and thank you for inviting us to speak before you.

I would like to give you a brief recap of some negative experiences both my wife and I have had with one particular credit card issuer. Though Chase, Citibank, and GE Money Bank have engaged in similar behavior, I would like to make you aware of the actions of Capital One with regards to our retail credit card accounts.

When a consumer applies for credit with a card issuer, or as we did - respond to a "pre- approved" offer, upon establishment of an account, a bona-fide financial contract exists between the consumer and financial institution. It is because of consumer protection laws at the federal level, that the rates, rules, and terms of the contract are spelled-out in advance of the first use of the card. Both the customer and financial institution trust that the other will live up to the terms of the agreement.

Unfortunately, an increasing number of credit card issuers are engaging in less-than- ethical practices at an alarming rate. Unilateral, or one-sided changes in the terms of the contract - most always in favor of the credit card company - are becoming routine practice at an alarming rate. These one-sided changes are bad for consumers, bad for our national retail credit health, and essentially violate the spirit and letter of Title 15 Consumer Credit Protection Law.

My relationship with Capital One goes back to 1999, when I was solicited with an offer for a Visa card with a "fixed" 9.9% rate card. I applied over the phone, and was approved. The card was used for both purchases and balance transfers in a positive relationship with Capital One for eight years until July, 2007. That's when Capital One advised me in a billing insert that my "fixed" rate of 9.9% was being raised to 16.9%. No reason or explanation was given - I was not late on payment, and had not utilized the entire credit limit. This was a unilateral change to the terms of our agreement.

In August, of 2007, I wrote a letter to Mr. Richard D. Fairbank, Chairman, President, and CEO of Capital One, at their McLean, Virginia home office. My written statement will contain a copy of Capital One's response which includes the line, "Unfortunately, changes in the interest-rate environment or other business circumstances may require us to increase rates, even for fixed-rate accounts in good standing."

Other issues should be of concern to this committee as well. My wife holds a Capital One-issued MasterCard credit card. Last October, she experienced a medical emergency and had to leave work to spend hours at a medical facility to receive tests and treatment. Arriving home later that evening, she immediately logged on to the CapitalOne.com website to pay her bill online. It was approx. 9:00pm on the due date. Although she made the payment on the due date, it was 6 hours past the 3:00pm cutoff time.

For being six hours late on her payment, she was hit with a $39.00 punitive fine labeled as a "late fee." That late fee, when added to her account, pushed her balance over the limit by $16.00. It was at this point that Capital One added a second $39.00 fine in the form of an "Over the limit fee" to her account.

In tears, my wife called Capital One and explained her situation and the emergency medical treatment. She was told the late fee was not going to be removed, she was late and that was that. They did tell her that as a "courtesy" they would remove the over limit fee on a one-time-only basis. Ironically, at the same time, my wife had a credit balance of over $300.00 for her overpayment on the total balance of her Capital One Auto Loan.

The NFL does not allow one team, in the midst of the fourth quarter, to unilaterally move their end zone 20 yards in their favor just because they don't like the point spread. The rules are laid out before the kickoff, and the umpires enforce the same rules for both home and visiting teams for the whole contest. It's time for legislation at the federal level that tells the credit card industry, "Game Over" to unilateral, one-sided, rule changes.

As a registered Republican, it has typically been my philosophy that business and commerce flourish and perform better with minimal government interference. However, when an industry sector proves time and again that it is unable to police itself and behave and engage in fair and ethical trade practices, legislative intervention is required.

With some progress in our consumer credit laws, and reform of the monopolistic credit scoring cartel controlled by the Fair, Isaac, and Company ("FICO"), perhaps once again consumers can have a level playing field in doing business with credit card issuers.

• Ban arbitrary rate increases
• Force creditors to provide 45 days notice of any rate increase
• Ban double-cycle billing
• Empower cardholders to set limits on their cards and ban over-the-limit fees once that ceiling is reached
• Ban excessive fees
• Ban lending to subprime borrowers
• Require creditors to mail bills at least 25 days before the due date, instead of 14 days as currently required
• Require creditors to apply payments first towards high interest items