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Post date: February 6 2004

Spitzer Marks National Consumer Protection Week

In observance of National Consumer Protection Week, Attorney General Spitzer today released a list of the top consumer complaints in the state.

Automobile problems, credit and banking issues and Internet concerns headed the list of statewide consumer complaints in New York in 2003, according to an analysis of the 56,000 written consumer complaints received by Spitzer's office.

"This analysis highlights areas where consumers should be especially careful and diligent to protect their rights and interests," Spitzer said.

The Attorney General's office -- through its Consumer Frauds and Protection Bureau, Internet Bureau and Telecommunications and Energy Bureau -- investigates and prosecutes business and individuals engaging in fraudulent, misleading, deceptive and illegal trade practices. It also mediates thousands of complaints from individual consumers and issues reports on emerging consumer protection issues.

Last year, the office commenced nearly 130 enforcement actions and, through these actions and through mediation efforts, obtained approximately $53 million in restitution for consumers.

Some of the 2003 cases significant include:

  • A landmark settlement with Household International, the parent company of Household Finance Corporation and Beneficial Finance Corporation. In addition to significant injunctive relief obtained through the settlement, consumers across the nation who were victims of predatory lending shared in the largest restitution fund in the nation's history. Over 21,700 borrowers across the state shared more than $37.6 million;
  • A September 2003 lawsuit filed against County Bank, Cashnet, Inc., and TC Services Corporation d/b/a Telecash for operating a "payday" loan scam that saddles numerous working people, the elderly, and members of minority communities with usurious loan terms that trap borrowers into spiraling debt;
  • A December 2003 lawsuit filed against Synergy6, OptInRealBig.com, LLC, and Delta Seven Communications for sending billions of junk e-mails to consumers while hiding behind fake identities, forged e-mail addresses, and a worldwide network of more than 500 compromised computers. The suit seeks an injunction that bars the companies from sending junk e-mails that falsify sender identities, subject matter heading and the e-mail's transmission paths. It also seeks civil penalties in the amount of $500 for each fraudulent act;
  • An April 2003 lawsuit filed against Cross Country Bank and its service affiliate, Applied Card Resources, for misrepresenting the amount of available credit and initial fees charged to consumers, failing to post payments on time, providing consumers with incorrect pay-off amounts, and making abusive statements to collect debts;
  • A commitment in February 2003 from 15 major retailers to amend their policies regarding lost or stolen gift cards. The retailers agreed to re-issue lost or stolen gift cards for those customers who can provide reasonable evidence that they were the purchaser of the gift card;
  • A February 2003 lawsuit filed against three leading pharmaceutical manufacturers – GlaxoSmithKline, Pharmacia, and Aventis – accusing each of conducting elaborate schemes to inflate the price of prescription drugs for consumers and government health plans. The drug companies were charged with consumer fraud, commercial bribery, and making false statements to government health plans. New York is the first to attack the drug companies' pricing scheme by alleging bribery and false statements. The companies are alleged to have reported an inflated average wholesale price in relation to the price charged to doctors, pharmacists and other health care providers;
  • Settlements in March of 2003 with dozens of used car dealers who failed to inform customers that they were buying cars once returned as "lemons." The investigation determined that 56 dealerships across the state failed to comply with a law that requires auto dealers to notify the state Department of Motor Vehicles following the return of a vehicle under the Lemon Law so that the title can be "branded" with a warning to prospective buyers. As a result, 37 owners of returned "lemons" received approximately $200,000 in restitution; and
  • A favorable court decision in June of 2003 that ordered Plus Ultra Tours (a Queens-based travel agency) to pay refunds to consumers who paid for travel arrangements to Spain and Portugal but never received plane tickets or other services. Consumers have received refunds totaling $272,000.

The following is a list of top statewide consumer complaints by industry in 2003 (a description of the categories is available on the Attorney General's web site www.ag.ny.gov):

 
Industry
Number of Complaints
1 Automobile
6,699
2 Credit
6,127
3 Internet
5,529
4 Mail Order
3,536
5 Services (non-auto related)
3,408
6 Telecommunication
3,275
7 Home Repair/Construction
2,247
8 Retail Sales
2,140
9 Landlord/Tenant
2,041
10 Utilities
1,095

The list does not include cases handled by the Attorney General's Health Care help line, which each year handles more than 8,000 calls. The largest number of those complaints arise from provider mistakes in processing health insurance claims. A separate report analyzing health care complaints and providing consumer tips is available at the Attorney General's website www.ag.ny.gov.

Spitzer noted that his office stands ready to assist consumers in resolving their problems. He encouraged individuals to contact his consumer helpline at (800) 771-7755. Consumers can access a wide range of consumer "tips" visiting his website at www.ag.ny.gov.

Description of Consumer Complaint categories

  • The "Automobiles" category includes new, used, leases, rental, repairs, service contracts and other Automobile industry related complaints.
  • The "Credit" category includes credit cards, debt collection, Identity Theft, other credit, Credit reporting, credit repair and debt consolidation.
  • The "Furniture/Major Household Appliances" category includes complaints concerning household furniture (i.e., problems with chairs, tables, cabinets, sofas, carpets, rugs, curtains, bedsteads and chests) and major household appliances (includes problems with air conditioners, washing machines clothes dryers, food freezers, refrigerators, stoves, ranges, ovens, microwave ovens and sewing machines). Complaints typically allege furniture or appliance is defective, damaged or is not the item ordered by the consumer, ( i.e., wrong color, size or model), or was not delivered within time specified by retailer or manufacturer.
  • The "Retail Sales" category includes all complaints against any retail establishment that sells goods for personal household use. Included here are problems with department stores, supermarkets, clothing stores, specialty stores, consumer electronics, rent-to-own, discount houses and buying clubs.
  • The "Services" category includes complaints concerning consumer-related service industries (a service for personal household use) categorized. This includes, but is not limited to, alarm companies, answering services, buying clubs, carpet cleaners, dry cleaners, furniture repair and refinisher, restaurants, hair and nail salons, automobile clubs, watch repairs, locksmiths, upholsterers, banking, parking garages, movers, dating services, schools, special occasions, professional service (non-medical) and pistol permit complaints.
  • The "Telecommunication" category includes phone cards, slamming, cellular service, pay-per-call , and residential service.
  • The "Utilities" category includes complaints concerning "ESCO"'s unregulated energy service providers; resellers that distribute energy. All cable complaints concerning billing, contracts, service and equipment problems with cable service. All digital satellite systems (DSS) complaints concerning billing, contracts, service and equipment problems. All water, oil, gas & electric complaints concerning water, oil, liquid propane and electric & gas companies.

 

In observance of National Consumer Protection Week, Attorney General Spitzer today released a list of the top consumer complaints in the state.

Automobile problems, credit and banking issues and Internet concerns headed the list of statewide consumer complaints in New York in 2003, according to an analysis of the 56,000 written consumer complaints received by Spitzer's office.

"This analysis highlights areas where consumers should be especially careful and diligent to protect their rights and interests," Spitzer said.

The Attorney General's office -- through its Consumer Frauds and Protection Bureau, Internet Bureau and Telecommunications and Energy Bureau -- investigates and prosecutes business and individuals engaging in fraudulent, misleading, deceptive and illegal trade practices. It also mediates thousands of complaints from individual consumers and issues reports on emerging consumer protection issues.

Last year, the office commenced nearly 130 enforcement actions and, through these actions and through mediation efforts, obtained approximately $53 million in restitution for consumers.

Some of the 2003 cases significant include:

  • A landmark settlement with Household International, the parent company of Household Finance Corporation and Beneficial Finance Corporation. In addition to significant injunctive relief obtained through the settlement, consumers across the nation who were victims of predatory lending shared in the largest restitution fund in the nation's history. Over 21,700 borrowers across the state shared more than $37.6 million;
  • A September 2003 lawsuit filed against County Bank, Cashnet, Inc., and TC Services Corporation d/b/a Telecash for operating a "payday" loan scam that saddles numerous working people, the elderly, and members of minority communities with usurious loan terms that trap borrowers into spiraling debt;
  • A December 2003 lawsuit filed against Synergy6, OptInRealBig.com, LLC, and Delta Seven Communications for sending billions of junk e-mails to consumers while hiding behind fake identities, forged e-mail addresses, and a worldwide network of more than 500 compromised computers. The suit seeks an injunction that bars the companies from sending junk e-mails that falsify sender identities, subject matter heading and the e-mail's transmission paths. It also seeks civil penalties in the amount of $500 for each fraudulent act;
  • An April 2003 lawsuit filed against Cross Country Bank and its service affiliate, Applied Card Resources, for misrepresenting the amount of available credit and initial fees charged to consumers, failing to post payments on time, providing consumers with incorrect pay-off amounts, and making abusive statements to collect debts;
  • A commitment in February 2003 from 15 major retailers to amend their policies regarding lost or stolen gift cards. The retailers agreed to re-issue lost or stolen gift cards for those customers who can provide reasonable evidence that they were the purchaser of the gift card;
  • A February 2003 lawsuit filed against three leading pharmaceutical manufacturers – GlaxoSmithKline, Pharmacia, and Aventis – accusing each of conducting elaborate schemes to inflate the price of prescription drugs for consumers and government health plans. The drug companies were charged with consumer fraud, commercial bribery, and making false statements to government health plans. New York is the first to attack the drug companies' pricing scheme by alleging bribery and false statements. The companies are alleged to have reported an inflated average wholesale price in relation to the price charged to doctors, pharmacists and other health care providers;
  • Settlements in March of 2003 with dozens of used car dealers who failed to inform customers that they were buying cars once returned as "lemons." The investigation determined that 56 dealerships across the state failed to comply with a law that requires auto dealers to notify the state Department of Motor Vehicles following the return of a vehicle under the Lemon Law so that the title can be "branded" with a warning to prospective buyers. As a result, 37 owners of returned "lemons" received approximately $200,000 in restitution; and
  • A favorable court decision in June of 2003 that ordered Plus Ultra Tours (a Queens-based travel agency) to pay refunds to consumers who paid for travel arrangements to Spain and Portugal but never received plane tickets or other services. Consumers have received refunds totaling $272,000.

The following is a list of top statewide consumer complaints by industry in 2003 (a description of the categories is available on the Attorney General's web site www.ag.ny.gov):

 
Industry
Number of Complaints
1 Automobile
6,699
2 Credit
6,127
3 Internet
5,529
4 Mail Order
3,536
5 Services (non-auto related)
3,408
6 Telecommunication
3,275
7 Home Repair/Construction
2,247
8 Retail Sales
2,140
9 Landlord/Tenant
2,041
10 Utilities
1,095

The list does not include cases handled by the Attorney General's Health Care help line, which each year handles more than 8,000 calls. The largest number of those complaints arise from provider mistakes in processing health insurance claims. A separate report analyzing health care complaints and providing consumer tips is available at the Attorney General's website www.ag.ny.gov.

Spitzer noted that his office stands ready to assist consumers in resolving their problems. He encouraged individuals to contact his consumer helpline at (800) 771-7755. Consumers can access a wide range of consumer "tips" visiting his website at www.ag.ny.gov.

Description of Consumer Complaint categories

  • The "Automobiles" category includes new, used, leases, rental, repairs, service contracts and other Automobile industry related complaints.
  • The "Credit" category includes credit cards, debt collection, Identity Theft, other credit, Credit reporting, credit repair and debt consolidation.
  • The "Furniture/Major Household Appliances" category includes complaints concerning household furniture (i.e., problems with chairs, tables, cabinets, sofas, carpets, rugs, curtains, bedsteads and chests) and major household appliances (includes problems with air conditioners, washing machines clothes dryers, food freezers, refrigerators, stoves, ranges, ovens, microwave ovens and sewing machines). Complaints typically allege furniture or appliance is defective, damaged or is not the item ordered by the consumer, ( i.e., wrong color, size or model), or was not delivered within time specified by retailer or manufacturer.
  • The "Retail Sales" category includes all complaints against any retail establishment that sells goods for personal household use. Included here are problems with department stores, supermarkets, clothing stores, specialty stores, consumer electronics, rent-to-own, discount houses and buying clubs.
  • The "Services" category includes complaints concerning consumer-related service industries (a service for personal household use) categorized. This includes, but is not limited to, alarm companies, answering services, buying clubs, carpet cleaners, dry cleaners, furniture repair and refinisher, restaurants, hair and nail salons, automobile clubs, watch repairs, locksmiths, upholsterers, banking, parking garages, movers, dating services, schools, special occasions, professional service (non-medical) and pistol permit complaints.
  • The "Telecommunication" category includes phone cards, slamming, cellular service, pay-per-call , and residential service.
  • The "Utilities" category includes complaints concerning "ESCO"'s unregulated energy service providers; resellers that distribute energy. All cable complaints concerning billing, contracts, service and equipment problems with cable service. All digital satellite systems (DSS) complaints concerning billing, contracts, service and equipment problems. All water, oil, gas & electric complaints concerning water, oil, liquid propane and electric & gas companies.