Scams

Advertising for Free Services

We have recently found that some companies are sending solicitations to people recently married or who have recently had a child. They ask to provide them with new social security identification or to officially perform the name change. We are interested in viewing these mailings.

Other companies offer to provide copies of credit records at a charge. We are interested in these mailings as well.

Associates First Capital Corporation and Associates Corporation of North America

This Company has been accused of deceptive marketing practices that induced consumers to refinance existing debts into home loans with high interest rates, costs, and fees, and to purchase high-cost credit insurance.

Bankruptcy

Creditor inflates the value of the claim you owe.

• A lawyer threatens an Adversary Proceeding against you. I want to review the complaint.
• Someone tries to get you to reaffirm a debt after you have filed for bankruptcy. This agreement must be entered into before the Bankruptcy, filed with the court and approved by your lawyer.
• Some companies engage in the deceptive practice of having the consumer take unsecured credit card debt and renewing it with a new credit card in the midst of a bankruptcy or to forestall a bankruptcy, or to deceptively inspire the consumer to pay off an old debt with the lure of new credit.

Car Purchases or Leases

• YOU WERE CHARGED A VEHICLE DISPOSAL FEE.
• You bought a car with financing papers, the dealer gives you the car. A week later the dealer calls you up and says you have to come back in since the financing did not go through and give him a larger down payment or redo the financing papers. This is a violation of the Truth in Lending Act and you are entitled to statutory damages of up to $1,000.00 plus actual damages. You are also entitled to tell the dealer you want him to stick to the contract.
• You responded to an ad advertising bad credit or no credit no problem.
• You rented a car with insurance supplements as part of the deal.
• You leased a car and when you turned in the lease you had to pay fees you did not know where there.
• You leased a car and the lease calls for "disposition fees" or "termination fees."
• You were charged VSI or Vender Single Interest insurance on a car loan
• You had to pay for insurance on a car lease.
• You had your car repossessed.
• You purchased a car and the dealer "fudged" the amount of the down payment or the trade in value.

Car Dealer Rebate Scam

You go to the car dealer and are offered a deal such as $700 cash back or 7% financing. You take the financing. The dealer does not calculate the 7% based upon the actual amount financed but on the principle amount of the car. Result: your disclosure statement is wrong and you pay more than what you were promised. If this has happened to you. Call us to discuss the matter.

Cell Phone Scams

Did you sign up for cell phone service with a contract and buy a phone with Sprint, Singular, Nextel, AT&T or any other company based upon false promises of great service? Have you been incorrectly billed for service. Do you want to cancel service and are afraid of the penalty they will charge. We believe the penalty is illegal and you do not have to pay it. Call us and we will advise you of your rights and provide you with a letter to write to the phone company to quite and protect your rights.

Collection Letters

Many collection agencies and attorneys violate the Fair Debt and Collection Practices Act. This is a Federal law that gives you certain rights and prohibits certain collection conduct. A violation of the FDCPA may entitle you to up to $1,000.00 for each collector who violates the law. Please send us copies of the front and back of any collection letter sent by a collection agency in the last year.

A debt collector is liable to you under the act EVEN IF YOU OWE THE DEBT!

Some violations of the FDCPA include:

• Adding collection charges which were unauthorized
• Adding interest charges which were unauthorized
• Threatening criminal prosecution
• Initial demand letters that ask for payment immediately or in less than 30 days.
• Sending attorney demand letters as a mass mailed letter.
• Having a collection agent say they are going to assist you with your credit.
• Collection agency names that imply the agent is with the government.
• Any notice which misstates your legal rights.
• A notice that comes from a collection agency without saying so.

FDCPA Generally:

• Addition of Unauthorized Amounts to the Debt. Debt collectors and collection attorneys will sometimes add amounts to the debt that are not authorized. One example is the addition of fees or service charges to dishonored checks. The addition of fees or service charges, without compliance with state law concerning notification of dishonored check and limits on the charge, are illegal. Also, the addition of collection costs and/or attorney’s fees where not provided for by the contract or law is illegal.
• Mass-Mailing of Attorney Letters. Collection letters sent on the letterhead of an attorney or over the facsimile signature of an attorney often violates the Act. The attorney must review the creditor’s file, reach a professional determination of the merits of the case, and participate in decision to mail the collection letter. In a mass-mailing situation the attorney’s participation does not reach this level.
• Threats of Action That Cannot Be Legally Taken or Not Intended to Be Taken. Collection letters that threaten a lawsuit, wage garnishment, seizure of property, etc. often are threats of unintended action. Neither the collector nor the attorney may overstate the remedies available to the creditor. Where the amount of the debt is small or the consumer has little or no assets, the threat of a collection action is usually false. In almost all circumstances threats of arrest for nonpayment of the debt are also false.
• Suit Filed in an Improper Venue. Where the attorney attempting to collect the debt files suit in a venue other than where the consumer resides or signed the contract, the Act may be violated. The Act limits suits regarding real estate to the jurisdiction where the land is located. For personal debts, a collection action may be filed only where the consumer resides or signed the contract.
• Communications with Third Parties. The collector may not communicate regarding the debt with anyone other than the consumer, his or her attorney, a consumer reporting agency, the creditor, and the creditor’s and consumer’s attorneys. Contact with the consumer’s employer or co-workers will probably violate the Act.
• Contradiction or Overshadowing of the Thirty Day Validation Notice. The collector is required to inform the consumer in the first communication or within five (5) days thereof that the consumer has thirty (30) days within which to dispute the debt, request in writing verification of the alleged debt, and/or request in writing the name and address of the original creditor. To contradict or overshadow this thirty (30) day period within which the consumer may exercise his rights violates the Act. The contradiction need not be threatening.
• Failure to Provide the Consumer Notices. The failure to give the validation notice, discussed in the foregoing paragraph, and the debt collection warning, i.e. — this is an attempt to collect a debt and any information obtained will be used for that purpose, violates the Act. In all subsequent communications the collector must state that the communication is from a debt collector.

Consumer Leasing Act

Violations of the Consumer Leasing Act are often apparent from the lease itself. Common violations include:

• Unreasonable Early Termination Formula. The calculation of the amount due on termination of the lease before its termination date is determined by the early termination formula set forth in the lease. Any unreasonable charges or penalties for early termination may violate this provision. Examples include the prohibition of terminating the lease, e.g., during the first year, the addition of amounts not charged at the end of the lease, an unreasonable result as a result of applying the formula, e.g., the application of the formula during the last few months of the lease results in a disproportionately larger amount due than when applied earlier in the lease.
• Disclosure of Warranties. The lease must state all warranties available on the vehicle, not just the warranties extended by the lessor. Thus, the failure to state the manufacturer’s warranty violates the CLA.
• Disclosure of Interest on Security Deposits. In recent decisions, it has been held that the lease must disclose whether interest on a security deposit will be paid and to whom. Many lessors do not disclose that interest is being earned on the security deposit and retained by the lessor. These cases do not require that the lessor must pay interest earned on the security deposit to the consumer, only that the practice is disclosed.
• Failure to Follow the Early Termination Formula. The Seventh Circuit has recently held that the failure to apply the early termination formula as stated in the lease, even though the method applied was more advantageous to the consumer, violated the CLA.
• Failure to Disclose the Trade-In or Downpayment. Failure of the lease to set forth the trade-in and/or any moneys paid to reduce the price of the lease violates the CLA. Sometimes dealers will to state the consumer’s trade-in or down payment of the lease. The CLA is thus violated.

Credit Card Over the Limit Fees

Have you been charged an over the limit fee on your credit card in the last month or two? We believe it is illegal and you have rights under the Truth in Lending Act to recover from the credit card company.

Deals in a Foreign Language

Did you or someone you know enter into a contract where the contract was “talked about” in Spanish or some other foreign language? Well if so, and the written contract was in English, we can help you with this fraud.

Equal Credit Opportunity Act

If you are turned down for credit and do not get a written explanation why, call us.

The Equal Credit Opportunity Act prohibits the creditor from discriminating in any transaction on the basis of race, color, religion, national origin, sex or marital status, or age (provided that the applicant has the capacity to pay the contract). The ECOA also prohibits other conduct:

• The Exercise of Any Right under the Consumer Credit Protection Act. It is unlawful for any creditor to discriminate because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. For example, a collector which brings suit against the consumer, when it would not have done so otherwise, because the consumer filed an FDCPA claim violates the ECOA.
• Failure to Provide a Declination Letter. Within thirty (30) days of application for credit, the creditor must inform the consumer of the action taken on the application. The creditor’s notice must state that credit has been granted, denied, or that further specific information is needed. The denial of the application entitles the consumer to obtain a copy of his credit report without cost.

Fair Credit Reporting Act

The Fair Credit Reporting Act was passed to provide greater accuracy in consumer credit reports and to insure the privacy of the consumer’s credit report. Common violations of the FCRA include:

• Theft of Identity. The perpetrator will gain enough information on the consumer to obtain a copy of his or her credit report. With the additional information gleaned from the consumer report the perpetrator will apply for credit, often in the form of credit cards, run up the balance, and abscond, leaving the unpaid bills to appear on the consumer’s bill. Action may be taken against the credit reporting agency and others to correct the situation.
• Unauthorized Use. Similarly, companies and individuals may obtain a consumer report for unauthorized purposes. The FCRA limits the permissible purposes for which a consumer report by be requested to: court ordered access, access on written approval by the consumer, extension of credit, application for insurance or for government license or permit, or other business purposes. A collection agency may access the consumer report in the course of collecting a debt. Examples of obtaining consumer reports for unauthorized purposes include: accessing the report for the purpose of litigation, accessing the report of a political rival, accessing the consumer report for use in support proceedings prior to the entry of judgment without court order, etc.
• Deletion of Improper Information. The FCRA requires the credit reporting agencies to maintain consumer reports to reflect the maximum possible accuracy. Debts older than seven (7) years and bankruptcies older than (10) years are required to be deleted. The consumer may request the credit reporting agency to reinvestigate. If the entry is not verified or the creditor does not respond, the information must be removed. The failure of the credit reporting agency to delete obsolete or unverified information violates the FCRA. Also, the reappearance of such information after removal is likely to violate the Act.

Home Repair Fraud

Here a consumer gets a repair company to do a remodeling job, and they consolidate debt for the consumer by adding it to the home improvement loan. Very often these violate TILA and the repair company in the process rips off the consumer. Any documents for these cases we would like to review.

Illinois Wage Assignments

All Illinois wage assignments are revocable at will. They are also good for only three years for the original employer and two years if you switch jobs. An assignment must be supported by consideration. The penalty if a collection agency or creditor violates the act is $500.00 plus any actual damages, plus attorney fees.

Insurance for Catalog Purchases

Have you ever ordered from a catalog and been charged for insurance for mailing the package? $1.50 or $1.75. Well guess what? Most deliveries for catalog merchandise are done by UPS, which automatically insures it deliveries for values up to $100.00. If you have paid for insurance on a purchase made through a catalog order you may have been ripped off.

Loans

The client has signed a loan agreement with a bank, mortgage broker, loan company, car company, etc. Many of loan documents fail to properly provide a consumer with their rights.

You may be able to stop a foreclosure under the Truth in Lending Act.

We are also interested in looking at any loan that:

• Requires more than four payments in a year.
• Charges a high rate of interest.
• Is a "Payday" or "Title" loan secured by a car.
• Refinancing loans secured by your house.
• Loans secured by personal property.
• Loans made to buy furniture.
• Loans for home-repairs.
• Loans, which include charges for insurance or some, other unusual fee.

Medical Bills Fraud

Many people who file for bankruptcy do so in response to a medical crisis. I would like to review bills that the consumer received and copies of the insurance claims paid. The insurance companies will attempt to get a discount from the hospital for themselves and not for the consumer. One such case recently ruled against Humana for not obtaining discounts for the co-pay payments made by its beneficiaries. Humana may be liable for $20-30 Million dollars and treble damages under RICO.

Med-Pay Cases

You or someone you know was in an Auto accident. You or the other person receives medical treatment. You or the other person sends the bills to your/their own insurance carrier, (a first party claim). The insurance carrier denies part of the bill after running it through a computer program. The reason given is “peer review” or a computer report. Chiropractors will see this type of unlawful behavior all of the time. People who have been in accidents and have had the vehicles totaled may also suffer a form of this type of insurance problem

Misclassification of Generic Drug as a Brand Name

Did you know that some health insurance companies have misclassified what drugs are considered generic and classified them as brand name drugs? An example of this is the drug tamoxifen. This misclassification influences the amount they charge you on your CO-pay. Next time you purchase a drug and are charged the higher CO-pay such as $10.00 or 20%, ask the pharmacist if the drug is really a generic. If it is you could be entitled to a significant refund for all the times you purchased the drug.

Mortgages

The consumer signs a second mortgage or gets a loan from a mortgage broker that does not comply with Truth in Lending Act. It is very common to have errors in the loan documents. The consumer may even be able to rescind the loan or renegotiate it for substantial savings. Any documents for these cases I would like to review.

• If you were charged a payoff fee, discharge fee, fax fee or any other fee on your loan that was not disclosed to you before the closing we would like to review the document.
• If you were charged an escrow waiver fee by a mortgage company.
• If you have money that was not directly deposited to your account after you paid it.
• You had to pay insurance on your property including the full value of the ground.

New or Used Car

Credit Life or Credit Disability Insurance: We are interested in talking to anyone who has purchases a car and signed a contract before the year 1998 and been charged for credit life or credit disability insurance from the dealer.

Overtime or Temp Employees

If you work more than 40 hours a week and are not receiving overtime you may want to know some facts. Even salaried employees may be entitled to overtime. Call us if you are not getting overtime. Long-term temps may be entitled to benefits even if your employer says you are not. The time sometimes starts from the moment you get to work from the time you leave, even if you are changing clothes or have not punched in.

Phony Products

Have you ever ordered a product that claimed it could do things and found out later that it would never perform the way the advertising claimed? The ELECTRO-AB-MASTER is a great example.

Repossessions and Foreclosure

Have you been the subject of an auto repossession or a home foreclosure? There are numerous laws in place to protect you even if you owe part or all of the money. There are too many to detail here but if you call we will be happy to answer some of your questions.

Student Loans

Some schools are fraudulent and this can be a basis for non-payment of student loans. If a collection agency is attempting an "administrative wage garnishment" please call us to discuss the matter.

Truth In Lending Act

The Truth In Lending Act requires the disclosure of credit terms prior to entry into a consumer credit contract. These disclosures which include the annual percentage rate, amount financed, finance charge, amount and timing of payments, etc. must be in writing in a form the consumer may keep, common violations include:

• The Two Note Case. The two note case is where the consumer is required to sign a contract which does not give the TILA disclosures, either containing no terms of financing or only partial incomplete disclosures. At a later date, the consumer is required to sign a contract containing the TILA. The TILA information comes too late; the consumer is already bound. Common areas of this violation are car sales and home improvements. The seller will have the consumer sign a contract without the TILA disclosures and later have the consumer sign another contract containing the TILA disclosures.
• Spiking. A contract which imposes a security interest in the consumer’s residence (other than the first mortgage) must provide a three day right of rescission. Sometimes in home improvement contracts the contractor will begin work before the expiration of the rescission period. This practice is called "spiking" and violates the TILA. Also, the failure to give the proper notice including the correct number of forms also violates the TILA.
• Hidden Finance Charges. The inflation of the purchase price in a credit transaction in excess of the price in a cash transaction is a hidden finance charge. An example is where the seller charges a lower purchase price when the item is purchased for cash ($100) but charges a greater amount when the item is financed ($120) We have seen this practice in the sale of health club memberships, the sales of motor vehicles, etc..

Unsolicited Marketing Calls to Cell Phones Are Illegal: With or Without a Cell Phone Directory

January 25, 2006 — The Direct Marketing Association (DMA) is warning consumers, legislators, and regulators about the re-emergence of bogus e-mails that are causing anxiety about new proposed cell phone number directories. An urban myth has resurfaced in recent days claiming that proposed directories of cell phone numbers are being compiled for use by telemarketers.

Although there may be efforts to compile cell phone directories by phone companies, such directories may not be used for unsolicited telephone marketing calls, according to a 1991 federal law. The 1991 Telemarketing Consumer Protection Act (TCPA) makes it illegal for solicitation calls to be made to wireless phone numbers without clear permission from the individual to whom a number has been assigned.

The Federal Trade Commission issued its own release on this latest cell phone marketing myth, reiterating that ‘despite the claims made in e-mails circulating on the Internet, consumers should not be concerned that their cell phone numbers will be released to telemarketers in the near future, and that it is not necessary to register cell phone numbers on the National Do Not Call (DNC) Registry to be protected from most telemarketing calls to cell phones.’ The FTC release is available online at http://www.ftc.gov/opa/2006/01/dnccellphones.htm.

The DMA and its members continue to support vigorous enforcement of the absolute restriction on unsolicited calls to cell phone numbers for marketing purposes and urge federal and state authorities to prosecute those who may engage in this illegal activity. Moreover, DMA continues to work aggressively with the Federal Communications Commission (FCC) to protect against cell phone solicitations by ensuring that marketers understand and comply fully with the law.

To help our members prevent even inadvertent unsolicited telemarketing calls to cell phones, DMA offers the following:

• The Wireless Block Identifier Service identifies for the marketing community those numbers that have been assigned as cell phone numbers – numbers they may not call without express permission from the holder of a number.
• The Wireless Ported Number File identifies land-based phone numbers that have been ported to cell phone numbers – new numbers that also fall under the protections of the 1991 law.

You Should Not Pay Illegal Late Fees

If you have paid a late fee on a video or cell phone or for a cable bill you may be entitled to it back even if the contract says the company can charge for it. Late fees for credit cards and apartment rental properties are also suspect. You also may be entitled to more than the late fee back if the company does it to others. A five-dollar late fee for a pager may be illegal.

Did you know it might be an illegal penalty to charge late fees on rent or on condo assessments? This was a recent case to hold for this proposition. If you or anyone you know has suffered from this practice call us to discuss how we can help. 3rd Dist. Hidden Grove v. Crooks No. 3-00-0329 (January 29, 2001) Rock Island County (HOLDRIDGE) Reversed and remanded. Provision in bylaw of condominium association which assess late payment of $25.00 for each month that each payment is late amounts to impermissible penalty and is unenforceable. There is no rational relationship between assessment and damages associated with administrative cost of late payment.