While the U.S. government spent weeks arguing about raising the country's debt ceiling, Americans were more concerned about their own personal debt problems. According to a consumer-complaint study released July 27, the number-two complaint was the way credit and debt agencies mishandled disputes and related problems.
The Consumer Federation of America, the North American Consumer Protection Investigators, and the National Association of Consumer Agency Administrators reported on "the most common, fastest growing and worst complaints" received by 31 agencies. Surprisingly, the number-one concern was vehicle rip-offs, such as misrepresented ads, selling lemons, faulty repairs, and disputes over leasing and towing.
The number three position was a tie between complaints over retail sales and home improvement and construction, followed by utilities, services, Internet sales, household goods, landlords, fraud and home solicitations.
None of these are new to the list, suggesting Americans consistently deal with these problems with little remedy. Some new complaints surfaced this year, however, that indicate how our marketplace has changed. Here are a few examples, along with advice on coping with them.
1. Group Discount Coupons
PROBLEM: Groupon and Living Social spawned a cyber cloud of similar businesses, as well as some fraudulent and suspect practices. Even the biggest companies aren't exempt from complaints about hidden expiration dates and other fine-print limitations.
SOLUTION: While many of these offers are on the up-and-up, you need to remember deal providers are making these offers to bring in regular business, not one-time customers. Many lose money on the initial coupon so they try to protect their return on investment by enforcing deal limitations.
Some of the more respectable companies will send coupon buyers reminders when a deal is about to expire, which is a big help. Watch out, however, for limitations like restaurant coupons that don't include drinks or appetizers. Another favorite is coupons for a company with several outlets that buyers can only use at one or two locations. Basically, click through to the detailed information screen before you buy. If you can't find such a screen, don't buy.
2. Medical Billing
PROBLEM: Gah! What American hasn't dealt with double billings, non-coverage issues and all the other dodges that place consumers squarely between insurance companies and health-service providers.
SOLUTION: You're not going to like this remedy. The only solutions are to know your policy's ins-and-outs before receiving care and monitoring billing closely. For example, I recently had a minor procedure performed that was somewhat unusual. I contacted the insurance company to identify what portions were covered, then asked the provider's billing office to double check. Naturally, I was billed for the entire procedure, which I caught by careful examination of the bill. Because I'd checked ahead of time, I was able to resolve the problem with one phone call.
Some insurance companies no longer provide printed handbooks or statements, preferring to go the cheaper route of posting everything online. It's worth the paper and ink to print this information out for future reference. That sounds somewhat arcane, but it's a lot easier to scan a print version than work your way through multiple screens and pull-down menus.
3. Recover Services
PROBLEM: These are services that claim they'll retrieve money you've lost to timeshare resale companies. Three Florida men who ran a timeshare resale business were arrested in July on charges of accepting fees before making sales after claiming they had buyers for the properties. Surprise surprise: The buyers didn't exist.
SOLUTION: First of all, you need to thoroughly research a resale company before engaging their services. There are many predators out there and the very nature of timeshares lends itself to fraud. A page on the Rutgers University website has a detailed listing of resources for researching a variety of companies. Often, your local Better Business Bureau can provide information on complaints lodged against companies.
Secondly, never pay an "upfront" fee for a sale. Before dealing with a resale company, double check with your state's attorney general or department of business and professional regulation to make sure they're legitimate. If you decide to go ahead, have your lawyer look over the contract.
4. Data Breaches
PROBLEM: The aforementioned study revealed a barrage of complaints from consumers concerned with identity theft. You don't even have to be online to experience this problem, although it helps. Thieves will take snail-mail bill payments directly out of your mailbox to lift your financial information from the paperwork.
SOLUTION: When you buy or pay your bills online, look in the url bar for an "https" address to make sure the page is secure. Install quality computer-safety software to knock out spyware, viruses and other methods of downloading your financial information. If you pay bills by snail mail, deposit them directly in a mailbox, rather than leaving them for the post man to pick up. If you think you've been a victim of fraud, visit the National Consumers League's Fraud Center.
5. Fake Coupons
PROBLEM: Coupon-use is all the rage, but even Extreme Couponers can get taken in by fakes. The problem has intensified with the availability of printable coupons and services that sell coupons.
SOLUTION: Naturally, I'd recommend only using printable coupons from a reputable company, like Coupon Sherpa. Look for a UPS code and expiration date as all coupons must contain this information. For more advice, check out our blog post "52 Places to Find Coupons" and heed the various warnings.
6. The Grandparent Hustle
PROBLEM: I've only noticed this con popping up in the last six months, but apparently it's been making the rounds for awhile. Con artists contact consumers via email or by phone claiming to be a relative or friend in an emergency situation and ask them to wire money. For example, they might claim to have been robbed in a foreign airport and don't have a ticket, credit card or cash. They'll request you send them money, but offer few details and won't answer your questions.
SOLUTION: Personally check with the relative or friend by calling or emailing them at the contact information you have on record. Ask them a personal question for which only they would know the answer, like where you last went out to dinner together. If they refuse to answer questions, they get no money. Common sense helps, as well. You likely know if your grandmother actually traveled to London.
7. Tax-related Schemes
PROBLEM: Consumers are receiving seemingly official letters and emails offering assistance with property-tax adjustments or other tax-related problems. Naturally, they'll help you out for a small fee.
SOLUTION: The government offers assistance in these areas at no charge, so just ignore these entreaties.
For more details, contact your local consumer agency at ConsumerAction.gov/state.