New scam claims that President Obama will pay your utility bills

Although if true they might help his re-election chances, recent claims that President Obama will pay your utility bills through a new federal program are actually scams. The scammers have reportedly used telephone calls, fliers, social media and text messages in several different states to try to lure their victims into giving the crooks their Social Security numbers and bank routing numbers.  If the victims provides the requesting information, he or she is given a fraudulent bank routing number to pay their bill through an automated telephone payment service.

No matter how hot it is, consumers should not believe these scams.  The end result if they do is likely that their identity ends up being stolen.

The primary reason so many people are falling for this scam (2,000 so far in Tampa, FL and 10,000 so far in New Jersey) is that it appears to work ... for a little while.  The payments seem to go through and get credited to the victims' accounts.  The victims then spread the word to family and friends, only to later learn that their payment is rescinded when its too late to warn the people the original victim told about the "federal program".

Don't fall for this scam.  But if you already have and do end up a victim of identity theft, remember that I am more than willing to help you.

Obama almost gets it right

In June, President Obama released a plan to revamp the government's financial regulatory system. The primary feature of the plan is the creation of a new federal agency called the Consumer Financial Protection Agency ("CFPA") whose primary focus will be to enforce consumer protection laws.

Kudos to President Obama for recognizing the problem with the lack of enforcement of the consumer protection laws such as the FCRA. President Bush could have cared less the enforcement (or lack thereof) of the FCRA. So consumers are in much better hands now with President Obama in the White House.

But the key to increasing enforcement of the FCRA is not to switch enforcement agencies from the FTC to the CFPA. The key is to increase the penalties against violators of the FCRA, thereby making it more attractive for the nation's army of attorneys to sue the credit bureaus and furnishers who violate the FCRA. A large percentage of my practice as an attorney is comprised of representing consumers under the FCRA. It is so so so easy to find multiple violations of the FCRA in every case. The problem, though, is that it is very difficult to quantify the damage caused by these violations. IF the FCRA contained automatic damages of sufficient significance for violations of the FCRA, attorneys would flock to these cases and make the credit bureaus and furnishers toe the line or pay the fine.

Yeah! Phase one of the new credit card law goes into effect tomorrow

The first phase of the new law governing credit card companies goes into effect tomorrow August 20, 2009. The first phase unfortunately does not carry the force of some of the provisions that go into effect later. Here's what the first phase means to you:

1. Currently, credit card companies only have to give you only 14 days from the date the bill is mailed to pay your bill (meaning by the time you get the bill you have maybe 12 days at best left to pay). So if you go out of town for a week vacation, under the old law you were apt to be paying a late fee since you might only have a few days to get your payment in before it is past due. Fortunately, the new law requires that credit card companies mail your bill at least 21 days before payment is due, giving you an extra seven days to pay.

2. Currently, credit card companies must give you 15 days notice before upping your interest rate, lowering your credit limit, or making other significant changes to your credit card agreement. Under the new law, the credit card company must give you 45 days notice.

3. The best part of the first phase of the credit card law is that you have the right to reject major changes to your credit card agreement, including increased interest rates, but you must close the account and agree to pay off the account in five years.

"So (consumers) can effectively convert their balance into a closed-end loan that they can pay down over five years. That's a tool that they didn't have up until now," said Eleni Constantine, the director of the Pew Charitable Trusts Financial Security Portfolio.

The next phase of the law goes into effect in February. The second phase includes a provision that prohibits credit card companies from raising interest rates on existing balances unless the borrower is more than 60 days delinquent. How awesome is that? The second phase also requires a co-signer for any credit card applicant under the age of 21 and prohibits retroactive interest rate increases.

Go President Obama for getting this one passed. The playing field just got a little more level for the little guy.

President Obama must be reading my blog!

Remember the post I did about how to really get your free credit report. See http://fcralawyer.blogspot.com/2009/05/free-credit-reports-are-generally-not.html if you don't remember. Apparently, President Obama or someone in his administration read it. Ok, illusions of grandeur aside, I don't really think the President read my article. But they sure got the issue right in the credit card reform bill passed late last month.

As you all know (from reading my article perhaps), FreeCreditReport.com advertised through TV and radio commercials using a catchy jingle that led consumers to believe credit reports ordered on the site were actually free. Many people fell for the ruse, ordering their "free" credit report only to be forced to sign up for a $15 a month credit monitoring service to be able to get their "free" report.

The credit card reform law requires the Federal Trade Commission (FTC) to issue revised rules that require advertisers such as FreeCreditReport.com and others to acknowledge AnnualCreditReport.com as the only way to get a truly free credit report. Thanks to the new law, new FreeCreditReport.com commercials will include a statement that the credit report they provide for "free" is not the free credit report provided for by Federal law.

President Obama is carrying through with his promises to level the playing field for consumers, such as his excellent action of reversing the preemption being including in federal regulations. See http://fcralawyer.blogspot.com/2009/05/excellent-news-on-preemption-front.html and http://fcralawyer.blogspot.com/2009/05/more-on-president-obamas-preemption.html. That was big for consumers and the credit card bill is another great example of fair litigation for consumers. Once again, thank you President Obama, since I know you will read this. :)

More on President Obama's preemption memo

A few of the highlights from the executive memorandum regarding preemption:

• Heads of departments and agencies should not include in regulatory preambles statements that the department or agency intends to preempt State law through the regulation except where preemption provisions are also included in the codified regulation.

• Heads of departments and agencies should not include preemption provisions in codified regulations except where such provisions would be justified under legal principles governing preemption, including the principles outlined in Executive Order 13132.

• Heads of departments and agencies should review regulations issued within the past 10 years that contain statements in regulatory preambles or codified provisions intended by the department or agency to preempt State law, in order to decide whether such statements or provisions are justified under applicable legal principles governing preemption. Where the head of a department or agency determines that a regulatory statement of preemption or codified regulatory provision cannot be so justified, the head of that department or agency should initiate appropriate action, which may include amendment of the relevant regulation.
  

This is great news for all of us who have been fighting federal regulatory attacks our states consumer protection laws. Now, we need to get those regulatory heads to undo the terrible preemption work done over the last decade.

Excellent news on the preemption front!

As you may know, the Bush administration adopted a policy of including preemption provisions in federal regulations, unilaterally taking away your right to your day in court. These preemption provisions effectively circumvented any state laws designed to protect you, the consumer. They were neither voted on by you, nor passed by your representatives in Congress, nor even reviewed by the judicial branch. It was basically a terrible example of the executive branch legislating instead of governing.

Yesterday, the Obama administration took the first large step in correcting the preemption attrocities of the Bush administration. President Obama issued an executive memorandum to all federal agencies, mandating that no provisions for federal preemption shall be included in federal regulations except under extraordinary circumstances. Also, the executive memorandum requires that all preemption provisions enacted or written by any federal agency in the past ten years be rewritten to provide that state laws are not pre-empted.

This, my friends, is big. Thank you, President Obama, for leveling the playing field for consumers like us.