Tag Archives: Consumers

California Identity Theft Law Provides Stronger Protections to California Consumers Who Are Victims of Identity Theft

In response to the growing scourge of identity theft, California enacted its own Identity Theft Law in 2001. The law provides civil remedies to consumers in addition to the criminal remedies against the actual identity thieves.

As a practical matter, there is frequently little point in bringing a civil lawsuit against an identity thief. If the thief is some computer hacker or is otherwise a career criminal, a civil judgment against him or her will be meaningless. More frequently, we are seeing that the identity thieves are family members, and most victims of identity thefts are unwilling to pursue criminal prosecution against a family member even if he, or she, did commit a crime.

The California Identity Theft law has a very specific function: it gives victims of identity theft a civil remedy against creditors and debt collectors who refuse to cancel identity theft accounts. For instance, let’s say Mary is a victim of identity theft because some company did not secure her personal information and it was stolen. She files her police report and contacts the credit bureaus to notify them of the identity theft. She also contacts all of the creditors of the identity theft accounts (not the creditors of her genuine accounts) and requests that they cancel the accounts because of the identity theft. Several of them do. However, one or two hold out and continue to try to collect on the accounts even after they have been advised of the identity theft situation. They may even sue Mary even though they have been told about the identity theft.

As to these “hold-out” creditors, the victim of identity theft really had limited remedies before the passage of the California Identity Theft law. Defending, and winning, a patently frivolous lawsuit is costly in terms of both time and money, and many consumers faced the dilemma of spending more money to fight than they would spend to settle a frivolous and fraudulent claim. Moreover, traditional common-law legal theories really did not fit well with the growing scourge of identity thefts, and the fact that victims of identity theft badly needed to restore their credit and financial balance to their lives to fully recover and move on.

The California Identity Theft Law permits victims of identity theft to pursue a vast and effective array of remedies against creditors or debt collectors who do not cancel identity theft accounts. The victims can get all of their actual damages, including emotional distress damages; they can get a court order canceling their identity theft accounts and dismissing any lawsuits brought against them for identity theft accounts; they can get their attorney’s fees paid by the “hold-out” creditors or debt collectors and they can even obtain a $ 30,000 civil penalty under certain circumstances. It is a law that all California consumers need to know about.

The legal citation to the law is California Civil Code, Sections 1798.92 through 1798.97.

Here is what California consumers need to know to make the Identity Theft Law work for them:

1.You need to file a police report and/or a Federal Trade Commission fraud affidavit as soon as you learn of the identity theft. If you have trouble getting your local police to accept an identity theft police report, go to www.ftc.gov for an Identity Theft affidavit, or see the main article on our website about handling identity theft. This article has specific steps you will need to use if your local police department refuses to take your identity theft police report.

2.Send a copy of the police report to the creditor or creditors (or debt collectors), advising them of the known details of the identity theft and requesting that they cancel the identity theft accounts.

3.You must give the creditor or debt collector 30 days to cancel the account and/or dismiss the lawsuit. Sometimes they will request more information from you; if they do, provide it to them. If they do not act within 30 days, or they refuse to cancel the account, then you need to contact our law firm immediately for a free case review and consultation.

4.Remember to keep all correspondence via certified mail, return receipt requested, and obviously keep copies of everything you send and receive. This will not only help us evaluate your case, but these letters are frequently the very best evidence in any claim for a violation of the California Identity Theft Law.

Robert F. Brennan, Esq. is a principal with Brennan, Wiener & Associates, an AV-rated law firm in La Crescenta, CA. His firm specializes in consumer protection litigation including debt collection abuse. He can be reached athttp://SoCalDebtCollectionAbuse.com.

The Smart Consumer’s Guide to Buying a Used Car

The new millennium has thus far been a decade of rampant consumer fraud. Shrewd companies and salespersons cook up new way to rip off the public on a daily, if not an hourly basis. Concealed collision damage, rolled-back odometers, “laundered lemon” cars, where the manufacturer has repurchased the vehicle under lemon laws and then neglected to disclose the car’s history to the next buyer, used cars sold as new – these are just a few areas where dealerships and manufacturers are frequently committing fraud against consumers. My firm, by the way, specializes in representing consumers who have purchased “lemon” vehicle or who have been the victims of car dealer fraud.

This short piece is designed to assist you in buying a used car, providing you with the proper tools to protect yourself from being ripped off on your next purchase. PLEASE PRINT THIS ARTICLE OFF AND CARRY IT WITH YOU WHEN YOU GO OUT TO PURCHASE YOUR NEXT USED CAR. SHOW IT TO THE USED CAR SALES-PERSON IF HE OR SHE BALKS AT PROVIDING YOU WITH ANY OF THE REQUIRED INFORMATION. I just purchased a used car with excellent results, and I am not an expert mechanic; rather, I’m just a shrewd consumer, which is an outgrowth of the fact that I’m a shrewd and effective consumer lawyer. The following tips, if followed, are much more likely to result in a satisfactory used car purchase.

BRENNAN’S EIGHT-POINT CHECKLIST OF REQUIREMENTS IN BUYING A USED CAR AND AVOIDING BECOMING THE VICTIM OF A FRAUD

1) Always insist on a warranty. “As-is” can easily be translated into legal jargon as, “You’re stuck, sucker.” Even a 30- or 10-day warranty is better than just “as-is”.

2) Insist that the dealer print on the warranty, in bold letters, “THIS CAR HAS BEEN INSPECTED FOR COLLISION DAMAGE AND COLLISION REPAIRS AND HAS BEEN FOUND TO BE FREE OF COLLISION DAMAGE OR REPAIRS.” This then becomes a part of the warranty.

3) Insist that the dealer prints on the warranty, in bold letters, “THIS CAR HAS NOT BEEN RETURNED TO A DEALER OR MANUFACTURER BECAUSE OF LEMON LAW DEFECTS OR COMPLAINTS.” If the dealer can run a warranty service print-out, insist that they do so and attach it to the warranty itself, with an additional message printed on the warranty: “THE ATTACHED WARRANTY SERVICE HISTORY REPRESENTS THE COMPLETE WARRANTY HISTORY FOR THIS CAR, ACCORDING TO ALL MANUFACTURER’S RECORDS.”

4) You will receive an odometer disclosure statement as part of the vehicle purchase. If there is any inscription on it such as “TMU” (stands for “true miles unknown”), watch out: this car’s odometer has probably been tampered with.

5) Insist upon a test drive of at least 10 miles. Insist on driving the car in varying road conditions: city streets, highway, straight and curvy roads both. Really shrewd consumers arrange to have a friendly professional mechanic, not affiliated with the selling dealership, to accompany them for the ride. Paying a friendly mechanic $ 50.00 to do the test-drive can spare you a lot of heartache later on.

6) Before you buy, have the car inspected by a non-dealer-affiliated professional mechanic. The friendly professional mechanic who accompanied you on the test drive should do just fine for this. Have the car thoroughly looked over, as you will probably be depending on the vehicle, especially for its safety and dependability, for the next several years. Later on, anything beyond routine maintenance expenses will prove galling, so know what you are getting into up front.

7) Do research. You may like the looks of the car, but it pays to check out the vehicle’s service record with Consumer Reports or on the Internet. See the National Highway Traffic Safety Administration site (search under “NHTSA”) for warranty, defect and repair information about any car you are considering buying.

8) Although they are controversial, I recommend buying an extended warranty, particularly if you intend on keeping the vehicle for a long time.

That’s the checklist, which should provide joy rather than grief in most cases. It’s your insurance policy, so print it out and carry it with you when you next make a used-car purchase. Check off each number as you complete that step of the list; then you’ll stand a much better chance of not becoming the victim of a fraud in a used car sale.

I will now explain some issues concerning the documentation normally accompanying a used-car sales transaction, including points to keep your eyes peeled for and some definite red flags that signal you not to buy that car.

All dealerships try to put off the documentation step for the end. Whenever I buy a used car, I insist that the documentation step be done first. In short, after I’ve become interested in a car, I want to see the documentation then and there, before I begin discussing sales terms. All dealers have “dealer jackets” containing all documents for each separate car on the lot. Review these papers first, and only then go for a test-drive and mechanical inspection.

At the time of the sales close, you can expect that the salesperson or a clerk will present you with a stack of fine-print documents which would take a week to read. No one – not even an experienced lawyer – can read all of those documents in a short time. However, you must at least glance at these documents, and keep an eye out for the following pertinent information:

The “Odometer Disclosure Statement”

This is a document required by federal law to accompany all sales of used cars. Read it, and make sure the dealership signs it, for by doing so the dealership is certifying that the actual miles on the car are accurately reflected on the odometer. If the “Odometer Disclosure Statement” has an entry such as “TMU” (which stands for “True Miles Unknown”), or “Actual Miles Unknown”, or any such entry, don’t buy the car! In all likelihood, the vehicle has more miles on it than what is actually showing on the odometer.

The “BUYER’S GUIDE”

The “Buyer’s Guide” is the window sticker on a used car which shows whether the car comes with a warranty. My firm suggestion to all used car buyers: only buy cars with warranties. Do not buy cars “as-is.” The salesperson will frequently tell you that some little old lady only drove the car to and from church, and that dealership knows the service history of the car because that’s where it was serviced, etc., etc.–it’s all a pile of prairie pickles. If you buy a car “as-is”, expect to be ripped off. Expect problems with the car. When a dealership sells a car “as-is, it is telling you clearly that it wants no further responsibility for the vehicle as soon as you drive it off the lot. And if the dealership doesn’t want any responsibility for the car, what does that tell you about the vehicle?

The moral of the story: buy cars with warranties, even if the warranty is for only 30 days. Warranties give you rights in case the car was sold to you fraudulently or it turns out to be a lemon. When you buy a car “as-is”, that may be the end of the line for you as far as pursuing any fraud or lemon-law claim.

The ‘Warranty History”

You have to request this, and you should request it. Many dealerships have access to the warranty history of the cars they sell, and particularly in the case of new car dealerships for the same make of vehicles. For example, if you are buying a used Chevy from an authorized Chevy dealership which services and sells new Chevys, then that dealership has computerized access to the warranty history of the car. This means that you can learn of any repairs done to that vehicle while it was under its original warranty. You can quickly learn if the car was a lemon by its warranty history.

If you don’t understand the “warranty history”, have some knowledgeable explain it to you. Make sure you understand it before you buy the car.

And, insist that the “warranty history” be attached to the warranty itself, with a representation that it represents the complete warranty history for that car. This then gives the consumer additional legal rights if it turns out the vehicle was sold fraudulently or it is a lemon.

“DISCLOSURE NOTICES”

If you are given anything called a “Disclosure Notice”, or the like, BEWARE!!! Read over all the documents to ensure that you are not being sold a recycled, or “laundered”, lemon. Anything called a “Disclosure Notice” which discusses the mechanical condition of the car is a red flag to back out of the deal and leave the dealership. You do not want to buy a “laundered lemon” – it will likely cost you more trouble than you ever imagined possible. In short, don’t buy a car if there’s any indication that it’s a “laundered lemon.”

The above, then, are the basic documents you must keep your eyes peeled for. In fact, for your own protection you must demand to see them. The dealership may not have the “warranty history”, but it should have all the others.

Robert F. Brennan, Esq. is a principal with Brennan, Wiener & Associates, an AV-rated law firm in La Crescenta, CA.  His firm specializes in consumer protection litigation, including lemon law, car dealer fraud and consumer class actions.  He can be reached through his website: http://brennanlaw.com

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Facts Consumers Should Know Before Considering Credit Counseling or Debt Consolidation

Of course, the hate mail is always from a few people that happen to own these “certain types” of businesses I discussed and those businesses of course are Credit Counseling or Debt Consolidation companies; of which many “claim” to be non-profit organizations.

You’d almost have to be an ostrich with your head stuck in the sand to not see or hear at least one advertisement a day from a Credit Counseling or Debt Consolidation Company. However, you can expect this to change and change soon. Since this is a topic which tends to “stir up” the owners of these businesses, I am going to take a different approach by NOT sharing my opinion, but rather, the opinion of others. I will start with the news media and the Internal Revenue Service:

“(NPR News, May 15, 2006). The Internal Revenue Service is revoking the tax exempt status of some of the largest credit counseling agencies in the country. An IRS investigation disclosed that the firms solicited business from people seriously in debt and that they didn’t provide counseling or consumer education, as required.

Prodded in part by a congressional oversight committee and consumer advocates, the IRS began investigating dozens of credit counseling agencies — most holding non-profit status — two years ago. IRS Commissioner Mark Everson says the companies “poisoned an entire sector of the charitable community.”

Everson says in many instances, companies were organized merely to funnel business to loosely affiliated for-profit companies. Many of the firms spend millions of dollars on commercials that urge anyone with debt to call them to solve their financial woes. And because tax-exempt organizations are not bound by the federal do-not call list, the firms were able to randomly call consumers, pitching their services under the guise of a non-profit counseling service.

The IRS investigations are also likely to affect consumers, thanks to a new bankruptcy law that requires consumers considering bankruptcy to get counseling before they are allowed to file. The IRS wants to ensure that only legitimate non-profit agencies are doing the counseling. In addition to the actions announced Monday, the IRS is sending more than 700 compliance letters to the rest of the credit counseling industry (END).”

Since almost all Credit Counseling and Debt Consolidation companies claim a non-profit status, I feel most consumers are easily sucked in with their skepticism and defenses at bay. After all, when most of us hear the word “non-profit” the first thing we usually think of is a church or homeless shelter.

From the NPR article and the actions of the IRS, I think it’s fair to assume that many of these “non-profit” organizations have been operating under a scenario similar to that of a wolf guarding a hen house. However, this doesn’t mean all credit counseling and debt consolidation companies are bad but… you do need to know the truth about how they operate and their limitations.

The first thing you want to understand is these companies are ALL more interested in making money off you than they are in preserving your credit rating. The bottom line with either credit counseling or debt consolidation is that it absolutely ruins your credit. I can just hear the companies arguing this with a consumer right now, telling them nonsense like “It helps your credit since it tells creditors that you’re working on your situation and not just running away from it.” Listen… if one these places tells you that than watch out. Why? Because they will lie to you about other things as well!

One of the first actions these programs usually requires you to do is for you to CLOSE all your revolving credit accounts. You then make payments to the organization and they take care of everything for you. What this says to all your creditors (as well as anyone considering giving you credit) is that you are so out of control with your finances that you can’t even manage paying everyone back on your own. Therefore, you’re hiring someone else to do it for you!

99% of the time these companies will claim they can negotiate with your creditors and get interest rates reduced thereby saving you money. While this is true, what’s also true is you can easily negotiate these same rates as well as they can by just calling your creditors yourself. You’d be amazed at how many of your creditors would love to hear from you (especially when the chips are down!). Not too mention, any money the counseling company was to save you would more than likely be sucked back up by their monthly fees (usually around $ 500 to $ 1,000 per year).

This brings us into a whole other dynamic of their business model. Because these companies always make their money off of monthly fees paid by the consumer, the longer they can keep those monthly fees coming in the more profitable their business will be. It’s for this reason that most consumers who sign up with these companies usually find themselves on payment plans with the lowest monthly payment possible (which turns out to also be the LONGEST payment plan as well). Not surprising is it?

Am I against Credit Counseling and Debt Consolidation companies? Absolutely not. After all, there are millions of people in America who will never be able to manage their finances. Credit to them is a destructive addiction much like alcohol or drugs and they will never be able to control it. Instead, it will always control them. We’ve all seen these people. Every time they are extended credit shortly thereafter they are in financial trouble (usually blaming it on some external factor). For these people I think these credit and debt counseling programs can be a good thing (as a ruined credit report is not a hindrance to them but actually an asset). It keeps them out of future financial trouble by forcing them to live their lives on a “cash and carry” basis; which is ultimately conducive to a better standard of living down the road.

On the other hand. If you’re good with your finances and have control with credit but went through some type of hardship beyond your control in the past (i.e. divorce, job loss etc); then the services of these companies will never be for you. You will do far better and preserve your credit rating by taking matters into your own hands. Reason being is that you understand your credit rating is a powerful tool that can help you move ahead faster, help others and help yourself as well as create the life you want. It all comes down to self management. We all know that those who cannot manage themselves will ultimately be managed by others. Credit is no different. When you learn to manage it well, you are the master and it is the servant.

If you care about your credit and want to benefit from it in the future, then you will never rely on a credit or debt counseling service to help you get out of any trouble you find yourself in. Instead, you’ll look inward and get yourself out while preserving your credit rating the best you can. Credit and debt counseling is for people who are “ok” with throwing their credit rating in the trash so they can have “someone else” manage their payments for them (since they are unable to manage them themselves). And again, as far as negotiating interest rates, you can do just as good as them or better. If you don’t believe me just call any of your creditors and straight out tell them your situation. You will quickly find you don’t need to be afraid of them. They just want to get paid like the rest of us.

Jay Peters is the founder of Consumer Education Group which publishes the Credit Secrets Bible (in print since 1994). To receive Free Credit Tips including “how to get your credit reports for free” visit their website: http://www.TruthAboutCreditRepair.com

For media inquiries or interviews Jay may be contacted at (928) 848-1400 or email: JayPetersOnline@yahoo.com