NCL applauds Congress’s passage of aviation consumer protection improvements

/in , , , , , , /by

May 16, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – Yesterday, the House of Representatives passed a bill to reauthorize the Federal Aviation Administration (FAA) through 2028, sending it to the president. The legislation includes a number of wins for the millions of consumers who travel by air every year: airline vouchers cannot expire in less than five years, caregivers can sit with their minor children without paying an extra fee, and passengers will automatically receive a refund if their flight is cancelled.

The measure also strengthens the Department of Transportation’s (DOT) ability to hold air carriers accountable when they break the law by tripling the maximum civil penalty the Department may impose and creating an assistant secretary position for aviation consumer protection.

“The National Consumers League is grateful to the negotiators of this bill for working to improve the flying experience,” said NCL Vice President of Public Policy, Telecommunications, and Fraud John Breyault. “Without support from Senator Cantwell, Senator Cruz, Representative Graves, Representative Larsen, and their diligent staff, these important new consumer protections would not have made it to President Biden’s desk.

“We look forward to the president signing the bill into law and a robust enforcement regime from DOT. Particularly, we expect the FAA to act on its mandate from Congress to establish minimum seat sizes on airplanes—a directive Congress has given the agency twice now.”

Unfortunately, Congress missed a significant opportunity to enact structural change in how airlines are regulated. The airline industry still enjoys extraordinary privileges and remains protected from Federal Trade Commission and state government oversight. A tax break for add-on fees remains in place, encouraging air carriers to generate revenue from added charges instead of the base fare. And a provision that would have established bare-bones safeguards around the devaluation of frequent flyer rewards was stripped from the bill.

While there is still work to be done, the flying public undoubtedly secured important wins in this reauthorization. NCL is appreciative of the allies to consumers who championed our priorities on the Hill and we will continue to advocate for passengers as the legislation is implemented in the coming years.

Further reading:

  • Consumer advocates support federal review of air industry’s data collection practices
  • Full list of consumer and public interest advocates’ priorities for the FAA reauthorization
  • Consumer groups call for a moratorium on smaller airplane seats pending FAA safety review

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

NCL supports AI liability rule, recommends extending its reach

/in , , , , , , , , /by

May 2, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – This week, NCL and six other consumer advocacy and public interest organizations submitted comments in support of a Federal Trade Commission proposal that would establish legal liability for AI developers who know (or have reason to know) that their AI is facilitating fraud.

The FTC’s proposed rule would enable the agency to crack down on scams that use deepfakes and voice cloning. It would also help to fill a glaring gap in its ability to hold impersonation frauds accountable, like romance and grandparent scams. This hole in the Commission’s capacity to return funds to victims of fraud is a direct result of the Supreme Court’s decision in the 2021 AMG Capital Management v. FTC case.

“While some AI developers implement safeguards to prevent the misuse of their products, many do not,” said NCL Public Policy Manager Eden Iscil. “The FTC’s initiative in this space should put companies on notice that they cannot put out unregulated AI tools and allow criminals to supercharge their frauds with them.”

Recent trends have shown the urgent need for the FTC to have strong enforcement options to combat impersonation fraud. NCL’s Top Ten Scams report for 2023 found significant consumer losses attributed romance and family-and-friend imposter fraud, with victim complaints showing median losses at $8,000 and $1,040, respectively. Generative AI, including text generation, voice cloning, and visual deepfakes, can enable these scams to be significantly more effective. The Federal Bureau of Investigation noted a 322% increase in sextortion reports between 2022 and 2023, attributing much of the increase to the proliferation of AI tools.

The Center for American Progress, Consumer Action, Consumer Federation of America, Electronic Privacy Information Center, the National Association of Consumer Advocates, the National Consumer Law Center, and NCL urged the Commission to clarify that the liability for AI developers in facilitating fraud should also apply to companies that provide scammers access to AI tools, even if the companies did not develop the AI themselves. The full comments can be found here.

Additional reading:

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

NCL on Upcoming Congressional Hearings with UnitedHealth Group CEO Andrew Witty

/in , , , , , , , , , /by

April 30, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – Tomorrow, the Senate Finance Committee and House Energy and Commerce Committee will hear from UnitedHealth Group CEO on the insurance company’s cyberattack that put millions of medical records and patient privacy at risk.

The cyberattack is, of course, cause for concern, but there are also several other ways major insurance companies like UnitedHealth Group are hurting consumers. These companies have taken over the prescription drug marketplace – they are integrated with the pharmacy benefit managers (PBMs) who gatekeep our prescriptions, limiting access and increasing out-of-pocket costs.

Here are the top questions American consumers deserve answers to:

  • How will your company work to not only protect patient data going forward, but also protect patient choice and power in their healthcare decision-making?
  • Can you explain the relationships and makeup of UHG, Optum Rx, and Optum Health? How does this vertical integration give consumers a fair choice when it comes to their health when there is a clear incentive to keep patients – and thus profit – in the UHG family?
  • UnitedHealth Group’s PBM Optum Rx claims to benefit consumers by negotiating rebates with drug manufacturers – why, then, aren’t consumers experiencing lower costs at the pharmacy counter?
  • How much does Optum Rx collect each year in rebates from drug manufacturers? How much profit does the UHG corporation rake in from prescription drug purchases?
  • Is UHG aware of the significant health and financial challenges that prior authorization requirements impose on consumers and their families?

The insurance industry is riddled with poor incentives that ultimately hurt consumers. Lawmakers have an opportunity this week to shine a light on these problems. We need bipartisan reforms to give consumers more power when it comes to their prescriptions, and ultimately, their health.

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

Consumer groups welcome protections in FAA reauthorization agreement, urge continued improvements

/in , , , /by

April 29, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – Today, U.S. House and Senate negotiators released their bipartisan and bicameral compromise bill to reauthorize the Federal Aviation Administration (FAA). As consumer and public interest advocates, we are grateful to members of Congress who are utilizing this opportunity to implement meaningful safeguards to the flying experience. However, as the last few years have demonstrated, there is a need for even more protections to address the extreme hardships that passengers have been forced to endure. Given the limited opportunity to enact reforms in the five-year cycle of the FAA reauthorization, we strongly urge Congress to enact amendments to further strengthen the bill before its final passage. 

“Consumers are notching significant wins in this package, but there is still work to be done to fix a broken airline industry,” said John Breyault, NCL Vice President of Public Policy, Telecommunications and Fraud. “Tripling civil penalties, codifying DOT’s authority to issue important consumer protection rules, prohibiting family seating fees, and creating an Assistant Secretary position charged with protecting airline passengers will all have meaningful impacts on the flying experience. There is more that can be done as this bill heads to the floor, including requiring airlines to maintain 24/7 customer service telephone lines, protecting against the devaluation of frequent flier benefits, and codifying DOT’s ability to protect consumers from unrealistic airline scheduling practices. We look forward to working with leaders in Congress on this important issues.”

“Considering this bill was expected eight-plus months ago, you might have thought House and Senate negotiators would have taken the extra time to include all of the meaningful protections airline passengers deserve,” said Teresa Murray, Consumer Watchdog Director with U.S. Public Interest Research Group. “We’re particularly concerned with the absence of some provisions that would make air travel less burdensome, such as fee transparency.”

“Airline passengers will achieve some real gains in this bill and we look forward to seeing continued progress to strengthening the bill to include compensation for consumers,” said Ruth Susswein, Consumer Action’s Director of Consumer Protection.

“This legislative package includes some important steps forward for air travel consumers and ensures that some existing protections are not weakened,” said Erin Witte, director of consumer protection for Consumer Federation of America. “As this bill moves toward passage, we urge Congress to take full advantage of the opportunity to make it as strong as possible.”

Importantly, there are several boons for consumers in this version of the reauthorization, including:

  • Establishing a permanent office of consumer protection at the Department of Transportation, headed by a Senate-confirmed assistant secretary;
  • Requiring airline vouchers to be valid for at least five years;
  • Tripling the amount DOT can fine airlines for law violations;
  • Requiring air carriers to allow families to sit together with no extra charge;
  • Commissioning a Government Accountability Office study on competition and consolidation within the industry.

As it heads to the Senate floor, passenger advocates are urging senators to protect those provisions while supporting additional amendments that were included in previous versions of the House and Senate reauthorization bills, including: 

  • Requiring airlines to provide cash refunds for cancellations and significant delays automatically, without the need for consumers to navigate often-complicated refund processes; 
  • Eliminate a loophole that would allow FAA to avoid creating safe and humane seat size dimensions; 
  • Provide DOT with clear authority to regulate unrealistic and deceptive flight schedules; 
  • Codifying DOT’s authority to mandate ancillary fee transparency; 
  • Directing FAA to study the impact of shrinking seats sizes on the safety of airplane evacuations and passengers with disabilities.

Additional reading:

  • Full list of consumer and public interest advocates’ priorities for the FAA reauthorization
  • Consumer groups call for moratorium on smaller airplane seats pending FAA safety review

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

Consumer advocates support federal review of air industry’s data collection practices

/in , , , , , , /by

April 29, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – Today, a coalition of seven consumer and public interest advocacy organizations sent a letter to the U.S. Department of Transportation supporting the agency’s review of airline and ticket agents’ data collection practices.

The coalition outlined several areas concerning passenger privacy that DOT should examine, including:

  • How airlines collect consumer data from their websites and mobile apps, including sensitive data like precise location information and web browsing activity
  • How airlines collect and use consumer data in relation to their mileage and rewards programs
  • How airlines collect and use consumer data in relation to the New Distribution Capability system

Additionally, the coalition urged DOT to explore permanent mechanisms for consumers to have better control over their own data, such as requiring aviation companies to follow data minimization principles, implementing transparency requirements around industry actors’ data practices, and creating tools for consumers to exclude themselves from those practices.

Airlines currently enjoy unique privileges that almost no other industry in the nation has. The U.S. Department of Justice, the Federal Trade Commission, and state governments are unable to hold air carriers accountable for violations of consumer protection and civil rights laws—only DOT has this authority.

The signatories to the letter are the American Economic Liberties Project, Consumer Action, Consumer Federation of America, Ed Perkins on Travel, FlyersRights, the U.S. Public Interest Research Group, and the National Consumers League. The full letter can be found here.

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

Airline passenger advocates hail landmark junk fee rules

/in , , , /by

April 25, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – Airline passenger rights advocacy organizations today hailed new rules announced by the U.S. Department of Transportation (DOT) that will make it easier to obtain refunds for cancelled flights and ancillary services that aren’t provided. The groups also applauded the finalization of regulations that will make it easier for flyers to do apples-to-apples comparisons of flight costs. The groups, which supported passage of these new protections for more than four years, urged Congress to follow suit and include these protections in the forthcoming FAA reauthorization bill. 

“Too often, airlines promise one thing and fail to deliver it,” said National Consumers League CEO Sally Greenberg. “The law says that when this occurs, consumers should get a refund. Far too often, the airlines make the process of getting your money back unnecessarily difficult. Today’s rules promise to bring sanity to the refund process. In addition, the new rules on fee transparency will make it easier for consumers to get an accurate price for their flights upfront. This is a far better solution making consumers wait until the end of the ticket buying process to learn what their true cost will be.” 

“It has become painfully clear that the status quo is no longer working in air travel, and we are glad to see Secretary Buttigieg acknowledge that consumers deserve better,” said Erin Witte, director of consumer protection at Consumer Federation of America. “These rules will bring transparency to opaque ticket pricing, and they will put the responsibility for refunds where it belongs: on airlines, not consumers.” 

“It’s a shame that it takes actual rules to get airlines to do the right thing and take better care of their passengers,” said Teresa Murray, Consumer Watchdog Director at U.S. Public Interest Research Group. “It’s important to remember that most Americans fly only once every 12 to 18 months. These rules will especially help those travelers who aren’t as familiar with their rights.” 

“We applaud the DOT’s move to require refunds for consumers —by default—when flights are cancelled or ‘significantly’ delayed,” said Ruth Susswein, Consumer Action’s Director of Consumer Protection. “This clear directive is sorely needed and a significant improvement for airline passengers.” 

“For years, domestic and foreign airlines both large and small have made it as hard as possible to give passengers well deserved refunds for disruptions they’ve caused or services they’ve failed to provide,” said William J. McGee, Senior Fellow for Aviation and Travel at the American Economic Liberties Project. “The DOT’s new rule is a watershed moment for passenger protection in the airline industry, making it easy and accessible for consumers to get relief when Too-Big-To-Care airlines run roughshod over them. This news follows a positive sea change in the DOT’s enforcement activity under the Biden administration, including supporting the DOJ’s successful JetBlue-Spirit merger challenge, a historic enforcement action against Southwest, and new efforts to empower state attorneys general to address consumer complaints. There’s more work to be done, but the DOT is showing that it’s getting serious about taking on corporate power across the airline industry—and we’re thrilled to see that.” 

The new rules come as Congress closes in on approval of legislation reauthorizing the Federal Aviation Administration. The passenger rights groups are calling on leaders in the House and Senate to ensure that additional protections are put in place to ensure that a future DOT does not roll back these hard-won consumer protections. 

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

NCL expresses concern over Colorado Senate Bill 184, which seeks to impose new tax on car rental consumers

/in , , , , , , /by

March 29, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – The National Consumers League (NCL) recently sent a letter to Chairwoman Faith Winter of the Senate Transportation and Energy Committee, Colorado State Senate, expressing concern over Senate Bill 184, which seeks to impose a new tax on car rental consumers of up to $3 per day, for the purpose of creating a new rail light line service. NCL does not believe taxpayers should bear the burden of paying for this new service.

The full letter can be found here.

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

NCL urges regulators to investigate auto makers’ data collection practices

/in , , , , , , , , , , /by

March 27, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – Today, the National Consumers League sent a letter to the Federal Trade Commission urging oversight of vehicle manufacturers’ collection of consumer data. Modern cars can collect a range of information on drivers, including the locations they visit, their exact weight, and their texts and call records. Consumers are often unaware of this data collection and are even more surprised when insurance companies utilize this surveillance to increase drivers’ premiums. As digitally connected vehicles become more commonplace, the risks they pose to consumer privacy will only become greater—absent mandatory safeguards.

The full letter can be found here.

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

NCL endorses the Shrinkflation Prevention Act

/in , , , , , /by

March 13, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – Today, the National Consumers League sent a letter to the United States Senate urging action on the Shrinkflation Prevention Act. As American consumers struggled with spiking inflation, companies posted steep profits. One analysis found that corporate greed drove over 50% of consumer price increases in the years following the pandemic. One of the methods businesses have used to extract greater profits has been shrinkflation—selling less product at the same price. The Shrinkflation Prevention Act would officially designate this as an unfair or deceptive practice.

“Multiple surveys have found that consumers are unhappy with this practice,” said NCL CEO Sally Greenberg. “Almost four out of five Americans say they feel cheated by shrinkflation. Despite this sentiment, sellers continue to take advantage of the public and participate in this trend.”

The full letter can be found here.

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.

NCL applauds Biden Administration actions to minimize unfair charges, protect producers from retaliation

/in , , , , , , /by

March 5, 2024

Media contact: National Consumers League – Melody Merin, melodym@nclnet.org, 202-207-2831

Washington, DC – Today, the White House Competition Council announced new actions to lower costs for consumers and promote market health. The Consumer Financial Protection Bureau (CFPB) finalized a rule to save consumers $10 billion a year by capping credit card late fees to an average of $8. The Federal Communications Commission (FCC) is initiating a ban on bulk billing, a practice where landlords or service providers charge all tenants in a building for a particular service—even for residents who do not choose that service. Lastly, the Department of Agriculture (USDA) is implementing protections for farmers and ranchers from retaliatory practices used by the industry’s dominant firms.

The following statement is attributable to NCL Chief Executive Officer Sally Greenberg:

“Under President Biden’s leadership, consumer protection agencies are doing critical work to guard the marketplace against industry misconduct. As more industry sectors have become increasingly consolidated, today’s actions are necessary to ensure that consumers aren’t ripped off and to protect producers from illegal retaliation and discrimination. When businesses concentrate market power and employ unfair practices to maintain that dominance, new legal safeguards and structural reform become necessary to protect the public from further harm. Today’s announcements are an important piece of this effort to maintain healthy marketplaces that benefit consumers and workers.”

The National Consumers League has worked to protect both consumers and workers from consolidated corporate power since 1899. From advocating against banking fees that disproportionately affect marginalized communities to fighting for transparency in telecom billing, NCL continues to provide a voice for the public interest.

###

About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization.  Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad.  For more information, visit nclnet.org.