AdvoCare settlement highlights FTC’s importance in protecting consumers from pyramid schemes

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October 2, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—Today, the National Consumers League, the nation’s pioneering consumer and worker advocacy organization applauded the Federal Trade Commission (FTC) for its successful investigation and settlement with multi-level marketing (MLM) company AdvoCare. The settlement, in addition to providing $150 million in relief to victims, implements a lifetime ban preventing AdvoCare from ever rejoining the MLM business.

The following statement is attributable to John Breyault, vice president of public policy, telecommunications and fraud at the National Consumers League:

Today’s settlement once again highlights the central role that the FTC plays in protecting Americans from illegal pyramid schemes. The FTC has a 45-year track record of winning favorable settlements and court judgements against pyramid schemes. In spite of this, many leading members of the direct selling industry continue to push a discredited bill that would dramatically undermine the Commission’s ability to protect consumers against companies like AdvoCare. 

Under the Orwellian name of the “Anti-Pyramid Promotional Scheme Act,” the bill would create a series of carve outs and safe harbors that would prevent the FTC from protecting consumers and entrepreneurs from all but the most blatant pyramid schemes.

Today’s actions by the FTC demonstrate the need for  continued  consumer protection under its existing authority. NCL opposes pyramid scheme legalization bills like the Anti-Pyramid Promotional Scheme Act, which is even now being peddled by industry lobbyists. We hope this bill will once again be stopped from gaining momentum by members of Congress.

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About the National Consumers League

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 www.nclnet.org.

The National Consumers League applauds House passage of FAIR Act

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September 30, 2019

Bill would ban forced arbitration clauses in consumer and worker contracts

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League is applauding the groundbreaking legislation passed in the U.S. House of Representatives to restore legal rights to millions of American workers and consumers.

By a vote of 225-186 September 27, the House adopted the *Forced Arbitration Injustice Repeal (FAIR) Act, banning companies from forcing workers and consumers to resolve legal disputes in private arbitration—a forum essentially controlled by the company with no judge, no jury, and no oversight.

These clauses have become ubiquitous in employment and consumer contracts, “take or leave it” contracts of adhesion that make it impossible for workers to sue their bosses in court for sexual harassment, racial discrimination, wage theft, and nearly anything else or consumers to sue when a product proves dangerous, falsely advertised or marketed or violation of privacy or other rights. Arbitration is a rigged system where workers and consumers are *less likely to win their cases in private arbitration, and when they do win, they tend to get *much less money than they would in court.

Outlawing forced arbitration would restore access to the courts to more than 60 million U.S. workers who have signed away their right to sue.

“Arbitration is one of the central ways in which corporate America has rigged the system against middle class families, working people,” Rep. Rosa DeLauro (D-CT) said Friday on the House floor.

The bill will likely face some resistance from Republicans in the Senate, but passing it in the House is a victory for workers and consumers. “It’s about time our House of Representatives stood up for democracy and the little guy,” said Sally Greenberg, NCL executive director. “We thank Majority Leader Nancy Pelosi and members of the House Judiciary Committee for their leadership to move this bill and restore consumer and worker rights and hold corporate wrongdoers accountable.”

As Greenberg noted, “Forced arbitration clauses are toxic for companies and employees; they embolden companies to break the law with impunity, knowing they will never be held accountable because they cannot be sued in most democratic institution in the American democracy -our courts. Passage of the FAIR Act is an essential step to this end run around protecting the rights o average Americans.”

Forced Arbitration Injustice Repeal Act, briefly explained (Source: Vox)

The FAIR Act, introduced by Rep. Hank Johnson (D-GA) and Sen. Richard Blumenthal (D-CT), would ban businesses from forcing workers and consumers to give up rights through mandatory arbitration clauses. It would also invalidate current agreements that have already been signed, but only for disputes that come up after the law goes into effect.

The same bill was before the House last year, but did not get support from Republicans, who controlled the chamber at that time.  This time around, the challenge will be to get it through the Senate. But Republican senators, including Lindsey Graham (R-SC), have recently shown an interest in curbing forced arbitration.

NCL applauds the House of Representatives for this historic vote and for its support for consumer and worker rights. We urge the Senate to move with dispatch, pass the bill and send it to the President’s desk for signature and enactment.

*Links are no longer active as the original sources have removed the content, sometimes due to federal website changes or restructurings.

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About the National Consumers League

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 www.nclnet.org.

The National Consumers League statement on Senate confirmation of Eugene Scalia as Secretary of Labor

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September 30, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League (NCL) issued this statement in response to the Senate’s 53-44 vote last week to confirm Eugene Scalia as Secretary of Labor.

The National Consumers League (NCL) is disappointed by the Senate’s confirmation this week of Eugene Scalia as Secretary of Labor. The Labor Secretary should be a champion of the working women and men. The National Consumers League is proud that this nation’s first female cabinet member and Secretary of Labor – Frances Perkins – began her professional career representing NCL in New York and was a witness to the Triangle Shirtwaist Factory Fire in New York City in 2011, which led to her focus on fire codes and safety reforms in the workplace. As Perkins once said: “I came to Washington to work for God, FDR, and the millions of forgotten, plain common workingmen.”

Instead of being a champion for workers, Scalia has devoted his legal career to defending corporate interests:

  • He criticized a Clinton-era rule to protect workers from repetitive stress injuries that was repealed early in the Bush administration
  • He defended Boeing from a labor union lawsuit
  • He fought on behalf of Wal-Mart against a Maryland law aimed at improving workers’ health care.
  • He represented Wal-Mart Secretaries of Labor – to understand the plight of workers, advocate for better pay, working conditions, benefits and safety.
  • He represented the Chamber of Commerce opposing rules requiring mutual fund companies to put independent overseers on their boards of directors, and insurance companies challenging the SEC’s authority to regulate certain annuities with values tied to stocks

As AFL-CIO President Richard Trumka has noted: “It is insulting and dangerous that lifelong union-buster Eugene Scalia is the country’s top labor official. His track record is well documented, and it’s clear he has yet to find a worker protection he supports or a corporate loophole he opposes. Making the Labor Department—whose mission is to defend the rights of workers and enforce the law—a satellite office of a corporate right-wing law firm flies in the face of working people’s clearly expressed desires.” 

As Mary Kay Henry, president of the Service Employees International Union, noted about Scalia:  “The last thing working people need is another Secretary of Labor who sides with corporate CEOs instead of hard-working Americans and makes it harder to join together in unions.”

NCL, which works with DOL on a range of issues, urges the new DOL Secretary to reconsider his inclination to support corporations over the interests of working families and balance these interests with a focus on the impact on workers.

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About the National Consumers League

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 www.nclnet.org.

DOT inaction leaves kids at risk, NCL tells Congress

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September 26, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League (NCL), America’s pioneering consumer and worker advocacy organization, today called on the House Aviation Subcommittee to compel the Department of Transportation (DOT) to follow through on its Congressionally-mandated passenger protection rulemakings.

The Federal Bureau of Investigation recently warned that in-flight sexual assaults have increased by 66 percent and that children as young as 8 have been victims of such crimes in the air. New data *uncovered by Consumer Reports found that children as young as two years old and kids who have autism or who suffer from seizures have been separated from their parents on airplanes. Airlines have pressured parents to pay expensive seat reservation fees or buy priority board passes so that they can be sure to sit with their small children. Incredibly, the DOT earlier this year decided that creating a consumer education website would be sufficient to fulfill Congress’ intent that it act to ensure that families can sit with their young children.

“How many children will have to be assaulted on aircraft before the DOT acts?” asked John Breyault, NCL’s vice president of public policy, telecommunications and fraud at a House Aviation Subcommittee hearing today. “The DOT’s inaction on this issue has put children at greater risk. Congress should demand answers from the DOT on the process it used to determine that it should do nothing substantive on this important children’s safety issue and mandate that the agency follow through on Congress’ clear intent.”

Read Breyault’s full testimony here.

The consumer group also highlighted the Federal Aviation Administration’s (FAA) inaction on setting minimum seat size standards despite a looming deadline to do so. The FAA has actively. The FAA is required to issue regulations no later than October 2019, yet consumer groups have seen no indication that the agency is prepared to initiate such a rulemaking. Instead, the FAA has actively resisted judicial efforts by consumer advocates pressing it to take action on the important safety issue.

“Congress must not allow the FAA to simply adopt whatever inhumane seat size standard the airline industry favors,” said Breyault.

Breyault also testified about the impact of a lack of action by the DOT on Congressional mandates related to fee refunds, denied boarding (“bumping”), and the availability of fare, fee, and schedule data.

“The DOT’s actions and inactions on important rulemakings paint a picture of an agency that places consumer protection and consumer safety at the bottom of its list of priorities,” said Breyault. “It is imperative that Congress act to ensure that its mandates are not unduly delayed, or worse, ignored completely.”

*Links are no longer active as the original sources have removed the content, sometimes due to federal website changes or restructurings.

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About the National Consumers League

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 www.nclnet.org.

NCL opposes harmful proposed rule that will expose more to hunger

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September 23, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—Today, the National Consumers League (NCL) submitted written comments opposing the USDA’s Proposed Rule: Revision of Categorical Eligibility in the Supplemental Nutrition Assistance Program (SNAP), arguing that the proposed policy change would impact millions who qualify for the federal program that is the nation’s first line of defense against hunger.

“Our organization is deeply concerned that the proposed changes would deprive an estimated *3.1 million people of access to this vital program and cause 500,000 children to lose their automatic eligibility for free or subsidized school lunch. This proposed rule may potentially worsen hunger among low-income households, harm local economies, and increase SNAP administrative costs,” wrote NCL in the comments.

Low-income households receiving cash assistance from Aid to Families with Dependent Children (AFDC), Supplemental Security Income (SSI), or General Assistance have long been considered *automatically (or “categorically) eligible for SNAP, which means they do not separately have to pass SNAP’s asset or gross income tests.

Agriculture Secretary Sonny Perdue said the proposed rule change is intended to close a “loophole” that states have misused to “effectively bypass important eligibility guidelines.” However, that’s simply not the case. Broad-Based Categorical Eligibility (BBCE) allows states to cover the gap between income and need by considering cost of living, wages, and other local economic conditions when determining people’s eligibility for SNAP.

The National Consumers League strongly opposes the proposed rule that would expose even more people to the arbitrary food cutoff policy.

NCL’s written comments are available here (PDF).

*Links are no longer active as the original sources have removed the content, sometimes due to federal website changes or restructurings.

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About the National Consumers League

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 www.nclnet.org.

Consumer groups applaud congressional action to improve live event ticketing marketplace

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September 20, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—Today, the National Consumers League (NCL), along with seven other leading consumer and public interest groups, sent a letter to Congressmen Bill Pascrell (D-NJ) and Chairman Frank Pallone (D-NJ) and Senator Richard Blumenthal (D-CT) to applaud the lawmakers’ leadership in fixing the opaque live event industry by reintroducing the Better Oversight of Secondary Sales and Accountability in Concert Ticketing Act of 2019 (BOSS ACT). 

The following statement is attributable to Brian Young, public policy manager at the National Consumers League: 

“Unchecked consolidation in the live event industry has led to an opaque ticket marketplace that is rigged against consumers. In addition to undisclosed holdbacks designed to create a false sense of ticket scarcity, consumers are forced to grapple with a litany of fake websites which pose as legitimate box offices, and ridiculous fees that increase the cost of a ticket by an average of 27-31 percent. These outrageous fees typically prevent comparison shopping as they are often not disclosed until near the end of the purchase process. Likewise, despite the passage of legislation in 2016 which banned the use of ticket–buying BOTS, consumers have witnessed an increase of illegal ticket-buying bot usage of nearly 17 percent.  Fortunately, Congressman Bill Pascrell, Congressman Frank Pallone, and Senator Richard Blumenthal are working to bring transparency and competition back into the live event ticket marketplace. Today’s letter from 8 leading consumer advocacy groups applauds their efforts.” 

To add transparency to the live event ticketing marketplace and empower consumers to make informed purchasing decisions, the BOSS ACT would: 

  • Prevent primary and secondary ticket marketplaces from slamming consumers with hidden fees during checkout process; 
  • Prohibit scalpers from impersonating venues’ and teams’ websites to charge higher prices for less-desirable seats; 
  • Require primary ticket sellers to be honest about the number of tickets they plan on selling; and
  • Require the Federal Trade Commission (FTC) to identify ways to improve enforcement against illegal ticket-buying bots. 

To read the full letter, and learn more about the BOSS ACT, click here. 

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About the National Consumers League

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 www.nclnet.org.

NCL calls upon state legislators to protect their residents from dishonest automatically renewing contracts

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August 12, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League (NCL), the nation’s pioneering consumers and worker advocacy organization, calls upon state legislatures across the country to take action to protect consumers from deceptive automatic renewal clauses.

While automatic renewal provisions in consumer contracts, also known as negative option clauses, are billed as helping consumers avoid service disruptions, they can result in financial hardship for consumers. Dishonest companies continue to place these clauses into the fine print of contracts to mask rate hikes, renew gym memberships, generate recurring deliveries, or cause other services to renew without a consumers’ knowledge or consent.

The following statement is attributable to Brian Young, NCL’s public policy manager:

At least 22 states have some protections from automatically renewing contracts; however media reports have shown that companies are now using the guise of a ‘free trial’ to secretly roll consumers into binding contracts, sometimes after as little as a few days. Such clauses can trap consumers in expensive and unwanted contract renewals.

NCL is calling upon each state legislature to review their laws and enact comprehensive legislation. Recently enacted legislation in the District of Columbia is a model bill which requires:

  • clear disclosure of all automatic renewal clauses;
  • a consumer’s affirmative consent for free trials to be rolled over into a contract at the end of a free trial period; and
  • notification by mail, email, or another method of the consumer’s choosing, to be sent to consumers if their long-term contract is set to renew to a “month to month” or longer subscription.

*Thirty-five percent of consumers have complained that they have signed up for an automatically renewing contract without realizing it. Likewise, *48 percent of consumers have had a free trial roll over into a contract without their knowledge. The time is long overdue for state legislators to step in and take action to ensure consumers are not tricked into costly and deceptive business practices.

*Links are no longer active as the original sources have removed the content, sometimes due to federal website changes or restructurings.

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About the National Consumers League

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 www.nclnet.org.

NCL statement on White House “Protecting Americans from Online Censorship” proposal

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August 12, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League, America’s pioneering consumer and worker advocacy organization, is urging the Trump Administration not to move forward on its reported proposal to require the Federal Communications Commission (FCC) and Federal Trade Commission (FTC) to regulate speech on the Internet. As reported, the draft proposal would severely curtail the protections that website operators receive under Section 230 of the Communications Decency Act. These protections are crucial to website operators’ abilities to moderate content, including hate speech, violence, and other objectionable content.

The following statement is attributable to John Breyault, vice president of public policy, telecommunications and fraud at the National Consumers League:

An open and well-moderated Internet is crucial to consumers’ ability to get the information they need to make informed marketplace decisions and to hold industry and government officials accountable. Nonetheless, the Trump White House seems determined to pursue a fairness doctrine for the Internet in order to placate a small, but vocal portion of the President’s base. In the name of protecting against largely fictitious ‘conservative bias,’ the Administration’s proposal would direct the independent FCC and FTC to exercise authority they don’t legally have and which their leaders have said they don’t want. If reports about the draft executive order are true, the results could be disastrous for consumers and free speech online. This proposal is deeply misguided. We urge the Administration to consign it to the dustbin of history.

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About the National Consumers League

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 www.nclnet.org.

NCL: Consumers should be able to access broadcast channels for free via Locast

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August 5, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—Last week, the four largest broadcast networks—ABC, CBS, Fox, and NBC—filed suit against Locast, a free streaming service operated by the non-profit Sports Fans Coalition NY. The networks’ lawsuit seeks to block Locast’s streaming of local broadcast programming. The suit alleges that Locast violates copyright laws by failing to compensate the networks for their programming.

The following statement is attributable to NCL Vice President of Public Policy, Telecommunications, and Fraud John Breyault:

Consumers can already legally obtain free over-the-air broadcast channels via an antenna on their roofs. We think broadcasters would be better off embracing an innovative technology that allows consumers to more easily access their ad-supported content.

To secure public accessibility of broadcast signals, the Copyright Act expressly permits non-profit organizations to retransmit free over-the-air broadcasts. Locast is operated by the non-profit Sports Fans Coalition NY as a free public service. NCL supports broad consumer choice for access to local broadcast channels.

This year alone, the four largest broadcast networks are expected to generate more than $10 billion in retransmission-consent fees from cable and satellite providers that carry the networks’ programs. These fees are largely passed onto consumers in the form of higher monthly cable and satellite bills. Along with advertising that networks and local television stations sell, retransmission fees support the production of critically important local news content as well as traditional entertainment programming. 

NCL and Sports Fans Coalition (SFC) have a history of working together on a range of important consumer issues. In 2014, together we successfully petitioned the Federal Communications Commission to repeal the Sports Blackout Rule. In 2018, we jointly urged the Federal Trade Commission to protect consumers in the live event ticketing marketplace by cracking down on deceptive “white label ticketing websites.” We have also worked with SFC to create a landmark “Sports Bettor’s Bill of Rights” to ensure that consumers are protected as more states move to legalize online sports betting.

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About the National Consumers League

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 www.nclnet.org.

NCL statement on White House pathway for drug importation

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August 2, 2019

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—As the nation’s pioneer consumer organization, the National Consumers League (NCL) strongly supports consumer access to safe, effective, and affordable prescription drugs. The recent announcement by the White House to open a pathway for importation of drugs from outside of the United States seems unworkable and poses safety and purity challenges.

Six years ago, the U.S. government enacted a safe system to “track and trace” drugs sold to U.S. consumers through the Drug Supply Chain Security Act. The law required, that by 2023, all drugs sold to U.S. consumers must have both a product identifier and a unique package code to allow Food and Drug Administration (FDA) and any buyer in the supply chain to obtain a comprehensive history of where the drug was manufactured and packaged. This secure supply chain system best ensures consumers are receiving medications that are not counterfeit or substandard.

“The recent announcement by the White House ignores the Drug Supply Chain Security Act and undermines the security of the U.S. pharmaceutical supply chain,” said Sally Greenberg, NCL executive director. “This new pathway for importation could easily lead to counterfeit or substandard drugs finding their way to consumer’s medicine cabinets, thus putting patient health and safety at risk.”

In addition to the safety risks posed by this new policy announcement, there are no guarantees that it will save consumers money. The proposal opens the door for states, pharmacies, and distributors to obtain the medications outside of U.S. borders, but it does not require that any cost savings from obtaining those “lower-priced” medications be passed on to consumers. So, even if safety concerns could be addressed, it is not clear that there will be any direct cost savings benefit to consumers.

The threat to public health is real. Counterfeit medications may contain the wrong active ingredient, the wrong amount of the active ingredient, no active ingredient, harmful ingredients, or even poisons such as mercury, road tar, or antifreeze. Counterfeit medications made with deadly ingredients have been found in more than 40 states across America, posing a significant public health threat.

“Allowing importation will only serve to exacerbate the challenge of preventing counterfeit drugs from reaching American patients,” said Greenberg.

NCL continues to advocate for more responsible strategies to ensure the affordability and accessibility of safe and effective prescription drugs.

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About the National Consumers League

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 www.nclnet.org.