Consumer, Latino rights groups urge opposition to pyramid scheme promotion bill – National Consumers League

/in imported/by

September 22, 2016

Contact: NCL Communications, Cindy Hoang, cindyh@nclnet.org, (202) 207-2832

Advocates urge Congress to reject legislation that promotes fraud in the direct selling industry.

Washington, DC—At a briefing held today for members and staff of the U.S. House of Representatives, a national consumer advocacy group, two Latino organizations, and a leading marketing industry expert urged opposition to H.R. 5230, the so-called “Anti-Pyramid Promotional Scheme Act of 2016,” which would significantly weaken federal protections against get-rich-quick scams known to target immigrant communities and minorities.

“The Federal Trade Commission is the critical cop on the beat, protecting consumers from pyramid schemes posing as legitimate multi-level marketing or business opportunity scams,” said John Breyault, National Consumers League (NCL) Vice President, Public Policy, Telecommunications and Fraud. “Were this bill to become law, it would decimate the FTC’s ability to take action against all but the most blatant pyramid schemes, leaving millions of consumers vulnerable to fraud.”

Leaders from NCL, the League of United Latin American Citizens (LULAC), and MANA, a national Latina organization, joined marketing professor William “Bill” Keep, Dean of The College of New Jersey’s School of Business, to discuss how many direct-selling companies profit from the illegal and unethical recruitment of vulnerable consumers rather than selling products to actual retail customers.

“H.R. 5230 would allow product based pyramid schemes to count the financial losses of the people they trick into the scheme as retail sales,” stated Brent Wilkes, LULAC National Executive Director. “It essentially legalizes pyramid schemes in which the recruitment of victims is the ultimate objective.”  [See LULAC’s post on The Hill .]

As shown by its action to shut down energy drink seller Vemma in September 2015 and its settlement with nutrition company Herbalife, the FTC’s ability to bring effective enforcement actions against pyramid scheme behavior is critical for consumer protection. H.R. 5230, introduced in May 2016 by Rep. Marsha Blackburn (R-TN), would create an impossible standard for the FTC to meet in order to stop unfair and deceptive acts and practices by companies like Vemma and Herbalife.

“Pyramid schemes do great financial and social harm, create hundreds of thousands of victims in the United States annually, and fraudulently obtain many millions of dollars,” added Bill Keep.  “This legislation reverses decades of regulatory action and codifies permission for purchase and recruiting behaviors the courts have already identified as endemic to illegal pyramid schemes.

[See Bill Keep’s open letter to Congress on H.R. 5230.]

Supporters of H.R. 5230 claim that it would strengthen consumer protections.  However, in June 2016, five national consumer organizations raised significant concerns about the bill. Writing to House Energy & Commerce Committee leadership, the groups stated that H.R. 5230 would “provide numerous carve outs and exemptions for all but the most blatant pyramid schemes.”

Amy Hinojosa, Executive Director of MANA, said: “Latina entrepreneurs should be supported and protected under the law, not exploited by legislation that gives a free pass to pyramid schemes.” [See MANA’s op-ed.]

###

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.

Illinois AG Madigan to receive highest honor from oldest consumer watchdog org – National Consumers League

/in imported/by

September 19, 2016

CA State Senator Dr. Richard Pan, FCC’s Karen Peltz Strauss to receive Florence Kelley Consumer Leadership awards

National Consumers League: Cindy Hoang (202) 207-2832, cindyh@nclnet.org   
Illinois Attorney General Lisa Madigan Contact: Eileen Boyce (312) 814-3118, eboyce@atg.state.il.us  
California State Senator Dr. Richard Pan Contact: Shannan Martinez, (916) 651-4006, shannan.martinez@sen.ca.gov
Federal Communications Commission Contact: Will Wiquist, (202) 418-0509, will.wiquist@fcc.gov

Washington, DC—The National Consumers League (NCL), the nation’s pioneering consumer and worker advocacy organization, will honor Illinois Attorney General Lisa Madigan with its highest honor, the Trumpeter Award, on Wednesday, September 21 in Washington, DC. The award has honored leaders in the fight for consumer and workers’ rights for more than 40 years, and past honorees include: Senator Ted Kennedy, the award’s inaugural recipient, as well as Labor Secretaries Hilda Solis, Robert Reich, and Alexis Herman, Senators Carl Levin and Paul Wellstone, Delores Huerta of the United Farm Workers, and other honored consumer and labor leaders. Last year’s recipients were Senator Amy Klobuchar (D-MN) and FTC Chairwoman Edith Ramirez.

“The Trumpeter Award is NCL’s highest honor, given to leaders who have dedicated their lives to improving the rights of consumers and workers. Attorney General Lisa Madigan embodies these values, and her impressive career has had a measurable impact on the marketplace for consumers, in Illinois and across the nation,” said NCL Executive Director Sally Greenberg. “With this year’s Trumpeter Award, we recognize Madigan’s active leadership on important consumer protection issues such as student loan debt, predatory lending, data security, and more. She is an exceptional attorney general, whose aggressive advocacy for the consumers and workers of Illinois has set a trail for others to follow.”

“I’m honored to receive this recognition from the National Consumers League, which has been a champion for our nation’s consumers and workers for more than a century,” Madigan said. “I’m proud to partner with NCL to protect and advocate for consumers in Illinois and throughout the country.”

Florence Kelley Consumer Leadership Award 

In addition to the Trumpeter Award, NCL will the honor two recipients of this year’s Florence Kelley Consumer Leadership Award, which was named after an early leader of NCL: Dr. Richard Pan, California State Senator, and Karen Peltz Strauss, Deputy Chief of the Consumer and Governmental Affairs Bureau at the Federal Communications Commission.

“Dr. Pan is a passionate advocate for his patients and constituents, a hero to those fighting misinformation about vaccination efficacy and risk, and an ally in our own work to ensure that consumers get access to safe, effective medicines,” said Karin Bolte, NCL health policy director. NCL has worked with Dr. Pan via its Script Your Future medication adherence program and are allies in the fight to promote vaccinations.

“It is an incredible honor to be recognized by the National Consumers League, which has advocated for American consumers since 1899,” said Dr. Richard Pan, California State Senator representing the Sacramento Region. “Consumers need accurate guidance on medications that can improve their health, especially vaccines which benefit both patients and the public. NCL has been a strong partner as we strive to combat misinformation about vaccines.”

NCL will honor Karen Peltz Strauss for her leadership on access for those with disabilities.

“As one of the country’s premier disability rights attorneys for more than three decades, Strauss has valiantly led efforts to ensure persons with disabilities have access to our country’s communications programming, services, and equipment,” said John Breyault, NCL vice president, public policy, telecommunications and fraud.

“The FCC is proud of the essential role we play – and our continued success – in addressing communications accessibility issues. Under Chairman Wheeler, we have made tremendous headway in such areas as closed captioning, video description, accessible broadband and wireless communications, and emergency access. And because today’s technology allows us to address so many of these issues in ways never before considered, for the first time we can take advantage of new innovations, such as real-time text, to fully integrate access by people with disabilities into our shared public communications systems.  I thank the League for its support on this important work,” said Peltz Strauss.

The event will feature a reception, dinner, and speaking appearances by NCL leadership and the honorees, as well as former Trumpeter recipient and Washington Post syndicated columnist Michelle Singletary, FCC Commissioner Jessica Rosenworcel, Consumer Financial Protection Bureau Director Richard Cordray, and S. Floyd Mori, President and CEO of the Asian Pacific American Institute for Congressional Studies.

MEDIA ADVISORY

What: National Consumers League’s 2016 Trumpeter Awards
When: Wednesday, September 21, 2016 – 7 pm Dinner and Presentation of Awards
Where: Omni Shoreham Hotel, 2500 Calvert Street, NW, Washington, DC 20008

Members of the media are welcome to attend this event but must RSVP. For questions or to RSVP: Call Cindy Hoang, (202) 207-2832 or Carol McKay, (724) 799-5392.

###

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 applauds Congressional action to crack down on ticket bots – National Consumers League

/in imported/by

September 13, 2016

Washington, DC—The National Consumers League (NCL), America’s pioneering consumer and worker advocacy organization, today applauded recent Congressional action to fix the rigged live event ticketing industry.  Yesterday, the House passed H.R. 5104, the Better On-line Ticket Sales (BOTS) Act of 2016. Today, the Senate Commerce, Science and Transportation committee held a hearing to consider a similar bill, S. 3183.  

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

“Bipartisan support for the BOTS Act in both houses of Congress shows that Washington is serious about promoting a fair ticketing marketplace for all consumers.  Although a comprehensive solution to fixing the rigged live event ticketing industry will only come with increased transparency — such as Congressman Bill Pascrell’s BOSS Act —  the BOTS Act is an important first step. This bill would empower the Federal Trade Commission or state attorneys general to crack down on ticket-buying “bot” operators that jump the line and scoop up thousands of tickets for resale to the highest bidder. Such activity is blatantly anti-fan and we are proud to support a solution that puts a halt to it.”

###

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.

 

National student financial literacy competition opens 2016-17 season – National Consumers League

/in imported/by

September 12, 2016

Contact: NCL Communications, Cindy Hoang, cindyh@nclnet.org, (202) 207-2832

Washington, DC–Today marks the official launch of the 23rd season of LifeSmarts, with a new competition going live at the online home of the program, LifeSmarts.org. LifeSmarts, a program of the National Consumers League (NCL), is a national scholarship competition and educational program for middle-school and high-school students that tests knowledge of real-life consumer issues and aims to create a future generation of savvy-consumer adults.

“We are very excited to launch our 23rd season of LifeSmarts,” said national Program Director Lisa Hertzberg. “LifeSmarts gives students the skills they need to succeed as adults. We see students gain knowledge, confidence, leadership skills, and teamwork. The competition is a lot of fun, and the impact of LifeSmarts is lifelong.”

LifeSmarts focuses on five main content areas: consumer rights and responsibilities, personal finance, technology, health and safety, and the environment. Students are quizzed on their knowledge of these subject areas during online competition. Top-performing teams then advance to statewide competitions, and state champion teams advance to the national championship held each year in a different American city. The 2017 National LifeSmarts Championship will take place April 21-24, in Pittsburgh, PA. Winning teams receive scholarships and other prizes.

Last year, students answered more than 3 million consumer questions about credit reports, recycling, nutrition, social media, state lemon laws, and everything in between. By being consumer savvy and quick on the buzzers, the LifeSmarts team from Dallas High School in Dallas, PA took home top honors last April at the 22nd national event in Denver.

In addition to state and national competitions, LifeSmarts recognition and awards occur throughout the program year:

  • Teams of students vie for cash prizes in the online TeamSmarts quiz, which focuses on a specific LifeSmarts content area each month.
  • Six $1,000 scholarships will be awarded this winter to winning LifeSmarts students who become Safety Smart Ambassadors, using the joint UL and LifeSmarts program to present safety messages to younger children in their communities.
  • Partnering with FBLA (Future Business Leaders of America) and FCCLA (Family, Career, and Community Leaders of America), LifeSmarts offers special competitive events for student members of both student leadership organizations.

“We are excited to continue to grow the LifeSmarts program into new states and regions, to continue to educate students about financial literacy and being responsible consumers, and to create a new generation of savvy, market-ready consumers and workers,” said Sally Greenberg, executive director of NCL. “Too often traditional high school curriculum fails to teach students vital information that will be crucial once students go to college, get their first job, or move out of their parents’ house.”

In addition to hosting the official LifeSmarts competition, LifeSmarts.org provides resources for teachers to supplement existing lesson plans. These include daily quizzes, educational videos, social media competitions, focused study guides, and scholarship opportunities. LifeSmarts lessons closely align with courses taught in family and consumer sciences, business, technology, health, and vocational education. Math and English teachers have also had success with LifeSmarts, as have homeschool and community educators.

Major LifeSmarts contributors include: Experian, McNeil Consumer Healthcare, Underwriters Laboratories, Western Union, LifeLock, Comcast NBC Universal, Intuit, American Express Company, and others. Visit LifeSmarts.org for more information. LifeSmarts: Learn it. Live it.

###

About the National Consumers League and LifeSmarts

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.

LifeSmarts is a program of the National Consumers League. State coordinators run the programs on a volunteer basis. For more information, visit: LifeSmarts.org, email lifesmarts@nclnet.org, or call the National Consumers League’s communications department at 202-835-3323.

NCL joins other consumer groups in strong support of CFPB rule to limit use of forced arbitration clauses against consumers – National Consumers League

/in imported/by

August 26, 2016

Contact: NCL Communications, Cindy Hoang, cindyh@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League (NCL), the nation’s pioneering consumer and worker advocacy organization, founded in 1899, joins comments by other consumer groups in support of a rule proposed by the Consumer Financial Protection Bureau (CFPB) to limit the use of forced arbitration clauses by banks, credit card companies, lenders, and other financial services. Nearly 13,000 comments were filed with the CFPB on this important rule. NCL is a signatory to a letter signed by 281 consumer and labor groups praising the CFPB’s rule.

Sally Greenberg, NCL’s executive director, stated: “This rule will finally help to even the playing field and work to curb the worst abuses in the financial services marketplace. While we would like to see additional reforms to help restore consumer rights, promote transparency, and improve the market, we see this as a significant step forward in efforts to curb industry practices and make consumer financial markets fairer and safer.”

The Dodd-Frank Act required the CFPB to study the use of arbitration provisions, and the bureau produced a lengthy report in March 2015 to lay out the basis for its curbs. Based on the report, the CFPB unveiled its proposed rule to prohibit companies from putting forced arbitration clauses in new contracts that block consumer participation in class action lawsuits in May.

While the proposed rule does not bar all uses of forced arbitration, as NCL had hoped, the rule will make a meaningful difference in consumer transactions moving forward. NCL has long advocated against companies’ use of arbitration clauses, which are often found hidden deep in the fine print of consumer contracts and user agreements.

Forced arbitration clauses eliminate the rights of consumers to go to court over future disputes that they may have with the company. Instead of having the right to bring cases to a court of law before an impartial judge paid by taxpayers and have a case heard on a public record, consumers have to go before an arbitrator–who is often chosen from a list created by the company. The company can keep choosing that arbitrator for repeat business, so there’s an incentive for the arbitrator to favor the company. This arbitrator is not required to follow established law or procedure. The arbitrator’s decisions cannot be appealed, and are often kept secret.

“These clauses are found in nearly every conceivable consumer contract, including those for credit cards, bank accounts, mobile homes, nursing homes, wireless cell phone carriers, physicians’ offices, and many others,” said Greenberg.

The Federal Arbitration Act, a statute enacted in 1925, was designed so that businesses could elect to settle their own disputes out of court if they wished to do so. “It was never intended to be used to deprive consumers of their rights. Unfortunately, a conservative Supreme Court, often decided by a close 5-4 vote, has approved business’ use of these clauses in consumer contracts,” said Greenberg. “The law has been converted into a weapon against consumers to force them to ‘agree’ to give up their rights.”

###

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 to submit comments to FDA on Prescription Drug User Fee Act VI – National Consumers League

/in imported/by

August 15, 2016

Contact: Cindy Hoang, National Consumers League, cindyh@nclnet.org, (202) 207-2832 

Washington, DC–Today the nation’s pioneering consumer advocacy organization, the National Consumers League (NCL), will submit comments to the U.S. Food and Drug Administration on the reauthorization of the Prescription Drug User Fee Act for fiscal years 2018 through 2022 (PDUFA VI). Founded in 1899, the National Consumers League has long been concerned with ensuring the safety of foods and drugs. Among NCL’s top priorities are ensuring the safety, effectiveness, and appropriate use of both prescription and over-the-counter (OTC) drugs, and medication adherence, which NCL has helped to advance through its Script Your Future Campaign.

“As PDUFA VI goes through the reauthorization process, NCL urges the FDA to remain mindful of the concerns expressed by some that because industry pays user fees, industry thereby controls the FDA’s agenda and process. It is critical for the agency to act independently of industry influence and to uphold its high standards for safety, efficacy, and quality of prescription drug products,” said Karin Bolte, NCL director of health policy, who will deliver a statement and submit comments on behalf of NCL today. 

“NCL wants to be sure that in the quest to reduce barriers to new drug approvals, FDA does not lose sight of the importance of the agency’s mission of protecting and promoting the health of consumers and patients. The FDA must balance the needs of consumers who are concerned about serious side effects with the concerns of patients who may be facing a life-threatening illness where time is of the essence. However, even patients in great need may be harmed rather than helped by drugs that have been approved too quickly without adequate consideration of safety and effectiveness or toxic side effects.”

NCL’s full comments are available here.

###

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 Delta Airline’s mass cancellations – National Consumers League

/in imported/by

August 11, 2016

Contact: Cindy Hoang, National Consumers League, cindyh@nclnet.org, (202) 207-2832 

Washington, DC—In light of this week’s system-wide failure at Delta Airlines and subsequent cancellations of thousands of flights, the National Consumers League (NCL) today calls on Congress to investigate the lack of consumer protections when airlines suffer from widespread outages. The following statement is attributable to Sally Greenberg, executive director of NCL:

“It is outrageous that while airlines are enjoying record profits, they remain unable to provide the most basic level of customer service. Delta’s system failure that resulted in flight cancellations was compounded by ineffective interlining agreements between carriers, which left consumers stranded and without alternative transportation options. This failure is yet another example of how the lack of competition is harming consumers. It is up to leaders in Congress to hold the airlines accountable and to demand stronger consumer protections from industry and the Department of Transportation to not only ensure that this never happens again, but to also ensure that consumers receive the refunds they deserve for their canceled flights.”

###

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 settlement with BBUSA Bakeries USA – National Consumers League

/in imported/by

April 20, 2016

Contact: NCL’s Cindy Hoang, cindyh@nclnet.org, (202) 835-3323

Washington, DC–The National Consumers League (“NCL”) and BBUSA Bakeries USA (“BBUSA”) are pleased to announce that they have resolved consumer-related litigation pending in the Superior Court of the District of Columbia, NCL v. BBUSA Bakeries USA, Case No. 2013 CA 006548 B. NCL and BBUSA recognize the importance of a focus on nutritional content in bread product offerings and ensuring that customers have nutritious options.  Without admitting liability, BBUSA has agreed to provide additional disclosures on the back of product packaging and on the Thomas’® and Sara Lee® websites and to make a donation to Feeding America.

###

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.

National Consumers League statement on FTC’s settlement with Herbalife – National Consumers League

/in imported/by

July 15, 2016

Contact: NCL Communications, Cindy Hoang, cindyh@nclnet.org, (202) 207-2832

Washington, DC—The National Consumers League (NCL) today welcomed the Federal Trade Commission’s (FTC) action to require fundamental restructuring and significant consumer redress as part of its settlement with multi-level marketing company Herbalife. In March 2013, NCL was the first consumer group to call on the Commission to investigate allegations that Herbalife was engaging in a sophisticated pyramid scheme. In March 2014, the FTC responded to calls from NCL and others by opening an investigation into the company’s conduct.

The following statement is attributable to NCL Executive Director, Sally Greenberg:

“The FTC’s action today addresses many of the concerns that NCL and other experts on pyramid schemes raised about Herbalife’s business practices. Specifically, consumers will benefit greatly from the settlement’s requirement that Herbalife base its compensation structure on verifiable retail sales to end-users of the product, not recruitment of new distributors. This is the core distinction, as enumerated by more than 30 years of case law, between a legal direct-selling company and a fraudulent pyramid scheme. The settlement’s requirement that at least 80 percent of product sales, companywide, must be made to end-users will further address concerns about a lack of retail sales to buyers outside the business opportunity. The FTC’s settlement will also address many of the blatantly unsubstantiated earning claims made by Herbalife’s distributors to entice new recruits to join the business opportunity and keep existing distributors paying to remain in the business opportunity. We look forward to the FTC’s forthcoming guidance to the direct selling industry as an opportunity to address the persistent lack of clarity that has characterized many industry practices.”

 ###

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.