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Consumer News & Alerts

February 21, 2006

GIFT CARDS NOT ALWAYS WHAT THEY SEEM
A gift card seems like the perfect present, allowing the lucky recipient to buy whatever he or she wants, right? Not always. All too often, gift cards carry unexpected restrictions, fees and expiration dates while failing to provide the consumer protections we've come to expect from credit cards.

It was bad enough when gift cards were mostly issued by larger merchants and malls. Many of them charged interest, fees and penalties while failing to offer any kind of help with disputes over merchandise or services.

Now that banks and other big financial institutions are starting to issue gift cards, the situation's even worse. Cards issued by American Express, Visa, MasterCard and so forth fall into a grey area -- no one's quite sure who has the authority to regulate them.

End result? It's open season on consumers on both the giving and receiving end. Congress may be riding to the rescue but we all know how that often turns out. For now, being a careful consumer is the best safeguard.

Learn more in this week's cover story -- Congress Considers New Gift Card Rules.

BUSINESS SURVEY: BUSINESS SUX
Most of our readers would probably agree that, by and large, corporations haven't earned their customers' loyalty and trust. But it's a little surprising to find that corporate managers feel the same way. Yet, sure enough, a survey finds that 54 percent of senior executives feel they don't deserve consumers' loyalty.

According to the study, 67 percent of executives do not meet often with customers and only 33 percent say they have the tools and authority they need to serve their customers. Can't argue with that.

Fords Still Burning Here's a good example of a corporation that has forfeited any claim to customer loyalty. Ford stalled, dithered and prevaricated for years -- years! -- as F-150 and similar trucks caught fire while parked and unattended, destroying homes, adjacent cars and garages and causing not a few deaths. Finally shamed into a recall, the company now claims it can't get the parts needed to make repairs. Meanwhile, trucks burn and consumers fume.

In many countries, Ford's top executives would face criminal prosecution. In others, they would resign in disgrace. Here, they plaster their face all over television.

CANDID CAMERAS
With all the chest-beating over national security wiretaps, there's not much likelihood the driving public will be clamoring for speed cameras. But a survey finds that up to 10,000 deaths could be prevented per year on U.S. highways if lower speed limits were coupled with speed cameras. Small increases in travel speeds resulted in a sustained death toll of more than 42,000 road deaths per year in the 1990s, safety experts say, and there's no way they'll be reduced anytime soon without lower highway speeds.

Mazda Plans Gas-Hydrogen Hybrid The RX-8 Hydrogen RE will initially be available only in Japan but if it's successful, expect to see some demonstration models on our shores within a few years.

GM Regional Truck Recall Stops Short Truck owners are irate. GM recalled only trucks that were originally sold in cold climates to fix a brake problem that's caused by road salt. Well, guess what? Trucks have wheels. They move. And some trucks now in warmer climes are having the problem that's supposedly confined to cold-weather states.

CALIFORNIA SUES H&R BLOCK
California Attorney General Bill Lockyer charges the tax preparation giant has violated 15 state and federal laws by pushing its high-cost refund anticipation loans (RALs), mainly to low-income families. The case could cost the company "hundreds of millions" of dollars, Lockyer said.

Not only are the "instant refund" loans expensive and unnecessary, they often don't deliver the goods. We hear a steady stream of complaints from consumers who pay big bucks for the loans but don't get their refunds on time ... or, in some cases, at all.

We hear lots of other complaints about our friends H&R as well ... including high prices and expensive mistakes.

Taxpayers Flock to Online Tax Prep We're a little worried at how fervently consumers are embracing online tax preparation sites. Hey, you're voluntarily giving your most sensitive personal and financial information to a Web site you know nothing about. Maybe this works out OK but, then again ... maybe it doesn't, as is the case with some taxpayers we're heard from lately. More on this topic next week.

Debit Cards Canceled After Security Breach Even more mysterious than Dick Cheney's hunting accident is the security breach involving major bank debit cards. Thousands of cards have been canceled because of it but public explanations are late and, well, sort of scatter-shot.

Discover Debit Challenges Visa and MasterCard Discover has never quite discovered the way to be successful but it's hoping its latest gambit will vault it to the front of the pack. As we understand our Martin Bosworth's report, Discover will let merchants sock consumers with a surcharge for using plastic. This is something we're supposed to applaud?

USE IT, THEN LOSE IT
We have found that those involved in Alzheimer's research tend to be a little depressed. It is a terrible disease and there's still not much in the way of a treatment. Now comes the news that Alzheimer's may begin later in highly-educated people but once it gets started, it progresses more quickly than in the rest of us.

French Fry Foibles With all that's happening in the world, it's a little hard to get excited about French fries but some consumers are up in arms about the revelation that McDonald's fries contain -- zoot alors! -- milk and wheat. This follows the earlier admission that the trans fat content was higher than previously disclosed.

Maybe McDonald's public relations wizards attended the same crisis management course as Vice President Cheney?

In other health developments ...

• Gum Chewing and Colon Surgery Study finds chewing gum highly effective at restoring bowel function.

• Vaccine Shown to Prevent Urinary Tract Infections Vaccine could prevent painful recurrent infections that bedevil many women.

SCAMS & OUTRAGES

• Oprah Ticket Scam Maryland travel agent offered group tours to Chicago which never materialized.
• "Unlucky 13" Securities regulators warn seniors and soon-to-retire boomers of common scams.
• "Verification" Phishing Scam Scammers claim target's account has been "compromised" and ask for verification information.
• Bernard Haldane Affiliate Supposed career counselors allegedly took money, did nothing.
• New Jersey Movers Companies allegedly violated consumer protection laws.
• New York Mover Watertown moving company blocked soldiers and others from reclaiming their belongings.
• Charity Check-Cashing Scam Scammers target victims on established job-listing sites.
• Online Dating Scam Crooks steal more than your heart.

ROGUES GALLERY
It's tempting to think that problems are solved when companies are sued, fined or prosecuted. But in fact, such annoyances are often regarded just as a cost of doing business. Take Cross Country Bank, for example. It recently paid New York $9 million, settled an expensive case with West Virginia and was sued by Pennsylvania and Texas. Has anything changed? Not that we can tell. Everyday our in-box overflows with Cross Country complaints from across the country.

Complaint Complaints We get a lot of complaints about the complaints on our site. Oh sure, some of the beefs are from businesses but quite a few are from consumers who say the complaints are too sparse, too thick, too old, too fresh or otherwise not to their liking. We have tried for years to "clean up" complaints by correcting spelling, grammar, etc. but, overwhelmed by volume, we have jettisoned the English teachers and will now post representative complaints pretty much verbatim (though without the profanity and libelous lagniappe so many contain).

HOTEL STAFFS MAY CHECK OUT
Heavy travel schedule? Look out! Expiring labor contracts in major cities this year could cause work slowdowns or stoppages at major hotels. A certain John Edwards is one of the national leaders of a drive to organize hotel workers to demand better wages and benefits.

Cancellations a Snow Job? Many of us have spent large portions of our lives sitting on the floor at Boston Logan and cursing the gods of Massport. Now, Massport is fighting back. It notes that during the recent nor'easter, international flights operated on time while domestic airlines were unable to muster crews or deal with conditions at other airports, our Dan Schlossberg reports.

RECALLS

• Paintball Markers The CO2 cartridge can fly into the user's face.
• Krups Orchestro Espresso Makers Fire hazard. Really strong coffee though.
• Black Dog Hooded Sweatshirts Strangulation hazard.
• Pilates Balls The straps can come off.
• Polycom Conference Phone Batteries They can overheat.
• Cooper Pickup, SUV Tires Concerns about slow leaks and cracking.

IT WAS NO BOX OF CHOCOLATE
Christmas produces endless complaints about the post office and delivery services, the airlines get no thanks for their Thanksgiving performance and Valentine's Day? It's open season on such companies as 1800flowers.com. Each year, there's new evidence that the best way to deliver a Valentine is in person.

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