The FTC has announced restrictions on companies that purport to help borrowers get rid of crippling amounts of debt amidst the growing number of debt settlement programs.
The rules, which will take effect in the fall, prohibit companies from charging a fee before they settle or reduce a customer’s credit card or unsecured debt.
The rules also require companies to set up dedicated accounts for debt relief payments by consumers and disclose how long the debt-reduction efforts will take, what they will cost and the potentially negative consequences that could occur.
The effort aims to address complaints about lenders that charge huge fees but fail to reduce the obligations of customers in debt.
The FTC is considering plans to make a “do not track” list for online advertising, similar to its current “do not call” list for telemarketers.
Such a program would be designed as a universally easy-to-use mechanism for consumers that would run through the FTC or run through a private entity.
The FTC plans to release a report on online privacy before the end of the year that may include information on whether “do not track” seems viable.
Personal details of more than 100 million Facebook.com users has become available via download through a popular Web site.
According to an MSNBC report, the owner of Pirate Bay, used code to scan Facebook profiles for information not protected by the social network site’s privacy settings. Ron Bowes, the owner of Pirate Bay, was able to compile that data and make profiles searchable through this data.
Several thousand people have already downloaded the program, which he made available through a torrent download. Bowes described his findings as “scary” regarding privacy. He was able to find more than 100 million unique names and the information gives anyone access to everyone on Facebook.
“Once I have the name and URL of a user, I can view, by default, their picture, friends, information about them, and some other details,” Bowes told MSNBC. “If the user has set their privacy higher, at the very least I can view their name and picture. So, if any searchable user has friends that are non-searchable, those friends just opted into being searched, like it or not! Oops :)”
Most users don’t completely understand Facebook’s Privacy settings, and therefore do not know what information they’re making available in the public domain.
A Facebook spokesperson said the information collected at Pirate Bay is just a collection of the information people have chosen to share with the public.
Drugstore operator Rite Aid Corporation and its 40 affiliated entities on Tuesday agreed to pay $1 million to settle potential privacy disclosure violations.
The allegations stemmed from videotaped incidents where pharmacies were shown to have disposed of prescriptions and labeled pill bottles.
The prescriptions and bottles containing individuals’ identifiable information had been put in industrial trash containers that were accessible to the public.
Rite Aid said it will take actions to safeguard pharmacy customer privacy.
The Federal Trade Commission has banned eight individuals and companies from selling mortgage-relief services to consumers.
According to an AP report, the companies and individuals were each accused of falsely advertising the ability to reduce a homeowner’s loan payments on a mortgage they couldn’t afford. The companies and individuals were accused of taking at least $29.2 million from consumers.
Many of the companies required up-front money from consumers – sometimes up to $5,500 each – but then could often not deliver on their promises. Some of the companies were accused of linking themselves to federal home mortgage relief programs.
The FTC announced settlements on its false advertising charges. Among them:
* Steven Oscherowitz, affiliated with a firm called Federal Loan Modification Law Center, was ordered to pay $11.5 million. The FTC said Oscherowitz’s firm received that much from consumers in the alleged scam. His firm charged as much as $3,000 to each client, most of which was required in advance. The firm often failed to deliver loan modifications, the FTC said. In addition to being banned from selling mortgage relief services, Oscherowitz is not permitted to operate telemarketing businesses, the FTC said.
* Loss Mitigation Services Inc. and Direct Lender were ordered to pay a total $6.2 million. Little money is likely to be collected from the two firms, however, which were shut down and taken over by a court-appointed receiver. The FTC has indicated that only small amounts sit in the firms’ frozen accounts. Dean Shafer, Marion Anthony “Tony” Perry and Bernadette Perry were banned from selling the services, but a $6.2 million judgment was suspended because they couldn’t pay it. The FTC said they falsely promised loan modifications if homeowners paid as much as $5,500.
* And Salvatore and Nicholas Puglia, of Hope Now Modifications and Hope Now Financial Services Corp. were ordered to pay $5.3 million. The FTC said that judgment will be suspended when they surrender all the funds in their bank accounts, which had been frozen by the court. They were accused of linking themselves with the federal Hope Now loan program.
A burgeoning, multimillion-dollar industry of drywall “remedies” has emerged, spurred by reports about the harm the toxic Chinese drywall can do.
Drywall testers and “remediators,” peddling wallboard diagnoses, air cleaning machines and total drywall removal, are doing so with zero oversight by state or federal regulators.
Afraid that fumes from defective drywall are sickening their families and ruining their investments, homeowners turn to these unregulated businesses that offer unproven solutions.
Scientists have yet to pinpoint what causes the gases or identify a foolproof solution to the problem.
The Securities and Exchange Commission’s inspector general said he is going to investigate whether political motivations prompted the timing of an announced settlement between it and Goldman Sachs.
Last week, the SEC announced it had settled securities fraud charges against the former titan Wall St firm, ordering the company to pay a $550 million fine. The settlement allows Goldman Sachs to avoid saying it committed any wrongdoing.
The company was accused of hedging bets on subprime mortgage securities that they’d lose money, guaranteeing the company a profit despite losing money for thousands of clients.
According to a Telgraph (UK) report, Calif. Rep. Darrell Isssa complained that the SEC’s five commissioners were politically motivated in announcing the settlement deal, doing so on the same day the government enacted new rules regulating the financial industry.
Republicans on Capitol Hill appear to be against bringing federal charges against the firm, while Democrats seem to be pressing for more investigations.
The court-appointed trustee recovering money for victims of convicted Ponzi schemer Bernard Madoff is preparing a wave of new lawsuits.
This time, Irving Picard will be targeting individual investors who might have benefited from the fraud.
Picard said he could sue about half of the estimated 2,000 individuals he has called “net winners” from their dealings with Madoff.
This month, Picard demanded $3.6 billion from more than two dozen entities and individuals that he says “deepened the pain” of Madoff’s investors by enabling him to operate his fraud for at least two decades.
The SEC is in the midst of more probes stemming from the financial crisis, its chairman said, a week after Goldman Sachs settled fraud charges for a record $550 million.
“We have investigations in the pipeline, across products, across institutions, coming out of the financial crisis,” SEC Chairman Mary Schapiro said.
The SEC last week secured the record fine from a single Wall Street firm from Goldman Sachs over government charges that the banking titan committed fraud when marketing a complex mortgage product.
At the hearing, there was demand for accountability after the 2008 financial crisis.
California has adopted a federal law aimed at curbing fraud and abuse by mortgage brokers that helped decimate the housing market.
Brokers in California will now be required by July 31 to have passed criminal-background and credit checks, as well as licensing exams.
California, along with about a third of US states, previously didn’t require mortgage sellers to have individual licenses.
Brokers will be assigned identification numbers to enable regulators and borrowers to track their lending histories.