• What people are saying
• Webinar helps educators prepare young adults to avoid scams
• Coalition Efforts
• CFPB Watch
• Class Action Database: “Release card” issuers settle over unfair fees
• About Consumer Action

What people are saying

"Consumer Action has been instrumental in providing key information on critical issues that we as Accredited Financial Counselors (AFCs) and all financial industry leaders use to stay updated on the most recent issues. Thank you, Consumer Action, for helping us keep our work and knowledge sharp.” —“What to know about scams and fraud targeting young adults” webinar attendee S. Young, independent AFC professional, Sarasota Springs, Utah (subscribe to our mailing list to learn about upcoming webinars)

Webinar helps educators prepare young adults to avoid scams

By Monica Steinisch

Last month, Consumer Action hosted a webinar aimed at highlighting the growing incidence of scammers and fraudsters targeting young adults. Community educators often focus on informing older adults about how to avoid scams, yet there is a real need to reach young adults with similar information.

During the 90-minute webinar, on Sept. 10, our panel of experts revealed statistics about the most prevalent scams targeting young adults, talked about the work being done to thwart scammers’ attempts, and offered guidance for how webinar attendees could protect the young adults in their communities.

Melissa Lanning Trumpower, executive director of the BBB Institute for Marketplace Trust, opened the presentation with a rundown of the top 10 riskiest scams for consumers aged 18 to 24. Risk, Trumpower explained, is measured by the BBB as: Exposure x Susceptibility x Monetary Loss. According to her organization’s data, employment scams are the #1 riskiest scam for this age group. Online purchase scams and cryptocurrency scams ranked #2 and #3, respectively. The red flags she shared are, for the most part, relevant to consumers of all ages—things like offers that are too good to be true, pressure to act quickly, unsolicited communications, and demand for nontraditional payment methods. For consumers, the BBB offers a suite of scam-related tools: a Scam Prevention Guide (information to help avoid scams), the Scam Tracker (a system for searching for and reporting scams), and the Scam Survival Toolkit (a guide to next steps after a scam).

Emma Fletcher and Kira Krown, both from the Federal Trade Commission (FTC), shared a number of statistics that paint a picture of how young adults are being reached and impacted by scammers, including the top fraud losses among consumers aged 18 to 29, the various ways this demographic is contacted (social media is, by far, the most common), which social media platforms result in the most scam reports by age, etc. Attendees were also given a wealth of tips for what young adults should know and do when faced with the range of scams. The FTC offers consumers resources to help spot, avoid and report scams in a dozen languages, and offers educators free scam-related educational materials in print, available for bulk ordering here. 

Our final presenters, Alexander Odisheli, associate director of operations and business for the Capacity & Resilience Program at Global Cyber Alliance (GCA), and Abigail Bishop, head of external relations for Amazon, which provided the funding for this webinar, spoke about their partnership to develop a tool to help protect young people from scams. Research into the problem of cybercrime aimed at young people began in the summer of 2023, and included a global survey and focus groups—opportunities to hear directly from young people and identify the challenges around protecting them. Launched in June, the resulting CyberFlex is an interactive online resource that includes learning opportunities (including a chance for users to test their knowledge, and perhaps avoid overconfidence), interactive guides, and text alerts to prevent, mitigate, report, and recover from scams and other cyber risks. It aims to raise awareness, shift attitudes about online risks, and provide easy steps to help young adults protect themselves and share their stories. 

This webinar is a must-watch for anyone with an interest in the shifting landscape of cybercrime or in a position to reach young adults with information to help them stay safe online. 

If you missed the live presentation, you can watch the video recording of “What to know about scams and fraud targeting young adults” on Consumer Action’s YouTube channel, here. (While there, please subscribe to our channel.)

Coalition Efforts

By Monica Steinisch

Consumer Action and its allies recently called on policymakers and regulators about these important issues:

Fair and transparent “tariffed on-bill” loans. Consumer Action was one of over two dozen consumer advocacy groups to sign on to a letter to the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC) requesting that the agencies issue guidance on Inclusive Utility Investment (IUI)/Tariffed On-Bill Financing/Pay As You Save (PAYS) (referred to jointly as “TOB”) loans. These loans are made to utility customers, often through third parties, to finance energy-related home improvement projects and products (such as solar panels). The loan is repaid through the borrower’s monthly utility bill, which poses the risk of utility shutoff if the consumer is unable to keep up with the payments. In the letter, the groups urged the agencies to clarify that TOB is a credit product and, therefore, subject to the Truth in Lending Act (TILA), and to issue guidance on aspects of TOB financing that may constitute deceptive or unfair acts and practices. Read the letter here.

Pre-dispute forced arbitration clauses. More than 40 advocacy organizations signed a letter to the U.S. Senate and House Judiciary Committee leaders urging them to immediately mark up the Forced Arbitration Injustice Repeal (FAIR) Act (S 1376 and HR 2953) and bring the legislation to a vote. The letter was sent in response to a wrongful death lawsuit brought by a man whose wife died on Disney grounds in Florida because a park restaurant allegedly failed to heed the couple’s numerous warnings and requests related to the woman’s food allergies. Disney initially responded by claiming that the husband could not proceed in court due to a forced arbitration clause in the terms of a Disney+ trial subscription and separate Disney online account that he created five years earlier. Pre-dispute forced arbitration clauses in corporate terms and conditions undermine consumers’ ability to enforce their rights when harmed in the marketplace and shield corporations from being held accountable. Disney eventually relented in the face of public outrage, but forced arbitration clauses in consumer contracts continue to deprive millions of consumers of their essential right to seek justice in court. Passage of the FAIR Act would ensure that people can exercise their constitutional right when they need it. Read the letter here.

Protections for student loan borrowers. In a letter to U.S. Department of Education (Department) Secretary Miguel Cardona, more than a hundred advocacy groups urged the Department to extend and strengthen crucial programs to protect student loan borrowers amid ongoing litigation over the Saving for A Valuable Education (SAVE) plan. While the Department did place borrowers who had been enrolled in the SAVE Plan into a zero-interest forbearance while it defends the SAVE plan in court, the groups expressed concern about the Department’s decision to not allow this time in forbearance to count toward Public Service Loan Forgiveness (PSLF) or Income-Driven Repayment (IDR) loan forgiveness. Also, the Administration’s current “on-ramp” protections, which have helped shield borrowers from many of the harshest economic consequences of falling behind on their student loans, and the deadline to enroll in the “Fresh Start” program, which enables borrowers in default to get back into repayment more easily, were both scheduled to end in September. The advocates pressed the Department to ensure that: servicers inform borrowers of their right to apply for SAVE and that they grant forbearance for all borrowers waiting in the pipeline; the forbearance time counts toward PSLF and IDR discharges; and “on-ramp” protections and the “Fresh Start” program are extended. Read the letter here.

AI consumer literacy. Consumer Action joined allies in expressing support for bipartisan legislation, introduced by Rep. Lisa Blunt Rochester (D-DE) and Rep. Marc Molinaro (R-NY), that would increase consumer awareness of and confidence in artificial intelligence (AI) products and services. While AI products and services can help consumers and small business owners by enhancing productivity, communication, information access and creativity, a lack of familiarity and confidence creates a barrier to the adoption and responsible use of the technology. The Consumer Literacy and Empowerment to Advance Responsible Navigation of Artificial Intelligence (Consumers LEARN AI) Act would help by directing the Department of Commerce to: develop a national strategy for increasing consumer AI knowledge and literacy informed by expertise from government, public and private organizations; create use case guidance for specific AI tasks, such as classification, voice dictation, and content generation, in domains such as personal finance, healthcare, communication, and business operations; and conduct a national media campaign to disseminate guidance and information about the safe and beneficial use of AI products and services. (Consumer Action also supported the Senate companion bill, introduced by Senators Mark Kelly (D-AZ) and Mike Rounds (R-SD). Read the press release and text of the bill here.

CFPB Watch

By Ruth Susswein

CFPB halts Navient’s future in student loan servicing 

The Consumer Financial Protection Bureau (CFPB) has banned Navient—the country’s largest student loan servicer—from servicing federal Direct Loans. The CFPB order also forbids the loan servicing giant from directly servicing or acquiring most loans under the Federal Family Education Loan (FFEL) Program.

The Bureau took this action after concluding that Navient, for years, steered student loan borrowers into expensive repayment options, depriving them of the more affordable income-driven repayment (IDR) plans for which they were eligible. (Rather than enrolling them in an IDR plan, Navient placed borrowers into a forbearance—a payment pause—which continues to accrue interest.) 

Navient misallocated loan payments, which resulted in borrowers being charged late fees and extra interest and harmed their credit records. Also, according to the CFPB, Navient ruined the credit records of disabled borrowers and veterans whose debts had been discharged. Navient also denied defaulted borrowers the credit reporting relief the loan servicer had promised to provide after the borrowers completed a student loan rehabilitation program.

Navient (formerly Sallie Mae) has been ordered to pay $100 million to borrowers and a $20 million penalty to the CFPB’s victims relief fund. Eligible consumers will receive direct payment from the CFPB. No action is needed by borrowers. Click here to ensure that the check you received is not a scam. 

Navient is a repeat offender. In 2022, 39 state attorneys general provided $1.85 billion in student debt cancellation and restitution for “predatory” student loan practices. Earlier, the giant student loan servicer was separately ordered to pay $100 million to servicemembers and $22 million to other borrowers for overcharging.

CFPB says TD Bank threatens consumers’ access to credit and housing

TD Bank put tens of thousands of consumers in harm’s way by “repeatedly shar(ing) inaccurate, negative information” about customers with credit bureaus, according to the CFPB.

The Consumer Bureau says it has ordered TD Bank to pay $7.76 million to affected consumers for spreading false information about credit card delinquencies and bankruptcies for years. 

Director Chopra said that after regularly “botching” its reporting to credit bureaus, TD Bank “barely lifted a finger” to fix the problem. Erroneous negative information on a credit report can ruin a consumer’s ability to access credit, employment and housing. 

The CFPB says TD Bank:

• Failed to fix credit reporting errors
• Shared fraudulent account information with credit bureaus that the bank knew to be fraudulent
• Failed to investigate credit report information consumers had disputed

In addition to the nearly $8 million in compensation to consumers, TD Bank will pay a $20 million penalty to the CFPB victims relief fund. 

This is strike two for the bank. In 2020, the Bureau ordered TD Bank to pay approximately $97 million to 1.4 million consumers for charging overdraft fees for ATM and one-time debit card transactions without obtaining consumer consent.

Help for the incarcerated

Join the CFPB on Oct. 10, from 3 p.m. to 4 p.m. (ET), for a webinar on assisting consumers who are in prison, awaiting sentencing, or have transitioned back into the community.

The Bureau offers a Focus on Reentry guide that provides tools, tips and information on how best to track and manage money (before, during and after incarceration), deal with debt, and understand credit and background screening reports. They offer a financial well-being checklist to get started, info on what identification documents are needed when someone is preparing for release, and a primer on understanding prepaid and payroll cards.

To register for the Oct. 10 webinar, click here.

To order multiple copies of the Reentry guide, click here.

Class Action Database: “Release card” issuers settle over unfair fees

By Monica Steinisch

Among recent settlements added to the Consumer Action Class Action Database is the $197.5 million settlement that will be paid by Visa and Mastercard to settle allegations that the companies violated consumer protection laws by overcharging bank customers when they withdrew money from ATMs using their Visa or Mastercard debit cards. If, between Oct. 1, 2007, and July 26, 2024, you paid unreimbursed surcharges to withdraw cash from an ATM owned by a bank other than the one that issued your debit card, you may be eligible for payment. The deadline for claims is Jan. 22, 2025. 

Of note is the $4 million that Numi Financial and Central National Bank agreed to pay to resolve allegations that the companies violated the Electronic Fund Transfer Act (EFTA) when they forced individuals who had been arrested to receive their confiscated money, upon release from detention, on a prepaid card issued by the defendants. The defendants profited by assessing fees on the cards—fees that began incurring immediately—despite the plaintiffs never agreeing to the terms of the cardholder agreement. If you received your confiscated funds on a Numi release card after July 2014, you may be eligible for payment. The deadline for claims is Nov. 19, 2024. 

About Consumer Action

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Consumer Action is a nonprofit organization that has championed the rights of underrepresented consumers nationwide since 1971. Throughout its history, the organization has dedicated its resources to promoting financial and consumer literacy and advocating for consumer rights both in the media and before lawmakers to promote economic justice for all. With the resources and infrastructure to reach millions of consumers, Consumer Action is one of the most recognized, effective and trusted consumer organizations in the nation.

Consumer education. To empower consumers to assert their rights in the marketplace, Consumer Action provides a range of educational resources. The organization’s extensive library of free publications offers in-depth information on many topics related to personal money management, housing, insurance and privacy. At Consumer-Action.org, visitors have instant access to important consumer news, downloadable materials, an online “help desk,” the Take Action advocacy database, and more. Our in-language media outreach allows us to share scam alerts and other timely consumer news with a wide non-English-speaking audience.

Community outreach. With a special focus on serving low- and moderate-income and limited-English-speaking consumers, Consumer Action maintains strong ties to a national network of more than 6,500 community-based organizations. Outreach services include in-person and web-based training and dissemination of financial and consumer education materials in many languages, including English, Spanish, Chinese, Korean and Vietnamese. Consumer Action’s network is the largest and most diverse of its kind.

Advocacy. Consumer Action is deeply committed to ensuring that underrepresented consumers are represented in the national media and in front of lawmakers. The organization promotes pro-consumer policy, regulation and legislation by taking positions on dozens of bills at the state and national levels and submitting comments and testimony on a host of consumer protection issues. Additionally, its diverse staff provides the media with expert commentary on key consumer issues supported by solid data and victim testimony.