National conference motivates, engages attendees

Consumer Action’s fourth annual National Consumer Empowerment Conference brought together community leaders and exposed them to the latest techniques for motivating adults to improve their money management skills and function more effectively in the consumer marketplace. The Chicago-area conference shared concepts for motivating people to learn new skills, including “gamification,” which Consumer Action trainer Linda Williams defined as using “fun challenges” to engage adult learners.

Payday loans

Attendees were briefed on the growing reliance on Internet payday loans and payday installment loans by low-income consumers who lack the funds to pay basic monthly bills. More than two-thirds of payday loan borrowers end up taking out seven or more high-cost loans a year. Borrowers often find themselves unable to repay the loan by the next payday and so are trapped in a cycle of debt. With annualized interest rates of 400-500%, payday loans have been banned by some states. The Consumer Federation of America’s Tom Feltner suggested attendees join the fight for lower-interest small-dollar loans with adequate underwriting standards to ensure that the borrower can afford repayment.

CFPB speaker

The Consumer Financial Protection Bureau (CFPB) told attendees it is looking for new ways to inspire people with financial information. Camille Busette, the CFPB’s assistant director of financial education, explained that the CFPB is evaluating what motivates consumers’ financial decisions. The Bureau is seeking to create innovative ways to help people manage their finances and, ultimately, achieve a sense of “financial wellbeing.” Busette encouraged advocates to join a new LinkedIn page to learn about the results of CFPB financial literacy research, expected this spring.

New York promotes saving

Later, New York City Department of Consumer Affairs Commissioner Jonathan Mintz wowed the crowd with stories of his office’s success with “provable ways to help people save.” He explained that NYC has set—and met—service goals that require financial counselors to help consumers reduce debt by 10 percent or increase savings by 2 percent. He explained the department’s highly successful program, $aveNYC, that encourages low-income residents to put half their tax refunds into a savings account and receive matching funds of 50¢ on the dollar if the funds are still on deposit after a year. Three-quarters of those who took part received the matching funds. The program is now being replicated around the country as SaveUSA.

Used vehicle dangers

Attendees were appalled by horror stories of “rebuilt wrecks,” unsafe used cars that cost people’s lives. In some cases, moldy and rotted flood cars were sold as “certified” used cars by dealerships. Rosemary Shahan of the Center for Auto Reliability and Safety (CARS) has worked tirelessly to expose this problem. Before any used car purchase, attendees were advised to check vehicle identification numbers (VINs) at the National Motor Vehicle Title Information System (NMVTIS) and to have the vehicle inspected by a reputable mechanic.

Foreclosure assistance

Consumer Action’s Ruth Susswein provided CBOs with an update on the new federal mortgage rules. Now in effect, the rules require lenders to verify that borrowers can repay the mortgages they receive and prohibit foreclosed homes from being sold while a homeowner is being evaluated for a loan modification. (For more information, see Consumer Action’s alert.)

Chancela Al-Mansour of the Housing Rights Center told attendees about ROOT (Restoring Ownership Opportunities Together), a pilot program designed to buy homes at risk of foreclosure and re-sell them to the original owners at lower prices and with lower-rate mortgages. Charles Young of Waypoint Homes, an Oakland-based company that buys foreclosed properties in various regions of the country, told the gathering about how he repairs and rents the single-family homes to people with low credit scores (525 and above).

Privacy, healthcare and more

Dara Duguay of Credit Builders Alliance got everyone up for a brief unscheduled armchair aerobics session before revealing the dangers and damage caused by children’s identity theft. Joanne McNabb, a longtime privacy advocate, now with the California Department of Justice, joined Duguay on the panel.

Day two included a primer on the Affordable Care Act and its new health care exchanges by Cheryl Fish-Parcham of Families USA, and a panel about the transition from landlines to wireless broadband connections (“IP transition”) featuring Consumer Action Executive Director Ken McEldowney, Patrick Halley of the Federal Communications Commission and Hank Hulquist of AT&T.

Professor Richard Warner of IIT Chicago-Kent College of Law kicked off the online privacy session with a discussion of the “rise of the surveillance state.” Warner said that courts have ruled that the police do not need a warrant to use hidden cameras. Unlike many privacy advocates, he said he believed that facial recognition, a form of biometric identification, is an effective and non-intrusive ID tool.

Consumer Action’s Michelle De Mooy also presented on the topic of online privacy. “Imagine over 100 people secretly following you around as you shop at a mall, writing down what you do, what stores you visit, what you purchase, how long you linger in one place or another. Although it’s hard for people to believe because it's hard to see, this is the world we live in when we go online,” she said. De Mooy discussed how the personal nature of mobile phones and tablets makes it more difficult for people to understand that they are carrying small tracking devices that increasingly use personal data without permission, including drug prescription information and medical history.

De Mooy also explained “Do Not Track” (DNT) to conference participants. The as-yet-undefined way for individuals to signal that they do not wish to be tracked online is still being hashed out under the auspices of the World Wide Web Consortium (W3). The W3C expects to release an update to DNT guidelines later this year. The term DNT has proven to be popular with the public, partially because its easy-to-remember acronym is reminiscent of the Do Not Call Registry. But DNT has yet to be embraced by online retailers.

“For DNT to be effective, online retailers must honor a signal set by a user, and right now, most are not,” said De Mooy.

The conference wrapped up with participants making music on kazoos as part of a hands-on lesson about the power of music by Bill Protzmann of Music Care. Protzmann teaches how music can be a tool to help people relax and concentrate.

About the conference

One attendee called this “the best conference yet,” which leaves the Consumer Action staff with a challenge for next year.

Consumer Action’s National Consumer Empowerment Conference is by invitation only. We thank the sponsors that allow all attendees to travel and attend free of charge. Underwriters ($35,000) for the 2013 conference included Capital One, Google and Visa Inc. The Leadership Circle ($10,000) included AT&T, Bank of America, Citi, Microsoft and TracFone. Benefactors ($5,000) included MyWireless.org and RushCard. Click here to view the program booklet (PDF).