Credit Problems Top Consumer Complaints

In observance of National Consumer Protection Week, Attorney General Spitzer today issued his annual "top ten" list of consumer complaints to his office.

According to an analysis of nearly 55,000 written consumer complaints in 2004, credit and banking complaints - including credit cards, identity theft, debt collection and credit reporting - eclipsed auto-related complaints. Internet concerns continued to receive the third most complaints to the Attorney General’s office.

"Consumers are encouraged to contact my office for assistance in handling disputes with commercial entities and for tips on protecting themselves before making purchases," Spitzer said. "My staff is dedicated to aggressive enforcement against fraudulent and illegal business practices and has an impressive track record in mediating individual consumer complaints."

The number one complaint to the Rochester Regional Office related to travel issues, many of which were associated with the settlement reached with the Canadian American Transportation Systems, the operator of the "fast ferry." Home repair and constructions received the second-most complaints, followed by automobile issues.

The Attorney General’s office - through its Consumer Frauds and Protection Bureau, Internet Bureau and Telecommunications and Energy Bureau - investigates and prosecutes businesses and individuals engaging in fraudulent, misleading, deceptive and illegal trade practices. It also mediates thousands of complaints from individual consumers.

Last year, these three public advocacy bureaus, joined by the Attorney General’s 13 regional offices, were responsible for nearly 120 enforcement actions - including lawsuits and settlements - to protect consumers.

Based on these efforts alone, in 2004, Spitzer’s office obtained more than $18 million in restitution through settlements, court judgments and mediation of consumer-oriented cases. An additional $13 million was recovered by consumers through the New and Used Car Lemon Law Arbitration Programs administered by the Attorney General’s office. The office also collected nearly $4.8 million in civil penalties and costs. The foregoing figures do not include recoveries by the Attorney General’s office in cases brought by other public advocacy bureaus.

The following is a list of top statewide consumer complaints by industry in 2004:

Industry Complaint Numbers

1. Credit 6,724
2. Automobiles 6,255
3. Internet 6,013
4. Telecommunications 5,091
5. Mail Order 2,757
6. Home Repair/Construction 2,610
7. Services (non-auto) 2,512
8. Retail Sales 2,274
9. Landlord/Tenant 2,064
10. Travel 1,639

This list does not include cases and complaints handled by the Attorney General’s Health Care helpline, which each year handles nearly 7,800 calls. A separate report analyzing health care complaints and providing consumer tips is available at the Attorney General’s website at http://www.ag.ny.gov/bureaus/health_care/about.html.

The following is a list of top complaints to the Rochester Regional Office, which covers the counties of Livingston, Monroe, Ontario, Seneca, Steuben, Wayne and Yates:

Industry Consumer Complaints

1. Travel 908
2. Home Repair/Construction 455
3. Automobile 389
4. Credit 303
5. Landlord/Tenant 207
6. Services 172
7. Telecommunications 169
8. Retail Sales 169
9. Utilities 92
10. Mail Order 77

In 2004, Spitzer’s Rochester Regional Office handled over 3,700 consumer complaints and obtained nearly $1.6 million in restitution for consumers through mediation efforts and enforcement actions. In addition, this regional office obtained nearly $75,000 in fines.

Some of the 2004 cases significant in the region include:

• Enforcement actions against a series of home improvement contractors, including a lawsuit against seven individuals and their 20 home repair businesses and court-approved settlements with four individuals who operated at least seven home repair firms. Spitzer’s investigation revealed that each firm engaged in deceptive business practices and fraud, failed to protect customer payments by depositing them in escrow accounts as required by law, failed to pay Small Claims Court judgments and violated a state law that requires written contracts that include important consumer disclosures;
• An investigation that began with a single complaint against a local costume shop resulted in agreements with two wholesalers to stop distributing toy guns that violate New York State law. The two New York City-based wholesalers, Rubie’s Costumes Company, Inc. and Franco American Novelty Co. - which distribute costume accessories, including toy guns, to 160 retailers across the state - agreed to pay in total $37,000 in civil penalties and costs. As a result of the investigation, thousands of unlawful toy guns have been pulled from store shelves;
• An agreement with a major upstate mobile home dealer, Affordable Great Locations (AGL), Inc., settling allegations that it failed to properly install mobile homes in a durable and liveable manner and then failed to correct problems. AGL agreed to provide over $30,000 in restitution to consumers and tens of thousands of dollars worth of repairs. It also paid $8,000 in civil penalties and costs.
• The final resolution of a case against the Livingston County-based Least Auto Group involving a massive auto loan scam. Spitzer’s office obtained over $1. 2 million in relief for consumers by convincing lenders to issue "satisfaction of loan" documents and lien releases to victims of the scam. Least Auto Group had failed to pay outstanding balances on loans for trade-in vehicles that were used as payment toward car purchases. Also, the Attorney General’s office, joined by the Monroe County District Attorney in a criminal proceeding, obtained judgments against the owners of the dealership for $1.3 million on behalf of 212 injured consumers.

Spitzer noted that his office stands ready to assist consumers in resolving their problems. He encouraged individuals to contact his consumer helpline at (800) 771-7755. Consumers can access a wide range of consumer tips by visiting his website www.ag.ny.gov.