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Consumer Law

An important component of Legal Service Command's legal assistance program is our consumer protection program. Personal financial difficulties can interfere with a member's ability to perform his or her official duties. We hope to prevent some instances of personal financial difficulties by sharing this consumer protection information and resource guide. In some instances, prevention will fail and our legal assistance attorneys will do their best to assist those clients experiencing financial difficulties. As in medicine, prevention of financial difficulties is worth a pound of cure. Please explore this web site and the links contained throughout. You will find information that can make you a better and more informed consumer.

  1. Consumer Scams
  2. Federal Door-to-Door Sales Rule
  3. Federal Telemarketing Rule
  4. State Unfair and Deceptive Practices Acts (UDAP)
  5. Truth in Lending Act (TILA)
  6. Fair Debt Collection Practices Act (FDCPA)
  7. Fair Credit Reporting Act (FCRA)
  8. Opt-Out
  9. Electronic Funds Transfer Act (EFTA)
  10. Conclusion
  11. What to do if you lose your wallet or purse

Consumer Scams

Both your state and the federal government provide a myriad of protections for you, the consumer. Nevertheless, there are plenty of scam artists out there trying to separate you from your earnings. To be a savvy consumer, you should be aware of common dangers signals, which should alert you to a potential scam, and you should be aware of your rights under the law. This page is designed to briefly describe some protections the law provides the consumer as well as provide links to the most current information concerning how to spot a scam and how to exercise your legal rights. This page relies heavily on the information available through an outstanding resource, the Federal Trade Commission (FTC) consumer web site.

How to Spot a Consumer Scam

  1. If an opportunity sounds too good to be true, then it probably is NOT true! Check out information on the FTC web site.

  2. Does the seller ask you to invite your friends or family to participate as distributors? Check out this FTC information on multilevel marketing plans and pyramid schemes.

  3. Are you paying in advance for an inventory you then sell? Check out this FTC information on work at home scams.

  4. Are you are paying now for the promise of future income? Check out this FTC information on the following scams:

Federal Door-to-Door Sales Rule

When someone comes to the door of your home to sell you something (perhaps a vacuum cleaner, set of encyclopedias, or a magazine subscription), do you feel pressured into buying something? Do you feel pressured into at least being nice and hospitable to the stranger on your doorstep? Of course you do -- that's why salesmen still do door-to-door sales. In this age of junk email and telephone solicitations, a salesman knows his best chance at a sale is a face-to-face meeting. It's a lot easier to hang the telephone up on a voice or delete an annoying email than shut the door on a real person.

Have you ever bought something from a door-to-door salesman and later rethought the purchase and wondered what you needed to do to rescind the sale? There might be a way, provided certain conditions are met:

  1. The transaction was a sale, lease, or rental of consumer goods or services (something for personal, household, or family use -- not for a business and not insurance, real property or securities); and,

  2. The purchase prices were $25.00 or more; and,

  3. The seller solicited you (in other words, you did not contact the seller and arrange to meet with the seller); and,

  4. The sale took place at a place other than the permanent place of business of the seller (includes your home, place of work, temporary facilities).

If these conditions are met, there is a good chance you have a 3 business day cooling-off period in which to rescind the transaction. As you can tell, time is of the essence. If you fail to rescind with the 3 business days, you may be stuck. Consult with your legal assistance attorney as soon as possible concerning your rescission rights and how to exercise them. For more information on this topic, see the Federal Trade Commission web site on the internet.

Federal Telemarketing Rule

When the telephone rings at your home between the hours of 1800 and 2100, it is often someone trying to sell you something. Telemarketers call at those hours because they know there is a good chance you will be home and the law prevents them from calling you after 2100 unless you consent). These calls are somewhat less intrusive than a salesman showing up at your door; but that is somewhat offset by the fact that each seller can call many more consumers than they could possibly visit door-to-door. While there is the chance the seller might be selling something you want, rampant abuses by telemarketers caused the federal government to pass a law, the Telemarketing & Consumer Fraud and Abuse Protection Act (the Act), to offer consumers protection from telemarketing deception and abuse.

  1. Failing to disclose important information (for example, the total cost of the transaction, terms and conditions of refund policy, the odds of winning a prize),

  2. Misrepresentations, either direct or indirect, of important information,

  3. Obtaining payment without express and verifiable authorization, or

  4. Making false or misleading statements to induce a person to pay for goods or services,

  5. Use of abusive language (threats, intimidation, obscene language),

  6. Continuing to call a consumer after the consumer stated he or she did not desire to receive telephone calls, or

  7. Failure to make important disclosures (for example, the identity of the seller, that the purpose of the call is to sell goods or services, that no purchase is necessary to win a prize if a prize promotion is offered).

Telemarketing & Telephone Service

Tech Support Scams

Telemarketing tips from the National Fraud Information Center can be found at: Telemarketing Fraud Tips (You're leaving a federal government web site.)

State Unfair and Deceptive Practices Acts (UDAP)

Each state has UDAP statutes that cover a wide variety of consumer topics. For a look at the state laws that apply where you live, check out this web site: Consumer World (You're leaving a federal government web site.)

The scope of transactions covered varies state to state. All UDAP statutes provide for state enforcement of your rights. Some provide a private cause of action as well. Consult with your legal assistance attorney to determine if a transaction into which you entered is covered under the applicable UDAP statute.

Truth in Lending Act (TILA)

TILA promotes the informed use of credit by consumers and requires lenders to provide meaningful disclosure of credit terms. TILA also protects consumers against inaccurate and unfair credit billing and credit card practices. TILA requires certain disclosures on both open-ended and close-ended credit transactions. TILA offers a 3 business day cooling off period and rescission rights for home equity loans and home equity lines of credit. To learn more about the protections TILA offers you as the consumer, consult with your legal assistance attorney.

An example of how TILA was used to protect consumers is a lawsuit that forced H&R Block to disclose that its "Rapid Refund" program was actually a loan program charging consumers up to 150% annual interest.

Fair Debt Collection Practices Act (FDCPA)

For anyone who has ever experienced the debt collection process, it can be excruciating and hostile (whether or not you actually owe the money sought). As a consumer, you have certain rights when dealing with a debt collector or collection agency. First of all, a debt collector or collection agency is someone hired to collect a debt (as opposed to the creditor, the person claiming that you owe them money). Your rights include:

  1. The debt collector must notify the debtor of the nature of the debt and the identity of the creditor. If the debtor asks that the debt be verified, the debt collector must cease collection efforts until the debt is verified,

  2. The debtor may tell the debt collector to stop correspondence or telephone calls,

  3. The debt collector may contact third parties about the debt only under certain limited circumstances, and

  4. The debt collector may not harass or abuse any person in connection with the debt. The debt collector may not contact the debtor at unusual or inconvenient times or places (before 0800 or after 2100), including the debtor's place of work if such calls are prohibited there.

  5. To learn more about the debt collection protections, consult with your legal assistance attorney or check out this FTC advisory:

Last Modified 4/7/2015