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Indiana Consumer Law Group/The Law Office of Robert E. Duff announces the filing of a lawsuit against North Carolina-based American Lending Solutions Corp. and Indianapolis-based Last Chance Wrecker & Sales, Inc. concerning the wrongful repossession of a motor vehicle.  ALS is a self-described “Skip Tracing/Repossession Management Firm” that works as a middleman between lienholders and towing companies.   Last Chance is a towing company.  The lawsuit, which has been filed in the United States District Court for the Southern District of Indiana, alleges that the defendants violated the Fair Debt Collection Practices Act (“FDCPA”) when they repossessed an Indiana consumer’s truck even though the finance company they were working for did not have a valid lien on it.

The FDCPA provides that repossession companies violate the law when they repossess a vehicle they have no right to repossess.  In this case, the reason they did not have a right to repossess was because the finance company they were working for did not have a valid lien on the truck.  However, a repossession company violates that FDCPA any time it repossesses a car it shouldn’t have. This could be because the repossessor chose the wrong vehicle, the consumer was not in default under the terms of the finance agreement or because the towing company breached the peace at the time the repossession occurred.

On Thursday, September 18, I attended a field hearing the CFPB held in Indianapolis on auto finance. I also was invited to a private community roundtable meeting with Director Cordray prior to the hearing. I must say that I was extremely encouraged. I believe Director Cordray and the CFPB staff are doing their best to look out for and protect the interests of consumers. There is no doubt they face significant hurdles and opposition. And I’m sure there will be times where we, as consumer advocates, will be disappointed with the actions or inaction of the CFPB. But I left the meeting with Director Cordray and his staff with the belief that the CFPB truly is attempting to do what its name says: protect consumers’ financial interests from unfair business practices. What a breath of fresh air!

The other thing I learned of note is that the CFPB actively works to resolve consumer complaints and THEY WANT CONSUMERS TO FILE COMPLAINTS WITH THEM. That was news to me. In Indiana, the consumers I speak with often file complaints with the Better Business Bureau and the Attorney General’s Office. These entities will take the complaint and then solicit a response from the business, but if the business maintains they did nothing wrong the consumer will generally get a letter saying “we’ve done all we can, to pursue this further you may need to consult an attorney.” But my understanding is that the CFPB will, when it believes the consumer has been treated unfairly, push the business to correct the situation. I haven’t gone through the process personally, nor have I spoken with any consumer who has (as of the time of this writing), but I am anxious to see if it really works like that. If so, this will be a tremendous resource for consumers in Indiana and throughout the United States.

Complaints can be submitted at or by calling 855-411-2372. They are even set up to take complaints over the telephone in over 175 different languages!

I have a personal story to tell. Recently I had a serious neck injury. I lost much of the use of my right arm because the nerve that controls the deltoid muscle coming from my spinal cord had been pinched where it passes through my cervical vertebrae. The first doctor I saw told me I needed surgery right away. Although I tried to schedule surgery, I was unable to get it scheduled immediately. Meanwhile, I sought a second opinion. I also began to try to educate myself on the medical issue and who were the best doctors in Indianapolis that treat it. The second opinion I obtained agreed that I needed surgery. I was convinced that I needed surgery.

I had heard that Dr. Terry R. Trammell, a doctor at Orthopaedics Indianapolis, was the best. It was difficult to get in to see Dr. Trammell, but I persisted. I am so glad I did. You can probably guess by now that Dr. Trammell told me that I don’t need surgery, at least not right now. Honestly, however, that has nothing to do with why I feel so blessed to have been able to see Dr. Trammell. The awesome thing about him was that he took the time to talk with me and to explain in as much detail as I wanted about my body, the injury, the surgery, what I could expect in the future and what I could and could not do physically and when. He spent about half an hour with me and I learned 100 times more in that half hour than I had in the previous six weeks of dealing with this issue. The doctors before had done virtually nothing to explain the details to me – they just said “you need surgery.” I guess I was just supposed to take their word for it – I’m so glad I didn’t. No one wants to have to undergo surgery unless it is absolutely necessary.

My recovery has been steady since the very beginning. With what Dr. Trammell has told me, I’m now optimistic that it will continue and I will eventually be back to where I was without the need for surgery. We will see. Of course it’s still possible I will need surgery, but even if I do I feel much more comfortable with it now that I have a better idea of what’s going on. Thank you, Dr. Trammell.

National Consumer Protection Week is March 2-8, 2008. In honor of this highly publicized week (not), I am going to write today about the importance of being proactive rather than reactive.

Whether the issue is a lawsuit by a debt collector, fraud perpetrated by an auto dealer, credit report errors or any one of a number of other issues, I speak with Indiana consumers all the time who put off addressing the issue for far too long. I’m sure there are many reasons for this. One of the primary ones, I believe, is a feeling of helplessness. But KNOWLEDGE IS POWER and it’s NEVER TOO LATE TO BECOME PROACTIVE. Some knowledge costs money, and I understand that, but there is a lot of knowledge out there on the internet on so many consumer issues that is totally free.

For instance, I give free initial consultations. I’m guessing, but I bet only 10-15% of the consumers I speak with become clients. Some I can’t help, some I can help with some simple advice, some choose not to hire me and some I can help and they become a client. The point is that if you look hard enough for information, free information, it can be found. Now I know I am really preaching to the choir here, because if you are reading this blog entry chances are you are looking for information on the web on a consumer issue and are being proactive. But we all need to be reminded of how critical it is to take the bull by the horns, so to speak, including myself!

Here’s another way to avoid buying a lemon vehicle. Don’t buy a car. Heck, don’t even own a car.

On a recent flight back to Indiana, I picked up one of those in-flight magazines. In it was an article about Zipcar is a car sharing company. What is car sharing? It involves the online reservation of a vehicle, located in an urban neighborhood, anywhere from minutes to months prior to needing the vehicle. Then you just show up, punch in a code, and drive away. The rates range from 8 to 11 dollars an hour.

It doesn’t sound like you get a whole lot of car for that rate, either. The article mentions Mini Coopers, Toyota Priuses, Scion xBs and Honda Elements as some of the primary rental vehicles.

Indiana Attorney General Steve Carter has issued a press release applauding the passage by the Indiana House and Senate of a measure that would make the Homeowner Protection Unit a permanent part of the Attorney General’s Office. The Homeowner Protection Unit was created as an experimental unit two years ago. It’s primary target: mortgage fraud. Homes are being appraised for thousands more than their actual worth, and the homeowner typcially doesn’t realize they owe way more than the home’s worth until they go to refinance or sell the home.

Apparently it’s not just a few bad apples in Indiana, either. In less than two years, the Unit has filed disciplinary actions against 211 real estate appraisers and 76 real estate agents. And the Unit is investigating another 750 complaints. In addition to these disciplinary actions, the Unit has also filed a civil lawsuit against a credit repair organization that “purported to provide ‘foreclosure consultant’ services.”

The Attorney General said:

I recently received an e-mail notice of the pending resolution of a class-action lawsuit against Experian, one of the big three credit reporting agencies. Experian had been sued “because of the way [they] advertised their credit scores and credit-monitoring products and because of certain information about credit that was contained on [their] websites.” Experian was accused of violating the Credit Repair Organizations Act.

Credit repair organizations sprang up in droves in the ’90’s, particularly with the proliferation of the Internet. They often advertised almost miracle credit cures, and charged the most vulnerable of consumers hefty fees. These companies were almost always a big rip off. The bottom line: anything that a credit repair organization can legally do for you, you can do for yourself for free! Anyway, the Credit Repair Organizations Act was designed to curb some of the most flagrant abuses of the credit repair industry.

I apparently received the Notice of Proposed Class-Action Settlement because I had purchased a credit score from the Experian website during the relevant time period. The notice gave me a website to visit to learn more. I took the time to do that, and frankly, was horrified at what I found. What I found was a gigantic waste of time and money that only accomplished one thing: making lawyers money.
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The Insurance Institute for Highway Safety has announced its list for the safest vehicles of 2007. Not surprisingly, its “Top Safety Picks” did not include a single small car. Four cars, seven SUVs and two minivans made the list which, sadly, also did not include a single domestic brand vehicle.

Here are the winners:

1. Audi A6, large car 2. Audi A4, midsized car 3. Saab 9-3, midsized car 4. Subaru Legacy (equipped with optional ESC), midsized car 5. Hyundai Entourage, minivan 6. Kia Sedona, minivan 7. Mercedes M-Class, luxury SUV 8. Volvo, XC90, luxury SUV 9. Acura RDX, midsized SUV 10. Honda Pilot, midsized SUV 11. Subaru B9 Tribeca (equipped with optional ESC), midsized SUV 12. Honda CR-V, small SUV 13. Subaru Forester, small SUV

Many Hoosiers don’t know that forgiven, or canceled, debt is considered income by the IRS and must be reported as such on an individual or business tax return. Let’s say, for example, that you have $80,000 of credit card debt and are able to negotiate the payment of these accounts for fifty cents on the dollar. You refinance your home, take out $40,000 and pay off the credit cards. You have received $40,000 of income from the forgiveness of half the debt, and must report this income on your tax return.

You should receive a Form 1099-C Cancellation of Debt from the creditor. The creditor is also required to provide a copy of the 1099-C to the IRS.

There are a few limited exceptions. If the forgiveness was intended as a gift, the debt was canceled because of Hurricane Katrina, the student loan debt was canceled because of work you performed, or the price of property you purchased was reduced after the purchase, the forgiveness may not be considered income. There are a few other limited exceptions. For more information, consult IRS Publication 17, Chapter 12.

If you watch much Court TV, you know that it’s not uncommon anymore for police to seize an accused’s computer and use information obtained from the hard drive against the accused. But the hard drive is not the only repository of information concerning the computer user’s activities. I just read this excerpt written by Greg Beck in the Consumer Law & Policy Blog:

Although there is no indication in the court’s opinion about how prosecutors in this case obtained the search data, Google has acknowledged that it can trace searches back to a particular computer or, in some cases, to a particular user. What exactly does Google know about you? Its privacy policy states that it automatically records information that your browser sends whenever you visit a website. This can include your search terms, IP address, date and time of your search request, and, if you have cookies enabled, possibly your personal identity. Google also acknowledges that it can track which links you click from its search results. In short, Google may have several years’ worth of your search activity stored in its databases, and it may be able to connect much or all of this activity back to you.

Now, I consider myself the epitome of the law-abiding citizen. But this information makes me go “Hmmmmm?” Even if I do some searches on my computer that I wouldn’t want at least certain other people to know about, I suppose I probably don’t have anything to worry about as long as I don’t become a criminal defendant.