Attorney General's News Release
December 31, 2008
Credit problems, phishing scams, car issues top list of consumer complaints to Attorney General’s Office
Jefferson City, Mo. - The Attorney General's Office has released its Top 10 list of consumer complaints for 2008, and it has a familiar look. Complaints about financing, credit and debt collection were the number one category of complaints filed, as they were in 2007. The Consumer Protection Division this year received more than 120,000 calls, letters, e-mails and online complaints in 2008.
The second-highest category of complaints was scams and fraud, phishing attacks and foreign lotteries. Category number three involved car issues - new and used car buying, title problems and car repairs.
The complete Top 10 list of complaints for 2008, along with examples of legal action, includes:
• Financing, credit and debt collection (5,491 complaints). The Attorney General's Office launched Operation Stealing Home in July, a series of lawsuits alleging mortgage fraud and other scams that claimed to help homeowners facing foreclosure. In a separate action, a lawsuit filed against JK Harris Company accused the business of failing to help consumers trying to negotiate down their debt owed to the Internal Revenue Service. According to the lawsuit, JK Harris claimed it could negotiate the amount of money taxpayers owed to the IRS, and consumers paid as much as $4,500, but Harris did not provide the services or the refunds to consumers who requested them.
• Financial fraud, lotteries and general scams (4,465). In July, the Attorney General filed criminal charges against a Kansas City man who allegedly defrauded investors out of more than $500,000 in a trucking investment. The nine counts of securities fraud against Steve Brownell accuse him of taking investments from three people, promising them profits in a dump truck business then delivering little or no return.
• Auto sales, repair, odometer, title and towing (3,989). As a result of Operation Taken for a Ride, filed in March, the Consumer Protection Division shut down one seller of motor vehicle extended service contracts, compelled three others to change their business practices, and has lawsuits pending against four others. The lawsuits accused the companies of misleading consumers in a number of ways, including the implication that the consumers' factory warranties were about to expire. The Attorney General also took action against Chad Franklin Suzuki in Kansas City, alleging a misleading promotion that claimed to give customers low monthly car payments that were too good to be true.
• Telephone slamming, cramming and billing (1,961). This has long been one of the top categories of consumer complaints, including topping the list in 2003, 2004 and 2005.
• Home repair and construction (1,795). The Attorney General took legal action, both in criminal and civil court, against ten individuals and companies in the home improvement industry in 2008. In each case, the contractors are accused of collecting money from customers in advance, then doing work improperly, leaving it unfinished or not starting work at all.
• Cable, satellite and Internet service providers (1,341).
• Health spas and health clubs (1,218). The Attorney General's Office was flooded with consumer complaints after a Cape Girardeau health club went out of business. Consumers reported they could not get their gift certificates honored by Spa 151, which closed its doors in January. After a lawsuit, the Consumer Protection Division got a settlement with the owners of the spa, who paid more than $100,000 to give refunds to all consumers who filed complaints.
• Travel clubs, timeshares and travel related promotions (1,213). A company that allegedly used misleading and high-pressure sales tactics in selling timeshares will pay more than $300,000 back to consumers in refunds and restitution. The Attorney General's Office settled with Festiva Resorts LLC, owners of timeshares at the Cabins at Green Mountain near Branson.
• Identity Theft (1,129). Two Web site operators were sued by the Attorney General for selling the personal information of Missourians - including Social Security numbers - to anyone with a valid credit card. The lawsuit seeks to shut down the sites and fine their operators. In August, a Florida woman was sentenced to three years in prison after stealing the identity of a Missourian. Shante Berry was charged with felony identity theft after using the personal information to buy more than $3,000 worth of digital cameras and other electronic equipment.
• Pre-need burial plans, funeral homes and cemeteries (546). The Attorney General filed a lawsuit against Forever Network Inc. in June, accusing the company of improperly handling money paid to them by consumers for pre-paid funerals. The lawsuit accused the company of keeping more money than allowed under Missouri law, improperly handling contracts and failing to submit adequate records of consumers who had paid in advance for funeral services. Also in June, another seller of pre-paid funeral plans agreed to pay $7,000 to the state after a lawsuit accused the company of failing to comply with Missouri's funeral laws. The lawsuit also alleged Cremation Society of Kansas and Missouri did not deposit 80 percent of consumers' payments into a trust account as required by Missouri law.