Harmful Business Practices During COVID-19

Business Activities Potentially Harming Consumers During COVID-19 Pandemic

October 20, 2020, HOME WARRANTIES SEEM ATTRACTIVE AMID LOCKDOWN. HERE'S WHY YOU WANT TO BE CAREFUL, "So don’t be surprised when you start running into brick walls. Some insurers seem to deliberately make the claims process as difficult and unfriendly as possible in hopes you’ll just give up."

October 5, 2020, DEBT COLLECTORS HAVE MADE A FORTUNE THIS YEAR. NOW THEY'RE COMING FOR MORE, "After a pause for the pandemic, debt buyers are back in the courts, suing debtors by the thousands."

September 24, 2020, DEBT COLLECTORS ARE GARNISHING WAGES DURING PANDEMIC, LEAVING THOSE BARELY GETTING BY WITH EVEN LESS MONEY, "In Oregon, there are no special protections during the pandemic for garnishing wages. It’s business as usual for creditors and debt collectors."

September 24, 2020, EVEN IN A PANDEMIC, VENMO TELLS CONNED CUSTOMERS TO PAY UP"Some customers face a choice: Deal with debt collectors or pay a debt they say they don’t owe."

September 9, 2020, CORONAVIRUS TESTS ARE SUPPOSED TO BE FREE. THE SURPRISE BILLS COME ANYWAY"Congress sought to ensure that patients would not face costs connected to the virus. But rules are not always being followed."

August 31, 2020, THE LOAN COMPANY THAT SUED THOUSANDS OF LOW-INCOME LATINOS DURING THE PANDEMIC, "A monthslong investigation revealed that Oportun Inc., which was founded to help Latino immigrants build credit, routinely uses lawsuits to intimidate a vulnerable population into keeping up with high-interest loan payments — even amid COVID-19."

August 21, 2020, HOSPITALS STILL SUING PATIENTS IN CORONAVIRUS HOTSPOTS, "Almost all of the roughly two dozen Community Health Systems hospitals in Florida, Texas and Arizona have sued patients since the pandemic beganMany paused or slowed down in the spring, but then resumed business as usual over the summer — when these states were being hit hardest."

August 14, 2020, GOVERNMENT CONTRACTORS NICKEL-AND-DIMING CORONAVIRUS RELIEF RECIPIENTS, "Unexpected fees for ATM usage and balance inquiries are part of the four million CARES Act payments distributed on debit cards."

August 13, 2020, UNIVERSITY OF MARYLAND STUDENTS ARE STUCK IN ON-CAMPUS APARTMENT LEASES, "According to the statement from Capstone on behalf of MEDCO to the Diamondback, students are able to transfer their lease to another student renter, but residents are saying that’s unrealistic given the status of classes and the pandemic."

August 7, 2020, PREDATORY LENDERS FIND BORROWERS DESPERATE FOR A LIFELINE AS THE PANDEMIC STRETCHES ON, "Experts say that this deregulation could have dire consequences down the line, as people desperate for cash, including those who have been left out of government assistance, may turn to payday and auto title loans, which often use misleading or deceptive practices. "

August 3, 2020, SOME UNIVERSITY OF MARYLAND STUDENTS STRUGGLE TO CANCEL HOUSING LEASES"By June, the university gave students the option to cancel their fall housing agreements without penalty, but South Campus Commons and The Courtyards, the public-private apartments owned by the Maryland Economic Development Corp., did not."

July 29, 2020, THE CORONAVIRUS WILL RUIN YOUR CREDIT SCORE, "Consumer groups were successful in inserting a ban on negative credit reports into House Democrats’ follow-up coronavirus response bill, the HEROES Act, in May. But it does not appear in the HEALS Act, the Senate Republican follow-up engineered by McConnell. Negotiations are under way to reconcile those two bills"

July 28, 2020, THEY SUED THOUSANDS OF BORROWERS DURING THE PANDEMIC - UNTIL WE STARTED ASKING QUESTIONS"Months into the pandemic, a lender that markets to Latino immigrants continued to sue borrowers after they lost jobs and missed payments. But they reversed course when we started asking questions."

July 16, 2020, TROY HARLOW HAS ALWAYS MADE SURE TO PAY HIS MORTGAGE ON TIME. WELLS FARGO HAD OTHER PLANS FOR HIM"They have identified more than a dozen cases in Virginia, as well as cases in Alabama, Arizona, Florida, Kansas, Louisiana, Michigan, Missouri, New Jersey, North Carolina and Texas, where Wells Fargo has wrongly claimed that borrowers asked to pause their mortgage payments in forbearance plans."

July 15, 2020, CAR INSURERS GAVE EVERYONE A DISCOUNT DURING THE PANDEMIC. NOW SOME ARE RAISING RATES"In most cases, those discounts are now in the rearview mirror, meaning our rates are back to pre-pandemic levels. And now comes the prospect of some insurance companies recouping their losses by raising rates for the second half of the year."

July 3, 2020, MILLIONS OF CREDIT CARD USERS ARE SEEING THEIR CARDS CLOSED OR LIMITS LOWERED DURING PANDEMIC"According to a recent report from CompareCards, 25% of credit cardholders saw their limit slashed and/or their card closed altogether within the past 30 days before the survey – all during this pandemic"

June 28, 2020, CARES ACT STIMULUS DEBIT CARDS FORCE AMERICANS TO SACRIFICE CONSTITUTIONAL RIGHTS FOR CASH, "This means that if a recipient of a prepaid stimulus card has a dispute, she must agree to arbitrate the dispute through a third-party arbitrator rather than pursue the claim in court." 

June 23, 2020, SQUARE, JACK DORSEY'S PAY SERVICE, IS WITHHOLDING MONEY MERCHANTS SAY THEY NEED"Thousands of small enterprises that use Square to process their credit card transactions — including plumbers, legal consultants and construction firms — have complained that the company recently began holding back 20 to 30 percent of the money they collected from customers. The withholdings came with little warning, they said, and Square asserted the right to hang on to the money for the next four months."

June 8, 2020, DEBT COLLECTORS SEE A GOLDEN OPPORTUNITY WITH ALL OF US STUCK AT HOME"It’s understandable why debt collectors are stepping up their game. Consumer debt hit a record $14.3 trillion in the first quarter — and that was, for the most part, before the coronavirus kicked into high gear."

June 8, 2020, CAPITAL ONE AND OTHER DEBT COLLECTORS ARE STILL COMING FOR MILLIONS OF AMERICANS, "As the COVID-19 pandemic hit, Americans got protection from evictions, foreclosures and student debt. But debt collectors have continued to siphon off their share of paychecks from those who still have jobs."

May 29, 2020, BORROWERS SKIPPING LOAN AND CREDIT-CARD PAYMENTS WITHOUT PENALTY COULD SOON FACE A RUDE AWAKENING"After that period of time, the lender could demand full repayment from the borrower or credit-card holder and, if they’re unable to repay, their credit scores could nose-dive, said John Ulzheimer, credit expert and president of the Ulzheimer Group in Atlanta. That would make it harder or more expensive for them to get a loan, take out a mortgage or even get a new job, he said."

May 26, 2020, SORRY YOUR TRIP GOT CANCELED. BUT WE'RE KEEPING YOUR TRAVEL-INSURANCE MONEY"'If you are considering canceling your trip due to the COVID-19, please read your insurance policy thoroughly,' AIG told customers in March. 'Generally, fear of travel is not a covered event under most of our policies.'"

May 22, 2020, ZIONSVILLE MAN LOSES JOB, THEN DREAM HOME AND $30K DEPOSIT"In fall 2019, Staten signed a contract with Fischer Homes to build his family’s dream home in Zionsville...Fischer Homes will not refund the $32,400 deposit."

May 20, 2020, HOMEOWNERS ARE GETTING MORTGAGE RELIEF THEY DIDN'T WANT, "But some homeowners were put into forbearance programs they did not want -- and that has caused problems. Being in forbearance, even if the homeowner is making regular payments, has prohibited some from taking out new home loans or refinancing their existing mortgages."

May 19, 2020, SOME NURSING HOMES ARE TAKING RESIDENTS' STIMULUS CHECKS, FTC WARNS, "The Federal Trade Commission reported that that nursing homes in several states are requesting residents sign over their stimulus checks. The facilities may say they get to keep the payment if a patient is on Medicaid, which isn't true, said Lois Greisman, the FTC's Elder Justice Coordinator."

May 19, 2020, STUDENT LOAN SERVICERS ARE DINGING CREDIT REPORTS FOR THE CARES ACT FORBEARANCE, "The CARES Act payment suspension is not supposed to have any adverse credit consequences...Despite this, some student loan servicers appear to be reporting the student loans as delinquent or in a non-payment status to national credit bureaus."

May 13, 2020, FALSE GRUBHUB ADS IN CORONAVIRUS PANDEMIC HURT RESTAURANT: FEDERAL LAWSUIT"'Nobody from Grubhub reached out to us to see if we were open or delivering before telling the world that we were closed and pointing my potential customers to restaurants that were paying Grubhub,' Erik Riggs, the owner of Freshcraft, noted in a press release. 'We are doing what we can to stay afloat and Grubhub is just feeding off people's troubles.'"

May 12, 2020, RESTAURANT, FEARING CORONAVIRUS LAWSUIT, CREATES LIABILITY WAIVER"The chain has created a waiver asking Nacho Daddy employees to absolve the company of liability if they catch the disease and has asked all hires, as the business had laid off all but a handful of employees, to sign it."

May 11, 2020, CONSUMER ADVOCATE RICHARD CORDRAY FEARS RISE OF 'VEHEMENT' DEBT COLLECTORS AMID PANDEMIC"Debt collectors are going to become increasingly insistent and increasingly vehement. They’ll potentially go over the legal lines they’re not supposed to cross in terms of pursuing debt collection."

May 7, 2020, NJ RESTAURANTS FILE CLASS ACTION LAWSUITS OVER DENIED COVID-19 BUSINESS INTERRUPTION CLAIMS"According to the Benito Ristorante lawsuit, Chubb’s policy language stated that business interruption insurance covers a disruption of the business that is caused by physical loss or damage to the property by a “covered peril.” The same language also established that an infectious agent or communicable disease does not constitute as physical loss or damage, it states."

May 5, 2020, WHAT DO YOU DO IF A BUSINESS FURLOUGHS EVERYONE YOU NEED TO SPEAK WITH?, "Nobody likes dealing with problems in their credit files. It can be a lengthy, laborious process involving lots of documents and calls to multiple companies and credit agencies.That situation may now be even worse thanks to coronavirus business closures."

May 3, 2020, SCHUMER REVEALS: AMID CORONAVIRUS CRISIS, GREEDY LOAN SHARKS ARE CLOSING IN & TARGETING DESPERATE, OUT-OF-CASH CONSUMERS & SMALL BIZ’S WITH SHAMEFUL EYE-POPPING INTEREST RATES UP TO 800%; SENATOR DEMANDS IMMEDIATE FED ACTION TO STOP THESE LENDERS & PROTECT PEOPLE WHO NEED EMERGENCY FUNDS, "U.S. Senator Charles Schumer revealed, today, that ‘loan sharks’ are closing in and targeting desperate, out-of-cash consumers and small businesses, which includes New Yorkers. Schumer warned about --and showcased-- recent predatory lender online solicitations deceptively veiled as 'COVID-19: Financial Relief' and 'Emergency Relief Funding' that are targeting Americans and New Yorkers. He explained how the kinds of loans being offered during these desperate times can come with a hefty price: interest rates that could be as high as 800%."

May 1, 2020, PAYDAY LENDERS ARE CHARGING UP TO 780% INTEREST AMID CORONAVIRUS PANDEMIC, "There’s an opportunity for fast-cash and payday lenders stand to make even more because they’re considered essential services. Unlike banks and credit card companies that have lowered interest rates on loans and credit and are offering deferral options, payday lenders are, for the most part, running their businesses as usual."

April 28, 2020, ONE THING THE PANDEMIC HASN'T STOPPED: AGGRESSIVE MEDICAL DEBT COLLECTION, "U.S. hospitals are in the spotlight for being on the frontline of fighting the pandemic. But in the shadows, debt collection operations continue, often by the same institutions treating coronavirus patients, all while unemployment and uncertainty soar."

April 26, 2020, LAWMAKERS WARN CORONAVIRUS CONTACT TRACING IS RIPE FOR SURVEILLANCE ABUSE"Apple and Google, which are leading the efforts to develop tracking apps, have pledged that participation would be voluntary and include guardrails to protect confidentiality. But the inability of Congress to pass meaningful data-privacy rules — and the poor track record of many tech firms in protecting privacy — heightens the risk, lawmakers and outside experts say."

April 24, 2020, MILLIONS OF PEOPLE FACE STIMULUS CHECK DELAYS FOR A STRANGE REASON: THEY ARE POOR"Because of the baroque machinery that runs the tax preparation industry, the IRS had sent the money to a bank Citi Tax works with but the customers had not heard of. That bank sent the payments back to the IRS."

April 24, 2020, 3.4 MILLION HOMEOWNERS SKIP PAYMENTS. BUT MANY ARE SCARED, SAY CONGRESS NEEDS TO ACT"Lenders demanding giant balloon payments is not how this program is supposed to be working. Under the admittedly complex rules from various regulators, there's actually a much better option to make up the missed payments. And some other homeowners are being told they can get it."

April 24, 2020, WHITE HOUSE FACES INTERNAL DEBATE OVER ‘LIABILITY SHIELD’ FOR FIRMS SEEKING PROTECTION FROM CORONAVIRUS LAWSUITS, "White House officials are hotly debating whether and how to propose a “liability shield” that would prevent businesses from being sued by customers who contract the coronavirus, according to four people aware of the internal planning effort, as the administration seeks to encourage businesses to reopen without fear of being hit by lawsuits."

April 22, 2020, CORONAVIRUS PUT HER OUT OF WORK, THEN DEBT COLLECTORS FROZE HER SAVINGS ACCOUNT"The Supreme Court order, under which bank accounts cannot be frozen and new writs of garnishment cannot be served until May 8, is intended to last long enough for debtors to spend their stimulus money on necessities before facing collection of medical, student loan, credit card and other types of debt. But Texans like Boatswain, whose accounts were garnished just before the order took effect, have little recourse."

April 22, 2020, WHY STUDENTS ARE SEEKING REFUNDS DURING COVID-19“Recent class-action lawsuits filed by students at the University of Miami and Drexel University in Philadelphia similarly argue online classes are not an equal substitute for the in-person college experience, and as such they are asking for a refund of certain tuition and fees.” 

April 20, 2020, STIMULUS CHECKS: SOME LANDLORDS ILLEGALLY SPYING ON TENANTS' PAYOUT STATUS, “Thousands of Americans have gotten their stimulus check from the U.S. government recently, and some landlords are reportedly looking out for the payments, hoping to collect rent during the coronavirus pandemic…According to a report by Forbes, some of the ways landlords are watching for their tenants' payments to arrive are illegal.” 

April, 20, 2020, BANK SEIZURES OF $1,200 STIMULUS CHECKS TO COLLECT ON DEBT, “Reports quickly surfaced that some of these [stimulus] payments were being redirected to banks and private debt collectors from people who have overdraft fees, delinquent loans or other debt obligations.” 

April 18, 2020, WHERE CORONAVIRUS RELIEF CHECKS GO, FRAUDSTERS FOLLOW, “As of Wednesday, FTC had received more than 18,000 complaints related to COVID-19 this year, with consumers losing more than $13 million to fraud.”


April 17, 2020, MILLIONS COULD SEE THEIR CORONAVIRUS STIMULUS CHECKS TAKEN BY DEBT COLLECTORS, “Just as millions of Americans are receiving $1200 emergency coronavirus relief checks from the IRS in their bank accounts, many are facing an unwelcome surprise: Debt collectors can take the money to satisfy certain types of debt.” 

April 17, 2020, FTC: ALERT FOR SMALL BUSINESS OWNERS NEEDING PPP LOANS“(T)he FTC announced that it filed a case against a company that allegedly claimed to offer PPP loans — but, in reality, the company is not affiliated with the SBA and, the FTC says, it has been deceiving hundreds, if not thousands, of business owners." 

April 16, 2020,  ZOOM: TWO NEW SECURITY EXPLOITS UNCOVERED“A third class action lawsuit was filed against Zoom in California, citing the three most significant security issues raised by researchers: Facebook data-sharing, the company's admittedly incomplete end-to-end encryption, and the vulnerability which allows malicious actors to access users' webcams.”

April 15, 2020, DEBT COLLECTORS CAN GARNISH CORONAVIRUS STIMULUS CHECKS BECAUSE OF A LOOPHOLE, LEGAL ADVOCATES SAY‘’The problem, legal advocates say, is that the stimulus checks aren’t explicitly off-limits to debt collectors or creditors, unlike other government payments such as Social Security and disability benefits.” 

April 15, 2020, MILLIONS OF AMERICANS MIGHT NOT GET STIMULUS CHECKS. SOME MIGHT BE TRICKED INTO PAYING TURBOTAX TO GET THEIRS“As the IRS has struggled, for-profit tax preparation companies, notably Intuit, the maker of TurboTax, have stepped in with websites to help people get their checks. But Intuit is not just acting as a conduit: It is also misleading unwary Americans by steering them to paid services that they could otherwise get for free.” 

April 14, 2020, AIRLINES, BESIEGED IN COVID-19 ERA, FAIL TO REFUND PASSENGERS AS REQUIRED, LAWSUITS SAY“A lawsuit filed against Southwest Airlines alleges the carrier violated its contract with customers by failing to provide refunds for flights canceled during the coronavirus pandemic.” 

April 12, 2020, EXPECTING A STIMULUS CHECK? YOU MIGHT WANT TO SHIELD IT FROM PAYDAY LENDERS“The $1,200 economic stimulus checks from the federal government are expected to start arriving this week, and they’ll be a godsend to people who need to pay rent, mortgages, grocery bills and medical bills. But consumer advocates worry payday, auto title and high-cost installment loan companies might be set to snatch that money out of people’s accounts.” 

April 7, 2020, MANY STRUGGLING HOMEOWNERS NOT GETTING THE MORTGAGE RELIEF U.S. PROMISED“Homeowners who've lost their jobs or income say their lenders are demanding punishing terms if they take part in what's supposed to be a government effort to help them.” 

April 4, 2020, HOMEOWNERS SAY SOME LENDERS ARE OFFERING RELIEF WITH A SIDE OF RETRIBUTION, “Congress ordered home lenders to let homeowners who lost income skip mortgage payments, but some say lenders are demanding big lump sum payments just months from now, even if they've lost their jobs.” 

April 3, 2020, ATTORNEY GENERAL JAMES DEMANDS NEW YORK SPORTS CLUB STOPS RIPPING OFF MEMBERS BY CHARGING DUES DURING CORONAVIRUS CLOSURES (ALSO MARYLAND AND PENNSYLVANIA), “New York Attorney General Letitia James today led a multistate coalition of attorneys general in sending a letter to the parent company of New York Sports Club (NYSC), demanding immediate changes to the unlawful manner in which NYSC has responded to the mandatory closing of gyms and health clubs in response to the coronavirus disease 2019 (COVID-19) public health crisis.” 

April 2, 2020, A PAYDAY LOAN CHAIN IS DEFYING STATE SHUTDOWNS TO COLLECT DEBTS IN A PANDEMIC“The latest is Cash Store, a “payday loan alternative” chain that has classified its more than 100 locations in Illinois, Michigan, New Mexico, and Wisconsin as essential businesses. All four states have issued shelter-in-place orders—but at Cash Store, life goes on.” 

Coronavirus (COVID-19) Pandemic: The FTC in Action