Mail order complaints ranked 15th last year among consumer complaints recorded by numerous consumer protection agencies, an improvement from its No. 6 spot in 1998.
Telemarketing dropped to spot 16, and may show further improvements as a result of many states adopting do-not-call telemarketing lists that allow consumers to gain some control over in-bound telemarketing calls, according to the 11th annual survey conducted by the National Association of Consumer Agency Administrators (NACAA) and the Consumer Federation of America (CFA).
Home improvement ranked No. 1 and has been in the top five areas of consumer complaints for the last six years, followed by household goods and auto sales as complaints pour in about repairs that are not done correctly or are not done at all.
Credit and lending has ranked 5th for the past four years with consumers complaining about predatory mortgage lending, credit card fees and billing, advance-fee loans and other forms of expensive small loans.
Complaints about the Internet dropped from 8th place in 2000 to the 13th to 15th place in 2001. However, Internet service providers ranked No. 4 on a list of industries most likely to go out of business. Home repair contractors topped the list followed by health studios and furniture stores.
Some of the worst scams of 2001 included a telemarketing operation by a credit company selling consumers on a credit card that could only be used to buy product’s from the its own catalog. The companies involved are Titanium Blue, Liberty Benefits, Credit Enhancement Services and Consumer Credit Support. The operation is under investigation by the FBI, the report said.
One of the worst scams circulating in 2001 was the so-called "Nigerian 419 scam" which worked by asking victims to provide money or a bank account number to facilitate any number of deals including retrieving a bequest left to someone in a will. According to some estimates, the scam is the fifth largest industry in Nigeria and has accounted for more than $5 billion in illegal income for scammers, the NACAA said.
Membership and buying clubs also caused problems for consumers.
The Virginia Department of Agriculture & Consumer Services, Office of Consumer Affairs received 677 consumer complaints involving the American Savings Discount Club for allegedly telemarketing fraudulent advance-fee loan promotions to hundreds of thousands of consumers nationwide without their knowledge. In a lawsuit filed by the Federal Trade Commission and three states, the court ruled in August against ASCE in a $3 million judgement.
NACCA is a membership organization of consumer protection agencies at all levels of government. This survey is based on 41 NACCA member responses to questions about their 2001 complaint records.
