NEW YORK (MainStreet) – After all these years and all those clichés, American consumers are still getting ripped off by car dealers.
The Consumer Federation of America, a nonprofit association of consumer advocacy groups, Wednesday released its annual list of the top 10 consumer complaints received by member organizations in 2010. As was the case last year, the top two targets for consumers’ ire were car dealers and bankers – the former for lemons and false advertising, and the latter for various credit card and mortgage abuses.
It’s not surprising that car dealers are a frequent source of complaints, since most Americans buy a new or used car at some point, but as Edmunds.com editor Phil Reed pointed out to MainStreet earlier this year, “Most people only shop for a new car once every five to seven years, so it’s not something that they get particularly good at.” This lack of expertise means that Americans get scammed on everything from faulty repairs to lemons.
It also comes as no surprise that bank-related complaints remained common in 2010, as certain reforms in the financial sector had not yet been implemented. The CFA identifies “billing and fee disputes, mortgage-related fraud, credit repair, debt relief services, predatory lending [and] illegal or abusive debt collection tactics” as some of the main targets of consumers’ wrath. That’s a list that includes some of the abuses targeted by the financial reforms of the past few years, chief among them the CARD Act and the Consumer Financial Protection Bureau.
The CFPB took steps toward eliminating mortgage fraud by introducing more consumer-friendly mortgage forms in May, and the agency’s website has a special section where it can more easily take complaints about credit card companies.
So how can you avoid becoming one of these aggrieved consumers? The CFA, along with the National Association of Consumer Agency Administrators and the North American Consumer Protection Investigators, urged consumers to do their homework on all professionals by checking their credentials and looking them up on the Better Business Bureau or by checking with local consumer agencies. And you should also be sure to cover yourself against possible fraud by paying with a credit card (which have built-in fraud protections) and doing your best not to pay the full cost of a big-ticket item upfront.
Here are the top 10 sources of consumer complaints in 2010:
3. Home Improvement/Construction and Retail Sales (tie)
6. Internet Sales
7. Household Goods
10. Home Solicitations