Costco Connection

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■ No-limit cell-
phone service
Ask David
Horowitz
these “red flags”
By David Horowitz

RECENT GOVERMENT statistics show that 60 percent of businesses in America have suffered data breaches and 218 million Americans have had their personal information exposed to identity thieves since 2005.

In light of the increasing number of data security breaches, the government has finally stepped in. Congress recently amended the Fair and Accurate Credit Transactions Act with a set of conditions called the Red Flags Rule ( www.ftc.gov; search “Red Flags Rule”).

According to the rule, a business that maintains a credit-based relationship with its customers must have a written information security plan that outlines what it’s doing to protect customer records from theft. Businesses must comply by November 1 of this year. Businesses that are not Red Flags compliant by November 1 are subject to fines and penalties, and also open themselves up to the possibility of class-action lawsuits if their customer data are stolen.

The rule specifically calls out five industries: automotive, financial, health care, insurance and mortgage. If you are a customer of businesses in these areas, you should ask them to explain what plans they have in place to protect your sensitive customer information in compliance with the Red Flags Rule.

Here are a few ways this rule can affect everyday dealings for consumers:

Buying a car. Let’s say you’re at a car dealership and you’re ready to buy, but you need to finance the purchase. Some people get their car purchases financed through their bank, but maybe you, like many people, want to obtain financing directly from the dealership. That dealer, and its finance department specifically, needs to have a written information security plan in place to protect your information.

Signing a utility or phone plan. Any time you sign up for electric, natural gas, cable TV or telephone service, the business to which you’re giving your information must be Red Flags compliant. This also includes cellphone service.

Buying a home. With the mortgage industry in crisis, it’s tougher to get a loan. Because of that, homebuyers may need to shop around and offer their personal credit information to several mortgage brokers in order to find a mortgage with terms that are right for them. If you are shopping around, ask mortgage brokers what measures they have in place to prevent data breaches and identity theft.

Note: To find out about Costco’s protection of personal and credit-card information, go to costco.com and type “privacy statement” in the search box.—Ed.

MY DAUGHTER enrolled at a design school and applied for a loan through them. Because of her age ( 25) she didn’t qualify for her own student loan, but she was offered a student and parent loan through Wells Fargo. But the school approved the loan without my authorization, and I never received any paperwork on it. After she graduated, I received a statement for the $35,000 to be paid in full! I have documents showing my attempts to resolve this, but with no luck.

No-limit cell service

Three large U.S. cellphone companies— Verizon, AT&T and T-Mobile—have started a battle for business by offering unlimited calling plans for $99 a month. That’s a dramatic shift from set prices for a monthly time allowance and additional charges for each minute over the limit.

Seeking to turn cellphone use into a predictable fixed-fee service like cable television hints at the fierce competition among providers to woo customers away from their current plans. Wireless carriers now vie for a dwindling pool of new customers, so they need to offer more b enefits and features to gain consumer loyalty.

But before you hop aboard this bandwagon, take a look at what you really need. According to a study by J.D. Power and

Associates, the average consumer spends $63 to $77 for cellphone service, depending on the addition of data services such as e-mail, so you might be overpaying with a $99 plan.

Check your carrier’s rates to get the best plan for you, and don’t forget to ask about extra charges for

Internet access, text messages, video capabilities, photo sharing and GPS navigation, if any of these services are part of your wireless habit. C

Note: Costco and costco.com offer some of these services.—Ed.

Gina

Walnut Park, California

AMY CANTRELL

David Horowitz is a leading consumer advocate. His “Fight Back!” commentaries are heard daily on the Jones Radio Network. For stations and times, check the radio page at www.fightback.com.

You need more information
about the loan terms, and
to see who signed for it.
You say you didn’t give con-
sent, but if someone is
going to be responsi-
ble for loan payments,
their authorization
would be required.
Did you sign the
documents without
understanding
what they were
for? If so, unfortu-
nately the debt is
yours. Or did some-
one forge your signa-
ture on the application?
Contact Wells Fargo
and demand copies of
the application, and tell
them why. If you did not
give consent, you have
grounds to fight back
against being held liable
for the debt. If your signa-
ture was forged, you must
fight back by reporting this
to the school, the bank and
legal authorities.

Do you have a question for David?

Just log on to www.fightback.com and “Ask David.” He will personally respond to your problem if you follow the instructions printed on his Web site. (Costco members receive a rebate off the normal fee.) Questions and answers of the greatest interest to Costco members will be used in this column with the permission of the contributor and will be posted on www.fightback.com.