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Consumer Rights and Responsibilities - PowerPoint by liuqingyan

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									Consumer Rights and
     Chapters 3.1 and 3.4
   Right to safety
       Products must not endanger consumers’ lives
        or health
   Responsibility to use products safely
       Consumers are responsible for following
        directions for proper use and maintenance of
   Right to be informed
       Business must provide accurate information in
        advertising, labeling, and sales practices.
   Responsibility to use information
       Consumers are responsible for using the
        information to evaluate product choices.
   Right to Choose
       Consumers should have a variety of goods
        and services from which to choose.
   Responsibility to choose carefully
       Consumers should take advantage of product
        variety by considering many opinions and
        making rational choices.
   Right to be heard
       The government must consider consumer
        interests when creating laws.
   Responsibility to express satisfaction or
       Consumers should tell their elected officials
        their opinions on consumer issues, and inform
        them of improper business practices.
   Right to redress
       Consumers should be able to obtain fair
        remedies to consumer problems.
   Responsibility to seek redress
       Consumers should inform businesses of
        product defects and unfair practices and
        pursue remedies.
           Consumer Education
   Right to consumer education
       Sufficient information should be available for
        consumers to make rational decisions.
   Responsibility to be an educated
       Consumers should take advantage of
        opportunities to gather information and learn
        how to make rational buying decisions.
            Healthy Environment
   Right to a healthy environment
       Businesses should avoid polluting the
        environment and should contribute to the
        welfare of the community in which they
   Responsibility to contribute to a healthy
       Consumers should support businesses that
        operate responsibly and report environmental
        abuses to authorities.
   Consumer movement
       Seeks to protect and inform consumers of
        requiring such practices as honest
        advertising, product warranties, and improved
        safety standards.
              Who can help?
   Federal Trade Commission (FTC)
     Most important federal consumer protection
     Responsible for protecting consumers from
      unfair or deceptive business practices such as
      misleading information in advertising or on
      product labels
     Cease-and-desist order – stops deceptive
                Who else?
   Consumer Product Safety Commission
       Protects consumers from dangerous
   Environmental Protection Agency (EPA)
   State and local governments
   Company’s promise that the product will
    meet specific standards over a given time
    period or the company will repair or
    replace it, or give a refund
   Magnuson-Moss Warranty Act
   Full warranty – VERY specific, written

   Limited warranty – limitations explained in
          Implied vs. Expressed
   Implied warranty
       unwritten guarantee
   *Express warranty
       statement which presents a specific quality of
        performance feature of a product
   Consumer’s Union tests products and
    reports on the results in Consumer
   Underwriter’s Laboratories checks
    products for safety from fire, electric
    shock, and other hazards.
   State’s attorney’s office handles frauds
    and misleading ad claims
Deception and Fraud
      Section 3.3
         Deception vs. Fraud
   Deception
     Exaggeration
     Legal

     Misleading

   Fraud
     Deliberate
     Unlawful extremes
   Trading Up – practice of pressuring
    consumers to buy a more expensive
    product than they intended
   Sale Price – must be below usual price
   Suggested Retail Price – manufacturers
    price is sometime higher then what the
    retailer expects to get from it.
   Loss Leader – below cost to attract you to
    the store
   Statement is fraudulent if:
     Person making statement KNOWS it’s false
     Purpose of statement causes others to give
      up some value
   Proving fraud is difficult
     Was it a mistake?
     Was there intent?

   Best advice is to avoid fraud
When it seems too
good to be true…
…it probably is!!
             Types of Fraud
   Bait and Switch
   Pyramid Schemes
     Chain letters
     Memberships, not products

   Telephone (& Internet) Fraud
Pyramid Schemes
             Telephone Fraud
   Too good to be true          Pressure to act now
   Request for credit            or offer expires
    card or ss#                  Refusal to identify
   Buy for something             themselves or
    free                          company
   Refusal to send              Refusal to provide
    written confirmation or       company info (phone,
    information                   address)
       Telephone Techniques
   Drop famous names
    “Having lunch with Michael Jordan was great…”
   Use terms of endearment, emotions
    “I lost my mother and you remind me of her.”
   Suggest lack of power
    “May I talk to the decision maker?”
   Use guilt trips
    “I’ve already spent an hour with you…”
   Pressure to make quick decisions
    “We only have two left…”
           Telephone Advice
   Ask for time to think about it
   Ask for information be sent to you
   Ask for their number and call back
   Ask for referrals
         More Faces of Fraud
   Health-care products that cure
   Home improvement charging fees up front
   Vacation clubs promising cheap vacations
   REALLY inexpensive repair work
   Weight loss programs appearing unrealistic
            Protect Yourself
   Be skeptical!
   Ask questions!
   Research companies
   Research products
   Use your head, not your “heart”
Resolve Consumer
     Section 3.4
             Complaint process
   Have your facts straight
       Documentation
         Receipts, warranties
         Dates/locations/names

         Product details

         Price and payment method

         Explanation of problem

         Desired resolution

   Be rational, not emotional
   Document names, dates, and conversations
Who to talk to?
 Customer service rep



Consumer group/agency

        Consumer Organizations
   Better Business Bureau
     Helps resolve disputes
     Keeps files of complaints

     Educates consumers

     Promotes honest advertising/selling

   Arbitration – consumer board
   Media help
         Cooling-off Periods
   Allows time to back out of a deal
   Generally three days
   FTC created for door-to-door sales
              Other options
   Report incident to state’s attorney
   Small claim courts
     Price range ($1- to 10,000)
     No lawyer needed or allowed

     Court fees low

     Quick resolution

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