http://www.youtube.com/watch?v=CUCSK1QFwts

Business Ethics

Protecting your Money: Consumer

ProtectionCoach Markus

Shopping Online• Use a secure browser• Shop with companies you know• Keep your password private• Pay by credit card• Keep a record of your transactions

Shopping by phoneO Ask about the company’s refund and

return policyO Ask about availability of the productO Know the total of your order before

hanging upO Send your payment my mail. (Mail-

order rule)

Telephone and Mail Order Rule

O Companies are required to ship the order within a set period of time

O If your order is not shipped within set time period, the company must send you a notice of options

Rules that Protect Consumers

O Telephone and Mail order ruleO Fair Credit Billing ActO Cooling-off Rule

Fair Credit Billing ActO Sets up a procedure for the quick

correction of mistakes that appear on consumer credit accounts

O Applies to any item bought and paid for with a credit card (including phone or mail orders)

Cooling of RuleO If you buy an item from your home

(door-to-door sales), you have three days to cancel the purchases of $25.00 or more

O Seller must inform you of your cancellation rights at the time of sale.

Terms you should know:

O Fraud: when an advertiser or seller intentionally deceives consumers by telling lies or half-truths about a product or service

O Scam: a plan designed to intentionally deceive consumers

Telemarketing and Door-to-Door Sales

Warning Signs:- High pressure sales techniques- Insistence on immediate action- Offers that sound to good to be true- A request for personal information- A statement that something is free,

followed by a request that you pay for something else.

DO NOT!O Be pushed into decisionsO Buy anything on terms you do not

understandO Give personal financial information

DO!- Ask for written information about the

company or product (e-mail to you while you are on the phone)

- Do find out about return, refund, and cancellation policies

Examples of telemarketing or door-to-door scams:

O SweepstakesO Prize offersO Travel packagesO InvestmentsO CharitiesO Work-at-Home schemesO Magazine salesO Business opportunities

Steps to resolve consumer problems:

Collect ALL records: receipts, warranties, cancelled checks, contracts, and complaint records.1. Return item to the store2. Contact the store manager3. Contact the company that made the

product4. Contact consumer or government

agencies5. Take legal action, if necessary

How to start a consumer complaint

1. Go back to where you made the purchase2. Contact the person who made the sale or

performed the service3. Calmly and accurately explain the problem4. State what action you would like to see

taken5. Talk with the supervisor or manager6. Allow time for resolution7. Keep written records of your efforts

Agencies that protect us:

O National Fraud Information CenterO Better Business Bureau

How to write a letter of complaint:

O Type or write neatlyO Be concise and courteousO Include:

O Your name and addressO Your account numberO How you can be reached

How to write a letter of complaint:

O Describe your purchaseO Describe the problemO State the action you want takenO State your next action if the problem

is not resolvedO Enclose copies of related documents

Sample LetterEvan Smith100 Rider LaneChicago, IL XXXXX

August 8, 2004Brown’s Best Bikes, Inc.555 Rolling RoadChicago, IL XXXXX

Dear Mr. Brown:On August 1, 2004, I bought the “Rough and Ready, model 600” mountain bike from yourstore. When I got the bike home, I noticed that the front tire was soft. I used a hand pumpto inflate the tire. After riding the bike less than a mile, the tire was soft again. I broughtthe bike back into your shop on 8/2. You tested the tire, told me it was fine and filled it withair.The tire is still losing air. Every time I ride the bike, I need to pump the tire. I left detailedmessages on your voicemail on 8/4 and 8/5 and you have not returned my phone calls.I am enclosing a copy of your store warranty. It states that your store will replace defectiveparts on a bike within the first 30 days of purchase. According to your written policy, I amentitled to a new front tire. Please call me at 555-7045 to arrange a time for me to bring thebike in for repair. If I don’t hear from you by next week, I will contact our local BetterBusiness Bureau to help resolve this problem.

Thank you for taking care of this.

Sincerely,Evan Smith

Activity: Complaint Letter

Choose one of the following scenarios:1. Madison received a package of

greeting cards in the mail. She knows she never ordered any greeting cards. One week later, she receives a bill for the cards. What should she do?

2. Jason used a mail-order catalog to buy new software for his computer. It has been six weeks and the software still has not arrived. What should he do?