Consumer Rights: Common Consumer Misunderstandings and Mistakes

Consumer Rights: Common Consumer Mistakes

Do you feel scammed or cheated after a purchase you've made turned out to be defective or did not perform as advertised?  Are you confused by lemon laws, return policies and other consumer rights? Consumers believe that our legal system provides more statutory protections than it really does. The U.S. is a caveat emptor ("let the buyer beware"), meaning the law allows sellers to do almost anything in the way of advertising and it is up to the consumer to research before making the purchase. We can argue that is not the way it ought to be, but unfortunately, that is how things presently stand.

Here are some commonly held misunderstandings about consumer's rights:

Rights to cancel purchases within three days.

Unfortunately, the three-day right to cancel applies to only a limited number of cash or credit card transactions of $25 or more. In many states, it applies to door-to-door sales, health club contracts, time share purchases and home improvement contracts . Purchases of automobiles and other vehicles are typically NOT covered.

Store refunds

In most states, each store sets its own refund policy, which must be disclosed or displayed at the time of sale. If the policy is not displayed or if the store has no refund policy, a consumer may be able to return goods purchased for a credit or a refund within a matter of days - each state varies.  & days is common. This obviously does not apply to:

• food,
• perishable items,
• plants,
• custom made or custom ordered items,
• items which have been used,
• items which by state regulation cannot be resold (such as underwear), or
• items marked "as is" or final sale."

Retailers are also not obligated to make refunds without proof of purchase.

Lemon Laws

Almost all states have lemon laws covering new car purchases. But there is where it ends. Don't make the mistake of thinking lemon laws apply to all expensive items such as used cars, televisions, lawn mowers and refrigerators. Always investigate the history of a used car or other product and have it checked by a mechanic or other knowledgeable person before purchasing.

Donations to charities

Charitable organizations are not required to spend a certain percentage of what they raise on their stated charitable goals or activities. Some charities are notoriously inefficient and ineffective and waste most of the money they collect on administrative costs and staff salaries. Donors should ask if the caller is a paid solicitor or a volunteer for the charity and what percentage of the donation with actually go to the charitable organization. generally, your donations will be more effectively used in smaller, local organizations, and some of the carefully watched national organizations.

Do not give out your credit card number over the phone

Never use your credit card for identification purposes, especially over the phone. Criminals use your credit card number and expiration date to make unauthorized charges. Stick to using a credit card to place catalog orders, make hotel reservations, or make other purchases from established businesses. Credit card purchase protection policies and laws generally protect you better than using cash or checks.

Guard your checking account!

Any criminal who gets hold of your checking account number or your check book or even an old check may be bale to withdrawal money from your account. Scammers can contact your bank, using your  account number, and claim that you authorized a withdrawal> The bank may pay it even though it lacks your signature. Often, consumers don't find out about it until it's too late. Remember, the system allows others access to take money directly from your bank accounts without your written authorization - use checks as rarely as possible.  Paying by credit card offers more protection.

Credit reports are not private

Many companies and individuals, such as potential employers, landlords, insurers and retailers may access credit reports as part of a background check. You may obtain a free copy of your credit report from each of the 3 credit reporting agencies every 12 months (see this page). If you notice errors, contact the company immediately.

Accuracy of Advertisements on radio, TV and in newspapers and magazines

There is no government agency that reviews advertisements in advance of their showing. Only public pressure, state attorney general's offices and in rare cases, the FTC bring actions against advertisers for showing false or misleading ads.  Be very skeptical of claims that seem too good to be true, especially those "make money schemes" and "work from home programs"

Filing Complaints

The Federal Trade Commission works for the consumer to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. Click here to file a FTC Fraud Reporting or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad. You may also want to contact your state's attorney general's office.

See this page for more information about reporting scams and filing complaints.