Chapter 3 Combined
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Transcript of Chapter 3 Combined
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Consumer Rights and
ResponsibilitiesChapters 3.1 and 3.4
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Safety
Right to safety
Products must not endanger consumers lives
or health
Responsibility to use products safely
Consumers are responsible for followingdirections for proper use and maintenance of
products
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Information
Right to be informed
Business must provide accurate information inadvertising, labeling, and sales practices.
Responsibility to use information
Consumers are responsible for using theinformation to evaluate product choices.
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Heard
Right to be heard
The government must consider consumerinterests when creating laws.
Responsibility to express satisfaction ordissatisfaction
Consumers should tell their elected officials
their opinions on consumer issues, and informthem of improper business practices.
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Redress
Right to redress
Consumers should be able to obtain fairremedies to consumer problems.
Responsibility to seek redress
Consumers should inform businesses ofproduct defects and unfair practices and
pursue remedies.
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Consumer Education
Right to consumer education
Sufficient information should be available for
consumers to make rational decisions.
Responsibility to be an educated
consumer
Consumers should take advantage of
opportunities to gather information and learnhow to make rational buying decisions.
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Healthy nvironment Right to a healthy environment
Businesses should avoid polluting theenvironment and should contribute to the
welfare of the community in which theyoperate.
Responsibility to contribute to a healthyenvironment Consumers should support businesses that
operate responsibly and report environmentalabuses to authorities.
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Why?
Consumer movement
Seeks to protect and inform consumers ofrequiring such practices as honest
advertising, product warranties, and improvedsafety standards.
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Who can help?
Federal Trade Commission (FTC)
Most important federal consumer protectionagency
Responsible for protecting consumers fromunfair or deceptive business practices such asmisleading information in advertising or on
product labels Cease-and-desist orderstops deceptive
advertising
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Who else?
Consumer Product Safety Commission(CPSC)
Protects consumers from dangerous
products.
Environmental Protection Agency (EPA)
State and local governments
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Warranties
Companys promise that the product will
meet specific standards over a given timeperiod or the company will repair or
replace it, or give a refund
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Warranties
Magnuson-Moss Warranty Act
Full warrantyVERY specific, writtenguarantee
Limited warrantylimitations explained in
detail
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Implied vs. Expressed
Implied warranty
unwritten guarantee
*Express warranty
statement which presents a specific quality ofperformance feature of a product
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Misc.
Consumers Uniontests products andreports on the results in ConsumerReports.
Underwriters Laboratorieschecksproducts for safety from fire, electricshock, and other hazards.
States attorneysoffice handles fraudsand misleading ad claims
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Deception and Fraud
Section 3.3
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Deception vs. Fraud
Deception
Exaggeration
Legal
Misleading
Fraud
Deliberate
Unlawful extremes
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Deception
Trading Uppractice of pressuringconsumers to buy a more expensiveproduct than they intended
Sale Pricemust be below usual price Suggested Retail Pricemanufacturers
price is sometime higher then what the
retailer expects to get from it. Loss Leaderbelow cost to attract you to
the store
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Fraud
Statement is fraudulent if:
Person making statement KNOWS its 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
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When it seems too
good to be true
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it probably is!!
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Types of Fraud
Bait and Switch
Pyramid Schemes
Chain letters
Memberships, not products
Telephone (& Internet) Fraud
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Pyramid Schemes
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Telephone Fraud
Too good to be true
Request for creditcard or ss#
Buy for somethingfree
Refusal to send
written confirmation orinformation
Pressure to act nowor offer expires
Refusal to identify
themselves orcompany
Refusal to providecompany info (phone,address)
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Telephone Advice
Ask for time to think about it
Ask for information be sent to you
Ask for their number and call backAsk for referrals
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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
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Protect Yourself
Be skeptical!
Ask questions!
Research companies Research products
Use your head, not your heart
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Resolve Consumer
ProblemsSection 3.4
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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
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Who to talk to?
Customer service rep
Manager
Manufacturer
Consumer group/agency
Lawsuit
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Consumer Organizations
Better Business Bureau
Helps resolve disputes
Keeps files of complaints
Educates consumers
Promotes honest advertising/selling
Arbitrationconsumer board
Media help
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Cooling-off Periods
Allows time to back out of a deal
Generally three days
FTC created for door-to-door sales
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Other options
Report incident to states attorney
Small claim courts
Price range ($1- to 10,000)
No lawyer needed or allowed
Court fees low
Quick resolution