P E R S O N A L F I N A N C I A L M A N A G E M E N T P R O G R A M Consumer Awareness

C O N S U M E R A W A R E N E S S 2 Caveat Emptor Half a million Fraud Complaints in 2006 Half a million Fraud Complaints in 2006 $1.1 billion in total losses $1.1 billion in total losses – $591 million in Internet fraud Average Loss of $3,257 per person Average Loss of $3,257 per person (According to the Federal Trade Commission)

C O N S U M E R A W A R E N E S S 3Deter Prevent bad deals from happening in the first placePrevent bad deals from happening in the first place Detect Know if you’ve been victimizedKnow if you’ve been victimized Defend Guard against future assaultGuard against future assaultTheSavvyConsumer

C O N S U M E R A W A R E N E S S 4 Consumer Awareness Ensuring that when you purchase goods and services you are informed, alert and knowledgeable. Ensuring that when you purchase goods and services you are informed, alert and knowledgeable. Making deliberate spending decisions. Making deliberate spending decisions. Knowing the frauds and rip-offs that are out there. Knowing the frauds and rip-offs that are out there.

C O N S U M E R A W A R E N E S S 5 Why me? You have a steady paycheck.You marry younger.You must keep your financial life in order.You probably have no previous consumer training.You’re easy for debt collectors to find.

C O N S U M E R A W A R E N E S S 6 Why me? You’re easy to spot.Deployment creates unique financial situations for you.You’re influenced by affinity marketing.Businesses easily get inside the gate.You’re specifically targeted.

C O N S U M E R A W A R E N E S S 7 The Impact of Advertising Driver’s Wanted Driver’s Wanted Just do it! Just do it! Head for the Border Head for the Border 1 st Amendment 1 st Amendment 7 th Amendment 7 th Amendment

C O N S U M E R A W A R E N E S S 8 Energizer Bunny 1989 Pillsbury Doughboy 1965 Green Giant 1928 Tony the Tiger (Frosted Flakes) 1951 The Marlboro Man 1955 Can you guess the brand and the year?

C O N S U M E R A W A R E N E S S 9 Common Advertising Techniques Beauty Appeal Beauty Appeal Celebrity Endorsement Celebrity Endorsement Escape Escape Independence/ Individuality Independence/ Individuality Intelligence Intelligence Lifestyle Lifestyle Nurture Nurture Peer Approval Peer Approval Rebel Rebel Rhetorical Question Rhetorical Question Scientific/Statistical Claim Scientific/Statistical Claim Unfinished Comparison/Claim Unfinished Comparison/Claim

C O N S U M E R A W A R E N E S S 10 Empty Promises Meaningless Terms Meaningless Terms – Greatly Reduced – Below Cost – Now or Never – Special Purchase Misleading Ads Misleading Ads – We finance E-1s and up! – Specialists in Military Financing! – Instant Financing! – Free ride to the store! If it sounds too good to be true, it probably is!

C O N S U M E R A W A R E N E S S 11 The Impact of Technology 80% of people ages 18 to 29 use the internet on a regular basis 80% of people ages 18 to 29 use the internet on a regular basis 40% of this age group bank on-line 40% of this age group bank on-line 68% of this age group make on-line purchases 68% of this age group make on-line purchases Safe computing is a critical part of being a savvy consumer!

C O N S U M E R A W A R E N E S S 12 How to Deter Know what you can afford: have a budget and stick to it. Separate your needs and your wants. Don’t buy on impulse. Know who you are buying from. Get off of telemarketing, mailing and Lists. Protect your personal information and computer.

C O N S U M E R A W A R E N E S S 13 How to Detect Misrepresentations: not necessarily illegal, but misleading Misrepresentations: not necessarily illegal, but misleading – Door-to-door sales, sweepstakes prizes and contests, free gifts, unordered merchandise Scams: an unfair act of exploitation Scams: an unfair act of exploitation – Free home inspection, get-rich-quick deals, work-at-home schemes, internet scams and predatory lending Frauds: A deliberate deception Frauds: A deliberate deception – Auto repair fraud, pyramids and ponzi’s, slamming and cramming, phishing, internet and telemarketing fraud, identity theft

C O N S U M E R A W A R E N E S S 14 Internet Fraud Top scams of 2006 Top scams of 2006 – On-line Auctions – General Merchandise Sales – Fake Check Scams – Nigerian Money Offers

C O N S U M E R A W A R E N E S S 15 Predatory Lending Payday Loans Payday Loans – Short-term cash loans – Borrower leaves a post-dated personal check for amount and interest – To pay, borrower can redeem check for cash, allow the check to be deposited, or pay a finance charge and roll over the loan for another period – The average user of payday loans gets eight to thirteen loans per year! Payday Loans are Debt Traps! Average Payday Loan charges 470% APR!

C O N S U M E R A W A R E N E S S 16 Predatory Lending Rent-to-Own Rent-to-Own Tax Refund Anticipation Loans Tax Refund Anticipation Loans Various Mortgage Arrangements (ARMS, Interest-Only) Various Mortgage Arrangements (ARMS, Interest-Only) Subprime Lending Subprime Lending Home Equity Lines of Credit Home Equity Lines of Credit Teaser Rates on Credit Cards Teaser Rates on Credit Cards Auto Title Loans Auto Title Loans Overdraft Protection on Checking Accounts Overdraft Protection on Checking Accounts

C O N S U M E R A W A R E N E S S 17 Identity Theft Deter against Identity Theft Deter against Identity Theft – Safeguard your mail – Opt out of unsolicited credit offers offers – Guard your wallet – Take your receipts – Safeguard your checks

C O N S U M E R A W A R E N E S S 18 Detect Identity Theft Missing bills Missing bills Mysterious trade lines on your credit report Mysterious trade lines on your credit report Credit Cards you didn’t apply for Credit Cards you didn’t apply for Sudden denial of credit Sudden denial of credit

C O N S U M E R A W A R E N E S S 19 Defend Remember the Basics: Remember the Basics: – Know why the military is targeted – Understand the impact of advertising – Know what you can afford: have a budget and stick to it – Separate your needs from your wants – Comparison shop – Don’t buy on impulse – Opt out of calling, mailing, and lists – Protect personal information and your computer – Be familiar with current scams in the marketplace

C O N S U M E R A W A R E N E S S 20 Defend: Make Smart Purchases Get agreements in writing, keep all receipts Get agreements in writing, keep all receipts Don’t be rushed Don’t be rushed Know who you are dealing with Know who you are dealing with Take prompt action Take prompt action

C O N S U M E R A W A R E N E S S 21 Defend: Borrow Wisely Check with your credit union or bank first Check with your credit union or bank first Look out for APRs Look out for APRs Know all the terms of the deal Know all the terms of the deal Use Navy Legal Services Office Use Navy Legal Services Office

C O N S U M E R A W A R E N E S S 22 Defend: Take Action! Contact the seller first Contact the seller first Go to the company president or the manufacturer Go to the company president or the manufacturer Use your consumer advocate resources if you are still not satisfied Use your consumer advocate resources if you are still not satisfied

C O N S U M E R A W A R E N E S S 23 Defend: Identity Theft Place a fraud alert on your credit report Place a fraud alert on your credit report Close accounts that have been tampered with Close accounts that have been tampered with File a police report File a police report Keep a journal of all contacts Keep a journal of all contacts Contact the Federal Trade Commission Contact the Federal Trade Commission

C O N S U M E R A W A R E N E S S 24 Your Legal Rights Know how to cancel a contract Know how to cancel a contract – Cancel in writing – Keep a copy of your cancellation letter – Send Certified Mail Return Receipt Requested – Keep everything until situation is resolved Cooling Off Periods Cooling Off Periods – Doesn’t apply to many purchases

C O N S U M E R A W A R E N E S S 25 Your Legal Rights Federal Protection Federal Protection – Servicemembers Civil Relief Act – Consumer Bill of Rights – Fair Credit Billing Act – 7 th Amendment—Right to Trial by a Jury – The Military Lending Act of 2007 State Protection State Protection – State Lemon Laws (aka Motor Vehicle Warranty Enforcement Act) – State Usury Laws

C O N S U M E R A W A R E N E S S 26 Sources of Help The Command Financial Specialist The Command Financial Specialist Fleet and Family Support Centers Fleet and Family Support Centers Navy-Marine Corps Relief Society Navy-Marine Corps Relief Society Consumer Credit Counseling Service Consumer Credit Counseling Service Navy Legal Services Offices (NLSO) Navy Legal Services Offices (NLSO) State Attorney General or State Office of Consumer Affairs State Attorney General or State Office of Consumer Affairs The Better Business Bureau The Better Business Bureau The Armed Forces Disciplinary Control Board The Armed Forces Disciplinary Control Board

C O N S U M E R A W A R E N E S S 27 Internet Resources Sources of Help for Military Consumers Handout

C O N S U M E R A W A R E N E S S 28 Print your Certificate Click on the following link to add your name to the certificate and print it: Consumer Awareness