Consumer Protection Quarterly Newsletter

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Consumer Protection Newsletter

Winter 2021 

Covered in this Edition: 

Attorney General Herring Obtains $573 Million Opioid Settlement


Herring’s Proposed Opioid Abatement Legislation Is Enacted


COVID-Related Price Gouging Settlements


National Consumer Protection Week


Top 10 Consumer Complaints


Attorney General Herring Obtains More Than $300,000 for Virginia Students after COVID-Related Trip Cancellations


Herring Sues Libre By Nexus for Preying on Vulnerable Immigrants


$850,000 in Restitution Obtained for Virginia Consumers from Open-End Credit Plan Lender


Debt Relief and Restitution for Virginia Student Loan Borrowers


Herring Shuts Down Massive Charity Fraud Telefunding Operation


Attorney General Secures Settlement with Deceptive Veterans’ Charity


Herring Reaches Settlement with American Medical Collection Agency Over Data Breach


Herring Joins Task Force to Examine Pharmaceutical Mergers

National Consumer Protection Week

Attorney General Herring joined the Federal Trade Commission and other consumer protection agencies in recognizing February 28 to March 6, 2021 as National Consumer Protection Week. Throughout the week, General Herring highlighted common consumer protection challenges, ways Virginians can protect themselves, and enforcement actions taken by his Consumer Protection Section. Read more about the week here

Top 10 Consumer Complaints


Attorney General Herring’s Consumer Protection Section serves as the central clearinghouse in Virginia for consumer complaints. In 2020, the Section received 4,760 complaints. Here are the Top 10 complaint categories for 2020:
1.  Automotive Sales
2.  Credit, Loans & Debt Collection
3.  Internet Sales & Service
4.  Home Improvement, Service & Repair
5.  Warranties & Rebates
6.  Automotive Service & Repair
7.  Direct Sales & Scams
8.  Retail Stores
9.  Medical/Health Professions
10.  Price Gouging

 

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Attorney General Herring Obtains $573 Million Opioid Settlement

Attorney General Herring joined a $573 million multistate settlement with McKinsey & Company, one of the world’s largest consulting firms, resolving investigations into the company’s role in working for opioid companies, helping those companies promote their drugs, and profiting from the opioid epidemic. The complaint filed with the settlement described how McKinsey advised Purdue Pharma how to maximize profits from its opioid products, including targeting high-volume opioid prescribers, using specific messaging to get physicians to prescribe more OxyContin to more patients, and circumventing pharmacy restrictions to deliver high-dose prescriptions. Virginia will receive $13,681,773.38 from the multistate settlement to address the opioid epidemic. Read more about the settlement here

Herring’s Proposed Opioid Abatement Legislation Is Enacted  

Attorney General Herring’s legislation that will direct funds secured through his ongoing lawsuits against drug manufacturers to opioid abuse prevention, treatment, and recovery, ensuring that the most money possible goes to actually address the opioid crisis, passed the General Assembly and was signed by the Governor into law. The law will establish an Opioid Abatement Authority controlled by subject matter experts who will ensure that funds are used wisely to support prevention, treatment, and recovery. Read more about the legislation here

COVID-Related Price Gouging Settlements

Attorney General Herring recently obtained two separate settlements regarding alleged violations of the Virginia Post-Disaster Anti-Price Gouging Act during the state of emergency that was declared due to the COVID-19 pandemic. In one matter, the Attorney General alleged that Joule Wellness Pharmacy charged unconscionable prices for rubbing alcohol. Joule Wellness Pharmacy agreed to cease any price gouging practices, pay $2,500 in civil penalties and attorneys’ fees, and disgorge all profits from the offending sales. Read more about the Joule Wellness Pharmacy settlement here. In the other matter, Herring alleged that Rio Medical Supplies charged unconscionable prices for hand sanitizer. Rio Medical Supplies agreed to cease any price gouging practices, pay $2,500 in civil penalties and attorneys’ fees, and disgorge all profits from the offending sales. Read more about the Rio Medical Supplies settlement here

Attorney General Herring Obtains More Than $300,000 for Virginia Students after COVID-Related Trip Cancellations

The Attorney General’s Consumer Protection Section reached a settlement with Voyageurs International, Ltd. relating to international music tours sold to high school students and later cancelled due to the COVID-19 pandemic. Under the settlement, Voyageurs International will provide $313,500 in refunds to 165 high school students for trips organized for Virginia high schools. Affected students will receive $1,900 each, representing a cancellation fee withheld by the business at the start of the pandemic. Read more about the settlement here

Herring Sues Libre By Nexus for Preying on Vulnerable Immigrants

Attorney General Herring sued Libre by Nexus, its parent company, Nexus Services, and its founders for allegedly taking advantage of immigrants held in federal detention centers by offering to pay for their immigration bonds to secure their release, while concealing or misrepresenting the true nature and costs of its services. Among other allegations, Libre by Nexus charged large upfront fees and hefty monthly payments, which typically amounted to thousands of dollars more than the face value of the bond.  The New York and Massachusetts attorneys general and the Consumer Financial Protection Bureau joined Herring in co-filing the enforcement action. Read more about the suit here

$850,000 in Restitution Obtained for Virginia Consumers from Open-End Credit Plan Lender

Attorney General Herring’s Predatory Lending Unit reached a settlement with Allied Title Lending, LLC d/b/a Allied Cash Advance, an open-end credit plan lender, concerning violations of Virginia’s consumer finance statutes. Among other relief, the settlement required the company to pay $850,000 for restitution to customers who opened accounts with the business during a specific time period and to pay the Commonwealth $150,000 for reimbursement of its attorneys’ fees and settlement administration costs. The settlement prohibits the company from collecting anything further on thousands of accounts that remain unpaid, with the total value of the debt forbearance exceeding $10 million. Read more about the settlement here

Debt Relief and Restitution for Virginia Student Loan Borrowers

The Predatory Lending Unit also reached a settlement with Equitable Acceptance Corporation (Equitable), resolving allegations that it violated the Virginia Consumer Protection Act by making loans with illegal interest rates that were used by Virginians to purchase fake student debt relief services from companies that partnered with Equitable. Among other relief, Equitable is required to cancel over $50,000 in debt and provide $40,000 in restitution for nearly 700 Virginians. Equitable also is required to pay the Commonwealth $10,000 for reimbursement of its attorneys’ fees and costs. Read more about the settlement here

Herring Shuts Down Massive Charity Fraud Telefunding Operation

Attorney General Herring’s Charitable Solicitations and Deceptive Conduct Unit shut down a massive telefunding operation that bombarded 67 million consumers with over 1.3 billion deceptive charitable fundraising calls, including over 40.3 million calls to Virginians. The defendants collected more than $110 million using deceptive pitches they made for numerous organizations that claimed to support homeless veterans, victims of house fires, breast cancer patients, children with autism, and other causes that well-meaning Americans were enticed to support through the defendants’ high-pressure tactics. Attorney General Herring joined the Federal Trade Commission and 46 agencies from 38 states and the District of Columbia in stopping the massive operation. Read more about the settlement here

Attorney General Secures Settlement with Deceptive Veterans’ Charity

The Charitable Solicitations and Deceptive Conduct Unit also reached a settlement with a Florida-based veterans’ charity called Healing Heroes Network, Inc. and its former directors, Stacey Spiegel, Allan Spiegel, and Neal Spiegel. The settlement resolves allegations of deceptive sweepstakes mailers and telephone solicitations to help wounded veterans. As part of the settlement, Healing Heroes Network, Inc. and Hero Giveaways, LLC were required to permanently cease all charitable solicitations to help wounded veterans, and the Spiegels were required to pay $95,000 to be provided to a veterans’ charity whose mission matches the representations made by the charity. The Spiegels are banned for five years from overseeing, managing, or soliciting charitable contributions for any nonprofit organization. Read more about the settlement here

Herring Reaches Settlement with American Medical Collection Agency Over Data Breach

Attorney General Herring joined a coalition of 41 attorneys general in securing a settlement with Retrieval-Masters Creditors Bureau d/b/a American Medical Collection Agency (AMCA) to resolve a multistate investigation into the 2019 data breach that exposed the personal information of over 7 million individuals, including 115,956 Virginia residents, and potentially exposed the personal information of up to 21 million individuals throughout the United States. Among other relief, AMCA agreed to implement and maintain a series of data security practices designed to strengthen its information security program and safeguard the personal information of consumers. Read more about the settlement here

 

Herring Joins Task Force to Examine Pharmaceutical Mergers

Attorney General Herring has joined a nationwide task force of state attorneys general in response to the “Reimagining Pharmaceuticals Initiative” led by the Federal Trade Commission to update the national and international approach to analyzing the effects of pharmaceutical mergers. Read more about the Task Force here
 
 
 
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