Tag: Unclaimed Funds

I’m excited because this is something I had never heard of, even in all my years covering unclaimed money.  The Federal Trade Commission is the nation’s consumer watchdog, and when the FTC sues or settles with a company that has done something wrong, it often obtains refund money for consumers.  LOTS of refund money.  For example, in the first 6 months of 2017, the FTC returned $194-million dollars to well over a million consumers.  BUT, there’s more to be claimed.  It’s hard for the FTC to find everybody owed money. Nicole Vincent Fleming, Program Manager for the FTC’s Office of Claims and Refunds gave us information on how much money is still available, where it comes from, and what it takes to claim it.

Nicole, to get people interested, how much refund money does the Federal Trade Commission have available for consumers right now?  And roughly how many consumers might be eligible to claim that money?

We have active refund programs for over 50 different FTC cases right now. It’s likely at any given time that there are tens of millions of dollars available for tens of thousands of people.  We mail out checks every month. We recently heard from a woman who almost threw her check away, thinking that it was junk mail. It was worth $5000!

And give me the big picture.  In general, how does this money come to be available for consumers?

Generally, when the FTC investigates a company for unfair or deceptive practices, we may try to reach a settlement with the company. As part of the settlement, we often ask that the company pay money to provide refunds to consumers who were injured by their business practices. If we can’t reach a settlement, the FTC might sue the company and ask the court to order them to pay for refunds.  Once the lawsuit or settlement is final, and the defendants have paid the money the court orders, then my office handles distributions. 

You take extensive steps to return the money.  Describe those steps.

•Often we are able to get a list of customers from the company. We use those records to mail people a check and a letter that explains what the check is.  Then, we follow up with address traces to find people who might have moved, and we resend those checks.

• If we don’t have information about who bought the product, we get the word out by advertising and letting the media know that refund money is available. Then, people can come to our website and apply for a refund.

• Sometimes we use our Consumer Sentinel Database to find people. It contains millions of complaints from people who contacted the FTC, the Better Business Bureau, or other federal, state and local law enforcement offices. If people have filed a complaint related to a defendant in one of our refund programs, we might use the information in their complaint to send them a check. (That’s one good reason to report fraud to the FTC!)

•The vast majority of checks usually get cashed.

If there is still money left in the fund after we have done everything we can to reach people, then we might send a second round of checks to people who cashed their first check. For example, people might get a 50% refund with the first check and an additional 10% of their money back with the second check. Our goal is to return as much money as possible to as many people as we can.  

We’ll tell people how to search for open FTC refunds and make a claim in a moment, but first give us an example of a big refund currently available.

One interesting open case is Dolce Worldwide, which did business as My Car Solutions.  According to the FTC’s lawsuit, the defendants called people offering to sell them extended auto warranties. They implied that the company was affiliated with auto dealers and manufacturers. In reality, there was NO affiliation and no one received an actual warranty extension. The FTC sued the company and got sizable refunds for people.  We have mailed 6,000 checks that averaged more than $600 each.  We pro rate people’s share so the more you paid, the more you get back.  In this case, about a 4th of the checks haven’t yet been cashed, so there are maybe 1500 people STILL owed money. We just reissued checks in this case, so people can be on the lookout

Give us an example of a case where the company is refunding people ALL of their lost money.

Amazon had to refund people for in-app purchases made by their kids. The issue was that parents would let their kids play ‘free” games that actually cost money.  The game was free but kids could use real money while playing the game, to buy things like “gold stars” or virtual pet food. Purchases made between November 2011 through May 2016 are eligible. Amazon sent emails to people who made in app purchases during this timeframe.  If a child made these purchases without your permission, you may be eligible for a refund. The court order requires Amazon to provide FULL refunds—up to $70 million in all! 

Tell me about a case, with an even bigger pot of money available.

Herbalife is one that a lot of people will have heard of.  We have distributed 3/4 of the $200 million that was available.   But that means we are still trying to reach a lot of people. Herbalife was a multi-level marketing business.  The FTC says that Herbalife led people to believe they could earn substantial money, but that most people lost money.  And that the company’s payment structure was unfair because it rewarded distributors for recruiting others to join and purchase products, rather than selling the product to end users. To be eligible for a refund, people must have paid Herbalife more than $1000 and meet certain other criteria. The details are at ftc.gov/refunds.  The average checks range from $100-$500 per person. BUT the largest checks exceed $9000!  

Notice how the pots of money are growing?  There’s an even bigger one involving Western Union, right?

Yes, Western Union agreed to provide $586 million in refunds in this case, which was a combined effort of the FTC and Department of Justice.  The government charged that massive fraud flowed through Western Union for years and that the company could have prevented it. For example, scams where people thought they had won a cash prize, but they were asked to send “taxes” through Western Union.  Or people who thought they were sending money to help a friend or relative in an emergency, but it was a scam. Usually people who send money to a scammer via money transfers find it impossible to get their money back, so this is a remarkable case. The claims process is NOT open yet.  But it will be soon. If you already reported your loss to Western Union, the company should have your information in its database, which will help with the refund process. Western Union’s contact information is available on our site. 

We’ve profiled five different settlements where people can get refunds.  How many more open cases are there and how do people find out about them so they can see if they’re eligible?

We currently have more than 50 open refund cases, and we add new cases every month. Just go to FTC.gov/refunds for a list of open cases where funds are available.  In addition, EACH case has a separate phone number for people to inquire.

What do people have to do to prove they were wronged by the company and are eligible for a refund?

Most of the time we do NOT ask for proof of purchase because we have the company’s records and know who bought the product.   If we don’t have that, we might ask things like how much you paid and where you bought the product, because we know which retailers really did sell it, so that is one way of verifying claims.  When people apply for a refund in one of our programs, they must sign a statement swearing that they are telling the truth.  And we are able to spot shady claims other ways, too.  By the way, the FTC will NEVER ask you for money to claim your refund. Unfortunately, scammers are promising refunds for a fee—or in exchange for your bank account information—to take advantage of people. Don’t pay for the promise of a refund!

I’d like you to describe one final case, because it’s the biggest of all.  This is the Volkswagen case, where the automaker was caught fudging the emissions for its diesel vehicles.  How big was this settlement and what’s different about how the money’s being distributed?  

There are actually two related Volkswagen settlements: one for 2.0 liter cars and one for 3.0 liter cars. Combined, these two settlements are worth over $11 billion dollars!  And it’s a little different because VW is administering the program themselves. They are offering to buyback people’s cars for more than the full value of the vehicle! It’s a complicated settlement—for example, people who leased their car have different options than people who purchased their car. All the details are at FTC.gov/refunds including a chart that can help you determine what your refund will be. If you click on the link to the VW settlement page, you can enter your VIN number and find out how much money you are eligible for. $35,000 is not unusual.  It depends largely on what car you bought and how old it is. The low end of the buyback amount is $12,500 and the high end is $44,000. It’s a massive settlement.

After hearing about all of these cases and all of this money, people are going to want to search your site to see if any apply to them.  Why is it important that they do so right away?  

There are deadlines. We spend time searching for the rightful recipients of this refund money, but eventually, we must close the case and move on. If we have funds left over, we send that money back to the US Treasury’s general fund. Once we close a case and send the money to the Treasury, we can’t get it back.  We work really hard to find all the eligible recipients, but we encourage people to check out the site and see if they might be eligible.  The website, again, is  FTC.gov/refunds.

Nicole Vincent Fleming of the Federal Trade Commission, thank you SO much for telling us about this unique form of unclaimed money.  And a big thank you to the Federal Trade Commission for providing additional information for me to share with you. 

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