June 2011 Archives

The credit reporting business Teletrack, Inc. has agreed to settle charges that involve a violation of the Fair Credit Reporting Act (FCRA), but the settlement comes at an expensive price. According to the Federal Trade Commission, Teletrack has agreed to pay $1.8 million to settle the complaint. The settlement also requires the company to furnish credit reports only to those people that it has reason to believe have a permissible purpose to receive them.

Teletrack's alleged FCRA violations come after FTC accused the company of creating a marketing database of information that was gathered through credit reports and then selling that information to marketers. The information that was allegedly sold included lists of consumers who had applied for non-traditional credit products. The information sold violated FCRA because it contained information consumers' creditworthiness.

In the midst of Frank McCourt's bitter divorce, the billionaire is now also in the process of filing for bankruptcy protection. McCourt, who owns the Los Angeles Dodgers team, says that the Chapter 11 bankruptcy petition was filed in order "to protect the franchise financially and provide a path that will enable the Club to consummate a media transaction and capitalize the team."

KTLA News reports that McCourt blames MLB Commissioner Bud Selig for the financial failures of the Dodgers, citing that Selig rejected a $3 billion, 17-year television deal with Fox. McCourt stated in the bankruptcy filing that this deal would have given the Dodger team $385 million up front.

Has it been a while since you’ve used one or more of your credit cards? Are you one of those people who will only use a certain credit card in an emergency situation? If so, you may be surprised to find that your card might eventually be canceled, which can cause your credit score to drop.

ABC news reports that there’s now a trend for banks to cancel credit card accounts when there’s no use on a card, even if the card holder has excellent credit. When a bank cancels a credit card account, it can result in a lowered credit score.

Young people looking to jumpstart their careers may want to turn to other regions of the country besides Phoenix or Tucson. The Phoenix Business Journal reported on an On Numbers study in which the 65 most populated metro areas of the United States were ranked based on qualities that appeal to workers in their 20s and early 30s.

Sadly, the study ranked Phoenix in 49th place out of the 65 metros and ranked Tucson in a not much better position at number 47. The study took 10 factors into consideration when determining these rankings which included 10-year population growth, five and one-year employment growth, per capita income, five-year income growth, share of total population in the 18-34 age range, unemployment rate for the 16-34 age group, share of householders in the 18-44 age range who earn more than $150,000 a year, share of 18-to 34-year-olds with college degrees, and median rent.

Jobless Arizonians who have been out of work for more than 79 weeks could find themselves in a deep hole of financial trouble due to the state legislature voting down the extension for unemployment benefits. According to The Arizona Republic, this decision not to accept federal money to extend unemployment checks up to 99 weeks will affect at least 15,000 people in the state.

Why vote against the extension of unemployment benefits? After all, the proposal wouldn’t be costing the state any money since the federal government would be paying out the money to the long-term jobless workers. But some lawmakers are still against the idea of extended unemployment benefits based on ideological principles alone, saying that giving more money to the unemployed is a disincentive to finding another job.

Not all reality television stars end up rich and famous. Sonja Morgan from “The Real Housewives of New York City” might be famous, but she is by no means rich at this point in time. According to People Magazine, Morgan filed for Chapter 11 bankruptcy protection last November and listed $19.8 million in debt through her bankruptcy petition with $13.5 million in assets.

Now, seven months after the bankruptcy petition was filed, Morgan is still “heartbroken” over the bankruptcy case. Morgan’s bankruptcy might have been particularly emotional for her and her loved ones because her finances were heavily discussed in the media. The average person doesn’t usually have to worry about news stations and media networks reporting on their debt.

Future students at Arizona State University (ASU) might want to consider their housing options at the soon-to-be developed complex Concord Eastridge Inc. in downtown Phoenix. The two-structure project has been designed to serve ASU's growing downtown campus, where construction is scheduled to begin next year.

Students can expect the housing project to open in the fall 2013 semester. The Phoenix Business Journal reports that the property, which is located on Roosevelt Street between Third and Fourth streets, has an interesting history behind it when it comes to ownership. The property was reportedly supposed to be developed into the Roosevelt Gateway condos by local real estate broker Charles LaMar. Yet this project failed when the lender Mortgages Ltd. filed for Chapter 11 bankruptcy reorganization due to the harsh economy in the area.

If you would like a slice of homemade pie from Marie Callender’s restaurant, you will unfortunately have to travel out of the Grand Canyon State. That’s right, all seven of the company’s Arizona restaurants closed over the weekend after the chain’s parent company filed for Chapter 11 bankruptcy protection.

In total, 58 Marie Callender’s restaurants across the country closed over the weekend, reports Phoenix New Times. The restaurant chain, which is known for its home-style pies, was apparently in $150 million of debt and cited rising food costs and the weak economy as reasons for all the abrupt store closures.

The average person in Arizona has $6,765 in credit card debt, reports the Phoenix Business Journal. Based on this number released by CreditKarma.com, the Grand Canyon state now ranks 36th out of 50 U.S. states when it comes to paying down credit card debt.

This may seem like bad news for Arizona, but it turns out that the average $6,765 of debt is down by 15 percent from just one year ago, when the average credit card debt for an Arizona consumer was at $7,925. Nationally, credit card debt has also fallen over the past year.

The city of Phoenix still hasn’t made a full recovery from the recent recession, in which the region suffered from a significant loss of jobs in the financial sector. According to the Phoenix Business Journal, a new On Numbers analysis of U.S. Bureau of Labor Statistics found that the Phoenix area lost 10,900 financial sector jobs between April 2008 and April 2011. This ranks Phoenix’s job performance in the financial sector 89th out of the top 100 metro areas in the United States.

Yet while Phoenix’s financial sector seems to be plummeting, the financial sector in the Tucson metro area has actually seen job growth over the past three years. Tucson is reportedly just one of three metro areas in the United States that has more financial jobs today than it did three years ago.

We’ve reported in earlier blog posts that more and more debt collectors and debt collection agencies are using social networking websites, such as Facebook, MySpace, Twitter and LinkedIn, to track down consumers who are delinquent on their bills. But when is it illegal for debt collectors to contact debtors through these websites?

Under the Fair Debt Collection Practices Act (FDCPA), debt collectors are prohibited from discussing a person’s debt with third parties or telling third parties that somebody owes money. Hence, communicating with a consumer through a message on a Facebook wall can be considered an FDCPA violation, as any of the debtor’s Facebook friends would be able to read such a message.

The University of Phoenix may soon have a tougher time maintaining access to student financial aid if the for-profit institution cannot show that its students with degrees can get jobs. According to Consumer Affairs, the U.S. government is now moving forward with a crackdown on for-profit colleges so that students don’t take on too much debt from schools that don’t have many job prospects to offer after graduation.

The Department of Education has finalized a gainful employment rule, which states that for-profit programs will no longer qualify for federal aid if they cannot meet at least one of the following three criteria: