Fernandez Aims to Protect Consumers from Fraud and Abuse
Monday, July 19, 2010
As Rhode Islanders continue to slog through a hard recession marked by high unemployment and a foreclosure crisis, Democratic candidate Joe Fernandez is rolling out a detailed plan of what he could do to help consumers if he is elected Attorney General.
“For too long, special interests and unscrupulous businesses have got away with too much in Rhode Island,” Fernandez said. “I’ll work to change that because in this economy, Rhode Island families need all the help they can get.”
His three-point plan calls for strengthening the state consumer protection law, combating mortgage fraud and predatory lending, and aggressively advocating for ratepayers against hikes in insurance and utility rates.
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“Many of the proposals outlined in Joe’s plan are the result of looking at the consumer protection laws of neighboring states and comparing them with current Rhode Island law, which is one of the weakest in the nation,” said campaign manager Dan Herkert.
Under the current system, Herkert said insurance agents, securities brokers, construction contractors, and landlords were all exempted from the state consumer protection law. That law is supposed to protect consumers from unfair and deceptive trade practices such as contractors who get paid for their work before actually completing it or credit card companies that do not disclose all the terms of an agreement, like interest rate changes and hidden fees.
As Attorney General, Fernandez said he would seek legislation to end those exemptions, institute fines and other penalties on businesses who deceive consumers, and expand his powers to prosecute businesses.
Mortgage Fraud
Fernandez said he would take equally aggressive and comprehensive approach to dealing with mortgage fraud and predatory lending. He said he would make mortgage fraud a felony that carries a five-year prison sentence. Also, he wants mortgage consultants and debt negotiators to register with the state.
For homeowners who are facing foreclosure, Fernandez said banks and mortgage lenders should have to participate in a “mediation session” with the homeowner before actually foreclosing—those that refuse, would face fines.
Herkert noted that as city solicitor for Providence, Fernandez had taken the lead in the state in helping residents who were losing their homes.
“When the General Assembly failed to act to address the mortgage crisis, Joe helped create and implement the ordinance in the city of Providence that forced banks to negotiate mortgages before simply taking a person’s home in foreclosure,” Herkert said.
That ordinance recently withstood a court challenge, Herkert added. As Attorney General, he said Fernandez would adopt a statewide version of the ordinance.
Advocating for Ratepayers
Fernandez also reaffirmed a promise he has already made several times—that he would stand up to insurance companies that try to “stick it to hardworking Rhode Islanders with unfair rate hikes and the denial of services.” He said he would likewise resist rate hikes proposed by utilities.
“We’ve seen a lot of rhetoric in this race with regard to various consumer protection issues, but we haven’t seen much substance,” Herkert said. “Joe Fernandez isn’t interested in political sound-bites, he’s committed instead to getting real results for the people of Rhode Island. This plan demonstrates that commitment through a set of specific policy proposals designed to address the lack of consumer protection in Rhode Island.”
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