Each year the Office of Consumer Affairs and Business Regulations, conducts an annual review of what it has accomplished in returning money to consumers in Massachusetts. The OCABR, which oversees the Division of Insurance also oversees the Division of Banks, Division of Professional Licensure, Division of Standards, and the Department of Telecommunications and Cable.
For calendar year 2012, the OCBAR announced that it’s various agencies had collected $13.9 million in fines and settlements stemming from the over 57,000 consumer calls agencies made to the OCABR and its divisions.
“Consumers call and we take action,” said Undersecretary of Consumer Affairs Barbara Anthony. “Through our agencies’ collective efforts, we were able to recover $13.9 million for consumers during 2012. This figure represents how state government is putting money back into consumers’ pockets every day.”
What might be of particular interest to the Massachusetts insurance industry, however, is the exact part that the Division of Insurance played in helping to generate that $13.9 million amount.
- Of the 57,000 calls made to one of the OCABR’s divisions, the Division of Insurance received over 20,000 of those calls;
- Of the 20,000 inquiries it received, 1,100 were consumer complaints;
- As a result of those 1,100 consumer complaints, the DOI collected $3 million from insurance sellers who were involved n claim processing delays, inappropriate denials of claims or improper agent claim handling;
- The Special Investigations Unit of the Division of Insurance assessed insurance sellers over $209,000 dollars in enforcement fines and penalties for violations of state law and unethical conduct;
- The Division’s Market Conduct Unit settled with eight different insurers in 2012;
- The penalties recovered from these insurers totaled $7.5 million.
Based on this information provided, the Division of Insurance and its actions generated approximately $10.7 million of the total $13.9 million that the OCABR collected last year. The OCABR says that “Money generated through fines and settlements with an agency goes to the General Fund. Settlements, arbitration wins and other payments for consumers go directly to that consumer.”
To following is a list from the OCABR of what the other Divisions generated during calendar year 2012:
- The Office of Consumer Affairs’ Lemon Law Program accepted 61 complaints into the new and used car arbitration program in 2012, which resulted in more than $387,000 in awards and settlements to consumers.
- The Office of Consumer Affairs’ Home Improvement Contractor arbitration program, which was created to resolve disputes between homeowners and registered contractors, awarded nearly $361,000 to 26 homeowners in 2012. The Home Improvement Contractor Guaranty Fund, a separate but related program, paid over $375,500 to 44 homeowners in 2012. The Guaranty Fund was created as a fund of last resort for consumers who have an unpaid final judgment against a contractor. The Guaranty Fund is funded by a one-time fee that contractors are required to pay at the time of registration.
- The Division of Banks responded to over 9,100 consumer inquiries in 2012, resulting in $15,500 recovered from financial institutions and licensees. Complaints included issues encompassing checking accounts, bank rates, mortgage points and non-bank ATMs. As a result of examinations of mortgage brokers, mortgage lenders, debt collectors and finance companies, the Division directed reimbursements of nearly $426,000 to approximately 1,065 Massachusetts consumers in 2012. The Division also collected loan originator fees and penalties to fund $900,000 in grants to 11 regional foreclosure centers and seven counseling agencies during 2012.
- The Division of Professional Licensure (DPL) oversees 31 Boards of Registration and licenses over 366,000 professionals in 50 different trades. The Division issued nearly 23,000 new licenses to trade professionals in 2012. The DPL Boards received and investigated a total of 4,025 complaints, resulting in almost 1,400 fines totaling over $522,000. The DPL Boards issued over 700 enforcement actions against licensees, including 244 license suspensions, 186 license revocations, 72 voluntary surrenders, 16 stayed suspensions and one censure. The Boards also issued 33 reprimands or verbal warnings and placed over 150 licenses on probation.
- The Department of Telecommunications and Cable’s (DTC) consumer division responded to over 19,000 inquiries and investigated over 2,200 complaints in both regulated and unregulated industries. The majority of complaints concerned quality of service or billing disputes. In 2012 the DTC authorized over $71,000 in refunds and credits to consumers’ bills.
- The Division of Standards received approximately 300 consumer complaints, including licensing issues, weights and measures violations and item pricing complaints involving overcharges. Last year the Division issued fines for item pricing violations totaling $142,350. Approximately 10 percent of this total was directly attributed to consumer complaints. The Division issued civil citations for various weights and measures and licensing violations totaling nearly $12,500. The Division also approved one judgment for payment to a consumer from the auto repair shop bond fund in the amount of $7,500. The judgment was authorized by the Worcester District court on behalf of the Plaintiff, settling a case over shoddy repair work by Fremont Autobody Shop.