Consumer Fraud 1448 articles

Teddy bear company cited for FLSA child labor violations

Build-A-Bear-Workshop Inc. is listed on Fortune’s 2009 list of the “100 Best Companies to Work for,” but the U.S. Department of Labor’s Wage and Hour Division disagrees — at least where the company’s youngest employees are concerned. The government agency cited the St. Louis-based company for violations of child labor provisions of the Fair Labor Standards Act and ordered it to pay $25,600 in civil penalties. Build-A-Bear Workshop, an international retailer with more than 400 locations worldwide, allows customers to design and create their own teddy bears. The Wage and Hour Division found that many Build-A-Bear’s Midwestern retail locations violated ... Read More

Teenager’s death leads to multiple FLSA and OSHA fines for Georgia company

The U.S. Department of Labor’s Wage and hour Division has ordered a Suwanee, Georgia-based demolition company to pay a steep penalty for violating child labor laws after a teenage employee died on the work site. The teenager, an employee of Demon Demo Inc., was working on a demolition site at Macy’s in the Gwinnett Place Mall when he fell from the third story of the building. The boy had been tossing debris off the building when he fell. The fine was the first one issued by the Wage and Hour Division under the Genetic Information Nondiscrimination Act of 2008 – ... Read More

Solis works to revamp and empower Wage and Hour Division

The Department of Labor’s Wage and Hour Division, under which the Fair Labor Standards Act came into existence in 1938 as part of a nationwide effort to protect working class citizens from corporate exploitation and abuse, may be on the mend after an long era of being little more than a bureaucratic entity. In March, Secretary of Labor Hilda L. Solis announced her intentions to revamp and empower the Wage and Hour Division, saying that she would increase the Division’s staff size by a third in an effort to “refocus the agency on [its] enforcement responsibilities.” The addition of new field investigators, ... Read More

Brazilian workers sue Gulf Coast shipyard recruiters

If a group of Brazilian workers is believed, some U.S. companies are still practicing a form of indentured servitude. According to a lawsuit filed in U.S. Distrcit Court for the Southern District of Mississippi, a group of Brazilian welders and pipefitters came to the U.S. as temporary H-2B guest workers for American recruiters that provide workers for shipyards. According to the suit, the workers came to this country “on promises of consistent, well compensated work at a reputable shipyard through a regulated U.S. government program.” What looked like an American dream, however, quickly turned into an American nightmare. The suit ... Read More

California maid company fined for ignoring 2007 ruling

Violating the rules of employment set forth in the Fair Labor Standards Act can be an expensive way to do business. In August of 2007, a federal judge in the U.S. Central District Court for California in Santa Ana ordered Southern California Maid Services Inc. to pay nearly $3.5 million in back wages and another $1 million in liquidated damages to 385 of its employees. The court ruled that by improperly classifying their workers as independent contractors, Sergio Maldonado and Lorenza Rubio, the company owners, avoided paying minimum wage and overtime, which the FLSA requires. Then, last week, after finding ... Read More

AIG’s self indulgence linked to Unum’s former CEO

Remember the $165 million in bonuses that American International Group (AIG) awarded to its executives after accepting more than $170 billion in federal bailout money? Those bonuses, which have become a symbol of corporate greed and self-indulgence in the eyes of many Americans, were approved by former Unum CEO James F. Orr. Orr is now an AIG director and serves as chairman of its “executive compensation committee.” Now several owners of AIG stock, including the leaders of big union and pension funds, are requesting the removal of Orr from AIG’s directorship. The stock owners made their appeal to the three AIG ... Read More

Investors, 6 Morgan Keegan, 0

Regions Morgan Keegan has suffered it sixth straight loss in arbitration negotiations with investors who claim they lost substantial amounts of money when RMK misrepresented its bond funds. The suits claim RMK presented the bond funds as low-risk investments, when they actually were tied to the volatile mortgage bond market. When the subprime mortgage lending crisis reached a peak, many investors lost up to 80 percent of their money almost overnight. This week, Morgan Keegan & Co., a subsidiary of Regions Financial Corp., was ordered to pay $950,000 to investor Jerome Woods, whose claim included allegations of fraud, negligence and ... Read More

Department of Labor fails to uphold and enforce FLSA regulations

If you’re a wage worker and your employer is violating the Federal Labor Standards Act (FLSA) by paying you less than minimum wage, denying you overtime, or misclassifying you as a manager or independent contractor, don’t go running to the Department of Labor (DOL) for help anytime soon. According to the Government Accountability Office (GAO), the DOL’s Wage and Hour Division (WHD) is incompetent. What’s worse, the latest report, released on March 29, represents the third time in less than a year that the GAO has found the Wage and Hour Division’s performance a failure when it came to enforcing ... Read More

Helios bond funds set for liquidation

Three former Regions Morgan Keegan bond funds that were renamed under the Helios brand when Hyperion Brookfield Asset Management acquired them are now set for liquidation, pending stockholder approval. The troubled funds were acquired after suffering significant and sudden losses during the subprime mortgage crisis. Regions Morgan Keegan is defending hundreds of arbitration lawsuits regarding the funds, which were backed by risky mortgage-related assets. Investors allege the funds were represented as low-risk securities, but when the mortgage crisis hit beginning in the middle of 2007, the funds suffered staggering and sudden losses. Some funds dropped between 62 and 82 percent ... Read More

RMK investor awarded more than $250,000 to cover bad fund losses

Earlier this month, it was announced that Morgan Keegan & Co., the brokerage firm owned by Regions Financial Corp., would be required to repay an investor $267,711 for losses suffered by the collapse of Regions Morgan Keegan investment funds. According to CCNMoney, this is the largest bond fund arbitration award to date. Hundreds of investors lost significant amounts of money nearly overnight as a result of monies invested in mortgage-backed funds that collapsed in the subprime lending crisis. Lawsuits against Regions Morgan Keegan allege the funds were represented to investors as low-risk preferred stocks and corporate bonds, when in fact ... Read More