September 26, 2020

Bucks Blog: Friday Reading: Tackling Medical School Debt

December 14

Friday Reading: Tackling Medical School Debt

Tackling the problem of medical school debt, filling your iPhone’s e-wallet, airline passengers seek child-free flights and other consumer-focused news from The New York Times.

Article source: http://bucks.blogs.nytimes.com/2012/12/14/friday-reading-tackling-the-problem-of-medical-school-debt/?partner=rss&emc=rss

Bucks Blog: Dwolla: A Service for Passing Money Back and Forth

When he was a merchant selling stereo speakers online, nothing burned up Ben Milne more than the fees he had to pay credit card companies. So he has started a company, one that aims to create an alternative, Internet-based payment system with a simpler fee structure for both consumers and retailers.

The company, based in Des Moines, Iowa, has a funny name: Dwolla. Nevertheless, Mr. Milne, Dwolla’s chief executive, says the system has about 70,000 users (including about 5,000 merchants) and is handling $1 million a day in transactions.

How does it work? Users sign up online for a Dwolla account, which involves entering personal information like date of birth and Social Security number. Dwolla says it uses the information to make sure you are old enough to open an account (you must be 18 or older) and to verify your identity.

Then you fund the Dwolla account by linking it to a bank account and transferring money to Dwolla (this differs from other kinds of newfangled payment services — like, say, Google Wallet — which are typically funded with a credit card).

Formalizing the setup can take a couple of days. During that time, Dwolla makes one or two small test deposits, which you must verify, to make sure you are authorized to have access to the bank account. Dwolla itself is not a bank, so once the Dwolla account is funded, the money actually sits in a credit union in Iowa.

Then, when you shop at a merchant that accepts Dwolla (a map is on the Web site), you can get access to the system via a phone; find the merchant, enter an amount and click to pay. You can also pay individuals, via an e-mail, or by Twitter or Facebook; the recipient gets notification that you have sent the money. (Dwolla says it does not exchange your financial information with the social media sites “in any way, shape or form.”) Then, he or she must register for an account at Dwolla to accept the money.

Transactions are now free for amounts under $10; otherwise, they are a flat 25 cents each, rather than a percentage of the transaction. The store — or the person getting the money — pays the fee, under Dwolla’s default setting. But you can click an option to pay the fee yourself — if, say, you’re making a donation, or paying back a friend who fronted you some cash at dinner.

The system is secure, Dwolla says, because the merchant never sees your bank account number; the transaction is handled by Dwolla. “We don’t expose your information,” Mr. Milne said.

To demonstrate how this actually works, Dwolla sent me a test payment of $1. I received an e-mail, notifying me that I had been sent money on Dwolla. (It also said, “It could be a million dollars!” Cute — maybe a bit too cute, for a payment system trying to be taken seriously and not wanting to be mistaken for spam or a scam.)

To accept the payment, I clicked on an embedded link and was directed to the Dwolla Web site, where I selected a PIN and signed up for an account. (I didn’t, however, link my bank account; call me a fuddy-duddy, but I tend to be cautious about doing things like that.) Mr. Milne says Dwolla is vigilant about watching for phishing attacks, which often involve sending look-alike e-mails with embedded links. But if you are uncomfortable clicking on a link in an e-mail, he said, you can instead go directly to Dwolla’s Web site by typing its URL yourself, then entering your e-mail address to receive your money.

At that point, the money could sit there in my Dwolla account, to be used to pay other Dwolla users. Or — if I linked my bank account — I could transfer the buck into my outside account. Since this was just a test, I opted to pay Dwolla back its dollar. (But I didn’t click the option to pay the quarter fee myself; sorry Dwolla!)

One catch is that moving money from your bank to your Dwolla account typically takes a few days because of the funds transfer system that banks use. That’s a drawback if you are suddenly in need of cash to buy something unexpected and your Dwolla balance is too low.

So to speed up access to your money, Dwolla recently began offering an “instant” option for people who want faster access to their cash. The option, which costs $3 a month for unlimited use, means Dwolla will spot you up to $500 when you do not have enough in your Dwolla account to cover a purchase. You promise to repay the funds within 30 days; otherwise, you incur a flat, $5 late fee. (Dwolla currently does not require a formal credit check for Instant users, but may in the future, a spokesman, Jordan Lampe, said in an e-mail. Right now it qualifies Instant users with a risk analysis tool developed with the Members Group, a payment company and a Dwolla investor.)

Adding fees to accounts is not wildly popular with consumers right now (see: Bank of America). But Mr. Milne counters that the fees for the Instant service are clearly disclosed, and consumers know what they must do to avoid the late charge; there is no risk of a whopping $35 overdraft fee, followed by multiple add-on fees, as there is if you overdraw a bank account. “We want to have transparency in fees,” he said.

You can, of course, skip the instant option. In that case, if you try to buy something without sufficient funds, the transaction is simply declined.

The Smokey Row Coffee Company,  with several locations in Iowa, has been accepting Dwolla at its Des Moines location since May and now does two to 10 transactions a day, says Mandy Miller, creative director at the shops. The service saves money that would otherwise be paid in credit-card interchange fees. “We don’t see any drawbacks,” she said.

Carter Bailey, a software developer near San Antonio, heard about Dwolla online and persuaded his landlord to begin using it. “It’s one of the easier Web services I’ve ever signed up for,” said Mr. Bailey, who signed up for Dwolla and authenticated his bank account using Twitter.

Of course, many more merchants and users will have to start using Dwolla if it is to reach critical mass. Mr. Milne says he thinks it can be done — and that, eventually, the system may even be attractive to banks themselves. “We believe our system can be leveraged by banks and consumers, and it would be valuable to everybody,” he said.

What do you think of Dwolla’s approach?

Article source: http://feeds.nytimes.com/click.phdo?i=77535f44543ba9c6174c1a0825099a9a

Bucks Blog: Tuesday Reading: How Government Austerity Affects Health Care

Today in Your Money

All the news from The Times that will hit you in the wallet.

A variety of consumer-focused articles appears daily in The New York Times and online in our blogs. Each weekday morning, we gather them together here so you can quickly scan the news that could hit you in your wallet.

Concealed weapons permits put guns in the wrong hands. (National)
A law requires ads for airfares to include all taxes and fees. (Business Day)
Airlines are cutting costs and increasing fares. (Business Day)
F.D.A. urges big pharma to develop diagnostic tests alongside drugs. (Health)
Wine is not the only type of alcohol linked with longevity. (Health)
Austerity measures take toll on health care for Greeks. (International)
Foreign financial firms fight tax evasion legislation. (Business Day)
Oversupply of televisions means fire-sale prices. (Business Day)
Penny-pinching gets its 15 minutes of fame through reality shows. (Arts)
Members of Congress have gotten richer as most of country has become poorer. (Politics)
Fear of suspect French breast implants spread to Netherlands. (International)
San Diego keeps an organist on the city payroll. (National)

Article source: http://feeds.nytimes.com/click.phdo?i=bb698337f45f4771aec046b7d5c020e0

PERSONAL TECHNOLOGY: Google Wallet

Google Wallet is intended to replace the credit cards in our actual wallets, but we should not cut up our plastic quite yet.

Article source: http://feeds.nytimes.com/click.phdo?i=6ad7a8e3a97fff53530b8f2790ef6b35

State of the Art: Visions of a Future Where Phones Replace Wallets

Its new phone software, called Google Wallet, is intended to replace the credit cards in our actual wallets.

It does sound pretty spectacular, doesn’t it? No fishing plastic cards out of wallets, no paper slips, no signatures. Everything is handled securely, instantly, conveniently, with one tap of your phone at the register.

Europeans and Asians already routinely pay for things that way. Why can’t we have that in America?

Now you can. But there are enough footnotes to fill a podiatry journal.

At the moment, the free Google Wallet app runs on only a single cellphone model: Sprint’s Google Nexus S, which runs Google’s Android software. That’s because Google Wallet requires a special N.F.C. chip (near-field communications), and the Nexus S is one of the few phones so equipped.

Someday, Google says, many more phones will have N.F.C. chips. The company says that it’s in talks with every major Android phone maker.

The next question: Where can you use Wallet to pay for things? Google had the inspired idea of teaming up with MasterCard, which has already installed N.F.C. readers at 150,000 merchants in the United States and 230,000 overseas. You can see the black MasterCard PayPass terminals all over the place.

That’s 150,000 companies; the total number of physical stores is far higher. At the moment, they include CVS, Duane Reade, RadioShack, Sunoco, Sports Authority, Foot Locker and New York City taxis. In coming weeks, Google says, more stores will come along, including Subway, Macy’s, Walgreens and Bloomingdale’s.

Someday, Google says, the readers will be installed at cash registers all across this great land.

Think of Wallet as a copy of your actual credit card. Wherever you might swipe a credit card, you can tap your phone instead. At the moment, though, the only credit card Wallet can impersonate is a Citibank MasterCard.

Someday, Google says, all kinds of credit cards from all kinds of banks will work with Wallet.

If you don’t have a Citibank MasterCard, you can still use Wallet. On the screen where you select which credit card you want to use, you’ll find an imaginary one called Google Prepaid Card. It comes with $10 of credit — Google’s gift to you, O Early Adopter — but right there on the phone, you can preload it with more money from another credit card.

All right. So you’re in CVS or 7-Eleven, and the cashier announces the total, “$31.24.” At the exact moment when you would ordinarily swipe your credit card, you simply turn on the phone. (You don’t have to fire up the Wallet app first.) You hold it against the PayPass terminal and enter your four-digit password. The screen says “Sent,” and the terminal’s screen says “Authorizing … Approved … Balance $0. Thank you!”

Security, Google says, is baked into the system from the beginning. The phone’s N.F.C. chip is completely deactivated when the screen is off. That’s to prevent sneaky evildoers from “skimming” (reading) your credit card information.

A shame, really; Google says that the N.F.C. chip could work even when the phone was off, meaning you could keep using it to buy things. But Google chose to emphasize security over convenience; as a result, the phone is useless as a wallet once its battery is dead.

The pass code requirement is intended to prevent people from buying stuff with your phone if it’s lost or stolen, since they won’t know the code. (And if they guess wrong five times in a row, the whole Wallet becomes unusable. You have to contact Google and explain yourself.)

Of course, the four-digit pass code requirement also sucks most of the fun and convenience out of the whole phone-as-wallet concept. Tapping out the pass code on small keys on a not-always-responsive touch screen is a hassle, and not demonstrably faster than signing a regular credit card slip. Why can’t we disable that requirement according to our own paranoia levels?

You can’t even pick an easy-to-type pass code to save yourself effort; Wallet won’t accept codes like 1234 or 1111.

E-mail: pogue@nytimes.com

Article source: http://feeds.nytimes.com/click.phdo?i=9d03f29519e86b095da3f12d99317966

Bucks Blog: Tuesday Reading: Flu Shots Cut E.R. Visits for Children

September 20

Tuesday Reading: Flu Shots Cut E.R. Visits for Children

Flu shots cut E.R. visits for kids, Google Wallet debuts, Netflix’s latest plan and other consumer-focused news from The New York Times.

Article source: http://feeds.nytimes.com/click.phdo?i=9190a00b5895b7d40e24d8eb62e6f250

Fair Game: Clawbacks Without Claws in a Sarbanes-Oxley Tool

Under the Sarbanes-Oxley Act of 2002, the Securities and Exchange Commission was encouraged to hit executives where it hurts — in the wallet — if they certified financial results that turned out to be, in a word, bogus.

SarbOx was supposed to keep managers honest. They would have to hand back incentive pay like bonuses, even if they didn’t fudge the accounts themselves.

That, anyway, was the idea. The record suggests a bark decidedly worse than its bite. The S.E.C. brought its first case under Section 304 of SarbOx in 2007. Since then, it has filed cases demanding that only 31 executives at only 20 companies return some pay.

In 2007 and 2008, most of the cases involved shenanigans with stock options and produced some big recoveries. In the wake of the financial crisis, the dollars recouped have amounted to an asterisk. Since the beginning of 2009, the S.E.C. has pursued 18 executives at 10 companies. So far, it has recovered a total of $12.2 million from nine former executives at five. The other cases are pending.

“It seems like a dormant enforcement tool,” Jack T. Ciesielski, president of R. G. Associates and editor of The Analyst’s Accounting Observer, says of the SarbOx provision. “It was supposed to be a deterrent, but it’s only really a deterrent if they use it.”

How assiduously the S.E.C. enforces this aspect of Sarbanes-Oxley is important. Only the S.E.C. can bring cases under Section 304. Companies can’t. Nor, it appears, can shareholders. In 2009, the Court of Appeals for the Ninth Circuit ruled that there was no private cause of action for violations of Section 304.

Half the companies pursued by the S.E.C. during the past three years have been small and relatively obscure.

For example, the commission sued executives at SpongeTech Delivery Systems (2008 revenue: $5.6 million), contending that the company had booked $4.6 million in phony sales that year. NutraCea, a maker of dietary supplements with 2008 sales of $35 million, was sued along with Bradley D. Edson, its former chief executive, over what the S.E.C. called its recording of $2.6 million in false revenue. An executive at Isilon Systems, a data storage company, was pursued because, the S.E.C. maintained, the company had inflated sales by $4.8 million during 2007.

No money has been recovered in the SpongeTech or Isilon matters, which are still pending. Mr. Edson, who could not be reached for comment, returned his 2008 bonus of $350,000.

In all cases when executives have returned money, they have neither admitted nor denied allegations.

The S.E.C. typically recovers more money from executives at bigger companies. But top executives are rarely compelled to return all their incentive pay.

In a case brought last year against Navistar, for example, the S.E.C. contended that the company had overstated its income by $137 million from 2001 through 2005. Daniel C. Ustian, who is Navistar’s chief executive and who was not charged with wrongdoing, returned common stock worth $1.32 million. He had received $2.2 million in incentive pay and restricted stock during the time that the S.E.C. says Navistar inflated its accounting. A company spokeswoman said Mr. Ustian would not comment.

Robert C. Lannert, Navistar’s former chief financial officer, who also was not charged, gave back stock worth $1.05 million. His incentive pay consisted of only $828,555 during the years that the S.E.C. said the company misstated its results. He didn’t return a phone call seeking comment.  

ANOTHER case brought by the S.E.C. last year involved Diebold, a maker of automated teller machines. Contending that Diebold had overstated its results by $127 million between 2002 and 2007, the commission sued to recover money from three former executives. Walden W. O’Dell, who is a former C.E.O. and who was not charged, repaid $470,000 in cash, and 30,000 Diebold shares and 85,000 stock options. During the years that the S.E.C. alleged that results were overstated, he received bonuses totaling $1.9 million, in addition to restricted stock worth $261,000 and 295,000 stock options. Mr. O’Dell didn’t return a message seeking comment. The cases against the other Diebold executives are pending. A company spokesman said it had settled with regulators and declined to comment further.

Article source: http://feeds.nytimes.com/click.phdo?i=00b6bdbd32a8fbb9500da82b3d536448