Archive for the ‘Consumer Forum’ Category

Don’t buy a car if you can’t touch it first – Bangor Daily News

CONSUMER FORUM

Posted Feb. 08, 2016, at 7:50 a.m.

Northeast CONTACT wishes to give a major thank you to all the financial professionals who keep consumers safe. Our thanks go especially to one bank official in the Ellsworth area.

The official was concerned when a customer wanted to make a sizeable withdrawal with plans to wire money for an antique car. What aroused the official’s suspicion was the money’s destination: London, England.

Scammers typically operate from bases overseas, and money that’s wired away never comes back. The official had heard of such schemes and gently urged the customer not to buy a vehicle sight unseen and definitely not to wire money to an unknown party. That advice probably prevented a $14,500 payment for a car that almost certainly doesn’t exist.

The customer had seen an ad in a local newspaper. Detective Dorothy Small of the Ellsworth Police Department said identical ads appeared in Rolling Thunder Express and Penobscot Bay Press.

The latter online publication is now running a scam alert on its classified page, noting that the ad that ran in its Jan. 14 and 21 papers “was submitted under false pretenses and is a scam.” The publisher went on to apologize “for falling victim” — even though the ad appeared to meet policy guidelines — and urged readers not to respond.

The look-alike ads are no coincidence. Scammers find appealing phrases (“1970 Chevrolet Chevelle 454, manual four-speed, red with black stripes”) and cut and paste in publications everywhere.

One online vintage car dealer has tips to avoid being scammed, including a nearly identical ad to those that appeared in Maine, athttp://nwcam.com/Helpful_Tips_About_Internet_Scams.html. Search a key phrase from the ad and find all kinds of “late husbands” and their treasured cars for sale, over several years.

The gist of all such ads is the same: you’ll be getting the deal of a lifetime. In fact, you’ll get nothing.

Small noticed that photos of the car “for sale” had been taken on different road surfaces, a tipoff that the pictures had been lifted from various Internet sources. Payment was to be made via Pay Safe, which is headquartered in Nevada … so instructions to wire funds to England were another red flag.

“If you can’t put your hand on the vehicle that you’re going to buy, then don’t buy it,” Small said.

senior-safe

Click image to access brochure

That probably echoed the urging of our bank teller, who was likely one of more than 300 front-line bank and credit union employees who have undergone training in what’s called Senior$afe.

The program is a partnership of Maine’s financial community and state government, all allied through the Maine Council for Elder Abuse Prevention. Training enables key employees to spot potential cases of fraud and, in many cases, stop them cold.

Partner agencies help with training and promoting what Maine Securities Administrator Judith Shaw called a “no wrong door” approach to referrals in testimony before a U.S. Senate committee last year.

A spokesman for Shaw’s department told me it’s hoped Senior$afe will grow and further expand protections against financial fraud. You can find a brochure on the program at the Maine Bankers Association website, www.mainebankers.com/seniorafe/.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

How to get help if your identity is stolen

CONSUMER FORUM

Posted Feb. 01, 2016, at 9:07 a.m.

Having your identity stolen means starting a recovery process that can take months, even years.

The Federal Trade Commission, or FTC, last week announced an upgrade of its efforts to help the millions of consumers who are victimized every year.

Edith Ramirez, chairwoman of the FTC, told participants on a conference call that complaints about identity theft to her agency rose by nearly 50 percent last year. Ramirez said, while that’s shocking enough, the true scope of the crime is not known because it is “vastly underreported.”

What is known is that thieves are illegally opening new accounts, getting access to existing accounts fraudulently and filing phony tax returns, all while using other people’s names and personal information.

The FTC says victims can ease the task of getting their financial lives back in order by visiting the agency’s secure recovery website at identitytheft.gov.

Visitors can browse the range of recovery tips or jump right in by entering as much relevant data as possible that led to their identities being stolen. The FTC thinks the upgraded site will give consumers a one-stop means of filing a complaint about identity theft and beginning the process of recovery.

Victims are asked to first enter basic information about the type of identity theft to which they were subjected. Then the site walks the victims through a checklist geared toward that type of crime.

The site will generate affidavits and automatically fill a lot of information in letters and forms to be sent to police, businesses, credit bureaus, debt collectors and the IRS. If a recovery effort hits a snag, the site will suggest other ways to proceed.

To minimize further risks, the site will not ask victims for sensitive information, including dates of birth and Social Security numbers. There will be follow-up emails from the site, and consumers can go back to their plans later — through two-factor authentication — as their recovery continues.

The U.S. Justice Department estimates that 17.6 million Americans were victims of identity theft in 2014. Ramirez said the crime is one that will be with us for quite a while.

“We’re all doing more online. We’re all using mobile technology,” she said. “It’s going to expose people’s information to breaches,” if we’re not increasingly vigilant.

Ramirez made the announcement on Data Privacy Day, designated in 2008 by the National Cyber Security Alliance. Read tips from that nonprofit about keeping your data to yourself at staysafeonline.org.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

Protect yourself against scams before filing taxes

CONSUMER FORUM

 

Posted Jan. 25, 2016, at 11:18 a.m.
Federal officials have termed them the biggest scams ever. Together, they cost consumers billions of dollars every year. And they use people’s fear of the Internal Revenue Service as a weapon.

The first starts with an unexpected phone call. You’re told that you owe taxes and must pay immediately or you’ll be jailed. What do you do?

An IRS official says, just hang up … it’s a scam.

Hundreds of thousands of consumers have received multiple calls from different people, all posing as either IRS officials or law enforcement agents. All the callers claim that legal action is certain, unless they receive money via wire right away. A demand for immediate payment is the second tipoff that it’s a hoax.

The first was the threat of imprisonment.

The IRS does not typically call a taxpayer; the agency begins by sending a letter. It also does not seek payment by way of prepaid cards, and it does not have agents standing by with arrest warrants in case the taxpayer hesitates.

The criminals who use these techniques can be abusive, even threatening to hurt their victims. These hoax calls may originate halfway around the world — although a spoofed phone number may make them appear nearby — and any threatened action rarely happens.

The second major hoax involves the filing of a phony tax return. If a thief steals your name, birthdate and Social Security number, he or she can file a bogus return in your name. If the IRS doesn’t catch it, the agency might send a refund to the crook; it may not be until you file your legitimate return that the fraud is discovered.

The IRS has trained thousands of employees to help possible victims. It has also put in place a number of preventive measures, most of which it won’t discuss in order not to assist the scammers. In a public message last week, the IRS said it has teamed up with the states and tax preparers to “stop fraudulent returns at the door.”

One new piece of information from tax software providers will be the amount of time it took to prepare a return. That could be a tipoff when computer-generated returns are fraudulent and have been filed by the hundreds or thousands.

You can read about the new measures at IRS.gov/uac/IRS,-States-and-Tax-Industry-Deploy-New-Safeguards-for-2016.

Tax season brings with it a rash of scam artists trying new ideas. Crooks might point to last year’s hack of IRS computers, which compromised some information of about 200,000 taxpayers. They might pose as “IRS counselors” or “credit advisers” while their real goal is to steal more personal data.

IRS officials suggest that tax preparers do a “deep scan” of all their computer drives and devices to find malware and viruses that may hide in places that a “quick scan” can’t find. Firewalls and antivirus software also should be up to date; if you use a tax preparer, don’t be shy about asking if security systems are robust.

If you store your tax filings on your computer, make sure there’s a backup in case your hard drive crashes. If you store paper copies, keep them under lock and key (ideally in a fireproof container). Find more security and identity protection tips at IRS.gov.

If you get a phone call you suspect is a hoax attempt, call 800-366-4484 to find out if the caller is a real IRS employee with a legitimate reason to reach you. If a piece of mail seems suspicious, call 800-829-1040 to see if it’s legitimate.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

When does it make sense to buy an extended warranty?

CONSUMER FORUM

By Russ Van Arsdale, executive director Northeast CONTACT
Posted Jan. 18, 2016, at 7:31 a.m.

Consumers who do their research may conclude that buying an extended warranty is not generally worth the cost.

On major appliances, the manufacturer’s warranty covers the period of initial use, when minor problems generally surface. More serious problems likely will arise after an extended warranty period is over, so the cost of coverage may not be justified.

However, for some really big purchases, extended warranties may be worth a second look. Look carefully because many consumers have found that some extended warranties were bad investments. Third-party coverage for vehicle repair is notorious for refusing to pay because the problem in question is “not covered.”

For private homes, purchasing a warranty might make sense. In many states, homebuilders have to provide a warranty on new homes they build. An extended warranty is different from home insurance, which covers your loss in case of natural or manmade disasters. Owners of existing homes can buy warranties that cover heating and cooling apparatus, plumbing and electrical systems and appliances.

A home warranty likely will cost between $350 and $500 and typically is paid annually. The cost will depend on what you want covered — for example, appliances only, systems only or both. There typically are fees for every service call, running $75 to $100. You should ask up front whether you’ll be charged a fee each time if more than one service call is needed to resolve a problem.

Another question to ask a warranty provider is whether service providers are licensed. The company may allow you to use a provider of your choice, but most use their own service people to make sure work is done correctly. Also, find out about dispute resolution if you’re not satisfied with the service that’s provided.

There’s a section of Maine law called the Service Contract Act, but it applies only to contracts on tangible personal property — goods costing more than $100 and sold for noncommercial use. It requires that sellers of service contracts be licensed. You can find a summary of the law at maine.gov/pfr/insurance/faq/Service_Contracts.html.

You may determine you don’t need an extended warranty for your home. You may instead decide to self-insure — that is, to set aside money on a regular basis to create your own insurance fund. If you need it to fix an appliance or make another repair, it’s there. If such a need does not arise, you can invest the money or spend it on something else.

Consumer Reports looked at home warranties a few years ago and concluded that, for most homeowners, the self-funded approach makes the most sense. An exception, Consumer Reports noted, is when a house is for sale and the seller buys an extended warranty to reassure prospective buyers.

If you buy such a house, make sure the warranty is paid in full and know all the terms.

ConsumerAffairs.com offers comparisons of 15 of its top-rated home warranty plans. Read more at consumeraffairs.com/homeowners/aaa_warranties.html#guide-features.

Another website with reviews and related information is homewarrantyreviews.com.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

Second-chance resolutions for smart consumers

CONSUMER FORUM

Posted Jan. 11, 2016, at 7:27 a.m.
Have you abandoned all your New Year’s resolutions? Here’s a chance to start over (good consumers deserve second chances).

Take the pledge to be more aware of your spending, saving and other monetary decisions. We’re well aware of the ads, store displays and peer pressure during the recent holidays. Let’s agree to be attentive to our finances year-round.

A great goal for the end of 2016 is a “rainy day fund,” savings equal to one month’s wages. Setting a few dollars aside each week can get you started, and the extra money could be critical in an emergency. Financial advisers say we should all eventually set aside two to four months pay for unforeseen events.

Setting up such a fund is one recommendation of David Leach, principal examiner at Maine’s Bureau of Consumer Credit Protection. Leach says consumers can save themselves a lot of grief by following the most basic of advice: Always spend less than you earn. Follow that rule, and you can have part of your paycheck withheld and put automatically into a retirement account.

Leach and others at the Bureau of Consumer Credit Protection have been watching interest rates with, well, interest. While it’s too soon to get any clear indication how consumers will react to the Fed’s raising of the prime rate by 0.25 percent, Leach cautions consumers not to rush into a major spending spree in anticipation of more rate hikes.

Economists seem to be leaning toward predictions of a few quarter-point increases in coming months. Over time, those increases in the prime lending rate will make their way into the rates consumers pay for loans.

In the near term, Leach predicts those consumer rates won’t change much. That could prompt people to buy durable goods — cars, appliances, other big items — while rates are low. It might trigger other consumer action as well.

“My advice to consumers is to always shop around for the lowest annual percentage rate, or APR, when looking to finance their next home, automobile, snowmobile, or when selecting a new credit card,” Leach told me.

He said big-ticket purchases should come only after thorough investigation of both the items and consumers’ ability to repay any loans needed to buy them.

Leach offers several other money-saving resolutions for Mainers for 2016:

— Pay cash or use a personal check or debit card whenever possible; reduce or eliminate interest paid on credit cards.

— If you’re buying a vehicle, try to make at least a 20 percent down payment in cash or through a trade-in.

— On outstanding auto or home mortgage loans, pay a little extra each month, to shorten the term of the loan and thus save on interest payments.

— Avoid impulse buying at grocery and department stores. When you shop, make a list and stick to it.

Leach’s colleagues at the Bureau of Consumer Credit Protection can help with a variety of consumer credit issues. Reach them by phone at 800-DEBT-LAW (800-332-8529) toll-free in Maine, or find the bureau online at Credit.Maine.gov.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

“No risk” investment schemes often prove to be scams

CONSUMER FORUM

Posted Jan. 04, 2016, at 8:08 a.m.

Maine’s securities administrator has some advice for would-be investors: steer clear of any offer promising “limited or no risk” and big returns.

Judith Shaw sent out a news release as the old year was drawing to a close, reminding consumers that education was their best defense. Shaw said red flag warnings should go up any time there’s an unsolicited offer of financial advice or investment possibilities.

Shaw also serves as president of the North American Securities Administrators Association. A survey of other members turned up five troubling themes.

Leading the list were unlicensed salespeople and unregistered products. Licensing requirements are in place to protect investors; crooks try to get around them by offering those quick returns at minimal risk.

A second danger zone involves promissory notes. These are usually offered by companies looking to raise capital; they’re best purchased by experienced or corporate investors who can thoroughly check out the company that’s making the offer. Inexperienced investors would do well to stay away from short-term notes, which may be offered to bypass rules stating that they be registered with the U.S. Securities and Exchange Commission and state regulators.

Oil and gas investments can be tricky. The deal might originate in one state with drilling in another; this can make visiting either a challenge. The Securities Administrators Association cautions that bogus offers are making the rounds as oil prices continue to fluctuate.

A fourth area that’s not for novice investors is real estate deals. Nontraded real estate investment trusts, brokered mortgage notes and re-sales of timeshares often carry high risk.

The fifth area — probably the worst — is the Ponzi scheme. Using the money from new investors to pay off old ones is always doomed to fail. And it’s never legal.

CNBC’s website has a longer list of sometimes shaky investment offers. Trading currencies sounds exotic but the complexities can spell trouble. Precious metals are touted by advertisers, but scammers know that buyers likely won’t visit the companies that supposedly store the gold bullion.

Sellers of “private placements,” or securities that are exempt from federal or state regulations, tout high returns but they may be telling tall tales. The Internet is loaded with offers for private placements; some are legitimate, while others are scams.

Speaking of the Internet, the SEC reminds consumers that financial advice of all kinds abounds in cyberspace. Read the commission’s advice about online investment newsletters at sec.gov/investor/pubs/cyberfraud.htm. And check out financial investors who are licensed to do business in Maine at maine.gov/pfr.

Finally, remember the old saw: If it sounds too good to be true, it is. That applies to offers from people you know as well as those you don’t; people who appear to be your friend may simply be after your money.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

 

How the new federal spending plan affects consumers

CONSUMER FORUM

Posted Dec. 28, 2015, at 9:41 a.m.
Last modified Dec. 28, 2015, at 10:14 a.m.

The omnibus spending bill Congress passed earlier this month included $1 billion for a destroyer. Maine’s congressional representatives hope the contract goes to Bath Iron Works.

Passage of the 1,600-page, $1.1 trillion bill headed off a possible government shutdown, prevented another of the stopgap spending plans our lawmakers have made famous and it allowed the national debt to go up. It also included a number of added-on spending items, known on Capitol Hill as “riders.”

Our thanks to writers at The Washington Post, Christian Science Monitor and The Atlantic for spotting these items of interest to many consumers.

— A 1 percent pay raise for federal employees, starting Jan. 1, 2016. President Barack Obama ordered the increase and the omnibus bill retains it. Military service personnel will receive a similar raise, while pay for generals and flag officers are subject to a pay freeze.

— Multi-employer pension plans. The benefits of potentially millions of retirees could be cut to try to save some pension plans that are in financial trouble. There are about 1,400 such plans, most of them in good shape.

— More money for food safety. Funding for the Food and Drug Administration goes up $37 million from last year. The Food Safety Modernization Act gets $27 million in new funds, and there’s a $5 million increase for the Food Safety and Inspection Service.

— Some Dodd-Frank reforms reversed. The financial reform bill had required that banks “push out” some derivatives trading into other entities that did not have the backing of the Federal Deposit Insurance Corporation. Banks won a reversal of that rule; Democrats say that, in exchange, they received more funding for enforcement efforts by the Securities and Exchange Commission and the Commodity Futures Trading Commission.

— Internal Revenue Service cuts. Funding for the IRS drops by $345.6 million. The agency also is barred from singling out organizations that cite ideological beliefs to get tax-exempt status.

— School lunch programs. Flexibility goes to school districts that can “demonstrate a hardship” when buying whole grain products. There also are less rigid sodium standards until they are supported by “additional scientific studies.”

— WIC and potatoes. The Women, Infants and Children nutrition program for low-income families gets $6.6 billion, down $93 million from the last fiscal year. But WIC will have to guarantee that “all varieties of fresh vegetables, including white potatoes, are eligible for purchase.”

— Tired truckers. The trucking industry won a round in the fight to require that drivers get two nights sleep before going back to work. That Department of Transportation regulation would have cut a typical driver’s workweek from 82 hours to 70. Maine Sen. Susan Collins had pressed for suspension of that rule in favor of more study.

— Safer tracks. The omnibus bill includes $3 million to expand inspection of about 14,000 miles of track used by trains that include oil tanker cars.

— Veterans reform bill funding. The bill that was passed last summer gets $209 million to deal with new costs, including added medical staff and expanding facilities. The Veterans Administration’s Office of the Inspector General receives an additional $5 million to keep investigating the “wait list scandal.”

— Light bulb choice. The spending bill limits enforcement of a 2007 law to end use of incandescent bulbs. While many consumers have switched, others may be able to find the older style a while longer.

— Saturday mail delivery. It continues, courtesy of the omnibus bill, despite years of efforts to cut the service to save money.

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit https://necontact.wordpress.com or email contacexdir@live.com.

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