Archive for the ‘FTC’ Category

Unlocking the code – FTC Scam Alert

 

Unlocking the code

by Alvaro Puig
Consumer Education Specialist, FTC

Identity thieves may already have a lot of information about you – like your credit card number, the card’s expiration date, and your name, address, and phone number. With all that information in his hands, why would he call you? He’s after one vital piece of information – the security code on your credit card.

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Easier to lose money than weight

CONSUMER FORUM

By Russ Van Arsdale, executive director Northeast CONTACT Posted Feb. 22, 2015, at 10:09 a.m.

Here’s a recipe for making millions on unsuspecting consumers. Buy green coffee bean extract from China for about 50 cents per bottle plus shipping, sell each bottle for $30 to $48 and gross an estimated $16 million to $26 million.

To rack up those sales, you’ll need to pass off an unscientific study as “proof” people can lose “an astounding amount of fat and weight” simply by downing your product. Advertise that there’s no need to reduce calories or increase exercise; just swallow the extract along with the seller’s worthless promises. You’ll need some TV promotion to build credibility. An appearance on the “Dr. Oz” show should do the trick. Add a few websites with names that will trigger lots of hits for your wonder product, and you’re on your way.

Dr. Oz scolded at hearing on weight loss scams (click image for FoxDC.com story)

Just don’t get caught. The Federal Trade Commission said last year the “as seen on TV” campaign was false and misleading. In May 2014, the FTC charged NPB Advertising of Tampa, Florida, with making “false and unsupported advertising claims” and with failing to disclose its news sites and testimonials were phony. The case is pending. Then, in September, the FTC charged that Applied Food Sciences of Austin, Texas, used a study it should have known was flawed to make “false and unsubstantiated weight-loss claims” to deceive consumers and sell its extract. The company settled that case for $3.5 million. In September, Dr. Oz announced on his website the study had been retracted. “This sometimes happens in scientific research,” Oz wrote at the time. Last month, the FTC settled charges against Lindsey Duncan and two companies he controls: Pure Health LLC and Genesis Today Inc. Under the settlement, Duncan and his companies have to pay $9 million in consumer redress and refrain from making deceptive claims about green coffee bean extract or any other dietary supplement or drug product. Several critics of the settlement cited a “chilling effect” and voiced fears other manufacturers might hesitate to advertise true claims about products. In a statement, FTC Chairwoman Edith Ramirez said she and the other two commissioners supporting the settlement are “more concerned about other marketers’ incentive to emulate the defendants’ conduct, believing that they will ultimately retain the lion’s share of their ill-gotten gains.” You can review a timeline of the FTC’s actions at nutritionaction.com. On the homepage, look for the article titled “Watch Out for Deceitful Marketing of Dietary Supplements” under “Daily Tips.” Then do a web search for “green bean coffee extract.” We’re betting a wide majority of the 1.58 million hits are still touting weight-loss myths. To lose weight and keep if off, eat fewer calories and increase activity. To learn more about possibly getting some money back if you bought green coffee bean extract, visit the FTC website at consumer.ftc.gov/features/feature-0008-getting-your-money-back.

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.

If Bruce with a foreign accent calls, offers to fix your computer, hang up

CONSUMER FORUM

Posted Feb. 08, 2015, at 3:01 p.m.

You get a call from someone claiming to be from Windows Helpdesk, Windows Service Center, Microsoft Tech Support, Microsoft Support or a similar sounding name.

The caller says he has “detected trouble with your computer” and can help you fix it. Red flags should be flying, because this is one of the most frequently perpetrated scams going. Microsoft warns consumers about these scams and offers tips for spotting fake calls.

The clues are all there. Most callers are heavily accented but give very American-sounding names. They claim your computer is infected with a virus or is operating “with a lot of errors.” They can fix this, they claim, if you’ll only turn over control of your computer to them online and send them a few hundred dollars.

It’s always a scam. No cold-caller could possibly know whether your computer is operating correctly. Those “errors” are typical operating vagaries a scammer tries to make you believe will damage your system if left alone.

Give up control of your computer to someone who calls out of the blue, and you run the risk of having your passwords, financial data and other personal details stolen. Thieves could use that information to drain bank accounts, ruin your credit and steal your identity.

If successful, they’ll probably call back and try to sell you worthless computer security software. Once a scammer succeeds, you can bet your phone number will go on other crooks’ call sheets.

The Federal Trade Commission tried to crack down on the tech support scam, as the crime has become known. In September 2012, the FTC froze the assets of 14 companies working the scam. The agency said the “repair” fees ranged from $49 to $450 and netted thieves tens of millions of dollars from innocent consumers.

That put a few crooks out of business, at least for a while. However, cheap international phone rates and sophisticated dialing programs offer criminals the means to exploit the fears of computer users.

If you let the scammers prattle on, they’ll urge you to open a Microsoft event utility viewer; it’s built into Windows and lists harmless errors legitimate repair people can use to fix operating problems. The crooks point to the “error” and “warning” messages as signs that disaster is about to strike, when in fact the computer may be operating just fine.

The caller might then try to trick you into visiting a phony website and downloading what appears to be a repair tool; in fact, it’s malware that can lock up one or more programs on your computer. The caller may later demand a ransom to allow those programs to work properly again. Or the scammers might install malicious software that turns your computer into a “zombie,” which in turn looks for more computers to infect.

If you receive such a phone call, the best thing to do is hang up. Never buy any software or services from these cold callers. Don’t give them a credit card number or other financial information. And don’t click on links at websites to which you’re directed or in emails they send you. And never turn control of your computer over to anyone other than a known representative of a company with which you already have a business relationship for computer service.

If you have given information, change passwords to your computer, main email service and any financial programs. Do an anti-virus scan to look for malware; if you’re unsure whether the scan has dealt with any problems, you may want to take the computer to a local company you trust to have it thoroughly checked out.

If you’ve shared personal or financial information with a scammer, you may want to place a fraud alert on your credit report. Get details from the Maine Bureau of Consumer Credit Protection, credit.maine.gov, or call 1-800-332-8529 (1-800-DEBT-LAW).

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.

Your phone company is not your friend when it comes to blocking telemarketers

CONSUMER FORUM

Posted Nov. 30, 2014, at 9:15 a.m.

Primus Technologies seems to be a hit with consumers in Canada. Since 2007, the company has offered free blocking of unwanted telemarketing calls.

In a survey, two-thirds of Primus customers say they like Telemarketing Guard, as the program is called. A whopping 87 percent of those surveyed say the big drop in unwanted calls is the main reason they stay with the company.

A lot of U.S. consumers likely would be happy if companies on this side of the border offered a similar service. We have all had our fill of robocalls. Despite tougher rules on such automated calling by the Federal Trade Commission, the pre-recorded automatons still harangue us about better credit, “free” cruises and dangerous falls at home.

Indeed, robocalls lead all categories of consumer gripes. The FTC racks up 150,000-200,000 complaints every month — so many that the agency awarded prize money to computer wizards who came up with the best ways of “Zapping Rachel.” One prize winner is offering a service he calls Nomorobo. It detects when numbers are called in sequence or seconds apart and answers with a robotic voice. If the caller can answer a question, the call goes through; if not, it’s disconnected.

We might think phone carriers would jump at the chance to keep Rachel and her ilk out of our phone lines. The chilling truth is that those carriers see federal rules as standing in the way.

At a recent U.S. Senate hearing, Sen. Claire McCaskill, D-Missouri, said the technology for screening such calls is available. She urged “more pressure on the phone carriers to participate in solving this problem.”

An executive with the U.S. Telecom Association, however, testified his members are bound by law to complete all calls. He said they may not be able to employ call screening or filtering software.

A spokesman for the mobile phone industry said wireless carriers are concerned about “overreaching” and blocking legitimate calls.

The attorneys general of 38 states, including Maine, recently chimed in. They’re urging the FTC to update its Telemarketing Sales Rule in several key ways:

— Ban pre-acquired account information, meaning consumer consent is needed for any transaction.

— Clarify the “negative option” in telemarketing. The attorneys general argue a consumer’s silence or failure to take action and opt out of a certain deal does not necessarily mean a customer agrees with that deal.

— Require telemarketers to keep call records. These could help the attorneys general with enforcement actions.

— Ban or restrict several ways of paying, including money transfers.

In a news release, the attorneys general say they support the intent of the TSR but argue it needs updating to reflect current market practices and lessen the chance for harming consumers. You can read a copy of their letter here.

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.

Phony phone cops bullied US consumers out of millions in bogus debt

CONSUMER FORUM

Posted Nov. 24, 2014, at 9:21 a.m.

Click image to learn more about phantom debt collectors

They make harassing phone calls, claiming that they are law enforcement agents. They threaten to revoke your driver’s license, prosecute you and lock you up. All for debts that aren’t yours.

The National Consumers League says on its website ( www.fraud.org) that thousands of consumers are being bullied into paying debts they don’t owe.

There are many variations, but all scams boil down to one harsh message: wire us money or be in big trouble.

The perpetrator of one such scam received a harsh message last week. A complaint filed by a U.S. attorney in New York charged Williams Scott and Associates of Georgia with scamming $4 million from 6,000 consumers in all 50 states. The complaint charges that over a five-year period, the company had employees pose as police officers, Justice Department officials or FBI agents.

An affidavit filed by a real FBI agent says callers claimed falsely that people owed money for payday loans or had committed fraud.

The affidavit says the scheme involved up to 87 different phone numbers, changing when the scammers realized there were too many complaints. One script seized in an FBI raid includes this exchange between a caller and a frightened woman.

“You think an eight months pregnant woman wants to go to jail?”

“I don’t care if you’re nine months pregnant. I have a job to do.”

When I called Maine’s Bureau of Consumer Credit Protection, principal examiner David Leach was helping a woman whom scammers had tried to dupe.

The scammer had claimed to be from the “Kennebec County Private Locating Service” and said there was legal action pending. When the consumer called the Kennebec County court clerk’s office, she found nothing pending and no record of the “locating service.”

“Scam collectors will do anything to collect money,” Leach told me. He said the fake phone calls “started in Maine sometime in the summer of 2014 and may have peaked somewhere in October.”

However, Leach said this is the most frequent consumer complaint his office deals with.

In some cases, people have taken out payday loans from illegal, unlicensed lenders and repaid the money. The lenders sell their names and other personal information to illegal, unlicensed collectors who then put their defrauding machinery to work.

Consumers may believe these calls are real because the scammers have some personal details about them. If you get such a call, ask for the caller’s name and address, company name and original creditor, if you do have an outstanding loan.

If the caller demands a lot more than you owe, it’s likely a scam. If you have questions about the status of a real loan, hang up and call the number on your loan paperwork.

If you get a call and are uncertain, ask the caller to send a written notice of the debt; then say you don’t want to be called again. That request must be honored, according to the Fair Debt Collection Practices Act.

You can find sample letters drafted by the Consumer Financial Protection Bureau at the “self-help/action letters” tab on our blog ( necontact.wordpress.com).

Some consumers hire an attorney. Giving callers the attorney’s name and number usually stop such calls, when scammers realize the person isn’t an easy target. Report suspicious calls to the Maine Attorney General’s Consumer Protection Division, 1-800-436-2131 or email consumer.mediation@Maine.gov.

Advise the Federal Trade Commission at www.ftc.gov/complaint.

The federal prosecutor says it’s likely that more cases will be brought in the future. He says payday lenders may be among those prosecuted.

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 necontact.wordpress.com or email contacexdir@live.com.

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WABI Interview w/ Wayne Harvey

Lock the door against “work at home” scams that promise big bucks but deliver grief

Posted Nov. 02, 2014, at 10:15 a.m.

Click for FTC Consumer Information

Maybe you’ve been laid off, or maybe you just decided you would rather work from home than commute to a job.

You went to Monster.com to find the perfect job you could land while staying at home. The only problem is, all that’s available is a job helping people troubleshoot problems with their handheld computing gizmos. You’ve ruled yourself out, since your technical ability stops at turning the computer on.

So now for the answer, you turn to the source of all knowledge: the Internet. Your search for “work at home jobs” returns 29.2 million possibilities. A lot of them promise weekly earnings of “hundreds or thousands of dollars.” For every website warning you of possible scams, 10 more promise “easy earnings” with “minimal” outlay of time and effort.

A federal judge last month threw the book at one of these outfits, Zaken Corp. The company and its principal officer, Tiran Zaken, were ordered to pay more than $25 million to consumers who had been promised “substantial income” by working from home. The Federal Trade Commission had opened an investigation in 2012 and found that more than 99 percent of the 110,000 consumers who invested in the “Quicksell” program got no income at all in return.

The Justice Department probe was labeled “Operation Lost Opportunity.” Investigators found that consumers had been promised that they could earn $4,000 or more in their first 30 days, or an average of $4,280 per deal. After signing up for an average fee of $148, they were typically bombarded with ads to buy more “business tools” for hundreds or thousands of dollars.

The FTC doesn’t have much of a sense of humor about such things. When companies advertise business opportunities, the agency says the ads should be clear about what markets exist and what an investor’s potential income truly is.

There are some legitimate careers that allow you to work from home. Do some serious research before investing:

— Know who you’re dealing with; find out if the offer is a job or just a way to sell overpriced supplies.

— Get all details before you pay; a real company will give you all the information you need to make an informed decision.

— Don’t believe claims of big rewards for little work (wouldn’t they do it themselves?).

— Be sure there’s a market first. There must be a real market, not a perpetuation of the scam in which you hoodwink others into investing.

— Know the refund policy.

— Talk with people who have been successful — real people, not those a scammer might refer to you.

Once you’ve responded to an offer, you’re likely to be targeted by other scammers. Several years ago, a client of Northeast CONTACT complained that her husband — whose disabilities prompted him to seek home-based work — complained that he was receiving shady-sounding offers virtually every day. Our caseworker suggested (only half kiddingly) that she keep a blowtorch with her while she checked their mailbox.

The FTC warns consumers not to believe any ad about stuffing envelopes; they’re virtually always ripoffs. Read the FTC’s advice at http://www.consumer.ftc.gov/articles/0175-work-home-businesses.

The Maine attorney general’s Consumer Law Guide also offers tips on work-at-home offers online at http://www.maine.gov/ag/consumer/consumer_law_guide.shtml (chapter 12, section 14).

You can also call the AG’s Consumer Mediation Service at 800-436-2131.

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.

Don’t let a vacation getaway become a house of horrors

CONSUMER FORUM

Posted Oct. 19, 2014, at 10:14 a.m.

On Oct. 11, Texas A&M hosted the University of Mississippi in football. Some fans of Ole Miss made the trek to College Station for the game, and a dozen of them planned to spend the night in a rented home.

They discovered soon after arriving that the home was not really for rent, and the $2,000 they had paid up front was in the pocket of the crook who scammed them. The scammer had insisted on being paid by wire transfer, a sure tipoff that the football fans were being swindled.

The property had been listed on several home rental sites, and the descriptions appealed enough that the would-be renters skipped one of the key pieces of advice in such situations: don’t rent sight unseen. That home may not be available to rent, or it might not even exist.

Craigslist offers this tip on its website: “Deal locally, face-to-face; follow this one rule and avoid 99 percent of scam attempts.” It’s as valid with vacation rentals as any other transaction. Looking someone in the eye gives you a feel for the person you plan to deal with, and that’s usually more than any anonymous, electronic relationship can offer.

Finding the rental initially might happen by way of a website. There are some reliable sites run by honest people, with accurate descriptions and representative photos. There also are some brazen attempts to separate people from their money through deceptive words and pictures, both of which may bear no relationship to anything in the real world.

Don’t be fooled by great-looking photos; they may have been digitally enhanced. If a description sounds too good to be true … you know how this sentence always ends. And if the price is one-third to one-half below the going rate for other rentals in a given area, chances are the ad is bogus.

If you find a rental that sounds legit, have it checked out by a trusted local agent. Sure, you’ll pay for this service, but that will be money well spent if it verifies that you’re really getting the deal you think you’re making.

Doing your own investigating? Make sure that the person claiming to own the property actually owns it. You can verify this through public property tax records. You may want to have a lawyer review any agreement you sign, as you would if you were signing a yearlong lease.

If you’re on an extended vacation, you may want to spend the first few days in a hotel. That will allow time to check things out on your own before finalizing any rental plans. Trust your instincts during this process. If red flags go up, walk away.

Don’t pay with cash, and don’t wire money. Both methods of payment leave you little recourse if the deal goes sour. Be wary of any requests for a credit check before you meet the owner. Such requests are sometimes ways of trolling for people with less than solid credit who may be desperate for a rental.

If you rent a place and like it, consider renting it again. Building a relationship with an owner over time can remove a lot of uncertainty over future getaways.

For more information, visit the federal government’s website www.usa.gov/topics/consumer/scams-fraud/family-home-community/rental-fraud.shtml or call 800-FED-INFO (333-4636), 8 a.m.-8 p.m.

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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