Online Banking: Navigating a Vulnerable Environment

Online banking has surged in popularity the last few years, due mainly to the allure of easy online bill payments. According to a consumer survey conducted by Fiserv Inc., in 2008 over 2 million homes adopted online banking. This brought the total number of households banking from home to just under 70 million, or four out of every five with internet access.

While financial institutions continue to assure their customers of the safety of online banking, none can guarantee an account won’t fall victim to fraud. Cutting-edge technologies offer convenience, but also attract a cutting-edge class of criminals.

Early last year hundreds of HSBC online bank customers suddenly discovered their checking accounts had been drained of $2,000 each. According to an account on consumerist.com, one customer was told by the HSBC Fraud investigator that the department was so overwhelmed they weren’t even sure how to handle it. When pressed with how many other customers had suffered the same fate, the investigator replied, “We don’t even know.” The size of the fraud was so severe, the bank was ill-equipped to tackle, much less identify, the problem and it took up to 10 days before the affected customers had the stolen funds credited back to their accounts.

Though anecdotal, the above story is just a recent example of a problem that has plagued the banking and credit card industries from the time online services were first introduced. Fortunately, there are certain measures which can be taken to protect both your money and identity while banking electronically. Many of these tools also apply to using your credit card online. Most fall under common sense, but in this age of quick-and-easy access, it doesn’t hurt to go over the sometimes overlooked basics.

1.Bank with the Big Boys – There are many online banks, mostly chartered overseas, that are not FDIC insured. Bank with these companies at your own risk. When choosing an online bank, the safest bet is to go with one of the larger financial institutions with a recognizable name. The large banks are moving towards more online and customer-direct banking in an effort to lower costs and improve their bottom line. They often provide the best in online security, but if it fails you want the safety-net of FDIC insurance.

2.Don’t fall for Phishing – Phishing is the online security firm for a malevolent entity attempting to acquire your user name, passwords, credit cards or any other personal data by masquerading as a trusted entity. This can be undertaken by various means but most commonly comes in the form of an email claiming to be from your financial institution. You’ve probably encountered these before and hopefully sent them straight to junk mail. The emails often look convincing with legitimate logos, but will ask you to connect via a provided link to a fake site where you will be asked to enter your username and password for verification purposes. Once you’ve entered this information, the criminals can attempt to access your account. These emails are normally pretty easy to recognize. They won’t address you correctly or by name at all, and often they contain grammatical errors. Legitimate emails from your bank will typically address you by your proper name and will never ask a customer to divulge their pin number, account numbers, or passwords. If you aren’t sure about an email you have received, call your bank and ask.

3.Phishing from the other side – Unfortunately, this attempt to appropriate your personal information and access your account can strike when you least expect it, after you have logged into your online banking site. Though rare, tech-savvy criminals have the ability to hack into a bank’s online system and re-direct the customer to a fake page where they are asked to once again enter their user name and password. If during an online banking session you are rerouted in such a manner, the wisest course of action is to terminate the session without entering any further information and then re-accesses your account through the bank’s home page. It would also be prudent to let your institution know such an attempt was made via their site. Better yet, ensure your bank is using the standard “secure socket layer” (SSL) protocol on pages that require secure information. Most banks use this technology on a few pages, but not on every page. (SSL-secured pages start https as opposed to http.)

4.User names and passwords – If you are going to be banking online, always choose unique user names and passwords. Avoid using your email address as a long in name and never use important dates, such as birthdays or anniversaries, for a password. If a criminal is trying to access your account these are often the first guesses that he will attempt to use. Always try to include both alpha and numerical characters in your login information, as use of both generates user names and passwords that are inherently tougher to crack.

5.Bank from home – If you are going to be banking online, try to avoid public domain computers. This includes both work computers and those you would use at an internet café, public library or any retail business. You have limited control over the safety measures taken at these locations and are putting your personal information at risk every time you share it here. If you are banking online and have no choice but to use a public access computer, be sure the username and password are not saved on the computer if prompted to do so. Once your session ends click on the Tools option of the browser and clear all saved forms, passwords, cookies, and history. For the two most used web browsers this feature is located under Tools/Internet options (MS Explorer) or Tools/Clear Private Data (Mozilla Firefox).

6.Stay protected – It is vital to keep your home computer protected with up-to-date anti-virus software and firewall protection. This is particularly true when you are banking from home online. There malicious software, or malware, that can unknowingly be downloaded on your computer while the user surfs the internet. These harmful programs can attack your computer in a variety of ways, but the most dangerous are capable of stealing your personal information by logging the keystrokes used when entering user names and passwords. This information is then transmitted back to the programs creator. This is why it is so important to keep your computer protected and update that protection regularly.

7.Keep alert – If you have an online bank account or use your credit cards for online purchases, check your balances regularly. If you notice any suspicious activity, notify the bank immediately. The longer it takes to report fraudulent activity the more difficult it will be to have those stolen funds restored.

Online banking can be a convenient and easy way to manage your personal accounts, but it will never be 100% safe. Still, there are ways online banking customers can increase the odds in their favor by using common sense and taking preemptive steps to protect themselves. Most importantly, communicate with your bank. Know their security measures and check the safety recommendations they make. If you ever have any questions or concerns about the security of your account, call the bank and get the answers you need. Its your right as a customer, so don’t hesitate to use it.

Helpful links:

FDIC: Safe Internet Banking
http://www.fdic.gov/BANK/INDIVIDUAL/ONLINE/SAFE.html

Online Banking Safety – LoveToKnow Online
http://online.lovetoknow.com/wiki/Online_Banking_Safety

Reverse Mortgage Twists and Turns

Watch out for the “quicksand”, it can suck you in.

If you’re 62 years or older, a legitimate reverse mortgage allows homeowners to convert their home equity into cash. Instead of making a payment each month to your mortgage bank, the bank pays you monthly. You can also elect to receive a lump sum or line of credit. Looks simple, but the “quicksand” of fraud and scams are deceptively alluring.

Speculators are buying houses on the cheap, doing minor cosmetic decorating and then reselling these dwellings to unsuspecting senior citizens at excessive prices. The deal is based on the senior citizen taking out a reverse mortgage sponsored by the scam artist, generally with exorbitant upfront fees. When the reverse mortgage is in place the scam artist usually takes all the money for the payment of the inflated property, leaving the sucker senior citizen holding the bag and probably still owing more money as a result of the terms of the scam transaction.

Also, these scam artists will use inflated appraisals and then promise this “mirage bargain” home with no-money-down, and as part of the swindle, arrange for the sucker to secure a scam reverse mortgage loaded with excessive fees for the service. Thus, the scammer diverts most and often all the proceeds from your reverse mortgage for themselves.

These crooks recruit and con naïve seniors; so do not be tempted by these “sweet-talking” swindlers. Here are a few guidelines to follow regarding any supposed reverse mortgages:

1. Don’t respond to any flashy advertisements and unsolicited promotions.

2. Stay away from anyone claiming you can own a home with zero cash down.

3. Never sign anything you don’t fully understand. Try and have a competent lawyer or accountant review all proposed contracts.

4. Seek out a legitimate reverse mortgage advisor.

5. The scammers target senior citizens through churches, investment seminars, radio, television, and mail/email advertisements.

6. A legitimate reverse mortgage never causes you to give up title to your home.

7. Watch out for upfront fees—never agree to pay them; as this demand is a tip-off that you are being set up for a swindle.

8. Watch out for any reverse mortgages that do not escrow sufficient money to pay required real estate taxes, insurance, etc. This could result in foreclosure.

Again and again senior citizens are being swindled by these “too good to be true” propositions. If you are truly interested in a reverse mortgage for your home that you have lived in for a long time—study the various plans offered by some of the well-known Banks such as Chase, Well Fargo and Bank of America. At least you will familiarize yourself with what programs are currently available. Never get sucked into a “No Money Down” scam promising to get you into a home for free. Run away from any of these sham offers. Be careful, and remember: “IF IT’S TOO GOOD TO BE TRUE–IT IS”! — ALWAYS!

FINANCIAL ADVISORS: Look for WHAT they know, NOT who they know!

Never ever get caught up or impressed with the “Madoff style garbage”, such as Country Clubs, exclusive addresses, and pictures on the walls with your prospective advisor glad-handing politicians and celebrities. Stay away from the windbag money managers and “financial advisors”—–there are plenty out there.

If you are fortunate enough to have accumulated money to invest, you better be darn sure you are not turning it over to a con-man/scam-artist. They are everywhere! Don’t be dazzled by slick-talk and glossy brochures or an expensive lunch—keep your eye on the ball—the safety of your “nest-egg”.

First—check all available credentials and records thoroughly.

Contact Government Agencies:

(check on licenses and disciplinary records of your proposed planner/advisor)

a) National Association of Securities Dealers (NASD) — 800-289-9999

b) Securities & Exchange Commission (SEC) — 800-732-0330

c) Certified Financial Planners-Board of Standards (CFP) — 888-237-6275,

830-7543 x219

Obtain References:
Get the names of clients and make sure the “client” is a legitimate “real” person or business. Telephone these references and courteously ask questions.

Ask Your Proposed Advisor the following questions:

a) Specifically what services they provide (ie: cash management, tax planning, estate planning, retirement planning, recommendations for investing).

b) What Licenses they hold and their specific qualifications; and in which State are they licensed?

c) What type of investments are they licensed to offer?

d) How will the planner/advisor prepare your financial plan and will it be in writing? Does the planner/advisor set goals?

e) What continued and ongoing services will you receive? — Such as financial products, research, analysis of your financial situation and recommendations.

f) Does the planner/advisor take possession of your assets or have access to them via any form of Power of Attorney over your assets?

g) What are their other clients like, and how have their investments performed over the past one, five, ten years?

h) Most significant, ask how the advisor/planner is to be paid, and how all such compensation is calculated. Is it an hourly rate, flat fee, percentage of assets, commissions, etc.

Always Be Sure to Obtain a Written Fee Schedule and Remember:

When it comes to handing your nest egg over to anyone—you must be very, very careful! Look what Bernie Madoff did. Although the Madoff numbers are astronomical — scams at every level go on all the time. Only a few years ago, a bunch of celebrities, including Leonardo DiCaprIo, were scammed for millions of dollars by a sweet-talking yet a phony/scam-artist supposed “Advisor”. The selection of a Financial Advisor is really difficult. Many banks and brokers offer these or similar services, but most of their personnel’s qualifications are marginal. Again, you must use your instincts.

Scamraiders suggests that you get recommendations from your accountant and/or lawyer and you do your own legwork. But be careful. DO NOT GIVE A STRANGER YOUR POWER OF ATTORNEY, OR CONTROL OF YOUR MONEY. If you are finally satisfied with who you choose to hire, do so; but YOU control the account—at least until you are fully comfortable and feel confident, safe and secure. If you plan to “put your eggs in one basket”, as one great money-man said, “watch the basket very very carefully!”

NEVER become complacent— that is how Madoff made off with billions! Again remember—“IF IT IS TOO GOOD TO BE TRUE, IT IS”—ALWAYS!

PS: If you are a senior citizen take a look at AARP Financial Inc. At least, this Program seems safe—- as best it can be in the volatile economic times we now live. STAY ALERT—PLEASE.

Lotto Scams

If you receive an email, telephone call, letter or fax telling you that you won the Canadian, Nigerian, Irish, French, or Welsh, etc. lottery—delete, hang-up the phone, rip-up the paper, throw out the supposed windfall! Listen up—First you can’t win a lottery that you didn’t buy a ticket for. So when that enticing announcement, or nice well-trained voice on the other end of the phone tells you that to claim your prize you must first wire a few thousand bucks to the lottery “sponsor”— don’t fall for it! Here are some other important facts to remember so that you won’t get ripped-off:

1. No stranger is your friend; and there ain’t no free lunches!

2. In a legitimate lottery, you never have to pay BEFORE you receive the winnings.
Lotteries that are legitimate request that you pay taxes after you receive your money.

3. If you truly win a lottery, first you surely hold a ticket evidencing that you have
entered into the lottery contest. If you win, your lottery number will be posted or
announced, and you must present your winning ticket in order to claim your prize.
Legitimate lotteries usually DO NOT send emails, or letters, or phone you. They will
post or publish the winning ticket numbers on their website or in the newspaper and
the winners are provided with a legitimate email or phone number, or where to appear
with the winning ticket.

4. NEVER EVER give out any personal information to anyone without knowing who you
are giving it to.

5. Beware of anything lottery, coming from outside the USA — they are usually all “hot
spots” for scams.

6. If it’s too good to be true—it is.

You can be sure of this—once you turn your cash over to a scammer, it’s gone forever. Lottery scammers come up with new spins to the same old schemes — to get the money from us suckers. Some of the newer swindles are as follows —

a) BOGUS STATE LOTTERIES

Residents of Minnesota, Oklahoma, and Tennessee have recently been receiving emails, phone calls and letters stating that they have won Powerball or other State games. The “winners” are directed to pay up-front fees in order to claim their prize. Don’t do it! Legit State Lotteries never require any up-front money. State lottery winners must notify the State with their winning ticket in hand. You won’t be contacted by the State, you must contact them once you find your entry is posted as the winner on the respective State website or published in the newspaper.

b) UNCLE SAM SHAMS

Another scam— emails supposedly sent by the F.B.I., I.R.S., F.T.C., etc., implying that these Agencies are acting as middlemen awarding the Lottery winnings. These Agencies never act in this manner. Moreover, these scammers also are circulating a virus that can steal your computer’s personal data. So, if you receive one of these bogus messages, these thieves are ready to put their hands in your pocket—DO NOT open it! You will have just avoided a serious scam-rip off!

c) SLICK TALKING CON SCAMS

Some crooks prefer operating through personal contact. If you are approached on the street or in a shop by a stranger claiming to hold a winning State Lottery ticket that they cannot redeem themselves– such as, the ticket holder is not in the U.S. legally— say “NO THANK YOU”! In this con the scammer offers to sell you their jackpot ticket for a few thousand dollars—or split the winnings after you (the patsy) put up your cash as a “good faith” deposit. Then you are told that in exchange for your up-front-money the scammer will give you the ticket so you can redeem it and either keep the winnings or split the sums with this “generous kind person”. You will be left “holding the bag” with a worthless ticket. Or once you gather your “good-faith cash” from your bank, you may be conned into leaving your money with the scammer (in a taxi or car), and asked to go to a coffee shop to buy some donuts and coffee for you and the con artist before heading to the location to claim your jackpot. When you return, coffee in hand, the scammer is long gone on their way, with your cash. Remember what your mother always told you, —–“NEVER SPEAK TO STRANGERS”!

Although this is not a lottery scam, it’s similar and Scamraiders wants to alert you:
One of the most common scams that still hooks unsuspecting naïve people is the plea to help another person who has a problem with cashing a check. NEVER cash a check for a stranger or give them your money for their check! Usually the check is counterfeit and you will be stuck.

If you really want to play a lottery, BUY THE TICKET YOURSELF FROM A STATE-RUN LOTTERY— AND HOPE FOR THE BEST!

TIMESHARE PROGRAMS ARE NOT A ROSE GARDEN!

Looking for an inexpensive trip for a well-deserved special getaway for fun and relaxation? If your answer is YES, and some “nice” person sold you a bucket of dreams on timeshares—be really, really careful— many of these programs are not for the faint of heart! You could become just another sucker with a one-way ticket to oblivion and fraud—-not paradise as advertised.

Here are some rules you should follow if you want to jump into the thorny bramble bushes of timeshare programs:

1. Stick with the larger, well established companies that have been around for many years. These guys will not go into the deep water to skewer you.

2. Fully understand any contact or agreement you are provided BEFORE you sign or fork over one red cent.

3. Be careful if the contract/agreement makes it virtually impossible for you to sell your timeshare in the event you may wish to do so. Again, you must fully understand the rights and obligations of anything you sign.

4. Be especially cautious of overseas companies offering timeshares.

5. DO NOT pay up front fees before doing all possible due-diligence and investigations. If possible, review the contracts with a competent lawyer.

6. Review the published consumer “Black Lists” on the internet that detail the companies who have engaged in timeshare fraud. Keep in mind that newer scam timeshare companies may not be on these lists, because no one has yet reported them.

7. “The game may not be worth the candle”! Becoming a victim of timeshare fraud is a very distasteful and expensive mistake. Being alert and conducting solid research/due diligence will help you avoid heartache and being  swindled.

8. See firsthand exactly what you are buying into. Try to do this in person or through a reliable friend. Do not rely on glossy brochures or videos as many of them are outright con-games. You may hope a dream and arrive to a nightmare. Remember Scamraiders constant reminder—“If it is too good to be true— it is!” Always!

Scamraiders has looked at many timeshare “Vacation Clubs”. To us the safest looks like the Disney Vacation Club and coming in second is the Hilton Grand Vacations. It’s better to be safe than sorry—stay with the best and most reliable. In any event, DO YOUR HOMEWORK—-BEFORE YOU PUT PEN TO PAPER OR YOU HANDOVER YOUR CASH.

FTC WARNING – ROBOCALLS OFFERING CREDIT CARD RATE REDUCTION SCAMS

The Federal Trade Commission (FTC) released an alert warning US consumers to be on the lookout for automated calls from companies claiming that for a fee they will help negotiate a lower rate on credit cards. In the alert, Credit Card Interest Rate Reduction Scams, the FTC urges consumers to be highly skeptical of these automated calls.

This scam has been making the rounds for several years. According to the Better Business Bureau, complaints began to come in slowly around the summer of 2007 then escalated significantly in the latter part of 2008. There was a fresh wave clogging the voicemail boxes of potential victims in early 2010 which led to the alert being issued by the FTC.

The automated calls make vague claims about saving big bucks for those in serious credit card debt. At the end of the recorded message, the recipient is given a call-back number to contact, if interested. Once the consumer returns the initial call, the real pitch begins.

Alison Southwick, a spokesperson for the Better Business Bureau, broke down how a typical scam call will go in a posting late last year. A typical consumer with two credit cards carrying interest rates of 12 and 14 percent is promised a drastic reduction in APR to between 4.99% and 6.99%. The consumer is then promised a savings of interest and fee payments somewhere in the neighborhood of $2,000 to $25,000, with additional assurances that the debt will be paid off three to five times faster than normal. After these non-binding promises are made, a large upfront fee is requested, normally $600-$900. The scammer gets the consumer’s credit card information, which includes the customer service number on the back of the card. The caller, which at that point has already charged the advance fee to the credit cards, then places a conference call to the credit card issuer. The scammer then makes a request with a customer service representative to have the interest rate on the card reduced during the three way conversation with the cardholder. With the majority of complaints the BBB has received, Southwick says, “that’s the extent of the negotiation process.”

During the sales pitch from these scammers, they often claim to have a special relationship with the credit card companies. Besides the guarantees of lower interest rates and speedy debt resolution, they regularly aggressively push the scam by saying the reduced interest rates are only being offered for a limited time and quick action is crucial. There have been reports that money-back guarantees were offered as incentive.

The FTC warns consumers to be wary of the hype. Those behind the automated calls are not capable of doing anything that any individual consumer couldn’t do for themselves for free. The individual has just as much cache with the credit card issuing companies as these scammers and both are just as likely to be accepted or denied for a reduction in interest rate payments.

Last week’s alert from the FTC stated plainly that their investigators, “found that people who pay for these services don’t get the touted interest rate reductions, don’t save the promised amounts, don’t pay off their credit card debt three to five times faster, and struggle to get refunds.”

Here are some tips to remember if you get one of these calls, whether automated or live:

– Call comes up as “unknown caller” on CallerID with no provided phone number.

– These scam calls are made cold turkey; the recipient might not even have a credit card. The calls are being made randomly in the hopes of discovering potential victims. Calls like this should be regarded as scams.

– If you are on the National Do Not Call Registry, companies can call you only if you have agreed to accept calls from the company the salesperson works for, have purchased something from the company in the last 18 months or requested information from the company in the last three months. If none of these apply, then you have been randomly called by an automated system. Do not call back. Information and links to the National Do Not Call Registry are provided at the end of the article.

– Don’t give out your credit card information. There is no reason to share this information with a third party when you can be dealing directly with your credit card issuer. After using the number to charge the upfront fee, some scammers might also make further fraudulent purchases in the future and/or sell the information to others.

– Never share personal information like your bank account or social security number during one of these calls. Scammers will often try to lure this information while bombarding the victim with multiple form questions they are “filling out” during these unsolicited sales pitches. Once they have this type of information though, you can be certain they will use it against you in future frauds.

– Unsolicited and automated calls should always be approached with caution. They are often simply scams in disguise. If you want to renegotiate but don’t feel comfortable taking on the task alone, the Better Business Bureau recommends using the services of a reputable credit counseling agency. Links for checking on a company’s accreditation can be found at the end of the article.

The Federal Trade Commission takes the stance that if a consumer is interested in trying to negotiate new interest rates with their credit card issuer their success is just as likely if they do it themselves for free. It really is as simple as calling the number on the back of your credit card and then asking the customer service representative about reducing your rate. Remember to stay calm and be persistent. There is no reason to pay someone else hundreds of dollars to complete a task you can perform for yourself. If an automated call with promises of reduced credit card rates tempts you – hang up immediately.
LINKS:

If you would like to report violations of the Do Not Call Registry, or would like to register, call 1-888-382-1222. Or visit the website –
www.donotcall.gov

Check a consumer credit counselor’s credentials at:

Better Business Bureau –
www.bbb.org

National Foundation for Credit Counseling –
www.nfcc.org

Free Lunch? Visit Mom, Not the Stock Exchange!

Investment scams have been around a long time. Bernie Madoff might have been caught red-handed orchestrating the largest known Ponzi scheme in history at an estimated 64.8 billion dollars stolen, but he wasn’t doing anything new. Charles Ponzi, the schemes namesake, was arrested in 1920 for bilking investors out of millions, and he was likely inspired by Brooklyn bookkeeper William F. Miller who used the scheme to collect a cool million in 1899.

Business Week magazine recently reported in July that the SEC had filed 34 cases of alleged investment scams, a definite up-tick from just last year. These scams aren’t necessarily increasing in number though, but rather are finding themselves exposed by the financial realities of today.

Most investment scams are difficult to spot. Madoff’s, for example, began in 1991. The scam, which pays off high returns to separate investors from the money paid by subsequent investors instead of from actual profits, probably would have kept chugging along if not for the current economic crisis which was hurt by both a lack of new investors and the curiosity of older investors wondering how their returns were so high in such a tumultuous market.

Securities fraud steals $40 billion a year from investors, per an estimate from the North American Securities Administrators Association in the Business Week article. Even though some of the bigger scams are in the headlines as those orchestrating the schemes are led from their offices in handcuffs, don’t expect the trend to slow down. Con men sense an opportune market with many folks looking for quick and easy ways to safely turn a profit. Big and small, investment scams are here to stay.
There are many different kinds of investment scams out there; here are some of the more popular:

1.Ponzi schemes – Normally target big investors, and perpetrated by “respectable” financial professionals. Promise big returns and provide them until the investor pool dries up. The only thing really being invested in though, is the scammers lavish lifestyle.

2.Internet scams – Unsolicited email offers and shady websites offering investment opportunities in non-existent companies or products.

3.Prime Bank scams – Investments offered in overseas banks that are normally exclusive to the top tiers of society and which don’t actually exist.

4.Investment seminars – A large group of potential investors, sometimes hundreds, are pitched a remarkable opportunity for a sure-thing investment in a seminar setting. Often you are expected to pay immediately, as the offer will soon be leaving town with the scammer. Along with your money if you fall for it.

5.Unlicensed Sales – Investment advice or opportunities offered to you, unsolicited, by unlicensed brokers or sales agents.

6.Affinity scams – Scammers join hobby clubs, religious groups, or specific ethnic social organizations. After gaining folks trust, they sell them on a bogus investment that has been specifically targeted to the group of victims who they are looking to exploit.
The real problem with investment scams are recognizing and separating the nefarious plots from genuine opportunities. Sometimes it can be hard to discern the scams, but there are definite red flags to be aware of and basic precautions you can take to protect yourself.

Investment scammers are going to be charming. They are going to be charismatic. They are going to be well-spoken and convincing. They are criminals, but they are also salesmen. And you are the customer.

Learn to recognize when some common signs of a scam pitch. The pitches often utilize current events the scammer read in the paper or saw on the news such as political unrest, the economic situation, and emerging technologies and new products. They will almost always have three major talking points: incredibly returns or profits from the investment, how safe and sound the investment is, and how easily you can get your principle back if needed. None of which, of course, are true.

With investment scammers so difficult to identify, what precautions can be taken? Try out the three C’s.

Compare – Whenever an investment opportunity presents itself to you compare it with similar opportunities from other firms. Don’t invest in a money market from one bank, without checking out the rates of a competitor.

Consider – Never, ever, make a purchase decision at the sales pitch. Take you time, and think it through. Ask to be provided a prospectus which breaks down risks and potentials. Serious financial pros should make such available to you, although that doesn’t guarantee legitimacy. Research the company, the product, the security and/or stock. Investment opportunities should not be impulse buys, and if you find yourself pressured for a decision without proper consideration, you are probably being conned.

Consult – Scammers normally take advantage of those with little investment experience. Even the playing field. Talk to a professional financial advisor. Talk to your friends and family. If you have been snowed to the point of blindness by a too good to be true opportunity, have some fresh eyes you trust take a look at it. They will be much more likely to see the truth.

You can take these precautions and still find yourself scammed, so be vigilant. Question quick returns, scammers will often make out small payments right off the bat to gain more trust. Examine your reports for unauthorized transactions. Never trust promises of high returns for little risk. Repeat to yourself once again: If it’s too good to be true, it’s probably a scam.

CREDIT RESTORATION SERVICES

Will credit repair companies help you to get into “Credit Shangrila” or out of a frying pan into a fire???

LISTEN UP…the best and only legitimate path to repair your credit is to pay your bills, and time. There are no quick fixes. You can’t plant a seed and tomorrow wake up to find a large plant bearing fruit. It isn’t going to happen.

The Scam —“Credit Problems, No Problem!” — “We will erase your lousy credit; we will remove judgments, liens, etc.” Of course these companies are anxious for your cash and might even recommend certain tactics to be engaged in by you that could be fraudulent and even criminal——such as creating a new credit identity, using a new/different Social Security number and/or an Employer Identification Number. Don’t do it; you could be prosecuted for Mail Fraud.

Neither you or anyone else can legally remove correct negative data from your own Report. You certainly can and should dispute any entry that is incorrect. This ‘dispute’ must be done in writing. All should be aware that there is the Credit Repair Organization Act, mandating that all supposed “Credit Repair Companies” must give you a copy of Consumer Credit File Rights under State and Federal Law—BEFORE you sign any agreement with them! Stay away from all of these promises and claims that sound too good to be true. If you have been victimized, IMMEDIATELY contact your State Attorney General’s Office or the Consumer Response Center, Federal Trade Commission, Washington, DC 20580.

Scamraiders will be featuring follow-up articles on Credit Restoration Scams, Case Histories, and articles on various Mortgage Fraud Scams.

RESOURCES:

Law in Plain Language: Credit Repair – http://www.ct.gov/ag/cwp/view.asp?A=2066&Q=292378

Credit Repair Scams (ExpertLaw.com) – http://www.expertlaw.com/library/consumer/credit_repair.html

Credit Repair Scams (CreditRepairScams.Net) – http://www.creditrepairscams.net/

7 Ways to Stop a Credit Repair Scam – http://credit.about.com/od/creditrepair/qt/avoidrepairscam.htm

Credit repair scams (Bankrate.com) – http://www.bankrate.com/brm/news/advice/19980720c.asp

Credit Repair Scams: Self-Help May Be Best – http://www.ifg-inc.com/Consumer_Reports/CreditRepair.html

Consumer Credit Counseling Services – http://financialplan.about.com/cs/creditdebt/a/CreditCounselor.htm

 

LOTTERY SCAMS – THE GIANT OCTOPUS OF WORLDWIDE SWINDLES!

If you receive an email, telephone call, letter or fax telling you that you won the Canadian, Nigerian, Irish, French, or Welsh, etc. lottery—delete, hang-up the phone, rip-up the paper, throw out the supposed windfall! Listen up—First you can’t win a lottery that you didn’t buy a ticket for. So when that enticing announcement, or nice well-trained voice on the other end of the phone tells you that to claim your prize you must first wire a few thousand bucks to the lottery “sponsor”— don’t fall for it! Here are some other important facts to remember so that you won’t get ripped-off:

1. No stranger is your friend; and there ain’t no free lunches!

2. In a legitimate lottery, you never have to pay BEFORE you receive the winnings. Lotteries that are legitimate request that you pay taxes after you receive your money.

3. If you truly win a lottery, first you surely hold a ticket evidencing that you have entered into the lottery contest. If you win, your lottery number will be posted or announced, and you must present your winning ticket in order to claim your prize. Legitimate lotteries usually DO NOT send emails, or letters, or phone you. They will post or publish the winning ticket numbers on their website or in the newspaper and the winners are provided with a legitimate email or phone number, or where to appear with the winning ticket.

4. NEVER EVER give out any personal information to anyone without knowing who you are giving it to.

5. Beware of anything lottery, coming from outside the USA — they are usually all “hot spots” for scams.

6. If it’s too good to be true—it is.

You can be sure of this—once you turn your cash over to a scammer, it’s gone forever. Lottery scammers come up with new spins to the same old schemes — to get the money from us suckers. Some of the newer swindles are as follows —

a) BOGUS STATE LOTTERIES

Residents of Minnesota, Oklahoma, and Tennessee have recently been receiving emails, phone calls and letters stating that they have won Powerball or other State games. The “winners” are directed to pay up-front fees in order to claim their prize. Don’t do it! Legit State Lotteries never require any up-front money. State lottery winners must notify the State with their winning ticket in hand. You won’t be contacted by the State, you must contact them once you find your entry is posted as the winner on the respective State website or published in the newspaper.

b) UNCLE SAM SHAMS

Another scam— emails supposedly sent by the F.B.I., I.R.S., F.T.C., etc., implying that these Agencies are acting as middlemen awarding the Lottery winnings. These Agencies never act in this manner. Moreover, these scammers also are circulating a virus that can steal your computer’s personal data. So, if you receive one of these bogus messages, these thieves are ready to put their hands in your pocket—DO NOT open it! You will have just avoided a serious scam-rip off!

c) SLICK TALKING CON SCAMS

Some crooks prefer operating through personal contact. If you are approached on the street or in a shop by a stranger claiming to hold a winning State Lottery ticket that they cannot redeem themselves– such as, the ticket holder is not in the U.S. legally— say “NO THANK YOU”! In this con the scammer offers to sell you their jackpot ticket for a few thousand dollars—or split the winnings after you (the patsy) put up your cash as a “good faith” deposit. Then you are told that in exchange for your up-front-money the scammer will give you the ticket so you can redeem it and either keep the winnings or split the sums with this “generous kind person”. You will be left “holding the bag” with a worthless ticket. Or once you gather your “good-faith cash” from your bank, you may be conned into leaving your money with the scammer (in a taxi or car), and asked to go to a coffee shop to buy some donuts and coffee for you and the con artist before heading to the location to claim your jackpot. When you return, coffee in hand, the scammer is long gone on their way, with your cash. Remember what your mother always told you, —–“NEVER SPEAK TO STRANGERS”!

Although this is not a lottery scam, it’s similar and Scamraiders wants to alert you:
One of the most common scams that still hooks unsuspecting naïve people is the plea to help another person who has a problem with cashing a check. NEVER cash a check for a stranger or give them your money for their check! Usually the check is counterfeit and you will be stuck.

If you really want to play a lottery, BUY THE TICKET YOURSELF FROM A STATE-RUN LOTTERY— AND HOPE FOR THE BEST!

TEXT MESSAGE AND PHONE SCAMS: IN THE NEWS

Recently, a new scam involving text messages has begun to surface, and many people have reported being victims or at least intended victims. There is a text message going around that seems to come from a trusted source – Sears. The message reads: “customer issue. sears card frozen. please call at 786-206-5901”. When the number is called, the customer is asked to enter his or her Sears card number. Sears has addressed the issue saying that it is indeed a scam – a fake text from an illegitimate source, and that customers should never give out their card information.

This text message has alarmed many people. For those who do not have a Sears card there was concern of identity theft – someone else perhaps opening a card in their name. For Sears card holders, given that this is the busiest shopping season of the year, it can easily be mistaken as a legitimate message. Many people do their holiday shopping at Sears, and if you’d just charged a considerable amount to your card, this text would likely send you into a frenzy, which is exactly what the scammers want – people who will act before they think.

The Federal Trade Commission has now disconnected the phone number, so anyone else who calls will hear the message: “This is a message from the FTC. The telephone number you just called has been disconnected because it may be involved in a scam. You might have gotten this phone number from e-mail, text or voice mail message, but no matter how real it seems, that message was a trick.”

There are also several reports of a similar text message that claims to be from a bank, which could be even more damaging if anyone were to give out their bank account information. Authorities urge anyone receiving such a text message to call the customer service number on the back of their bank card to report and inquire.

Another very harmful phone scam currently in operation uses scare tactics to trick unsuspecting people into giving out their personal information. A scammer will call and inform their victim that they failed to report to jury duty, and therefore a warrant for their arrest has been issued. The caller will then claim that in order to clear the matter up, one must provide their social security number, date of birth, and even a credit card number in some cases.

The bottom line here is to NEVER give out your personal information to a stranger. If anyone calls or texts you asking for anything like this, do not respond. Instead, go directly to the source for answers – do not trust these texts and calls that could be coming from anyone.