Foreclosure Prevention Scams...
The housing market in the United States may not be thriving, but business is booming for foreclosure rescue and loan modification scammers.
The US Government Accountability Office (GAO) released a report in July 2010 entitled "Home Ownership Preservation". It says that: "The current foreclosure crisis has provided persons who may perpetrate mortgage foreclosure rescue and loan modification schemes with unprecedented opportunities to profit from homeowners desperate to save their homes. In March 2010, we reported that national default and foreclosure rates rose sharply from 2005 through 2009, to the highest level in 29 years. The most recent data from the Mortgage Bankers Association, which are for the first quarter of 2010, show that the number of home loans with payments more than 60 days past due, and therefore potentially facing foreclosure, is 2.7 million."
The GAO report says there are two main types of foreclosure rescue and loan modification scams: advance-fee loan modification schemes and sales-leaseback schemes, with advance-fee schemes being the most common. In an advance-fee scheme, someone charges you a fee in advance to negotiate a deal with your mortgage lender. They may even offer a money-back guarantee. But the usual outcome is that they take your money (the average is about $3,000), provide little or no service, and then refuse to refund the fee. In a sales-leaseback scheme, the scammer persuades you to transfer your deed to them by offering to assume your payments and let you pay rent while you get your affairs in order. They promise to sell the property back to you once your financial situation improves, but, of course, they don't. Often they take out another loan on the home or even sell it out from under you.
The Federal Trade Commission reports on a new twist on the advance-fee scam that's showing up this year, a "forensic mortgage loan audit." The scammer offers to find regulatory violations in your original mortgage that will help you avoid foreclosure or even cancel your loan. There's no evidence that anyone has ever succeeded in modifying their loan using this approach.
Here are some “red flags” that at-risk homeowners should watch out for when looking for foreclosure help, courtesy of the FTC. You should avoid any business that:
*guarantees to stop the foreclosure process – no matter what your circumstances
*instructs you not to contact your lender, lawyer, or credit or housing counselor
*collects a fee before providing you with any services
*accepts payment only by cashier’s check or wire transfer
*encourages you to lease your home so you can buy it back over time
*tells you to make your mortgage payments directly to it, rather than your lender tells you to transfer your property deed or title to it
*offers to buy your house for cash at a fixed price that is not set by the housing market at the time of sale
*offers to fill out paperwork for you
*pressures you to sign paperwork you haven’t had a chance to read thoroughly or that you don’t understand.
Dating Scams...
The Federal Trade Commission, the nation’s consumer protection agency, warns that scammers sometimes use online dating and social networking sites to try to convince people to send money in the name of love. In a typical scenario, the scam artist creates a fake profile, gains the trust of an online love interest, and then asks that person to wire money—usually to a location outside the United States.
Here are some warning signs that someone you met online could be in it for the money:
*Wanting to leave the dating site immediately and use personal e-mail or IM accounts.
*Claiming instant feelings of love.
*Claiming to be from the United States but currently overseas.
*Planning to visit, but being unable to do so because of a tragic event.
*Asking for money to pay for travel, visas or other travel documents, medication, a child or other relative’s hospital bills, recovery from a temporary financial setback, or expenses while a big business deal comes through.
*Making multiple requests for more money.
The FTC warns consumers that wiring money to someone they haven’t met is the same as sending cash. Once it’s gone, it can’t be recovered.
For more information on Online Dating Scams visit OnGuardOnline.gov, the federal government’s online safety website. OnGuardOnline provides practical tips from the federal government and the technology industry to help you be on guard against Internet fraud, secure your computer, and protect your personal information. OnGuardOnline.gov is a partnership of more than a dozen federal agencies and the technology industry.
The FTC works to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. To file a complaint or get free information on consumer issues, visit ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. Watch a new video, How to File a Complaint, at ftc.gov/video to learn more. The FTC enters consumer complaints into the Consumer Sentinel Network, a secure online database and investigative tool used by more than 1,800 civil and criminal law enforcement agencies in the U.S. and abroad.
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The ATM Scam...
ATMs are under siege more than ever from skimming. Skimming, where ATM thieves steal your PIN and account number using remote devices, is increasing dramatically. Often done by sophisticated crime rings from the Eastern bloc countries, ATM skimming is becoming a high-tech art that's hard to detect.
That's bad news for consumers. Experts say that losses from skimming are approaching $1 billion. Nearly one in five fraud victims reported having their credit card PIN or debit card ATM PIN information stolen in 2009, according to Javelin Strategy & Research. And Robert Vamosi, an analyst handling risk, fraud and security at Javelin, sees ATM skimming continuing to rise this year and next.
"Consumers aren't aware of ATM tampering," he says. "ATMs have 40 years of trust."
Skimming isn't new. It's been around for at least 10 years. What has changed is that the "technology of the bad guy is getting better and better every year," says Robert Siciliano, a security expert based in Boston. "It's up to consumers to watch their own backs."
Typically, ATM thieves use two devices to capture your PIN and card data. One device sits near where you swipe your card and reads the magnetic stripe on your card with your account number. Even more confusing, the device mimics the card slot. "The technology has evolved to a point where the molded plastic fits like it belongs there," says Siciliano. Devices are even readily available over the Internet for as little as $300.
A camera, hidden from view, captures the PIN. "You can get the data in real time," says Siciliano. "You can be in your car with a laptop remotely accessing the device."
Thieves then burn the data onto a blank card to access your money.
U.S. Secret Service spokesman Max Milien wants consumers to be warned. "The public is notified after an event," he says. And don't take bank security for granted. Fraud can occur at any bank in any part of the country. Thieves are even sending out false text alerts to get consumer data.
Banks, they say, are slow to adopt anti-skimming measures. When Javelin surveyed 25 banks, four stood out, though, for their anti-theft measures. They are Bank of America, Chase, Citibank and Wells Fargo.
advertisementExperts add that debit card users are most at risk. Typically, consumers must report fraudulent charges within two days, limiting your liability to $50. If you report ATM skimming fraud within 60 days, you're liable for the first $500 of any transaction. Siciliano adds that thieves carefully orchestrate ATM withdrawals, maxing out cash withdrawals one day and waiting until after midnight for the next stash, which quickly adds up.
Here are four tips to help you protect your account.
1. Cover your password with your hand
Hidden cameras are disguised so they can pick up your password. By protecting it, ATM thieves can't access your account.
2. Use familiar ATMs and limit your visits
ATMs in dimly lighted spots or used late at night could be more susceptible to fraud, while ATMs under video surveillance can be safer. Stay away from ATMs at retail stores or restaurants, adds Siciliano. Recently, skimming devices were found on ATMs in a popular grocery store in central Florida. Airports, convenience stores or kiosks are equally vulnerable to ATM thieves. Still, even highly trafficked ATMs outside a bank branch have been targeted by thieves.
Also, try to limit your visits to the ATM. "With frequency, there's risk," says Siciliano.
3. Check bank balances frequently
Given the two-day window for reporting fraud, it pays to check your account frequently. If you don't report fraud within 60 days, you have unlimited liability. "Sign up for alerts and notice unusual withdrawals," says Vamosi.
With credit cards there are more protections in place, and you can dispute charges."You have at least a billing cycle," says Siciliano.
4. Observe the ATM
Vamosi cautions consumers to look at an ATM to make sure a card slot is "legitimate and not tacked on." Look for things that strike you, he says. "Some people have felt that when they inserted their card, something went awry," he says. In that case, try another ATM.
When protecting your account against ATM thieves, "it's all about awareness, paying attention and understanding risks," says Sicilano. "There are 400,000 ATMs and every one of them is susceptible to fraud. The speed and convenience of technology has replaced the security of technology."
The Junked Copier Fraud...
Digital Copier Identity Theft
In our office we have a copier that can make your copy into a PDF document that you can receive via email at your desk. It’s a really great feature but recently I saw how that feature could turn potentially ugly with the push of a few wrong buttons.
A person accidentally sent a PDF copy of his license and social security card to a few people in the office because he mistakenly highlighted more names than his own. This could have been an identity theft situation that would have cost this person a lot of time and money to reclaim the stolen identity.
But the problem doesn’t stop there. If this person was using a digital copier, there is another risk that has nothing to do with human error. Did you know that digital copiers store what you’ve copied on a hard drive that if not wiped clean, can be retrieved when that copier is re-sold or junked after it is no longer useful to the company?
It is scary to think about how much personal and company data could be on your organization’s copier hard drive. Fortunately, there are some ways you can try to protect that information by working with your IT staff. An article by Consumeraffairs.com has some easy to follow steps you can take in your office.
As scary as this is, the number one way people become victims of identity theft is still through their own lapses in judgment. Don’t be careless with your personal information. Learn how to be identity smart with the brochure,Identity Smart: A Guide for Consumers to Help Protect Against Identity Theft, by LifeLock and the National Crime Prevention Council.
Ten simple tips to secure your identity:
• Do not give out personal information over the phone, through the mail, or over the Internet unless you have initiated the contact or know with whom you’re dealing.
• Shred all documents, including preapproved credit applications, insurance forms, bank checks and statements you are discarding, and other financial information.
• Protect your computer from Internet intruders—use firewalls. Also use anti-virus software and keep it up-to-date. Create hard-to-guess passwords that cannot be found in any dictionary. Select passwords with at least eight characters and that include a mix of numbers and both uppercase and lowercase letters.
• Minimize the identification information and the number of cards you carry. Take only what you’ll actually need. Make a list of all your credit card account numbers and bank account numbers with customer service phone numbers, and keep it in a safe place.
• Do not put your Social Security number on your checks or your credit receipts. If a business requests your Social Security number, give an alternate number.
• Be careful when using ATM machines and long-distance phone cards. Someone may look over your shoulder and get your PIN numbers. You also have to be careful of ATM skimmer machines. Do not use an ATM if it looks like it’s been tampered with.
• Never submit your credit card number to a website unless it is encrypted on a secured site. Look at the bottom of the screen for a padlock symbol. Do not select to save your information on the site for future transactions.
• Pay attention to your billing cycles. Follow up with creditors if bills don’t arrive on time. A missing credit card bill could mean an identity thief has taken over your credit account and changed your address.
• Cancel all credit cards you have not used in the last six months. Open credit is a prime target for an identity thief. Also, you might consider signing up for a monitoring service so you can be alerted to any unusual activity.
• Order your credit report at least twice a year from the three major credit bureaus: Equifax (www.equifax.com), Experian (www.experian.com), and Trans Union (www.transunion.com). The Fair Credit Reporting Act allows you to get one free credit report from each of the three major credit bureaus once per year. Visit www.annualcreditreport.com. Correct all mistakes on your credit report in writing. Send a letter to the credit reporting agency identifying the problems item by item, include a copy of the credit report, and send the letter return receipt requested.
Health Care Fraud...
A pharmaceutical company marketed four drugs to doctors. The drugs had been approved by the Food and Drug Administration (FDA) for specific medical conditions—like rheumatoid arthritis, schizophrenia, and neuropathic pain—but the company promoted the drugs for other uses as well—like post-operative pain, dementia, and migraines—and sometimes in larger doses than the FDA allowed. In some cases, the company even paid kickbacks to doctors to prescribe the drugs for these other uses.
What this company did is known as off-label marketing of prescription drugs, and it’s both illegal and potentially harmful to consumers. After an investigation involving the FBI and our federal and state partners, the company pled guilty to misbranding the drugs and agreed to pay $2.3 billion to settle criminal and civil violations…the largest U.S. health care fraud settlement ever.
Latest Schemes, Shams, Scams & Frauds
As part of its health care fraud program, the Bureau is looking at various fraud schemes involving:
- Home health care;
- Infusion therapy; and
- Durable medical equipment.
We’re also focused on other health care fraud-related crime problems impacting public safety, such as:
- Off-label marketing of prescription drugs;
- Drug diversion (prescription drugs diverted from legitimate supply sources for illicit distribution and abuse); and
- Internet pharmacies.
Partnerships are key. A tried-and-true method of leveraging resources is establishing partnerships. And we’ve done just that—with federal agencies like the FDA and the Drug Enforcement Administration, various state and local agencies, and private insurance groups like the National Health Care Anti-Fraud Association.
Our most recent joint endeavor? Our participation in the Department of Justice/Health and Human Services’ (HHS) Health Care Fraud Prevention and Enforcement Action Team, or HEAT, and its Medicare Fraud Strike Forces located in several major metropolitan areas.
The HEAT initiative includes senior Justice, FBI, and HHS officials who are focusing their efforts to reduce Medicare and Medicaid fraud through enhanced cooperation. And the strike forces, which use a data-driven approach to identify unexplainable billing patterns by health care providers and then investigate these providers for possible fraudulent activity, are a vital part of the initiative. As a result of strike force efforts, more than 300 cases have been filed and close to 600 defendants charged.
Health care fraud facts:
■Health care fraud schemes come in all forms—fraudulent billings, medically unnecessary services or prescriptions, kickbacks, duplicate claims, etc.
■Schemes target large health care programs—both public and private—as well as health care beneficiaries. (Medicare and the Medicaid are the largest programs, so they are targeted more often.)
■Schemes are committed by health care providers, owners of medical facilities and laboratories, suppliers of medical equipment, organized crime groups, corporations, and even sometimes by the beneficiaries themselves.
■FBI health care fraud cases sometimes cross over into other investigative areas, like organized crime, gangs, and cyber crime, where we see criminals beginning to use the proceeds from health care fraud schemes to fund their operations.
Tips to help avoid being victimized:
■Protect your health insurance information card like a credit card.
■Beware of free health services—are they too good to be true?
■Review your medical bills, like your “explanation of benefits,” after receiving health care.
Stay tuned for more exciting stories on mass money fraud so you can protect yourself from being scammed.
Michael L. Hathman
VP - Smart Solutions Financial Services, LLC
12141 Natural Bridge Road
Bridgeton, MO 63044
(888)955-3340 - Toll-Free
(636)533-4070 - Office
Info@SmartSolutionsFS.com
www.SmartSolutionsCreditRepair.com
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