ftc for the consumer federal trade commission scams targeting seniors todd m. kossow assistant...
Post on 20-Jan-2016
214 Views
Preview:
TRANSCRIPT
FTC For The Consumer www.ftc.gov
Federal TradeCommission
Scams Targeting Seniors
Todd M. Kossow
Assistant Director, Midwest Region
Federal Trade Commission
FTC For The Consumer www.ftc.gov
Background on FTC
• Nation’s general jurisdiction consumer protection agency
• Oldest independent agency of the federal government
• Five Commissioners appointed by the President
• About 1000 staff in Washington, D.C. and eight regional offices
FTC For The Consumer www.ftc.gov
FTC – What We Do
• Enforcement through federal district court and administrative litigation– Exclusively civil, not criminal, jurisdiction
• Maintain the Consumer Sentinel Network complaint database
• Perform outreach and education
FTC For The Consumer www.ftc.gov
FTC’s Consumer Sentinel Network• Database of millions of consumer fraud and
ID theft complaints maintained by the FTC• Number of Third Party Contributors, including
the BBB and a number of state AG’s• In 2014, received more than 1.5 million fraud
complaints, reporting losses of more than $1.7 billion; median amount paid was $498
• FTC acts as clearinghouse, making complaints available to law enforcement around the world
FTC For The Consumer www.ftc.gov
FTC National Fraud Survey
• 2011 Fraud Survey showed that 10.8% of the entire adult population in U.S. were fraud victims – an estimated 25.6 million people
• Less than 10% of victimized consumers complain to a third party
FTC For The Consumer www.ftc.gov
Mass Marketing Fraud – Going Global• Victim and scammer never meet• Connect by phone, email, internet, mail• Consumers may have no idea who they’re
dealing with or where they are• To get consumers’ money, they use
anonymous payment mechanisms like a money transfer or a GreenDot MoneyPak
FTC For The Consumer www.ftc.gov
What Would You Do . . .
FTC For The Consumer www.ftc.gov
Money Transfers
• Via Western Union or MoneyGram
–Can be useful when sending money to someone you know and trust
–Are inappropriate when dealing with strangers
FTC For The Consumer www.ftc.gov
Why Money Transfers?
• Wiring money is like SENDING CASH
– Can be picked up within minutes at multiple locations
– Can be sent anywhere in the world
– Cannot reverse or charge back the transaction once it’s been picked up
– Difficult to trace/identify the recipient
FTC For The Consumer www.ftc.gov
Money Transfer Complaints
• Consumer Sentinel Data 2009-2014
– 2009: 17,167 complaints, nearly $120 million in reported consumer losses
– 2011: 115,901 complaints; nearly $440 million in reported consumer losses• MoneyGram and Western Union complaints now
included
– 2014: 106,472 complaints; over $500 million in reported consumer losses
FTC For The Consumer www.ftc.gov
FTC For The Consumer www.ftc.gov
FTC For The Consumer www.ftc.gov
Reloadable Debit Cards
• Green Dot cards are reloadable debit cards sold in stores like Wal-Mart.
• MoneyPaks are advertised as a safe and secure way to send money – e.g., to reload prepaid cards, add money to PayPal accounts, or make payments to major companies.
• Also work like cash, allowing consumers to shop online without providing credit card or bank account information.
FTC For The Consumer www.ftc.gov
Green Dot MoneyPaks and Similar Reloadable Products
• They are NOT:– Credit cards – no chargeback rights
– Paper checks – cannot be traced to recipient accounts
– Debit cards – no fraud insurance
– NO REFUNDS!
FTC For The Consumer www.ftc.gov
Green Dot MoneyPaks and Similar Reloadable Products• Exercise caution in using a Green Dot MoneyPak
to pay an unfamiliar company or individual, particularly for Internet purchases.
• Anyone who requires an upfront payment with a Green Dot MoneyPak or similar product is likely operating a scam.
• Wal-Mart recently stopped selling MoneyPaks• Have been used extensively for Jamaican lottery
scams
FTC For The Consumer www.ftc.gov
Types of Advance Payment Scams
• “You’ve Won!” Scams• Employment Scams (Mystery Shopper
and Car Wrap)• Rental Scams• Nanny or Caregiver Scam
FTC For The Consumer www.ftc.gov
• You’re the “BIG WINNER!”– A call– An e-mail– A card in the mail
• You’ve won:– A prize– A sweepstakes– The lottery– A trip, car, television
• But wait... There’s more!– Before you can claim your winnings,
you need to send money to pay for:• Fees• Taxes• Customs duties
“You’ve Won!” Scams
LotteryInvestment
Board
FTC For The Consumer www.ftc.gov
“You’ve Won!” Scams• Hit older consumers disproportionately• Play on your emotions – how the money can
help family/friends
FTC For The Consumer www.ftc.gov
Counterfeit Checks
• “You’ve Won!” mailing includes a check to cover fees associated with your winnings.
• Your instructions are to deposit the check and use the funds to pay the fees via a money transfer.
FTC For The Consumer www.ftc.gov
Counterfeit Checks
• The check looks real but it’s a fake!
• Banks are required by law to make funds available within a few days of your deposit.
• When the check bounces, you will likely end up owing the bank the money you withdrew.
FTC For The Consumer www.ftc.gov
FTC For The Consumer www.ftc.gov
Universal Information Services
• Defendants sent mailings all over the world telling people they had won $2.7 million and needed to send $20
• Collected more than $12 million over several years
• FTC action ended the scam
FTC For The Consumer www.ftc.gov
Mail Tree
• In May 2015, FTC sued Florida operation that took in more than $28 million from consumers in several countries
• Letters touted “guaranteed” prizes of more than $2 million
• FTC action ended the scam• Defendants have been indicted• Still many similar scams operating
FTC For The Consumer www.ftc.gov
Mystery Shopper Scams
• You are hired to be a mystery shopper and asked to evaluate a wire transfer company’s customer service. You get a check to deposit in your personal account. All you have to do is withdraw the amount of the check in cash and wire it using the money transfer service you are evaluating…
FTC For The Consumer www.ftc.gov
Mystery Shopping – Counterfeit Check
FTC For The Consumer www.ftc.gov
Car Wrap Scams
• Get solicited to have your car shrink wrapped with ads for Red Bull or Monster Energy
• Receive a fake check to compensate you and pay for the wrapping
FTC For The Consumer www.ftc.gov
Rental Scams
• Two types:– Scammer agrees to rent something
you’ve advertised; provides a fake check for the deposit, and then changes mind and wants the deposit back
– Scammer posts potential rental units online with beautiful pictures; asks consumers to wire their deposit sight unseen
FTC For The Consumer www.ftc.gov
Nanny or Caregiver Scam
• Nannies and caregivers listed on sites like Care.com or sittercity.com are contacted by scam artists and offered employment by someone moving to their area
• Receive a fake check with instructions to purchase medical equipment or supplies before the patient arrives
FTC For The Consumer www.ftc.gov
Other Scams Targeting Seniors
• Imposter Scams– Grandparent or Friend-in-Need Scam– IRS Imposter Scams
• Health Care Scams• Medical Alert Robocalls• Tech Support Scams• Charity Frauds
FTC For The Consumer www.ftc.gov
Imposter Scams• What are they?
– You get a telephone call or email from somebody pretending to be someone else
– It could be from:• A “government official”• Someone you know – a grandchild, other relative, or
friend• Someone you met online
• What do they want?– Whatever the story, they always want your
money
FTC For The Consumer www.ftc.gov
Imposter Scams
• In 2014, the FTC received 276,662 complaints about imposter scams, which was 11% of all complaints received.
• Third highest complaint category overall – first time in the top three
FTC For The Consumer www.ftc.gov
• Pretends to be a grandchild or other family member• In trouble in another country• “Please don’t tell mom or dad”• Injured in car crash;
arrested and in jail• Need money immediately!• Send the money by
Western Union or MoneyGram• If you send some money, they’ll want more
Hi Grandma, it’s me. I need help! I’m in England studying for my semester abroad, but I got in some trouble. Can you please send me some money to help bail me out? Please don’t tell mom or dad. They’ll be mad, and they won’t let me come back!
Bobby
Grandparent Scams
FTC For The Consumer www.ftc.gov
• How big is the problem?– 2012: 11,793 complaints. Reported losses of $18 million.– 2013: 12,400 complaints.– 2014: 14,521 complaints.
• A lot of call centers—called “boiler rooms”—are in Montreal, Canada.
• Difficult to find perpetrators.• Royal Canadian Mounted Police have busted several
boiler rooms.• Perpetrators have been extradited to the U.S.
Grandparent Scams
FTC For The Consumer www.ftc.gov
Friend-in-Need/Family Emergency
• You get an e-mail out of the blue from someone who claims to be your friend or family member in dire need of help.
• All you have to do is wire money right away and keep it confidential…
• May be hacking into contacts on smart phones or into gmail; yahoo mail accounts
FTC For The Consumer www.ftc.gov
IRS Imposter Scams• Pretends to be with the IRS or another
government agency; caller ID may show 202 number and IRS
• Claims that there will be severe consequences unless you pay taxes you owe right now
• You’re told to wire the money or put it on a prepaid debit card
• Over 52,000 complaints in 2014 and about 45,000 in first six months of 2015
FTC For The Consumer www.ftc.gov
• You might get (or see)– A TV ad– An e-mail– A phone call
• They say you need...– A new Medicare card– A new health insurance card– Discounted health insurance
• You must “act now!”– Threaten you’ll lose Medicare or Social Security benefits.– You won’t be covered.– You’ll have to pay full-price for prescription drugs.
Health Care Scams
FTC For The Consumer www.ftc.gov
AFD Medical Advisors
• Called seniors in the U.S. from Montreal, Canada
• “Updating” information so you could retain Medicare benefits
• Took $300 directly from your bank account• Sent a worthless prescription drug discount
card• Out of business and operators under federal
indictment
FTC For The Consumer www.ftc.gov
Medical Alert Robocalls
• “John from the Shipping Dept” robocalls: Someone already ordered this for you and we just need to confirm shipping details
• Tell seniors it’s “free,” but later disclose monthly monitoring fee
FTC For The Consumer www.ftc.gov
Tech Support Scams
• Claim that something is wrong with your computer, but “we’ll help you fix it.”– May be through a phone call or pop-up window
• Caller tries to get remote access to your computer for the purpose of fixing a problem that doesn’t exist; may even install malware on your computer
• Want you to pay for “security” or “technical support” programs you don’t need; they ask for your account information so you can pay
FTC For The Consumer www.ftc.gov
Avoiding Tech Support Scams
• If you get a call like this, hang up and call your computer support company yourself on a number you know to be genuine
• Don’t give control of your computer to a third party who calls you out of the blue
• Don’t rely on caller ID alone to determine who is calling• Never provide financial account information to someone who
calls you and claims to be from tech support• Don’t give out your computer passwords to someone who
calls you on the phone
FTC For The Consumer www.ftc.gov
Charity Fraud• How it works:
– Someone contacts you asking for a donation to their charity. I sounds like a group you’ve heard of, it seems real, and you want to help.
– They might “thank you” for your prior pledge, creating the impression you’ve dealt with them in the past.
• What’s legitimate and what’s a scam?– Scammers want your money quickly. They pressure you to
donate now! (They might ask for cash or a wire transfer.)– Scammers often refuse to send you information, give you details,
or tell you how the money will be used
• What you can do:– Take your time! Ask for information. Check them out.
FTC For The Consumer www.ftc.gov
Cancer Fund of America
• In May 2015, FTC and all 50 states sued four sham cancer charities, charging they bilked more than $187 million from consumers.
• Alleged that less than 3% of donor contributions were spent on goods or services for cancer patients in the U.S.
• Most of the money was spent by the sham charities supporting themselves, as well as the families and friends of the operators; money spent on things like luxury cruises, jet ski outings, and sporting event and concert tickets.
FTC For The Consumer www.ftc.gov
Tips for victims: If you’ve wired money to a scammer…
• Call MoneyGram or Western Union ASAP to report the fraud and ask for the transfer to be stopped
• Call MoneyGram and Western Union even if the transaction can’t be stopped
AND…
FTC For The Consumer www.ftc.gov
Complain to the FTC
• To file a complaint– www.ftc.gov/compl
aint– Toll-Free Hotline
1-877-FTC-HELP (1-877-382-4357)
*English and Spanish
FTC For The Consumer www.ftc.gov
• Start a conversation.• Share what you know, your strategies, your ideas.• Get more information at ftc.gov/PassItOn.
...Pass it ON
Order free consumer education
materials byvisiting ftc.gov/bulkorder.
Order as many as you need! Available inEnglish and Spanish.
FTC For The Consumer www.ftc.gov
Federal TradeCommission
Questions??
Todd M. Kossow
312-960-5616
tkossow@ftc.gov
top related