SCAMS BULLETIN Host Jay White is a volunteer attorney who provides free legal services for low income seniors in San Mateo County, California.

February 22, 2020

DEBT RELIEF SCAMS

When credit card or other debts are burdensome, a phone call, email, website or ad promising relief may be welcome. A promise to settle your liabilities for pennies on the dollar can be very tempting. But proceed with care: Some debt relief offers are scams that will dig you deeper in debt.

There are reputable companies and organizations that can help you get out of the red. Some can advise you on budgeting and money management. They nay negotiate concessions with creditors or set you up with a plan to put away money each month to pay down your debts, usually over a period of years.

Scammers, on the other hand, offer sham “guarantees” to get you out of debt quickly and cleanly. Crucially, “they ask you to pay them before they do anything for you,” says the Federal Trade Commission (FTC). That’s illegal, and a big red flag that your would-be debt savior isn’t on the up-and-up. (Legitimate debt relief firms do charge for their services but can collect only when they get results.)

Some crooks will take your money and run; others will string you along, collecting payments and taking a “Management Fee” from each payment.

Bogus firms may instruct victims to stop paying their debts, on the premise that this will compel creditors to negotiate a reduction in the amount owed. This is misleading and risky. Creditors are under no obligation to settle rather than sue. These bogus firms don’t fully explain the potential consequences of being sued by creditors who are not paid. In the meantime, you could accrue interest and penalties and damage your credit score.

Warning Signs:

*A debt relief company asks for fees up front, before it settles any debts.

*The company guarantees it can eliminate your debt or reduce it by a particular amount in a set period of time.

*The company advises you to cut off communication with creditors.

*The company won’t send you information about its services unless you provide financial information such as credit card account numbers and balances.

Do’s:

*Do your homework on a debt relief service you are considering working with. Search online and check with your state’s attorney general and consumer protection agency to see if the company has been the subject of complaints.

*Do know the disclosure requirements for debt settlement companies. Among other things, they must explain all fees for and conditions on their services, estimate how long it will take to settle each debt, and lay out the risks of stopping payments to creditors.

*Do be skeptical of claims that a “new government program” or change in the law will reduce, forgive or cancel student loans, credit card debt or other liabilities.

*Do consider other options for dealing with debt, such as negotiating directly with creditors or using a nonprofit credit counseling agency.

Don’ts:

*Don’t pay a debt relief or credit counseling service fees in advance, even if they’re couched as “voluntary” contributions.

*Don’t believe guarantees. No company can ensure that it will reduce your debt by a certain amount or stop collection calls and lawsuits.

*Don’t let a company enroll you in a debt relief program without reviewing your financial situation with you.

*Don’t believe a claim that a company can remove negative information from your credit file. If data on delinquency, defaults and other problems is correct, it stays on your credit report for many years, by law.

Attribution: AARP.org

Courtesy US Federal Trade Commission

February 14, 2020

Coronavirus: Scammers follow the headlines

Scammers are taking advantage of fears surrounding the Coronavirus. They’re setting up websites to sell bogus products, and using fake emails, texts, and social media posts as a ruse to take your money and get your personal information.

The emails and posts may be promoting awareness and prevention tips, and fake information about cases in your neighborhood. They also may be asking you to donate to victims, offering advice on unproven treatments, or contain malicious email attachments.

Here are some tips to help you keep the scammers at bay:

Don’t click on links from sources you don’t know. It could download a virus onto your computer or device. Make sure the anti-malware and anti-virus software on your computer is up to date.

Watch for emails claiming to be from the Centers for Disease Control and Prevention (CDC) or experts saying that have information about the virus. For the most up-to-date information about the Coronavirus, visit the Centers for Disease Control and Prevention (CDC) and the World Health Organization (WHO).

Ignore online offers for vaccinations. If you see ads touting prevention, treatment, or cure claims for the Coronavirus, ask yourself: if there’s been a medical breakthrough, would you be hearing about it for the first time through an ad or sales pitch?

Do your homework when it comes to donations, whether through charities or crowdfunding sites. Don’t let anyone rush you into making a donation. If someone wants donations in cash, by gift card, or by wiring money, don’t do it.

Be alert to “investment opportunities.” The U.S. Securities and Exchange Commission (SEC) is warning people about online promotions, including on social media, claiming that the products or services of publicly-traded companies can prevent, detect, or cure coronavirus and that the stock of these companies will dramatically increase in value as a result.

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SCAMS BULLETIN Host Jay White is a volunteer attorney who provides free legal services for low income seniors in San Mateo County, California.

February 11, 2020

SUGAR DADDY SCAM

With Valentine’s Day around the corner, love is in the air at dating websites of all sorts. But there’s a new twist on romance scams that is preying on profile holders at “sugar daddy” dating websites.

It’s a growing trend where younger women and men (who call themselves sugar babies) look for an older “sugar daddy” or “sugar momma”. They are seeking someone to pay them cash or pay off their credit card accounts. This is, in exchange for companionship (which may or may not involve sexual relations).

If a new romantic interest persona offers to pay off one or more of your debts (such as credit card balances, student loans, rent, etc.), there’s a strong probability it’s a scam.

Here’s how the scam works:

A scammer approaches a user who is looking for a sugar daddy or sugar momma on dating websites or social media platforms. The scammer poses as a prospective sugar daddy and nurtures a relationship, ultimately offering to pay off the credit card balance of their sugar baby victim. If the victim agrees, the sugar daddy scammer will obtain the victim’s credit card account credentials and then deposit phony funds into the victim’s account, appearing to have paid off the debt.

Once this is done, the scammer—still playing the role of sugar daddy—demands that the victim purchase gift cards (such as Apple iTunes cards, Google Play cards, or Steam cards) that can be redeemed remotely as a thank you to their new patron. Any funds deposited on the gift cards is quickly drained by the scammer.

Sugar babies who refuse to buy gift cards have been met with abusive, threatening, or even black-mailing responses from the new friend and often caved to the pressure.

Caution:

Never share sensitive photographs, text messages or personal financial identity information such as bank account or social security numbers with a sugar daddy or other online suitor.

Finally, you can help other consumers avoid this scam by filing a complaint at Fraud.org via our secure online complaint form.

Attribution: fraud.org