North Carolina Department of Justice

North Carolina Department of Justice

North Carolina Department of Justice
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Be smart with your money during tough times


During tough times, families try to make their dollars stretch as far as possible. But when the economy slows, con artists ramp up their efforts to try to get rich at your expense. They know that the lure of easy money or help getting out of debt can be tempting when money is tight. Don’t fall for their ploys.

Here are some scams to watch out for during tough economic times:
  • Credit repair: Watch out for outfits that promise to fix your credit report for a fee. These scams cheat consumers out of hundreds of dollars and will do nothing to improve your credit. Under North Carolina law, it’s illegal to charge upfront fees for credit repair services.    
  • Debt settlement:  Avoid companies—including out-of-state lawyers—that offer to eliminate or cut your debts by negotiating with your creditors.  These operations typically collect large upfront fees but reach very few settlements with creditors, leaving you deeper in debt.  Under North Carolina law, it’s illegal to collect any upfront fee for debt settlement services. If you need help getting your debts under control, instead consider talking to a non-profit consumer credit counselor in your community about debt management services or budget counseling.  To find a reputable local counselor, contact the National Foundation for Credit Counseling at 1-800-388-2227 or  If your debt situation is especially difficult, you may want to consult a local bankruptcy attorney.
  • Foreclosure rescue: Steer clear of foreclosure assistance or rescue companies that want you to make your mortgage payment to them, or who tell you not to talk to your mortgage company or an attorney. Also, beware if they require payment before they will “help” you. It’s illegal to charge an upfront fee for foreclosure assistance services in North Carolina. For free help dealing with foreclosure, call the HOPE hotline at 888-995-HOPE.
  • Sweepstakes: A sudden windfall sounds great but be skeptical of calls or mailings announcing that you’ve won a sweepstakes or lottery. Scammers use the promise of winnings to try to steal your money and your personal financial information. In some cases, they include a very legitimate looking check that is supposed to cover taxes and fees you’re told to pay before you can claim your prize. Once you cash the check and wire the money, the check turns out to be fake—just like the promised prize.
  • Business opportunity and work-at-home schemes:  Promises that you can earn thousands of dollars a week working from home or get rich by investing in an exciting new business that’s guaranteed to make money sound tempting.  But be skeptical about such offers.  In most cases, the scheme will wind up costing you money rather than helping you make any.  Never pay for information about a work-at-home offer, or for any kind of start-up kit, instructional booklet or list of clients.   And never invest in a new business without checking it out thoroughly with our office and the Better Business Bureau.  Take the time to think it over instead of getting pressured into a quick decision.   Remember, if it sounds too good to be true, it probably is.  
  • Free grants: Don’t fall for ads you spot online or in your local newspaper that promise thousands of dollars in free government grants. The scammers say they can help you get a grant that you won’t have to repay and that doesn’t require a credit check. All you have to do is fill out an application and pay the company a fee. But once you pay the fee you’ll likely never see one dime of grant money.
  • Advance fee loans: Watch out for loan brokers who promise to get you a loan if you pay them a fee in advance. Under North Carolina law, it’s illegal for a loan broker to charge an upfront fee to help get a loan or a credit card for a consumer. Steer clear of anyone who says they can decide to give you a loan over the phone without a credit check, or who says you qualify for a loan at a competitive rate regardless of your credit history.
  • Telemarketing pitches:  Beware of telemarketers who call promising to help you get a better interest rate on your credit card, or a health plan at a price that sounds too good to be true.   Scammers use these kinds of pitches to try to steal your money and your identity so they can run up debts in your name. Hang up and call my office instead to report these scams.
For more help and tips, visit my website at or call my Consumer Protection office at 1-877-5-NO-SCAM.

Attorney General Roy Cooper and his staff work to help North Carolina consumers make smart choices and avoid scams. We are here to be of service when you need us, but through education efforts like these columns we hope to help consumers avoid problems from the start.