Telemarketing con artists are creative, coming up with new tricks every day to scam unsuspecting North Carolina residents.
The callers prey on anyone who answers a phone, but especially seniors and others who have responded to phony sweepstakes or other scams before.
These examples of scams we know have been successful for fraudulent telemarketers give you an idea of the tricks they play.
COUNTERFEIT CHECKS FROM PHONY LOTTERY & SWEEPSTAKES COMPANIES
You receive a check for $2,000 to $5,000 that appears to be from an International Lottery. Then you receive a phone call from overseas saying that you have won a million dollar lottery or sweepstakes prize in Canada, Australia or some other country. The scammer tells you that the check was sent to cover fees, taxes or insurance on the award. You are instructed to deposit the check and then wire the money to pay those fees. Ultimately your bank determines that the check is counterfeit, but you have already wired money to the overseas scammers—money that came out of your own funds.
A common variation of this scam involves a counterfeit check and a cover letter announcing that you have won an award. The letter provides a toll-free number and invites you to call for further instructions. When you call, the scam proceeds as described above: you are instructed to deposit the check and then wire the money to cover fees, insurance and taxes on the award. But the check is counterfeit and the scammer keeps the money that you send.
A caller offers to enroll you in the best overseas lottery opportunity each week. As a convenience to you, the caller proposes to charge the cost of this service to your credit card or checking account. You are typically charged $10 to $100 a week for months. Occasionally, the scammer may offer a special opportunity on a sure bet lottery package for $5,000 – $10,000. The scammer will pay out small sums in “winnings” from time to time to keep you interested, but the scammer is not really enrolling you in any lotteries. Learn more about sweepstakes and lotteries
and counterfeit checks.
PAYMENT PROCESSOR OR “MONEY MULE” SCAM
You are invited to earn money by providing international payment processing services. If you sign up, you will start to receive cash, checks and wire transfers from across the United States. Your job will be to forward the funds overseas immediately via wire transfers, after deducting a 10% commission for yourself. In reality, the money you receive comes from elderly fraud victims and you will be wiring it to the scammers who defrauded those victims. In many cases this scam, which makes the victim an accessory to fraud, is targeted at individuals who have themselves lost a lot of money to these same overseas scammers.
“GRANDMA/GRANDPA, IT’S ME!”
A young caller begins their conversation, “Grandma (or Grandpa), it’s me! Don’t you know who this is?” If you volunteer the name of a grandchild, the caller adopts that name and then pretends to need assistance. The caller begs “please don’t tell my parents” because they say they’ve been arrested, hospitalized, had a car wreck or gotten in trouble. The fake grandchild then sends a friend to your home to pick up cash or a check or asks you to wire them money. Losses can range from $200 to $20,000. If you wire money, another scammer may call pretending to be a jailer or attorney, requesting more money for bail or fines. Recent victims of this scam have stated that the callers knew detailed information about their grandchildren or other family members, information possibly shared by family members on websites such as Facebook. This scam is frequently used against seniors.
GUARANTEED GOVERNMENT GRANTS
A caller says you appear to be qualified for a free, guaranteed government grant because of your age, employment status, or where you live. The caller asks a few questions, such as, “Have you ever been delinquent on your taxes or been convicted of a felony?” When you say “no” the caller says you definitely will receive the grant. The caller then requests your bank account information in order to deposit the grant money. But instead of putting money in, the scammer withdraws money and you don’t receive any grants. Victims often lose several hundred dollars. Another version of this scam lures you into paying thousands of dollars for help applying for grants. Learn more about grant scams.
SWEETHEART SCAMS (INTERNET AND TELEPHONE)
You are contacted by someone (often from overseas) who has seen the personal information you posted on a social networking or dating website. The “sweetheart” uses email and phone conversations to strike up a friendship which eventually blooms into a romance. Once you are sufficiently smitten, your new love interest pretends to be in the hospital or in jail overseas and asks you to wire money to them, often repeatedly.
ADVANCE FEE LOAN SCAMS
You call the toll-free number from a classified ad in a local newspaper or shopping guide that guarantees a loan or credit card to people with no credit, poor credit, prior bankruptcies or inadequate incomes. The person who answers your call confirms that you will receive the loan or credit card, after you pay a fee. The fee is said to cover processing, credit insurance, a security deposit or the first and last month’s payments.
Scammers who are based in Canada often pressure you to wire the fee to them. Other scammers, usually based in Florida or California, ask for your checking account number so they can draft the account for the fee. The Canadian scammers send nothing after receiving your money, while the U.S.-based scammers may send you lists of banks that offer credit cards. Sometimes they send catalogs of over-priced merchandise and a plastic card, which is good only for charging part of the price of items listed in the catalog. Typical losses from advanced fee scams range from $199 to $2,000.
North Carolina ranks high in the number of victims of this scam. Frequent targets are enlisted military personnel and blue collar workers. In some instances, the scammers call the consumers directly after purchasing their credit information from banks which have turned them down for loans or credit cards.
Telemarketers are also purchasing the names and numbers of consumers with poor credit. They call and say that for a few hundred dollars, they can fix your credit by removing negative items on your credit report regardless of whether they are accurate. However, accurate items on credit reports cannot be removed and consumers can get truly erroneous information removed from a credit report at no cost. Learn more about advance fee scams
and credit repair scams.
CREDIT CARD OR IDENTITY THEFT INSURANCE
A caller claims to be able to protect you from identity theft and from thieves who might steal your credit card numbers using the Internet. The caller warns that thieves will run up hundreds of thousands of dollars in debts in your name, and that you will be liable unless you purchase protection for $200-$600. In fact, federal law already protects you from liability for such theft and for misuse of your credit card numbers.
SECRET SHOPPER SCAM
You are invited to become a “secret shopper,” someone who gets paid for conducting business with a company and then evaluating its performance. You receive detailed instructions on how to test the Western Union or MoneyGram wire transfer system, along with a check for several thousand dollars. You are told to deposit the check into your account, wire 90 percent of the funds to a person located overseas, and then immediately fill out an online questionnaire about your experience. Days after you deposit the check and wire the funds overseas, your bank says that the check was counterfeit and that your account has been debited in the amount of the check.
UTILITY COMPANY CUT-OFF SCAM
You are contacted by an individual who presents himself as a utility company employee. The phony utility agent claims that your water, gas or electric bill is past due and that your service is about to be cut off. You can prevent disconnection by paying your bill and late charges. If the scammer is standing at your front door, he will accept cash or a check. If he has called you on the telephone, you can pay by providing your checking account or credit card number. This scam is frequently used against seniors.
CHECK PROCESSING & CHECK OVERPAYMENT SCAMS
You receive a letter, telephone call, or email from someone who claims that they have received a check for several thousand dollars that they cannot cash in their own country. In this variation of the overseas money transfer scam and the sweepstakes scam, the scammer asks for your help cashing the check. The scammer endorses the check and sends it to you, asking you to deposit it and keep 20 percent while sending them the other 80 percent. The check appears to be from a U.S. car dealership, computer company or some other legitimate business, and it bears a valid account number for that business. Days after your money is wired overseas, your bank reports that the check is counterfeit and will not be honored. Learn more about counterfeit check scams.
OVERSEAS MONEY TRANSFERS (NIGERIAN SCAMS)
Via fax, email, or regular mail, you receive an impassioned plea from someone who claims to live in Nigeria or another developing country. They may present themselves as a former high government official, or perhaps a relative of a former dictator. They claim to need to transfer several million dollars into the U.S. and offer to pay you a 25 percent commission to use your account to make the transfer. The person requests absolute secrecy, and suggests the funds may not have been obtained legitimately. They may also ask for several thousand dollars, supposedly to bribe a foreign government official who is blocking transfer of the millions into your account. In recent variations of this old scam, the fax, email or letter will claim that the smuggled money is intended for orphans or a religious ministry. These are ploys to acquire your bank account number and then drain the account of funds.
Learn more about Nigerian scams.
"YOUR DISTANT RELATIVE HAS DIED IN OUR COUNTRY"
In this variation of the overseas money transfer scam, you receive a message from someone who claims that you are the sole heir of a distant relative who died in a foreign country and left an estate worth millions of dollars. The estate needs to be wrapped up quickly or it will be forfeited to the government. You are asked to wire funds to help pay for some aspect of the transaction (taxes, insurance, estate administration costs, money to bribe crooked officials, etc.). After each payment the scammer comes up with another reason for you to send more money.
ALARMING MESSAGE FROM THE BANK (PHISHING AND VISHING SCAMS)
You receive an email that appears to be from your bank. Because of a problem with the bank’s computer or security system, the email says, you need to provide important account information immediately. The email may contain a link to a web page where the account information can be entered. But the web page, which may appear legitimate, is phony. The information you provided is used to steal money from your account.
This is called a phishing scam because crooks use bait (a message that appears to come from a trusted source) to lure you into providing confidential information. Phishing scammers pose as banks or other financial institutions, insurance companies, social networking sites, online payment vendors, online auction websites, or even the Internal Revenue Service.
Another variation of this scam, called vishing (voice phishing) starts with an email or text message that asks you to call a telephone number to provide your account information. The scammers set up an automated call menu where you enter your personal bank account numbers and other financial information using your telephone. Learn more about phishing scams
PREDATORY MORTGAGE LENDING
An unscrupulous mortgage lender offers you a loan to consolidate your debts, help your grandchildren go to college, or pay for home improvements. But the loan is a bad deal for you because it includes a high interest rate, expensive fees for unnecessary options like credit life insurance or disability insurance, brokerage commissions, “points” and origination costs.
Your loan terms may also include a balloon payment so that the entire amount of the mortgage loan is due after just a few years. At that point the lender may offer to refinance the loan, claiming this will lower payments. Instead, more fees get tacked on to the loan.
The end result is that you can quickly lose most of the equity in your home (a process known as equity stripping) while continuing to face high payments for what might have originally been a modest mortgage loan. Predatory mortgage loans often target seniors whose home mortgages have already been paid off. This scam is frequently used against seniors. Learn more about predatory lending.
FUTURE CHURCH MEMBER SCAM
Your church receives a call from someone claiming to be a priest or pastor in another state. The phony clergyman claims that a valued female member of their church is moving to North Carolina with her children and intends to join your church or parish. They provide the names of the family members and the date they will arrive in your town. On that date, which is usually a Friday or Saturday, a woman claiming to be the future church member calls to say that her car has broken down and she and her children are stranded in Maryland or Virginia. She says that the mechanic will not accept her out-of-state check, and if funds (usually $500-$800) can be wired to her, she can get the car repaired and arrive in time for the Sunday service. She apologizes for the imposition and promises to repay the money. But after the money is sent, the supposed new member of the church and her former pastor are never heard from again.
SOUND-ALIKE CHARITIES AND LAW ENFORCEMENT GROUPS
Some questionable charities try to deceive you by using names that are similar to well-known, legitimate charities. They often adopt names that sound like law enforcement agencies because they know people generally support law enforcement, and because some people may be intimidated by a call from someone who claims to be with a police organization. Ask the caller to send you information by mail so you can check out the organization before contributing to them. If you want to support a particular group, such as your local police or schools, contact them directly to find out the best way to do so.
PROFESSIONAL CHARITABLE SOLICITORS
You are contacted by a professional fundraiser on behalf of a legitimate charity or community group. Unless you ask, fundraisers do not have to tell you how much of your donation they will keep. Some keep as much as 90 percent, so ask how much of your contribution would go to the worthy cause and how much would go toward fundraising. You can also ask to receive written information about the charity’s fundraising. Instead of responding to individual solicitations, you may want to contribute directly to your favorite legitimate charities. Learn more about giving to charity
and charity scams.
DRIVEWAY PAVING SCAM
A paving contractor knocks on your door. He says his crew just finished paving another driveway in the neighborhood. He claims to have some leftover paving material and offers an excellent deal on paving your driveway. The driveway is coated with an oily substance or a very thin layer of asphalt. Not long after you pay $3,000 - $6,000 for your driveway, the new surface crumbles or washes away. This scam is perpetrated by roving contractors who strike an area and move on quickly, and is frequently used against seniors. Learn more about home repair scams.