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Entries in Con Artists (3)

Monday
Sep032012

The Disasters After the Disaster

Mario Tama/Getty Images(NEW YORK) -- It's as predictable as the weather is unpredictable. As the people of Louisiana and Mississippi struggle through another post-hurricane flood, con artists are going to come out of the woodwork and try to profit from their losses.

So here's a reminder of the top three scams that usually float to the surface after every natural disaster.

Unlicensed Contractors:

Fly-by-night repair crews can wreak financial havoc after a family has already suffered through mother nature's blows. Here are the telltale signs of an unlicensed contractor:

•Door-to-door Solicitations. Legitimate, licensed contractors have all the work they can handle and don't solicit that way.

•Payment in advance. Unscrupulous contractors often demand their money up front, then do shoddy work --or no work at all. Even with a licensed contractor, you should never pay up front. Instead, pay in installments, and don't let your payments get ahead of the work that's actually been done.

•No physical address. Unlicensed contractors often offer up just a cell phone number and maybe an Internet address. What you want is a physical address where you can show up to complain --or serve a lawsuit-- if things go wrong.

To verify that a contractor is properly licensed, check the business name and the owner's name with your state or county. Not all states require contractors to be licensed, which is a shame. In that case, you will have to be extra diligent about checking the contractor's reputation with your state and county consumer protection agencies and with the Better Business Bureau, at www.bbb.org.

Fake Disaster Relief Drives:

Unfortunately, in natural disasters, there are greedy people who try to profit from it. They pretend to be collecting money for victims then keep it for themselves. Once again, there are red flags to look for:

•Emotional Pleas. If the pitch for assistance is long on pathos and short on details, that's suspicious. Demand written proof of the organization's mission and good standing.

•Copycat names. Fake charities often use names that are very similar to those of real ones. They'll substitute one word, like "foundation" instead of "association." So if the name sounds off to you, search it online and see what comes up.

•High pressure. If you are pressed to give money on the spot, beware. That's a classic scam tactic, because the bad guys want to get your money and run.

•Courier Pickup: Fake charities have been known to send a courier to pick up your payment rather than asking you to send it through the mail. Why? Because they want to avoid US mail fraud laws.

The best way to help after a disaster is to "be the hunter, not the hunted." In other words, research and seek out charities you are interested in giving to, rather than responding to those that come after you. To make sure that even a real charity makes good use of your funds, check its rating with the Better Business Bureau Wise Giving Alliance. Once again, the destination is www.bbb.org.

Price Gouging:

This is a term that's often misused to refer to anything that is outrageously expensive. But remember, we live in a free market economy, so businesses can charge any price they want if people will pay it --EXCEPT when a disaster is looming. The actual, legal definition of "price gouging" is when businesses charge extra for emergency supplies in the face of a disaster. That's illegal.

If you feel you have been gouged for supplies like gasoline, batteries, bottled water and so on, contact your state attorney general to complain. Go to www.naag.org to find yours.

Copyright 2012 ABC News Radio

Saturday
Jul142012

'Stranded Traveler' Scam Hacks Victims' Emails, Asks Their Contacts For Money

ABC News (NEW YORK) -- "Hi. Just writing to let you know my trip to Manila, Philippines with my family has been a mess…I need you to loan me some money. I'll refund it to you as soon as I arrive home."

That is the kind of fake e-mail thousands of Americans get every year. It appears to come from a friend, but is actually from a con man half a world away. Most people delete them.

When a Nightline producer received one of these emails, she decided to hit reply. That took Nightline on a journey half way around the world and inside one of the most common online scams around. It's called "the stranded traveler" scam and it costs victims who fall for it million of dollars every year.

The FBI's Internet Crime Complaint Center, based in West Virginia, has about 150,000 "stranded traveler" complaints on file. The phony emails often use the subject line, "I'm writing with tears in my eyes." Special Agent Charles Pavelites showed Nightline how the identical email has been received from Madrid, Spain, London, England and, yes, Manila in the Phillipines. "They're all basically the same story, they were out of the country, they've been robbed and they need assistance now," Pavelites said. "This is a prefab…it's a form letter for a criminal." "

The email the Nightline producer received asked for nearly $2,000 and it looked like it had been sent from an acquaintance named Susan Zador. But when Nightline checked in with the real Susan, it turned out she was not in the Philippines and her email account had been hacked.

Zador's son Andy said every contact in his mother's email address book, hundreds of people, received the same alarming message.

"It's pretty disheartening to think that people are that money-hungry that they'll just send it out to whoever they think they can get the most money from," he said.

Zador's friend Mary Blackwell said she sent $300 and then learned it was a scam.

"I went through the roof. I was so upset," she said. "Not because I sent the money or anything like that, but it was because my heart was broken for Susan."

The person pretending to be Susan Zador claimed over email that he was traveling with somebody named Richard Kamenitzer and to wire the money to Richard in Manila. When Nightline tracked down the real Kamenitzer, a professor in Virginia, he said he had no idea who Susan Zador was, but that his email had also been hacked the same day as hers. Kamenitzer said he received several emails from worried friends. The hackers blocked Kamenitzer's access to his own address book, so he had no easy way to alert his friends to the scam.

"I had had 4,036 contacts in my address book, none of which were available to me," he said. "Everything was lost."

In Nightline's case, instead of sending the nearly $2,000 that our new pen pal had requested, we only sent $20. Within hours, the con artist wrote back and complained.

"You should have told me you never had any money," he said. Then he had a creative suggestion. "I think you can also have the money wired with the use of your credit card."

Nightline followed the email trail to the Philippines, where a Western Union agent said a suspected scammer has come into his shop to cash in.

"The first time I met this guy, he claimed...$4,000 in two transactions," the agent said. "When he claimed it, he showed his... ID, which was his driver's license."

In "Nightline's" interactions with the con artist, we noticed that when we ignored the scammer's pleas, his emails became increasingly desperate. "Talk to me dear … Act as urgent please! ... Please I beg you in the name of God," one email said.

Wire services don't disclose where your money is picked up and law enforcement almost never pursues these cases so chances are victims will not get their money back.

If victims do send money, the con artists put them on their "sucker list" and hit them with other scams. Sure enough, the Nightline producer began receiving new emails phishing for her bank account number. This time, she hit "delete."

So how do criminals get your email password so they can get into your email account and attempt to scam your contacts? Nightline asked Cyber security guru Dan Clements, who told us there are four key ways:

1. Trojan programs: If you click on an attachment in an unknown email, it can trigger your computer to download a "Trojan" program that then allows cyber criminals to see every key stroke you make –including your email password.

2. Password breaker program: Often called a "brute force program," this is software bad guys use to try every combination of numbers and letters until they hit on your password.

3. Email addresses used as logons: You know how many websites have you set up an account using your email address as your User ID? If you then use the same password for that account that you use for email, criminals have what they need: your email address and your password.

4. Insider theft: It's less common, but there have been instances where employees at internet companies stole customers' email addresses and passwords from internal servers.

How can you protect yourself?

Don't click on attachments in emails from strangers. Create complex passwords that are random combinations of letters, numbers and symbols and use a different password for each account you create. If a website gives you a choice of using your email address as your User ID or some other ID, choose the alternate.

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Copyright 2012 ABC News Radio

Monday
Mar262012

Outsmarting the Con Artists: Top 5 Ways to Avoid Scams

iStockphoto/Thinkstock(NEW YORK) -- Tom Arnold was a smooth talker.  In six years, he made $3 million in commissions selling supposedly rare and gold coins.  Arnold worked for a company called All American Coins, cold-calling potential investors and roping them in on the phone.

Arnold, who is awaiting sentencing on fraud charges, told former investigator Doug Shadel, "What you have to do is keep telling them that the coins went up no matter what's going on in the world.  Whether oil is doing good or oil is doing bad -- anything that is going on with the economy -- if there's a new president, the coins went up.  If it was snowing, the coins went up."

Shadel, who is now the Washington state director for AARP (formerly the American Association of Retired Persons), interviewed Arnold and other con men for a new book called Outsmarting the Scam Artists. How to Protect Yourself from the Most Clever Cons

Every con man has the same basic technique, Shadel told ABC News: "Their goal is to get you into a heightened emotional state."

Shadel says the scammers call it "the ether," a reference to the inhaled anesthetic sometimes used to knock out patients before surgery.  When con artists get you into the "ether," the rational mind goes out the window and the emotional mind takes over.

"If anyone spent five seconds thinking logically about any of these offers, they would never do it," he said.

So, Shadel warns, if someone is trying to pitch you on a deal, and your "heart is palpitating, you have sweat on your palms, you can't think of anything but this offer," you're in the "ether" and you need to slow down.

"I think the number one piece of advice," he says, "is never decide to buy something at the time you hear a sales pitch.  There's no deal out there that can't wait 24 hours."  Shadel says that allows you time to get out from under the "ether" and do due diligence.

So what should you do the next time a persuasive-sounding sales person calls you with a deal of a lifetime?  Shadel has five key pieces of advice to avoid being swindled:

-- First, as noted earlier, don't make financial decisions "under the either."

-- Second, learn to spot persuasion tactics.  Some of those used by con artists include promises that this deal will make you rich, and assurances that what you're about to buy is so scarce you have to purchase it up immediately.  Shadel says another common tactic is to promise there's a wealthy investor waiting in the wings to snap up your purchases at a big mark-up.

-- Next, Shadel advises, "Develop a refusal script."  He says many potential investors have trouble hanging up because they don't want to be rude to the salesman on the other end of the phone.  Memorize and practice a simple line to allow you to hang up quickly.

-- Fourth, before you buy, check to see if the company is registered with the state or federal governments.

-- Finally, beware if you're under financial stress at home or on the job.  You are more likely to jump at the chance to make a quick buck.

Copyright 2011 ABC News Copyright







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