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Entries in Scam (14)

Friday
Mar082013

How to Avoid Foreign Lottery Scams

USPS(NEW YORK) -- By any accounts Clifford Curtis is an intelligent man.  He completed high school at age 16, and later became an engineer and an attorney.

So his daughter Laura was shocked when she noticed a Western Union receipt indicating her 83-year old dad had wired some unknown person $3,000.

Curtis was sending the money to collect his lottery winnings.  At least that's what he thought.  He'd received calls telling him he had won a foreign lottery.  All he had to do was pay fees and taxes and the millions would be his.

The elderly Washington State man had fallen victim to an increasingly common scam.

"There is just no question that this is really massive, and it really hits older consumers," said C. Steven Baker, director of the Federal Trade Commission's Midwest Region.

The FTC estimates that Americans are losing $1 billion a year to foreign lottery scams.

The U.S. Postal Service is so concerned that it teamed up with AARP and this week sent out 25 million mailers to older Americans, warning them to be on guard.

"Jamaica is the latest hot spot," said Paul Krenn, Assistant Inspector-in-Charge for the U.S. Postal Inspection Service.

So many scam artists are promising unsuspected Americans that they've won the Jamaican lottery, that officials are warning don't even answer phone calls from Jamaica's 876 telephone prefix.

There have been victims in 21 states, according to the U.S. Senate Committee on Aging, which will hold a hearing on this type of fraud next week.

"All foreign lotteries are scams," said Doug Shadel, a former fraud investigator who now heads ups AARP's Washington State office.  "It's illegal to participate in foreign lotteries, so that is the biggest red flag."  

He added, "Anytime anyone tells you you've won something and …you have to pay a fee, it's a scam, period."

Shadel says big losses are not uncommon: "We've seen people lose $300,000, $400,000.  And you might say to yourself, well they must be rich, so they can afford to lose that money.  No, that's ALL of their money."

The group has a nationwide Fraud Fighter Call Center (1-800-646-2283) for victims, or for those who want to question whether an solicitation they've received is fraudulent.

AARP says the most common victims of lottery scams are over age 70, often women, and with lower incomes and education levels.  Yet, as the Curtis case shows, it can happen to anyone.

"People think this only happens to dumb and senile people," said Baker.  "I can tell you that's not true."

Copyright 2013 ABC News Radio

Tuesday
Jul102012

Nationwide Utility Bill Scam Spreads to Midwest

Fuse/Thinkstock(NEW YORK) -- Utility companies in the Midwest are warning customers of an ongoing con that has already affected thousands on the West and East Coast in which a scammer claims households are eligible for an energy credit offered by President Obama to obtain personal information.

The Iowa Utility Association and three utility companies say a scam that falsely claims President Obama, who happens to be in Cedar Rapids on Tuesday, is providing energy credits by applying payments to utility companies with fake accounts provided by the scammers.

Scott Reigstad, a spokesman for Wisconsin Power and Light Company, an Alliant Energy company, said about 100 customers have been scammed since July 5.

"Nationally, the scams have been happening for months, some through social media, text messages, or fliers," he said.

Though many people wouldn't think of providing personal information to strangers on the phone, the scammer's pitch may be more persuasive than you think, especially if they already know the name of your utility company. "These credits that supposedly the president has offered seem fairly attractive to some people," said Mark Douglas, president of the Iowa Utility Association. "Because they offer the chance to reduce a utility bill, people are very willing to release that personal information."

Victims' stories vary, but the goal of the scam is to extract enough personal information from you to initiate identity theft.

"We had people reporting they have received calls from people saying they were utility representatives and they needed banking information now or their power would shut off," said Douglas.

Most of the scammed Alliant customers were contacted by phone through voice recordings or a person and were provided a bank routing number to pay their utility companies. Victims of the scam are instructed to provide their Social Security numbers in some instances, Reigstad said.

About 49 customers of MidAmerican Energy Company, Iowa's largest energy company, according to the firm, have tried to make payments with a non-working routing number used in the scam. Those customers were from cities including Des Moines, Waterloo, Iowa City, Davenport and Rock Island, Ill.

"Payments made using the routing number will not be applied to customers' bills," said Tina Potthoff, media relations manager with MidAmerican. "We are trying to reach out to customers to make sure no one else falls victim to this."

Starting in late June, customers began calling MidAmerican Energy Company to inquire about the non-existent government program.

"We've seen this at other utilities," Potthoff said. "The best possible way to put a stop to this is prevention and education."

The advice from MidAmerican and the other utility companies is to never provide personal information that the utility company should already have. If you're suspicious of someone who calls you and claims to represent your utility company, "hang up on the caller and give us a call so they know we are on the other end of the line," Potthoff said.

"If you're ever in doubt, give us a phone call as soon as possible," she said.

It's unclear where the scam originated, though Potthoff said the utility companies are working with local law enforcement to try to get to the bottom of it.

San Diego Gas & Electric issued an alert to customers warning of the scam on May 15. Pennsylvania Electric Company, PECO, released a warning to customers on June 28. Florida Power & Light Company issued a release last week and said 30,000 customers had tried to use the credit when making a payment.

For about six days in late May to early June, PSE&G, a utility company in New Jersey, noted customers were trying to or did pay their bills with the fake routing number and the payment bounced back because it was not a legitimate way to pay.

Bonnie Sheppard, spokeswoman from PSE&G in New Jersey, said about 10,000 customers tried to pay their bill with the scam "credit."  The company, which serves three-quarters of New Jersey's population, has over 2 million electric customers and nearly 2 million gas customers.

While customers in Iowa have mostly been contacted by telephone, victims have unwittingly encouraged their friends to join in the scheme by social media and word of mouth, said Potthoff of MidAmerican Energy.

"People think they are getting a good deal but they are publicizing a scam," Potthoff said.

Copyright 2012 ABC News Radio

Monday
Jun252012

Colorado Mother, Daughter Charged in Military Online Dating Scam

Tracy Vasseur, left, and her mother, Karen Vasseur. (Colorado Attorney General)(BRIGHTON, Colo.) -- A mother and daughter in Colorado were indicted for their role in a "Nigerian internet romance scam" in which associates in Nigeria posed as members of the U.S. Armed Forces and stole over $1 million from 374 victims.

Tracy Vasseur, 40, and her mother, Karen Vasseur, 73, of Brighton, Colo., about 21 miles north of Denver, face a hearing on Tuesday in the Adams County District Court.  The Colorado Attorney General, John Suthers, said the two were part of a scam since 2009 that "lured unsuspecting women to internet dating sites by posing as members of the U.S. military serving in Afghanistan.  The Vasseurs' 374 victims over a three year period were based throughout the United States and from 40 other countries."

The Vasseurs were indicted on 20 counts in violations of the Colorado Organized Crime Control Act, money laundering and theft in a 27-page document filed by Suthers' office.  Tracy Vasseur faces up to 205 years in prison if convicted on all counts; Karen Vasseur faces up to 172 years in prison.

"After a phony relationship was established, victims were asked to send money and were led to believe that the soldiers would use the money to retrieve property, travel to the U.S., and pay other expenses," the attorney general's office said in a statement.

The mother-daughter duo worked with associates in Nigeria, wiring most of the stolen money to them and kept about a 10 percent cut "although they would often receive less," the indictment stated.  The Vasseurs sent stolen money addressed to 112 different names in Nigeria, but most often to "Olamigoke Ayodeji."  They also wired money to individuals in Ecuador, Great Britain, India, United Arab Emirates and the U.S.

Most of the victims were women, the indictment stated, "looking for love and companionship on the internet" on various dating sites and social networking sites like Facebook.  During the "Nigerian internet romance scam," the attorney general's office said the Vasseurs never made contact with the victims, nor did they ever meet with their associates abroad.  But the Vasseurs engaged in "regular, frequent and detailed discussions" about where the money and how much would be sent.  Tracy Vasseur allegedly set up a "dating website" for one of her associates, the indictment stated.

"After an online relationship was established, the perpetrator would often send the victim fake military documents and personal photographs in order to convince the victim that they were truly a member of the U.S. military serving in a foreign country, usually Afghanistan," the indictment filing stated.

"After a relationship was established, the purported military member would begin asking the victim to send money to an 'agent' in Colorado," primarily through electronic fund transfer services like Western Union or Money Gram, according to the indictment.  "Among other reasons, victims were frequently told that the money they sent would pay for satellite phones, so that the victim and the perpetrator could talk directly to each other, or for travel expenses, so that the "soldier" could take authorized leave from duty to visit the victim in the U.S."

The money transferred was usually over $10,000 and as high as $59,000, according to the indictment.

None of the victims, "including 29 at-risk adults," that investigators spoke to had their money returned, the indictment stated.

Copyright 2012 ABC News Radio

Wednesday
Jun202012

Employee Scams Car Dealership Out of $10M, Spends Cash on Luxuries

Adam Gault/Thinkstock(PITTSBURGH) -- Patricia Smith, the former controller of an auto dealership in Pennsylvania, is headed to jail after embezzling $10 million from her former boss in a stunning case of a trusted employee looting the business then squandering the cash on luxuries.

Smith, who worked at Baierl Acura located in Wexford, Pa., an upper-middle class suburb of Pittsburgh, was convicted of systematically stealing for seven years -- some $4,000 a day on average -- for private jet travel, special trips to the theatre, fancy clothes and other goods, according to the court.

Smith spared no expense for herself or her family on the company's dime, according to reports from court.  The jet charters alone totaled $1.8 million for the bookkeeper, who officially made about $50,000 a year from the dealership.

According to Shannon Pierre, of ABC News' Pittsburgh affiliate WTAE, who reported on the story from court, Smith's reason for her crime spree was that she felt like a "horrible daughter, wife, mother and friend" and the gifts were a way to "earn their love" because she wanted to see "what happiness looks like."

An attorney for Smith did not return ABC News' request for comment.  News reports indicated that Smith told her family and friends she got rich investing in airline stock.

Now, the 58-year-old woman must serve 78 months in prison, three years of probation, and pay a restitution of $10,349,569.14 for the fortune she obtained by making more than 800 money transfers from Baierl Acura's coffers to her personal accounts.

"We're glad that justice has been served and this matter is now behind us.  Despite the amount of funds taken over time, there were no adverse impacts to our daily operations.  Our business is doing well and we have adopted stronger measures to prevent such a crime from ever occurring again," Lee Baierl, CEO of Baierl Automotives said in a statement to ABC News.

Smith was able to electronically transfer funds from the company's online account to her own personal account and use the funds to buy four homes, 10 vehicles, Louis Vuitton luggage, jewelry and $30,000 in pre-paid travel funds, among other purchases, court records show.

She will begin serving her sentence in July.

Copyright 2012 ABC News Radio

Thursday
May242012

Cops: Alleged Lego Scammer Sold 2,100 Boxes Through Website

Vladimir Weiss/Bloomberg via Getty Images(SANTA CLARA, Calif.) -- The California software exec arrested for allegedly switching bar codes on high priced Lego sets resold them online through "TomsBrickyard," a site so popular with Lego buyers that they rated his service "excellent."

Thomas Langenbach, who was the vice president of SAP Labs Integration and Certification Center in Palo Alto, was arrested on May 8 outside a Mountain View Target store.

Police say he used a home computer and printer -- and lots of Legos -- to amass a small fortune reselling the toys.

"Believe it or not this will be our first tech exec in a Lego case," Police Chief Scott Vermeer told ABC News.

Lagenbach, who lives in a gated multi-million dollar home in San Carlos, Calif., is free on $10,000 bail, but has refused to comment.

Police said that Lagenbach, 47, was repeatedly captured on store surveillance video with expensive Lego sets in his cart at retail stores.  Detectives said he did something called a "ticket switch," changing the price by allegedly putting his own barcode stickers on boxes so he could pay less.  He then resold the sets through the TomsBrickyard website, according to police. 

Prosecutors said he sold 2,100 Lego items for roughly $30,000 over the last year.  Police are investigating to determine how many of those sets were obtained through fraudulent bar codes.

Copyright 2012 ABC News Radio

Wednesday
May232012

Software Exec Charged in Lego Barcode Scam

BananaStock/Thinkstock(SANTA CLARA, Calif.) -- A Silicon Valley executive has been charged with four felony counts of second degree burglary after allegedly creating his own barcodes and placing them on Lego toys at Target stores to get major discounts.

Thomas Langenbach, 47, was arraigned Tuesday in Santa Clara County Court, but did not enter a plea.

The vice president of SAP Labs Integration and Certification Center allegedly stole from Target stores around his San Carlos home and then sold the items on eBay.  Each of the four counts represents the number of confirmed visits to Target stores where theft allegedly occurred.

When authorities searched his home they found hundreds of boxes of unopened Legos.  The volume and the types suggest it was not for personal use, according to Supervising Deputy District Attorney Cindy Hendrickson.

Hendrickson is not sure why Langenbach would go to such great lengths.

“It’s a bit of a head scratcher, the complexity of the crime and the amount of resources needed to commit the crime leave you scratching your head,” she said.  ”Mr. Langenbach is a VP of a successful company, living in a nice home and making money gainfully and in his free time creating false barcodes and going into Target stores and stealing Legos.”

Also present in the house were packaging materials consistent with the information provided by eBay that Langenbach sold 2,100 items and made $30,000, Hendrickson said.  Legos boxes, depending on the size, range in price from $15 to $279.

Target stores often count popular items before and after closing in an effort to prevent theft.  In April, Loss Prevention noticed the price of Legos in stock didn’t match store receipt records and began an inventory check.

After investigators sifted through sales records and footage they found Langenbach purchasing the toys at a much lower price, according to Hendrickson.  Investigators also realized he used a credit or debit card once and were able to get his name.

The investigation led to a search on Ebay and that is when they came across Langenbach’s year old account where he was selling Legos, police said.

A flyer with Langenbach’s picture was then circulated at Target stores to Loss Prevention teams.  When Langenbach walked into a Target store in Mountain View, Calif., on May 8, the loss prevention team immediately placed him under surveillance.   That is when they noticed him placing bar codes on several items, but only buying one at a discounted price, authorities said.  Once outside, Langenbach was arrested by Mountain View police.

Hendrickson said the investigation is still ongoing and Langenbach may be charged with another count of burglary at a Target store in the neighboring San Mateo County.  She added that Langenbach had three more preprinted barcodes in his pocket when he was arrested and another 32 in his car.

If convicted, he could face up to five years in prison.

Copyright 2012 ABC News Radio

Friday
Feb102012

‘Interstate Boys’ Admit to Million-Dollar Walmart, T-Mobile Scam

iStockphoto/Thinkstock(NEW YORK) -- Two men from New York City admitted Friday to ripping off Walmart and T-Mobile in a multi-state scam that federal prosecutors said cost the companies nearly $1 million.

Prosecutors said Ralbert Olacio, 23, and Edwin Rodriguez, 22, of Brooklyn, N.Y., called themselves the Interstate Boys. Court records reveal the pair traveled Interstate 95 from Maine to Florida using stolen identities to open more than 400 T-Mobile accounts along the way.

“After establishing the fraudulent accounts, the defendants traveled to over 350 different Walmart stores located from Maine to Florida on approximately 600 occasions to complete activation of the accounts and to purchase approximately 2,000 discounted cellular handsets for resale,” according to information released Friday by U.S. Attorney Paul J. Fishman.

The pair pleaded guilty in federal court to making calls they did not pay for and selling the devices at a profit.

Late last month, a third man, 23-year-old Alfredo Rodriguez, also of Brooklyn, pleaded guilty to one count of wire- fraud conspiracy in connection with the scam.

The defendants face up to 20 years in prison when they are sentenced this spring.

Copyright 2012 ABC News Radio

Wednesday
Aug312011

Discount iPad Turns Out to Be Made of Wood

Spartanburg County Sheriff's Office(SPARTANBURG, S.C.) -- A South Carolina woman’s desire to purchase an Apple iPad at a discount came back to bite her Monday when she forked over $180 dollars to strangers for an “iPad” that turned out to be a painted block of wood.

TheSmokingGun.com quotes a report from the Spartanburg County Sheriff’s Office as saying 22-year-old Ashley McDowell was approached in a McDonald’s parking lot by two men who claimed to have purchased a large number of iPads and were selling them for $300 each.  Authorities say when McDowell told the men she only had $180, they agreed to take that amount and handed over a FedEx box.

McDowell didn’t open the box immediately, but instead waited until she got home where she discovered that the iPad was actually a piece of wood painted black with a “screen” framed with black tape and stickers of iPad icons for photos, mail and an iPod.

Investigators dusted the fake iPad for fingerprints and are now searching for the suspects.

Copyright 2011 ABC News Radio

Monday
Jun202011

Iran Scam to Evade Terror Sanctions Busted, NYC Official Says

Adam Gault/Thinkstock(NEW YORK) -- Eleven companies, including Iran's state-sponsored shipping line, were indicted in New York City Monday for allegedly conspiring to evade U.S. sanctions on trade with Iran by duping major U.S. banks into funneling more than $60 million through the financial institutions in Manhattan.

"The defendants falsified the records of banks," said Manhattan District Attorney Cy Vance, who filed the indictment, in a conference call, "and in so doing the defendants deceived the Manhattan banks."

The conspiracy indictment seeks to enforce a U.S. ban on trading with Iran that was imposed because, according to the federal government, the country harbors terrorists and participates in the proliferation of weapons of mass destruction.

Iran's national shipping company is alleged to play a key logistical role in that nation's ballistic missile program as well as to serve as a conduit for supplying weapons to terrorist organizations.

The Islamic Republic of Iran Shipping Lines (IRISL), its regional offices, affiliates, as well as five individuals were charged in the 319 count indictment with using corporate shells and aliases to "exploit the services of financial institutions located in Manhattan," said Vance.

According to the indictment, the state-sponsored shipping company allegedly sent or received scores of illegal payments through Manhattan banks by using alias names and corporate alter-egos in Singapore, the United Arab Emirates, and the United Kingdom.

According to the indictment, among the banks whose security measures were circumvented in the alleged conspiracy were JP Morgan Chase, Standard Chartered Bank, Bank of New York Mellon Corp, HSBC, Deutsche Bank Trust Company Americas, Bank of America, Citibank, and Wachovia (now Wells Fargo).

Vance's office said in a statement that "the international shipping industry conducts business primarily in U.S. currency and therefore the firms involved in international shipping must have access to the U.S. financial system. Because IRISL and its sanctioned affiliates were banned from transacting with or through U.S. financial institutions, any use of their real names would have been detected and blocked by U.S. banks."

The Manhattan D.A.'s office noted that "IRISL has violated UN Security Council Resolutions by chartering vessels to transport IRISL cargo containers of ammunition and weaponry from Iran to countries linked to international terrorism."

The statement cited a case in November 2009 in which "36 Iranian cargo containers transporting hundreds of tons of weaponry, including rockets, missiles, mortars, and small arms, were interdicted en route to Syria via the intended port of Beirut."

"It is alleged that this shipment was intended for Hezbollah. This activity -- the provision of arms to terrorist organizations -- occurred during the time period charged in this conspiracy," Vance said.

"The point of this indictment is that sanctions exist...and to make sanctions work, they have to be enforced," he said. "The sanctions here are designed to shut IRISL down and to make it harder for IRISL and Iran" to achieve their goals.

Adam Szubin, the head of Treasury's Office of Foreign Assets Control (OFAC), cited the pressure on IRISL to date as having a dramatic impact on Iran's shipping business, including the loss of maritime insurance, the default on loans and the seizure of ships. Szubin pointed out that his office's aggressive actions have put extreme pressure on the shipping firm which is a significant part of the structure providing Iran with the materials needed for development of weapons of mass destruction.

"As the private sector around the world increasingly turns its back on Iran's national shipping line, IRISL's efforts to evade international sanctions and increased scrutiny have grown more and more desperate," Szubin said.

Szubin also announced Monday the sanctioning of ten additional shipping companies and three other individuals. The sanctions prohibit trade and authorize the freezing of assets of companies doing business with companies that harbor terrorists or proliferate weapons of mass destruction.

Still, Vance acknowledged the difficulty officials face in attempting to extradite the newly indicted individuals.

"Will anyone ever face judgment in New York courts? Possibly," he said.

Copyright 2011 ABC News Radio

Tuesday
Jun072011

What Lessons Can We Take from Madoff's Scam?

Mario Tama/Getty Images(NEW YORK) -- With yet another of Bernard Madoff's employees pleading guilty to his boss' investment scam on Monday, what lessons can investors take to avoid being part of a similar Ponzi scheme?

For one, you might have been a victim of Madoff's scandal without even knowing it.

"By one calculation, more than three million people were touched by this fraud.  That includes pensioners who's pension funds were effected," says Diana Henriques, author of The Wizard of Lies.

Henriques says one of the biggest lessons learned "is to accept that you can't trust your own gut."

Madoff ran a secret hedge fund.  "He was an unregistered investment adviser; he didn't use a third party custodian," she says, meaning someone who would verify the paper statements were backed up by real money.

Copyright 2011 ABC News Radio







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