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Entries in Scam (14)

Friday
Jun032011

Former Madoff Employee Expected to Plead Guilty

Mario Tama/Getty Images(NEW YORK) -- A former employee of Ponzi schemer Bernard Madoff is expected to plead guilty Monday to charges in connection to his boss' investment scam, according to court documents released Thursday.

Eric S. Lipkin's plea is part of a "cooperation agreement with the government," the court filing said.  He is charged with six counts of crimes, including bank fraud, falsifying records and making false statements to facilitate a theft.

If given the maximum penalty, the 37-year-old could face 70 years in prison.

Copyright 2011 ABC News Radio

Monday
May092011

Avoid Being Scammed by a Madoff-Like Ponzi Scheme

Mario Tama/Getty Images(NEW YORK) -- More than two-and-a-half years after the collapse of Bernard Madoff's investment scam, it's almost time for hundreds of investors to start getting a small amount of their money back.

So what lessons have we learned from Madoff's Ponzi scheme?

First off, never give all of your savings to one person to manage.  That may be the first rule of investing.

"We make a lot of these short cuts in our lives," says author Margaret Heffernan, who interviewed victims of the Madoff Ponzi scheme.

Heffernan explains that some of the victims handed over their money after hearing advice from a friend.

"They were blinded by the fact that everybody just like them was doing just the same thing," she says.

And always remember to do your research, something the Madoff victims didn't do.

"Because things come from people who are like us and therefore make us comfortable we think well we don't really need to do the research, we don't need to do due diligence," says Heffernan.

Copyright 2011 ABC News Radio

Tuesday
Mar292011

'Grandparent Scams' Among 60,000 Imposter Scams Reported Last Year

Medioimages/Photodisc/Thinkstock(WASHINGTON) -- A growing number of scam artists who target senior citizens have stolen thousands of dollars from victims in what is known as the "grandparent scam," officials say.

The con is within a category of "imposter scams" for which there were 60,000 complaints last year, according to the Federal Trade Commission.  And officials have urged the public to report the scams to law enforcement.

For example, Jim and his wife, of Wilmington, North Carolina, received a call last month from a man saying he was their grandson.  The man said he had been in a car accident while traveling in the Dominican Republic.  After explaining his injuries and that he badly needed money to get out of jail and return to the United States, the man begged Jim, 78, not to tell his "parents" and blamed his voice change on the accident.

"'Con man' is short for confidence man," Steve Baker, director of the FTC's Midwest region, said.  "Their expertise is gaining your confidence."

Jim, who asked ABC News not to publish his last name, worried about his grandson's safety and health, followed the man's instructions and wired him several installments totaling $7,200 through Western Union.  He and his wife had not spoken to their several grandsons in weeks, all of whom live out of state.

Jim learned he was the victim of an imposter scam when he called his son after a day to check up on him, and the grandson was fine at home.

"I obviously felt terrible about it," Jim said.  "My first reaction was I felt stupid.  I can think of 1,000 questions that would have stopped it."

North Carolina Attorney General Roy Cooper's Consumer Protection Division has seen a spike in the grandparent scam targeting the elderly in North Carolina.  From Jan. 20 to March 17, the office received 12 complaints from people ranging in ages from 72 to 88 targeted by scammers posing as their grandchildren or other family members.  The scammers stole from $1,200 to $25,549 from each individual, with a total loss of $129,889 in the period.

The Federal Trade Commission said that complaints of "imposter scams" have been growing for several years and was the sixth most frequent FTC complaint last year, breaking into the top-10 list for the first time. 

Copyright 2011 ABC News Radio

Tuesday
Jan042011

BBB Lists Top 10 Scams of 2010

Photo Courtesy - BBB.org(ARLINGTON, Va.) – The unemployed and those in other financial straits were among the most targeted by scams and ripoffs in 2010, according to the Better Business Bureau.

“With the economy still on the mend, scammers had a field day targeting struggling families who were looking for work and trying to make ends meet,” said Stephen A. Cox, president and CEO of the Council of Better Business Bureaus. “While some of the most popular scams are perennial problems that have always plagued consumers, some new additions to the list are signs of our tough economic times.”

The BBB on Tuesday released a list of the year’s top 10 biggest scams and schemes as carried out by everyone from hackers to crooked businesses.

Among the most widespread scams were those looking to get personal information from job-seekers and debt relief companies who left customers out to dry.

Other scams that made the list were identity theft, lottery scams and work-from-home schemes.

Copyright 2011 ABC News Radio

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