Feds Warn Of Holiday Identity Theft, Online Shopping Scams, And Charity Fraud

Philly Daily ran my Crime Beat column on the Feds warnings about holiday scams.

You can read the column via the link below or the text below:

Davis: Feds warn of holiday identity theft, online shopping scams, and charity fraud - Philly Daily  

It’s a sad commentary, but during the holiday season, when most of us are thinking of family and friends and of goodness and joy, there are heartless crooks looking to take advantage of one’s goodness by scamming them. 

On December 3rd at a Security Summit, the Internal Revenue Service (IRS) announced that the 10th National Tax Security Awareness Week hopes to raise awareness about tax-related identity theft and scams as the holidays and the upcoming tax season approach.

The Security Summit is a coalition of the IRS, state tax administrators, tax software companies, the tax professional community and others in the larger tax community, organized to combat tax-related identity theft through a public-private sector partnership that strengthened internal protections and raised awareness about security threats.

“With the holiday shopping season underway and tax season quickly approaching, we are urging taxpayers and tax professionals to take extra steps to protect their financial and tax information,” said IRS CEO Frank Bisignano. “During this holiday season, people face the heightened risk of identity theft as criminals ramp up efforts to trick people into sharing sensitive personal information: identity thieves might use this information to try filing false tax returns and stealing refunds.”

The IRS stated that the work of the Security Summit is to strengthen internal systems and share information across the tax system about fraudsters continues to show results. Since its inception, the work of the Security Summit has helped protect millions of taxpayers against identity theft and prevented billions of dollars from being wrongly paid out to fraudsters.

The IRS stated that the work of the Security Summit is to strengthen internal systems and share information across the tax system about fraudsters continues to show results. Since its inception, the work of the Security Summit has helped protect millions of taxpayers against identity theft and prevented billions of dollars from being wrongly paid out to fraudsters.

As the IRS and the Summit partners have strengthened their systems, identity thieves have increasingly turned their attention to stealing underlying tax and financial information from taxpayers, businesses, and tax professionals in hopes of slipping authentic-looking tax returns through the defenses. 

“There has been an increase of these activities on social media, including inaccurate tax advice that continues to mislead taxpayers. To help counter this, many of the Security Summit partners have joined together to form the Coalition Against Scam and Scheme Threats. This group will be increasingly active during the upcoming tax season,” the IRS stated.

 “A key tool in identifying and defending against these identity theft scams is the Identity Theft Information Sharing and Analysis Center, which was developed by the IRS and Security Summit partners to better identify and coordinate against fraudsters. As the group has strengthened defenses inside the tax system to spot emerging scams, identity thieves continue to look for new ways to obtain sensitive personal financial information to file fraudulent tax returns, making tax professionals and the sensitive tax information of their clients a target for scam artists.”

The IRS and Security Summit partners want taxpayers, tax professionals and businesses to be extra aware during the upcoming holiday season for the threats listed below.

• 
  Social media scams: Bad tax advice on social media can mislead taxpayers about their credit or refund eligibility. Influencers may convince taxpayers to lie on tax forms or suggest the IRS is keeping a tax credit secret from them. Social media posts may put taxpayers in touch with scammers.
• Phishing and smishing: The IRS frequently warns against phishing emails and smishing texts, which are common tactics used by criminals to steal personal and financial information. The impersonator wants taxpayers to send them money. Opening links and attachments may harm their computer.
• Protection for seniors: Scammers target people over age 65 or nearing retirement for personal or financial information or money. Often, once seniors give them money, they ask for more. When scammers trick them to withdraw from their retirement account, it could affect their taxes.
• Protection for businesses and tax professionals: The IRS reminds tax professionals of their legal obligation to have a Written Information Security Plan and to use multi-factor authentication. Businesses are also advised to update their security measures and remain vigilant against cyberattacks.
• Identity Protection PIN: An identity protection PIN is a six-digit number that prevents someone else from filing a tax return using a taxpayers Social Security number or individual taxpayer identification number. If taxpayers don't already have an IP PIN, they may get an IP PIN as a proactive step to protect themselves from tax-related identity theft. Anyone with an SSN or an ITIN can get an IP PIN including individuals living abroad.                                             

·         The Federal Trade Commission (FTC) also issued warnings about holiday scams.

·       “Scammers are everywhere online – especially on social media,” the FTC stated. “They sometimes impersonate real companies and run ads for brand-name products at unusually low prices. But if you click the link in the ad, it could send you to a “scammy” website designed to take your money in exchange for a counterfeit item, something that looks completely different from the picture in the ad, or nothing at all.”

·         When you’re shopping online, the FTC stated, here are some ways to protect yourself during the holidays and year-round:

• Do some research. Before you buy, search online for the seller’s name and the website URL the ad sends you to, plus words like “review,” “complaint,” or “scam” to see what others have to say.
• Pay by credit card, when possible. If you’re charged twice, billed for something you never got, or get a wrong or damaged item, you can dispute the charge with your credit card company. And if the seller says you can only pay with a gift card, wire transfer, payment app, or cryptocurrency, it’s probably a scam.
• Keep records. If something goes wrong, having your receipt and order confirmation number can help you get your money back from the seller. Also, sellers have to ship your order by the time they or their ads say they will — or give you the chance to get your money back.

If you think you were scammed, file a report with the FTC at ReportFraud.ftc.gov.

The FBI field office in Philadelphia notes that the holidays are underway, and with charitable giving and online shopping surging, the FBI reminds communities to stay alert for schemes designed to steal your money and personal information.

“The holiday season is a time to bring people together, but scammers are working to separate you from your money and personal information,” said Wayne A. Jacobs, special agent in charge of FBI Philadelphia. “Whether you are shopping, connecting with loved ones, or looking to give back, there are small, but important steps everyone can take to better protect themselves online: if you didn’t call them, don’t tell them—never share personal or banking information on an unsolicited call; If the link is a mystery, the risk isn’t — don’t click unrequested links; use secure payment methods; and verify charitable organizations before donating. If you have any doubt, reach out—call the FBI at 1800-CALL-FBI or report it at IC3.gov.

“If a deal you find this holiday season seems a little too good to be true, it probably is.”

Some of the most common holiday shopping scams reported to the FBI include:

• 
  Non-delivery scams, where you, as a buyer, pay for goods or services you find online, but you never receive your items.
• Non-payment scams, where you, as a seller, ship purchased goods or services, but you never receive payment for them.
• Gift card fraud, where a seller asks you to pay with a pre-paid card.

The FBI Philadelphia field office also reminds the public of the charity fraud scams criminals deploy this time of year to cash in on your kindness.

“Charity fraud schemes seek donations for organizations that do little or no work—instead your charitable donation goes to the fake charity’s creator. Scammers can contact you in many forms, from e-mails, text messages, cold calls and social media,” the FBI stated.

My Broad & Liberty Piece On Government Impersonation Scams

Broad & Liberty ran my piece on government impersonation scams today.

You can read the piece via the below link or the below text:

Paul Davis: Beware of government impersonation scams 

Some years ago, I came home from work and saw my wife arguing with someone on the phone.

She said someone claiming to be from the IRS was on the phone and he was saying that we owed back taxes. He told my wife that she could avoid arrest by paying the back taxes via a credit or debit card.

I took the phone and the man on the line told me that if we didn’t immediate pay the back taxes, he would send the Philadelphia police to our home and arrest us.

I knew from the start that this was a scam, and his comment about sending the Philadelphia police confirmed it. The IRS has their own law enforcement special agents, and they don’t use the Philadelphia police to arrest people who owe back federal taxes.  

The con man on the phone apparently did not know this about the IRS. The con man also didn’t know that at the time I was a Defense Department civilian employee with many years’ experience in the security and crime prevention field. He couldn’t know that I worked with federal intelligence and law enforcement agencies, as well as with the Philadelphia Police Department. I was also a part-time freelance writer at the time, and I covered crime for newspapers and magazines at night and on weekends.

So I was not quite the victim who didn’t know how the government works and would be frightened of a threat from someone claiming to be from the IRS. I told the con man that I knew he was a fraud, and I hung up. I then called the FBI and reported the IRS impersonation call.                

Sadly, government official impersonation calls are all too common, and sadly many people fall for the scam.

The Drug Enforcement Administration (DEA) recently issued a warning to the public of a widespread fraud scheme in which scammers impersonate DEA special agents in an attempt to extort money or steal personal identifiable information.

According to the DEA, DEA personnel will never contact members of the public or medical practitioners to demand money or any other form of payment, will never request personal or sensitive information, and will only notify people of a legitimate investigation or legal action in person or by official letter. In fact, no legitimate federal law enforcement officer will demand cash or gift cards from a member of the public. You should only give money, gift cards, personally identifiable information, including bank account information, to someone you know.

Anyone receiving a call from a person claiming to be with DEA should report the incident to the FBI at www.ic3.gov. 

According to the Federal Trade Commission (FTC), impersonators pretend to be government officials to try to steal your money or personal information. Scammers pose as a government representative, saying you owe a fine or a toll. Or they may claim they’re from your bank, saying there’s something wrong with your account. Or they might pretend to be someone you know - like a grandchild in trouble.

Impersonation scams are, year after year, the top fraud reported to the FTC, and people reported losing nearly $3 billion to impersonators in 2024 alone.

To avoid impersonation scams, the FTC states:

• Don’t give money or personal information to someone who contacts you unexpectedly. If you’re not sure if a call or message is real, reach out to the business, organization, or person using contact information you looked up yourself and know to be true.
• Don’t trust your caller ID. Your caller ID might show the name of a government agency or business, but caller ID can be faked. It could be anyone calling from anywhere in the world.
• Don’t click on links in unexpected emails, texts, or social media messages. Scammers send emails and messages that look like they’re from a government agency or business, but they’re really designed to steal your money and personal information.

 Here are some ways you can tell you're dealing with a scam:

·         Scammers usually pressure you to act quickly. They don't want you to have time to check what they're saying.

·         Scammers tell you to pay in a specific way. They want it to be hard to get your money back, so they'll say to pay by gift card, by wire transfer, or with cryptocurrency.

·         Scammers ask for your personal or financial information — things like your Social Security, credit card, or bank account number.

Before you act, type the company or product name into your favorite search engine with terms like “review,” “complaint,” or “scam,” and see what you find. 

Scammers who call you have a few things in common:

·         They'll ask for money or information (like your Social Security, credit card, or bank account number)

·         They'll tell you how to pay — often by gift card, cryptocurrency, or wire transfer.

Be aware that caller ID can be faked. So even if it looks like the call comes from a government agency like the Social Security Administration, IRS, or Medicare, or looks like it comes from a local number, it could be a scammer calling from anywhere in the world. 

As soon as a caller threatens you or demands that you pay them with a gift card, credit card or by wiring money, you know. It’s a scam. Even if caller ID tells you otherwise. 

As the FTC notes, that’s not the government calling. 

Paul Davis, a Philadelphia writer and frequent contributor to Broad + Liberty, also contributes to Counterterrorism magazine and writes the “On Crime” column for the Washington Times. He can be reached at pauldavisoncrime.com. 

Note: You can read my other Broad & Liberty pieces via the below link:

You searched for Paul Davis - Broad + Liberty

Feds Warn Of 'The Grandparent Scam': My Philadelphia Weekly Crime Beat Column On Scheme That Targets The Elderly

Philadelphia Weekly published my Crime Beat column on "The Grandparent Scam."

You can read the column via the below link or the below pages:

Feds warn of grandparent scam - Philadelphia Weekly  

You can click on the above and below to enlarge.

The Justice Department And The Federal Trade Commission Announce Expedited Antitrust Procedure And Guidance For Coronavirus Public Health Efforts

The U.S. Justice Department released the below information:

The U.S. Department of Justice Antitrust Division and the Federal Trade Commission (FTC) today issued a joint statement detailing an expedited antitrust procedure and providing guidance for collaborations of businesses working to protect the health and safety of Americans during the COVID-19 pandemic.

The expedited procedure notes, for example, that health care facilities may need to work together in providing resources and services to assist patients, consumers, and communities affected by the pandemic and its aftermath. Other businesses may need to temporarily combine production, distribution, or service networks to facilitate production and distribution of COVID-19-related supplies.

Under the expedited procedure for COVID-19 public health projects, the agencies will respond to all COVID-19-related requests, and resolve those addressing public health and safety, within seven calendar days of receiving all information necessary to vet these proposals. The statement sets out the instructions for businesses wishing to take advantage of this procedure.

The expedited COVID-19 procedure offers quicker review than existing FTC and Justice Department programs that are designed to provide guidance to businesses concerned about the legality of proposed conduct under the antitrust laws. The FTC’s “Staff Advisory Opinion” procedure and DOJ’s “Business Review Letter” procedure allow any firm, individual, or group of firms or individuals to submit a proposal to the agencies and to receive a statement advising whether the agencies would challenge the proposed activity under the antitrust laws.

“The Antitrust Division recognizes the importance of providing expeditious clarity on any antitrust obligations in this challenging time,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “Our expedited Business Review Letter procedure will help facilitate businesses that want to work quickly to address the urgent public health and economic needs associated with COVID 19.”  

“Under these extraordinary circumstances, we understand that businesses collaborating on public health initiatives may need an expedited response from U.S. antitrust authorities,” said FTC Chairman Joe Simons. “We are committed to doing everything we can to help with these efforts, while continuing to aggressively enforce the antitrust laws.”

The antitrust laws accommodate procompetitive collaborations among competitors. In their joint statement, the FTC and the Department of Justice listed several types of collaborative activities designed to improve the health and safety response to the pandemic that would likely be consistent with the antitrust laws.

At the same time, the agencies also stressed that they will not hesitate to hold accountable those who try to use the pandemic to engage in antitrust violations. In addition, the Department of Justice will criminally prosecute conduct such as price-fixing, bid-rigging, or market allocation.

The expedited procedure requires that an applicant provide the FTC or Justice Department a written description of the proposal, including the parties that would be involved in the effort or activity, and the name and contact information of a person from whom the agencies could obtain additional information. This expedited procedure is for use solely for coronavirus-related public health efforts and may be invoked at the option of the requestor, in lieu of the agencies’ standard procedures for handling requests for advice.

The agencies also committed to expedite requests under the National Cooperative Research and Production Act for flexible treatment of certain standard development organizations and joint ventures. 

The statement also notes that the FTC and the Justice Department are addressing actions by individuals and businesses to take advantage of COVID-19 through other fraudulent and illegal schemes. Anyone with information or concerns about this sort of conduct, or other COVID-19-related complaints, should contact the FTC’s Consumer Response Center at 1-877-382-4357 or the National Center for Disaster Fraud Hotline (1-866-720-5721) or e-mail (disaster@leo.gov). More information on the FTC’s guidance on potential fraud, deceptive practices, and scams is available here, and to report a complaint go to www.ftc.gov/complaint.

Don’t Give To A Charity Imposter

Although the Christmas season often prompts us to share our good fortunes with the less fortunate, one should be wary of the crooks out there who take advantage of our generosity. 

The Federal Trade Commission (FTC) offers the below piece to help you avoid bogus, crooked scams:

When you give to a charity, you’re giving because you care and want to help — and you want to be sure your money actually gets to those you’re trying to help. But scammers who pretend to be a charity try to get to your wallet. So consider these tips before you give:

Rule out anyone who asks you to send cash, pay with a gift card, or wire money.

Confirm the exact name of the charity and do some research, especially when donating for the first time. Search for the name of the charity online — plus the word “complaint” or “scam.” That’s one way to learn about a charity’s reputation.

Give to charities you know and trust, with a proven track record. Before you give to any charity, check them out with the Better Business Bureau's (BBB) Wise Giving Alliance, Charity Navigator, Charity Watch, or GuideStar.

Be wary of charities that seem to pop up overnight in connection with a natural disaster or other tragedy. 

Don’t assume that pleas for help on crowdfunding sites or social media are legitimate. Real victims’ pictures and stories can easily be misused to con you.

Before you text to donate, confirm the number on the charity’s website.

Never click on links or open attachments in e-mails, even if they appear to be from a charity. You could unknowingly install malware on your computer or be taken to a look-alike website run by scammers. 

For more information, visit ftc.gov/charity. If you think you’ve spotted a charity scam, tell us at ftc.gov/complaint.

Two Defendants Plead Guilty In Multimillion Dollar Prize Promotion Scams Targeting Elderly Victims

The U.S. Justice Department released the below information:

Two individuals who ran multimillion dollar prize promotion scams entered guilty pleas Dec. 12 in federal court in Las Vegas, Nevada, the Department of Justice announced.

Glen Burke, 57, of Las Vegas, pleaded guilty to contempt and conspiracy charges arising from his operation of two predatory schemes that defrauded thousands of victims, many of whom were elderly, out of more than $20 million.  Burke conducted those fraudulent campaigns in violation of a 1998 court order obtained by the Federal Trade Commission (FTC) permanently banning him from telemarketing and making misrepresentations to consumers.  A co-defendant, Michael Rossi, 52, also of Las Vegas, also pleaded guilty in connection with one of Burke’s schemes.

“The Department of Justice is determined to punish the perpetrators of fraudulent schemes that exploit consumers, especially those that target the elderly or vulnerable,” said Acting Assistant Attorney General Chad Readler of the Justice Department’s Civil Division.  “We will work with our partners at the FTC and the U.S. Postal Inspection Service to eradicate schemes that harm the elderly wherever we find them.”

Burke pleaded guilty to contempt for violating the court order prohibiting him from making misrepresentations to consumers.  That charge stemmed from Burke running a mass-mailing operation that misled consumers into believing that they had won large cash prizes, often millions of dollars. Burke specifically mailed consumers solicitations that used fake names and, in many cases, looked like they came from law firms or financial institutions, advising consumers to pay a fee – usually $20 to $30 –to claim their promised winnings.  Once consumers paid, however, Burke never sent any consumer a promised prize.

Burke, along with Rossi, also pleaded guilty to conspiracy to commit mail and wire fraud for running a fraudulent telemarketing operation.  Telemarketers working for Burke and Rossi falsely told victims that they had won one of five valuable prizes, typically: a Chevy Camaro; a Boston Whaler boat; a diamond-and-sapphire bracelet; $3,000 cash; or a cruise that could be exchanged for $2,300.  To claim the prize, consumers were told to pay hundreds, or in some cases thousands, of dollars.  Once they paid, victims received a nearly worthless piece of costume jewelry or nothing at all.

Sentencing is scheduled on March 12, 2018.  Under the contempt statute, Burke could be sentenced to any term of imprisonment and fine.  Under the conspiracy statute, Burke and Rossi face a potential maximum sentence of 20 years in prison and a $250,000 fine.  The court has the discretion to impose a lower sentence.

Principal Deputy Assistant Attorney General Readler commended the investigative efforts of the U.S. Postal Inspection Service and thanked the FTC for its valuable assistance.  The case was prosecuted by Trial Attorneys Timothy Finley and Daniel Zytnick of the Consumer Protection Branch of the Department of Justice’s Civil Division and Assistant U.S. Attorney Nicholas Dickinson of the District of Nevada.

Is The IRS Truly Calling? Report Phone Scams To The FTC

 The Federal Trade Commission released the below information:

You get a call from someone who says she’s from the IRS. She says that you owe back taxes. She threatens to sue you, arrest or deport you, or revoke your license if you don’t pay right away. She tells you to put money on a prepaid debit card and give her the card numbers. The caller may know part of your Social Security number. And your caller ID might show a Washington, DC area code. But is it really the IRS calling?

No. The real IRS won’t ask you to pay with prepaid debit cards or wire transfers. They also won’t ask for a credit card over the phone. And when the IRS first contacts you about unpaid taxes, they do it by mail, not by phone. And caller IDs can be faked.

Here’s what you can do:

Stop. Don’t wire money or pay with a prepaid debit card. Once you send it, the money is gone. If you have tax questions, go to irs.gov or call the IRS at 800-829-1040.

Pass this information on to a friend. You may not have gotten one of these calls, but the chances are you know someone who has.

Please Report Scams

If you spot a scam, please report it to the Federal Trade Commission (FTC). Report a scam online or call the FTC at 1-877-FTC-HELP (1-877-382-4357) or TTY 1-866-653-4261. Your complaint can help protect other people. By filing a complaint, you can help the FTC’s investigators identify the imposters and stop them before they can get someone’s hard-earned money. It really makes a difference.

U.S. Government's Office Of Personnel Management (OPM) Provides Information About the Recent Cybersecurity Incident

The U.S. Government's Office of Personnel Management (OPM), offered the below information yesterday:

The U.S. Office of Personnel Management (OPM) recently became aware of a cybersecurity incident affecting its systems and data that may have compromised the personal information of current and former Federal employees.

Within the last year, OPM has undertaken an aggressive effort to update its cybersecurity posture, adding numerous tools and capabilities to its networks. As a result, in April 2015, OPM became aware of the incident affecting its information technology (IT) systems and data that predated the adoption of these security controls.

Since the incident was identified, OPM has partnered with the U.S. Department of Homeland Security’s U.S. Computer Emergency Readiness Team (US-CERT), and the Federal Bureau of Investigation to determine the impact to Federal personnel.  And OPM immediately implemented additional security measures to protect the sensitive information it manages.

Beginning June 8 and continuing through June 19, OPM will be sending notifications to approximately 4 million individuals whose Personally Identifiable Information was potentially compromised in this incident.  The email will come from opmcio@csid.com and it will contain information regarding credit monitoring and identity theft protection services being provided to those Federal employees impacted by the data breach. In the event OPM does not have an email address for the individual on file, a standard letter will be sent via the U.S. Postal Service.

In order to mitigate the risk of fraud and identity theft, OPM is offering affected individuals credit monitoring services and identity theft insurance with CSID, a company that specializes in identity theft protection and fraud resolution.  This comprehensive, 18-month membership includes credit report access, credit monitoring, identity theft insurance, and recovery services and is available immediately at no cost to affected individuals identified by OPM.

Additional information is available beginning at 8 a.m. CST on June 8, 2015 on the company’s website, www.csid.com/opm (external link), and by calling toll-free 844-222-2743 (International callers: call collect 512-327-0700).

Steps for Monitoring Your Identity and Financial Information

• Monitor financial account statements and immediately report any suspicious or unusual activity to financial institutions.
• Request a free credit report at www.AnnualCreditReport.com (external link) or by calling 1-877-322-8228.  Consumers are entitled by law to one free credit report per year from each of the three major credit bureaus – Equifax^®, Experian^®, and TransUnion^® – for a total of three reports every year.  Contact information for the credit bureaus can be found on the Federal Trade Commission (FTC) website, www.ftc.gov (external link).
• Review resources provided on the FTC identity theft website, www.identitytheft.gov (external link).  The FTC maintains a variety of consumer publications providing comprehensive information on computer intrusions and identity theft.
• You may place a fraud alert on your credit file to let creditors know to contact you before opening a new account in your name.  Simply call TransUnion^® at 1-800-680-7289 to place this alert.  TransUnion^® will then notify the other two credit bureaus on your behalf. 

Precautions to Help You Avoid Becoming a Victim

• Be suspicious of unsolicited phone calls, visits, or email messages from individuals asking about you, your employees, your colleagues or any other internal information.  If an unknown individual claims to be from a legitimate organization, try to verify his or her identity directly with the company.
• Do not provide personal information or information about your organization, including its structure or networks, unless you are certain of a person’s authority to have the information.
• Do not reveal personal or financial information in email, and do not respond to email solicitations for this information. This includes following links sent in email.
• Do not send sensitive information over the Internet before checking a website’s security (for more information, see Protecting Your Privacy, www.us-cert.gov/ncas/tips/ST04-013 (external link)).
• Pay attention to the URL of a website.  Malicious websites may look identical to a legitimate site, but the URL may use a variation in spelling or a different domain (e.g., .com vs. .net).
• If you are unsure whether an email request is legitimate, try to verify it by contacting the company directly.  Do not use contact information provided on a website connected to the request; instead, check previous statements for contact information.  Information about known phishing attacks is also available online from groups such as the Anti-Phishing Working Group (www.antiphishing.org (external link)).
• Install and maintain anti-virus software, firewalls, and email filters to reduce some of this traffic (for more information, see Understanding Firewalls, www.us-cert.gov/ncas/tips/ST04-004 (external link); Understanding Anti-Virus Software, www.us-cert.gov/ncas/tips/ST04-005 (external link); and Reducing Spam, http://www.us-cert.gov/ncas/tips/ST04-007 (external link)).
• Take advantage of any anti-phishing features offered by your email client and web browser.
• Employees should take steps to monitor their personally identifiable information and report any suspected instances of identity theft to the FBI’s Internet Crime Complaint Center at www.ic3.gov (external link).
• Additional information about preventative steps by consulting the Federal Trade Commission’s website, www.identitytheft.gov (external link). The FTC also encourages those who discover that their information has been misused to file a complaint with the commission using the contact information below.
  
  Identity Theft Clearinghouse
  Federal Trade Commission
  600 Pennsylvania Avenue, NW
  Washington, DC 20580
  www.identitytheft.gov (external link)
  1-877-IDTHEFT (438-4338)
  TDD: 1-202-326-2502  

FBI: Senior Citizens Targeted In Sweepstakes Fraud

The FBI web page offers the below piece:

A North Carolina couple recently pled guilty to running a sweepstakes fraud scheme that targeted elderly Americans, in some cases causing victims to lose their entire life savings.

Jessica and Jason Brown acknowledged in federal court that they operated call centers in Costa Rica that falsely informed U.S. residents—predominantly senior citizens—that they had won a substantial cash prize in a global sweepstakes, but the prize was only redeemable if the “winners” sent money to cover insurance and other fees. From 2004 until 2013, the Browns and their crew fleeced hundreds of elderly Americans out of nearly $900,000.

“They could make themselves extremely believable over the phone,” said Special Agent Scott Duffey, who investigated the case from our Baltimore Division. “For people on the other end of the line who were even a little bit gullible or desperate for money, the deception could be too much to resist.”

“The victims of these scams are not just people without an education,” noted Pat Donley, a senior litigator with the Department of Justice who has prosecuted many sweepstakes fraud cases. “Some victims have been doctors, others Ph.Ds. They are just taken in.”

Those who carry out these types of telemarketing frauds, including the Browns, use Internet technology and even forged documents to dupe their victims. They also purchase marketing lists—commonly used by lawful telemarketers—so they may know something about their victims, such as credit cards they might possess.

The fraudsters work out of so-called boiler rooms, usually apartments or offices with banks of phones. They might make hundreds of calls before finding one person receptive to their pitch.

Typically, the criminals say they are calling on behalf of some reputable insurance company or a U.S. federal agency such as the Federal Trade Commission or the Internal Revenue Service. The imposters say they want to make sure all the taxes are paid on the sweepstakes money so the winner faces no legal or tax issues.

To mask that they were calling from Costa Rica, the Browns used readily available technology that made victims think they were talking to someone from an area code in Washington, D.C. This added a further air of legitimacy to the scheme, since the callers frequently claimed to be representing a U.S. federal agency.

Though initial prizes were usually billed as second-place winnings, the $350,000 to $400,000 figures were still substantial. The victims were told they would have to pay fees and taxes of about 10 percent—between $3,500 and $4,000—and were often directed to send the money via Western Union.

It didn’t stop there. After receiving money, the scammers would contact the victims again and inform them that their prize amount had increased, either because of a clerical error or because another prize winner was disqualified. Of course, the new, larger prize meant more taxes and fees. The attempts to collect more cash would continue until a victim either ran out of money or realized what was going on, Duffey explained. “One Delaware woman was swindled out of more than $300,000—her life savings,” he added.

Donley has seen similar schemes ruin elderly victims financially. “One person in Florida gave up more than $800,000,” he said, “and a woman from California gave up most of her savings that she was going to use to care for her two handicapped children. These criminals are heartless,” he continued. “It’s easy for them to rob people, because they never meet the victims and never see the consequences.”

Don’t Become a Victim

Criminals who prey upon the elderly through sweepstakes fraud and other telemarketing schemes can be extremely convincing, but you can avoid becoming a victim by keeping a few simple guidelines in mind.

The Federal Trade Commission (FTC), the nation’s consumer protection agency charged with preventing fraud and deceptive practices in the marketplace, offers these common-sense tips:

- Don’t wire money, ever. No government official will ask you to send money in this manner. If you have to pay for a prize, it’s not a prize.

- Never give callers financial or personal information. Don’t give out sensitive information such as your credit card or Social Security number unless you absolutely know who you’re dealing with.

- Don’t trust a name or number. Fraudsters use official-sounding names, like Lloyds of London of Costa Rica, to make you trust them. No matter how convincing their story—or their stationery—they are most likely lying. To make a phone call seem legitimate, scammers use technology to disguise where they are calling from. Even though it may look like they’re dialing from Washington, D.C., they could be anywhere in the world.

- Put your number on the National Do Not Call Registry. This won’t stop fraudsters from calling, but it should make you skeptical of random calls. Most legitimate sales people generally honor the Do Not Call list. Scammers ignore it. Register your phone number at donotcall.gov.

- Report the scam. If you get a call from a government imposter or someone attempting a sweepstakes fraud, file a complaint with the FTC at ftc.gov/complaint.

- Here’s the bottom line: If someone is pitching something on the phone that doesn’t sound right, you always have the option to just hang up. If it sounds too good to be true, it probably is.

For more information about sweepstakes and telemarketing fraud, visit the FTC website: http://www.consumer.ftc.gov/articles/0048-government-imposter-scams 

My On Crime & Security Column: Yellow-Pages Scam Artists Snag Small Businesses

 

The national small business web site AllBusiness.com published my latest On Crime & Security Column yesterday.

The Better Business Bureau (BBB) reported last week that the Federal Trade Commission (FTC) took action against a scheme that the BBB warned businesses about last year.

At the request of the FTC, a federal judge has temporarily halted a European-based operation that allegedly bilked small businesses and nonprofit organizations out of millions of dollars by deceiving them into ordering and then paying for unwanted listings in online business directories. The FTC is seeking to stop the illegal practices permanently and to require that the defendants reimburse their victims.

You can read the rest of my my piece via the below link:

http://www.allbusiness.com/operations/16645348-1.html 

My On Crime & Security Column: How To Spot And Avoid Travel Scams

The online small business magazine Businessknowhow.com published my On Crime & Security column today.

With Memorial Day coming up, many people are planning vacation trips for the summer months, and business people are planning trips to conventions, seminars and trade shows.

My column covers travel scams committed by unscrupulous travel agents and crooked telemarketers.

I cited two recent cases and passed on some good tips from the Federal Trade Commissionon on how to spot and avoid travel scams and fraud.

You can read my column via the below link:

www.businessknowhow.com/security/travelscams.htm

My On Crime & Security Column: Scareware: The FBI Issues a Warning About Those Pop-Up Bogus Security Warnings

The national online small business magazine Businessknowhow.com published my latest On Crime & Security column today.

The column deals with the FBI's warning about pop-up security warnings. The bogus security warnings pose a serious threat to your computer, as they may contain viruses.

My column, which also passes on the Federal Trade Commission's tips on how to handle the pop- ups, can be read here