If it sounds too good to be true, it isn’t! Beware scams, FTC warns

By Jaya Padmanabhan

Three of the most common fraud complaints nationwide have to do with debt collection, identity theft and impostor scams, according to Federal Trade Commission regional director William Efron.

In 2017 the FTC received 2.7 million reports from consumers in Massachusetts alone generating 33,000 complaints and $30 million in losses. This is only the tip of the iceberg, since many scams are not reported at all or only to community organizations.

At a media briefing in Boston on July 26, 2018 co-hosted by the FTC and the Massachusetts Attorney General’s Office at the National Consumer Law Center office, legal experts, researchers and advocates spoke passionately about the need for greater public awareness. “If It’s too good to be true, it isn’t true,” warned attorney Nadine Cohen of the Greater Boston Legal Services. And the toll on people’s everyday lives can be horrific.

Janice Fahey, a legal analyst at the Massachusetts Attorney General’s office, said the AG’s office receives five to 50 calls a day on its consumer advocacy hotline.  Identity theft is the most common complaint, with typical targets being veterans, the elderly, immigrants and people in need of housing.

Scammers deceive victims by promising jobs, announcing lottery wins, selling fake products or services and befriending the elderly. Some scams are perpetuated so often that they are given their own names, such as “grandparent scams” — grandparents are asked to pay an immediate ransom to ensure the safety of a grandchild; “bill paying scams” —  calls to pay bills over the phone in which the money never reaches the company in question, leading to a shut down in service; “travel agency scams” — tickets are sold to travelers, which turn out to be fake; or “closing scams” — during the process of buying a house, the victim is tricked into wiring the closing costs to a scam account.

Impostors pretend to be government officials, or people from trusted organizations, the IRS, or a utility company. Fraudsters persuade unsuspecting victims into signing up for payment plans that the alleged beneficiaries are not aware of. Victims wind up in debt collection court with no idea of how they ended up there.

Cross-cultural and community partnerships are critical in rooting out criminality and deception.  Cohen said organizations like the Chelsea Collaborative — a Latino-led advocacy organization— are great places to learn about scams targeting particular populations. Relating the story of a Latino family in Chelsea tricked by an imposter travel agency into buying phony tickets, Cohen described how the Chelsea Collaborative, with the help of Chelsea police detective Roselba Medina, was able to get restitution for the victims.

“For me, getting involved with the Collaborative was beneficial in the work that I do,” detective Medina said. “They are my right hand,” she stressed, adding that many victims aren’t comfortable reporting scams directly to police, perhaps because of their immigrant status.

“If it happens to one, it happens to many,” said Sylvia Ramirez of the Chelsea Collaborative.

Since November, she said, there have been five reports of the “quinceanera scam.” A quinceanera is the coming out ceremony of a young girl, and parents typically spend a fair amount of money in creating a memorable event for the occasion. Scammers set up event shops and disappear with the initial deposit, leaving families high and dry.

Another scam tailored to the Latino community is the “kidnap for ransom scam.” “I have your sister, pay $1,500 or we won’t release her,” is a typical threat and families fearing for their loved ones quickly pay up, according to Ramirez.

Most often, scams are targeted at low income, immigrant, non-English speaking and elderly populations. Elderly targeting is so prevalent that the mayor’s office in Boston has a commission on Affairs of the Elderly, which includes help and education with fraud. “It’s not a single issue,” explained An H. Le who works in the Mayor’s Office of Immigrant Advancement. “If we’re looking out for an immigrant, that immigrant might be elderly and targeted, too,” Le said.

Speaking in Cantonese, Baolian Kuang, along with interpreter Karen Chen, of the Chinese Progressive Association (CPA), described how a travel agency fleeced dozens of families by selling fake tickets. Eighty families reported losing money after buying tickets through the agency and finding that there was no record of their travel with the airlines. Beyond the financial loss, there’s a cascading effect caused by the stress of the situation that affects other parts of their lives, Kuang said. “They don’t know where to go initially, and then one person comes to the CPA office and then others hear about it and more and more people then come forward,”  she said.

Don’t wire money or pay with a prepaid gift card, the panelists urged. Watch out for impostors, don’t pay upfront for a promise and don’t give access to your computer.  

If you are the victim of a scam or fraud, call the FTC hotline 877-FTC-HELP, or report it at ftc.gov/complaint.

|