Onward, fellow “Ripped-off/Scammed/Defrauded Club” members!
Reader “G” says, “Consumer financial fraud can hurt us even more than politicians can.” That frightful thought is why we’re exploring the National Center For Victims Of Crime’s marvelous guidebook, “Taking Action -- An Advocate’s Guide To Assisting Victims of Financial Fraud”, billions of dollars’ worth each year, nearly none recoverable, plus countless disrupted lives and personalities. We left off at the fourth fraud category, one that assaults us every day in so many ways. Picking up there:
Mass marketing and related fraud:
This is enticement, penetrating millions of minds daily via “false (as opposed to the galaxy of perfectly legitimate and honorable) promises of cash or merchandise prizes, services, and good works in exchange for fees, donations, or purchases….through the mail, phone, e-mail, TV ads or infomercials, and every other mass medium”. So many of the schemes that we’ve been exploring are marketed this way….for instance “a Ponzi scheme investment opportunity marketed via mail…or the Internet… with payments made through a wire service.” The advanced-fee- for-promises-that-never- are-kept technique occurs frequently.
Some common schemes:
Fake check scams: An impressive, fancy cashier’s check arrives in the mail along with a letter that announces a windfall, such as a lottery win or inheritance from a relative (whom you’ve never heard of). You’re instructed to pay a “processing fee” or “taxes” — the cashier’s check is an advance to help you pay them — before the funds can be released to you. How magnanimous! As instructed, you bank the check, withdraw the fee and tax money and wire it to the scammer, who of course immediately withdraws it. The check bounces. It’s counterfeit after all, and you’re stuck for the money.
Yes, even cashier’s checks can be phony.
Foreign lottery and sweepstakes schemes: “Congratulations, you’ve won the mega-prize national lottery or sweepstakes in ____land! A wealthy investor invoked your name jointly with his, to permit multiple entries. You’ll receive your share as soon as your processing fee is received”. Wanna bet?
Mystery shopper scams: What a wonderful way to earn some money! And you can be good at evaluating stores and restaurants, plus it’s fun doing what you like to do! Just send the advance registration and contract fee. Then, the fraudster will be doing the shopping, with your money.
“Nigerian” e-mail or telephone schemes: “You qualify and therefore have been selected to help satisfy the transfer rules for distribution of millions of dollars now available for transfer from (typically) Nigeria. You’ll receive your share as soon as you remit the required transfer fee”. Sure, uh-huh.
Work-from home and business opportunity scams: The ad proclaims: “For a small fee one obtains the know-how and the business franchise”. You can fill in the rest of the story, right? Sometimes, a follow-up letter arrives explaining that the “business” requires you to recruit others, and/or to purchase a product.
These sound familiar, don’t they? But, how about this one? A recent law firm newsletter outlines what could be a fifth category: A 2016 study reveals that employee shoplifting and embezzlement cost typical employers an average of 5 percent of their revenue. That translates to robbing business owners, higher prices or less product or service for our money, and fewer healthy vendors available to us.
How’s this for clever, plus nerve? Reader M tells about the fraudster who hacks your credit card for that big TV in Honolulu, then immediately represents itself to you to be a new advanced state-of- the art hack-prevention service that detected the hack immediately. They’ll let you subscribe at a bargain introductory rate. Credible? Sure, you can’t know who this really is, and after all they did know about the TV hack even before the card-issuing bank or you did.
We, the targeted victims -- Who are we? In a word, almost everyone. We’re vulnerable if we possess a profit motive, human emotions, and some money. Scammers also know that those among us who are seniors (especially dependent ones), facing under-funded retirement, cognitively impaired, emotionally distressed, victims of domestic violence, previously victimized, short of sufficient income -- the physically, financially, and emotionally insecure -- yield the highest “hit rates”. The educated, sophisticated affluent are equally vulnerable, especially to the more sophisticated high-dollar schemes.
The emotional damage frequently exceeds the financial. The NCFVOC emphasizes that we’re not to blame, almost never at fault. Yet, we flagellate ourselves with enduring guilt, depression, anger, loss of self-esteem, shame, grief, and all the sneaky psychological defense mechanisms. And the suffering is magnified if the scammer is a loved one or associate.
They, the perpetrators — Who are they? In a word, anyone who can be governed, willfully or sub-consciously, by a need for greed, power, self-gratification, or aggression, is able to rationalize illegal and immoral behavior, and can convince us to trust them. They reach us via social and marketing media, our workplaces and schools, religious and community membership organizations -- every people-contact aspect of our existence. Thus, we can experience a shocking surprise from seemingly innocent acquaintances, strangers, neighbors, relatives, friends, work associates, fellow affinity group members, professional providers and advisors.
An attorney who I teamed with for decades working with clients suffered, understandably, nearly-disabling emotional disruption requiring years of psychiatry to overcome, after he accidentally discovered that his closest friend, high school/college/law school classmate and professional partner had clandestinely and brilliantly skimmed almost a million dollars from their law firm over years’ time. We all knew the partner to be a nice-guy family and community-supportive solid citizen and respected professional.
Hiding in plain view, he wasn’t an atypical scammer.
So, what to do about fraud? Now that we perhaps understand the problem a little better, how can we protect, prevent, detect, counteract, recover, and heal? Fortunately, tips, techniques, strategies, and insights abound, and are easy to access and to assimilate. There’s more than enough to fill this newspaper, or to monopolize this column for years, displacing all the other issues that we should discuss. So, we’ll not attempt to duplicate those excellent at-your- fingertips resources, but perhaps can highlight some key tips later on.
“Taking Action” devotes 25 pages to detailed specific “Action Steps” for all four categories. It also has a directory describing and listing contact information for dozens of both general and specialized agencies and foundations whose missions are to help us deal with every kind of consumer financial fraud, in addition to the many who are cited throughout the text.
Again: www.saveandinvest.org/sites/default/files/Taking-Action-An-Advocates- Guide-to- Assisting-Victims- of-Financial- Frud.pdf
Googling “Consumer fraud agencies in _______ (any state, city or county that we’re interested in) rewards us with a legion of outreach entities, also offering every kind of assistance. For instance, for South Carolina there are hundreds, from the state attorney general’s office to the county Better Business Bureau, to the local scam-reporting hotline.
Now we know about, and thus can benefit from, these under-publicized and under-utilized government and n.g.o. friends and allies, who offer us such hard-hitting literature and programs, mostly all free of charge!
Go for it. Feel better?
Contact Gary Newman at email@example.com. Your ideas and comments are always welcome.