Avoiding Fraudulent Debt Collectors

Debt collection generally works like this: a creditor who can’t devote the necessary time and resources needed to recover funds from old delinquent loans sells those debts to a collection agency, often for pennies on the dollar, to cut their losses a little. That agency, which now owns the debt, contacts consumers and tries to negotiate at least partial repayment.

Naturally, there are also con artists posing as debt collectors, attempting to obtain money, personal information, or both from victims. There are also collection agencies who stray from established, legal methods in order to collect legitimate debts. Here are six warning signs to watch for.

They’re trying to collect on a debt you don’t owe

Unscrupulous collectors will sometimes contact people with the same name as the actual debtor, or even settle for someone with a similar name. An outright scam artist might simply invent a debt out of thin air, or threaten random people in hopes that someone will pay out of sheer terror. In any case, never agree to pay a debt you don’t owe. Ask for a written validation notice. If they refuse, that’s a sign of trouble. Get as much information as you can about the agency, and report them to the FTC.

Important Note: collection calls for debts you didn’t incur can also be a signal that you have been a victim of identity theft. If you’ve received such a call, it may be time to check your credit report if you have not done so recently, to look for anything that shouldn’t be there.

They’re threatening you with arrest, lawsuits, or violence

For the most part, debt collectors are allowed to inform you that you owe a debt, provide proof that you owe it, state to whom the debt is owed, and present options for payment. They are not allowed to threaten you with arrest or legal action, and they’re especially not allowed to threaten physical harm to you or those around you.

They’re demanding personal information

Even if you actually owe money, there is no reason for them to ask for personal identifying information or account numbers over the phone. It’s one of the core rules of fraud and identity theft prevention: never reveal personal information to a stranger who contacted you out of the blue.

They won’t give you any information

If the caller won’t tell you the name of the agency, to whom the debt is owed, or anything else about whom he or she represents, be very suspicious. A legitimate collector will be transparent about these things, presumably because they want to actually collect on delinquent debts and stay in business, instead of being shut down by the FTC.

They’re calling in the middle of the night

This applies to a lot of other types of calls, but if they’re calling you before 8:00 a.m. or after 9:00 p.m., you have every reason to suspect either a scam or a rogue debt collector. There are rules about when they can contact you by phone. It’s kind of like putting yourself on the Do Not Call registry; if they’re already violating one rule, what else are they up to?

They keep calling after you’ve told them not to

Even if you’ve got a legitimate debt, you can still tell a collector to stop contacting you about it. Usually you will have to provide this request in writing, but once you do, they’re supposed to knock it off. Of course, if they won’t even provide an address to send said request to in the first place, you already know something is fishy.

Resources

Learn more about debt collection scams:

Report a debt collector to the FTC:

File a complaint with the Indiana Attorney General’s Office:

Hard Knocks: Student Loan Relief Scams

Congratulations, it’s time to pay off your student loans!

Most people in the U.S. exit postsecondary education with at least some student loan debt, and sometimes paying those loans off can present problems. While there are well-established paths to reducing the burden of a large student loan balance, there are also plenty of con artists waiting to take your money and make things even more difficult. Here are a few things to watch out for.

Upfront Fees

It is not illegal per se to charge a fee for services, such as consolidating your federal student loans, that you can do on your own for free, in much the same way that it’s not illegal to charge a fee for tax preparation.

However, any upfront fee for help with student loan repayment is a sure sign of a scam. Don’t pay for anything in advance, and even if they’re not charging an upfront fee, look at what they are charging compared to what you’re actually getting in return. Is it worth it? Do your research on every company you’re considering working with.

Debt Elimination

There are not many ways to have your student loan debt erased completely, and if you’re reading this you already don’t qualify for the primary one (death). Also, if you were taken in by a for-profit college that used falsified job placement numbers to lure students, there may be programs that might help. There are a few other options that apply to very specific cases. Other than those, with very few exceptions, once you have student loan debt, it’s yours until you pay it off. Bankruptcy won’t even touch it.

This means anyone advertising student loan elimination or forgiveness is trying to scam you. There is no way to pay a company a fee in exchange for your student loan debt disappearing. All you’ll end up doing is losing money and ruining your credit.

High Pressure Tactics

If you’re being told that an offer is only good for a certain amount of time, or being pressured in any other way by a salesperson, that’s a sign of a scam. There are no limited-time-only offers when it comes to student debt relief. They don’t hold blowout sales on this stuff.

What You Can Do

You can consolidate your federal student loans, adjust your repayment schedule, defer your repayment period and more yourself, for free, through the Federal Student Aid Office of the Department of Education. If you have private student loans, you can contact those lenders for options as well. There is no compelling need to pay anyone to do these things for you, unless you choose to do so and know what you’re getting into before agreeing to anything. Again, do your research.

One of the best resources for detailed information on student loan repayment is the Federal Student Aid Office website (https://studentaid.ed.gov). It also features specific information on avoiding scams (https://studentaid.ed.gov/sa/types/scams).

 

 

Strong Passwords and Where to Store Them

There was a time when you only really saw hackers in movies, and often they were the good guys. Sometimes you’d even get a montage of a hacker typing away while a driving, synth-heavy pop tune played. But today hackers are a major, persistent threat, and your passwords are your first line of defense against intrusions.

Make Your Passwords Complex

The days of using Fox Mulder’s X-Files password “trustno1” for everything are long gone. It’s still one of the most-used passwords, and even a novice hacker would be able to crack it with little trouble (possibly just by guessing it). Other extremely common passwords include “password,” “abc123,” “monkey” and “password1.”

The time has come for your passwords to be long, nonsensical strings of letters (upper and lowercase), digits, and special characters.

How Secure Is My Password? is on online tool you can use to compare different types of passwords (I’d still recommend against entering your actual passwords into the site, just because). Type a password into the box and the site will tell you how long it would take a computer script to hack it. Compare these screenshots from the site for these passwords:

trustno1:

$e4!gQ%pgeuXR3Fc:

Going longer than 16 characters can push that number of years into the octillions, nonillions and decillions, but one trillion years is probably plenty. Keep in mind that the website above is sponsored by Dashlane, a password manager program (I’ll get to those shortly).

Don’t Reuse Passwords

Don’t use the same password for multiple websites or apps. Hackers who gain access to one username and password combination will attempt to use that same combination on other sites, especially financial accounts and sites where additional personal information might be obtained. If your login information for some discussion board you haven’t used for months is compromised, and you’ve used that same username/password combination for all your online banking activities, the hackers probably aren’t as interested in posing as you on the message board as they are in trying your credentials out on a few of the larger bank or credit card websites.

Don’t Let Passwords Get Stale

You also need to change your passwords every so often – twice a year is a good start. Data breaches have happened recently (the Cloudflare bug earlier this year, for example) that exposed millions of users’ information. It’s a good practice to regularly create new passwords for all the sites you use (and even the ones you don’t use as often).

Use a Password Manager

Use long, complicated passwords, use a different one for every site, change them all the time – okay, but how are you supposed to remember them?

A password manager is a program (usually a browser plug-in for desktop and laptop computers, or an app for tablets and phones) that stores your passwords and can automatically fill in your login information on sites. Your passwords are kept safe with up-to-date encryption technology, and you only have to remember a single master password. These programs can also automatically generate strong passwords that will stump a brute-force attack.

There are a lot of different password managers to choose from, and many have both free and paid versions. Lastpass is one of the most popular, and the Premium version is only $12 per year. Dashlane is highly-rated, but at $40 the price is a little steeper. PCMag has two articles that give a nice rundown of the best ones, both free and premium, and their features:

Sick Child Facebook Hoaxes (OR: Don’t Like, Don’t Share, Don’t Type Amen)

You’ve almost definitely seen this if you use Facebook: a picture of a child or baby with some alarming medical condition appears in your newsfeed, along with instructions to type “Amen” in the comments, like and share the picture so Facebook will donate money to the child in the picture, let the child know you think they’re still beautiful, or share the post because “one share = one prayer,” and of course to keep scrolling if your [sic] heartless.

I’m here to tell you: be heartless. These posts are hoaxes. You’re definitely helping someone by liking, commenting and sharing, but it’s not the child in the photo.

First, those pictures are used without permission from the child or their parents. Sometimes the children in the pictures don’t have a medical issue, they’re just random photos somebody found on the Internet. This is pure exploitation.

Furthermore, Facebook does not donate money to individuals for medical treatments based on a photo being liked and shared. They’ve done it zero times in the past, and they’re going to do it zero times in the future, forever.

Here’s what you’re really doing when you comment, like, share or interact with one of these posts: you’re helping somebody who created a Facebook page, hijacked a photo of a child without permission, then created a post designed to generate thousands of likes and comments sell the page to someone else as a ready-made, plug-and-play, already-popular page.

It has to do with how Facebook prioritizes things in a news feed. Things don’t appear in unfiltered, chronological order. Posts which have already generated tons of activity (comments, likes, shares) get an additional boost from the Facebook algorithm. In other words, things that are already popular are boosted so they can become more popular, while things that are not popular get buried.

So a Facebook page (which is different from a personal profile) that generates super-popular posts with tons of interaction (i.e., thousands of people sharing and commenting “Amen”) will get a boost for future posts. It’s called like-farming. At that point, the person or company who created the page and post can sell it to anyone who will pay for it, the buyer changes the name of the page, and then runs whatever scam or ripoff they can come up with.

How should you respond to one of these posts?

First, don’t like, share, or type “amen.” But also don’t comment “this is a hoax,” because the algorithm only counts comments. It doesn’t care about their content. Besides, your comment will only be buried by a thousand “amens” within seconds anyway.

You can report the post or the page to Facebook, but there are so many of these hoaxes that it can be like playing whack-a-mole with a drinking straw (and forty thousand moles).

Definitely let your Facebook friend who shared it know that the post is a hoax and that they’re not helping a child at all. Let them know that the photo was used without permission, and that they’re only helping some con artist exploit children for personal gain.

If you need more evidence to convince your friend, here’s an article by the mother of a child whose photo has been repeatedly hijacked for this exact purpose: Why you SHOULDN’T “type Amen and share” posts of sick children.

What If I Don’t Have Caller ID?

I’m guilty of assuming everyone has caller ID these days. While the feature may be baked right into mobile phones, caller ID service for landline phones is still a feature you usually have to pay extra for. And some people don’t want to.

So how should these holdouts handle telephone scams?

My advice is: get on the list and be quick on the draw. First, add your number to the National Do-Not-Call Registry. Once it takes effect, it will weed out all the legitimate, non-scam phone calls. Anyone who calls with an offer or sales pitch after that is obviously ignoring federal regulations and can be assumed to be attempting to commit fraud. If you’ve answered the phone, hang up as soon as you realize what’s happening.

Second, the vast majority of scammers use automated robocalls, where they ring multiple phones at once and then connect with whomever answers first. That setup takes a moment to function, and causes recognizable audio artifacts. If you’ve answered the phone and don’t get a response within a second or so, you can assume it is a robocall and hang up. If you answer and the first thing you hear is electronic noises (little clicks, bloops, beeps, etc.) or silence, it’s safe to assume you’re dealing with a robocall and hang up.

If you’ve hung up on a legitimate caller, they’ll call back.

Failing the quick-draw hang-up technique, if you find yourself talking to an unexpected caller, the old rules still apply: if they’re trying to make you afraid, it’s probably a scam; if the offer sounds too good to be true, it’s probably a scam; never wire money to a stranger; the IRS doesn’t call to demand payment over the phone; you didn’t win the lottery; your grandchild isn’t in jail or a hospital overseas; your computer doesn’t have a virus; never press “1” for any reason.

You’re under no obligation to be polite to someone who is trying to trick you out of your money over the phone. You’re allowed to just hang up without explanation.

Online Dating Scams Can Be So Much Worse Than You Thought (OR: Incredibly Bad Romance)

The classic Online Dating Scam involves a con artist meeting a victim online, pretending to initiate a long-distance relationship, and then asking the victim to wire money.

It’s a widespread form of fraud, and despite increased awareness, it continues to thrive because we’re all convinced it only happens to other people. We’re too smart, right?

Right. There’s a reason you never hear anybody say, “Yeah, you know, I’m just really naïve and easy to manipulate.” Here’s a little trade secret known to scammers around the world: literally everyone has some area in which he or she is vulnerable. There is no such thing as a 100% scam-proof human.

But there may be an even more compelling reason to avoid the romance scam: the possibility of criminal prosecution. In this case reported by BBC News, a woman was not only tricked into wiring her own money to her online “partner” over the course of several years, but also convinced to move money between different bank accounts on behalf of the con artist, making her an accessory to money laundering.

For which she was prosecuted and convicted.

Yeah, let that one sink in for a second. The irony is, she was probably helping him launder money he was getting from other romance scam victims.

Now, I’m no legal expert, and this case did occur in the U.K., not the U.S. I’m not sure how different the laws are here, but I’m betting that there is a point at which they also no longer care that you were a victim because it should have dawned on you that you were laundering money.

So if you’re out there on the internet looking for companionship, or if you know someone who is, be aware of the risks. When someone you’ve never met is asking you to send money, or to transfer funds between different financial institutions, do not do it. Under any circumstances, okay?

Email Hoax Update: Bill Gates is Still Not Giving Away Free Money in 2017

I recently began tracking stats for this website again after a long stretch of not doing so. I hadn’t really been posting new articles very often, and when the program that I was using to track page views and the number of site visitors stopped functioning for whatever reason, I didn’t bother looking for a replacement.

This year, however, I started posting more regularly, and decided it was time to find a new stats plugin so I could at least see if I was putting out something of value. I got it all set up in early March, and recently I noticed that an article I wrote in 2009 about a certain email hoax was suddenly getting about ten times the usual daily traffic for the entire site. That could only mean one thing: it’s baaaaack.

This email chain letter hoax is a bona fide antique, dating back to at least 1999: forward this email and Bill Gates from Microsoft will give you something like $241 for each person you forward it to. It was supposed to have something to do with AOL and Intel, neither of which are affiliated with Microsoft.

Since this hoax is making the rounds again, I felt it was time to revisit the topic: Bill Gates is not giving away huge amounts of money to random people just for forwarding emails. For one thing, Microsoft doesn’t track every email sent. For another, would you? You do know how people get rich, right? Trade secret: it doesn’t involve giving millions in free money away to random strangers in return for nothing.

(I also wanted to write an update because the 2009 article is so chock full of bad jokes and this corny shtick that…it’s like I’m wearing suspenders and a bowtie, and there’s a guy with a snare drum and a crash cymbal doing rimshots after every ‘joke,’ and then I end by juggling on a unicycle. Corny.)

Anyway, the full, error-ridden text of this ancient email hoax is here:

THIS TOOK TWO PAGES OF THE TUESDAY USA TODAY – IT IS FOR REAL

Subject: PLEEEEEEASE READ!!!! it was on the news!

To all of my friends, I do not usually forward messages, But this is from my good friend Pearlas Sandborn and she really is an attorney.

If she says that this will work – It will work. After all, What have you got to lose? SORRY EVERYBODY.. JUST HAD TO TAKE THE CHANCE!!! I’m an attorney, And I know the law. This thing is for real. Rest assured AOL and Intel will follow through with their promises for fear of facing a multimillion-dollar class action suit similar to the one filed by PepsiCo against General Electric not too long ago.

Dear Friends; Please do not take this for a junk letter. Bill Gates sharing his fortune. If you ignore this, You will repent later. Microsoft and AOL are now the largest Internet companies and in an effort to make sure that Internet Explorer remains the most widely used program, Microsoft and AOL are running an e-mail beta test.

When you forward this e-mail to friends, Microsoft can and will track it ( If you are a Microsoft Windows user) For a two weeks time period.

For every person that you forward this e-mail to, Microsoft will pay you $245.00 For every person that you sent it to that forwards it on, Microsoft will pay you $243.00 and for every third person that receives it, You will be paid $241.00. Within two weeks, Microsoft will contact you for your address and then send you a check.

 thought this was a scam myself, But two weeks after receiving this e-mail and forwarding it on. Microsoft contacted me for my address and withindays, I receive a check for $24,800.00. You need to respond before the beta testing is over. If anyone can affoard this, Bill gates is the man.

It’s all marketing expense to him. Please forward this to as many people as possible. You are bound to get at least $10,000.00. We’re not going to help them out with their e-mail beta test without getting a little something for our time. My brother’s girlfriend got in on this a few months ago. When i went to visit him for the Baylor/UT game. She showed me her check. It was for the sum of $4,324.44 and was stamped “Paid in full”

Like i said before, I know the law, and this is for real.

Intel and AOL are now discussing a merger which would make them the largest Internet company and in an effort make sure that AOL remains the most widely used program, Intel and AOL are running an e-mail beta test.

When you forward this e-mail to friends, Intel can and will track it (if you are a Microsoft Windows user) for a two week time period.

Yep. It was a hoax in 1999, just like it was a hoax in 2009, and just like it’s still a hoax in 2017 and will be forever. If you get it, don’t believe a word of it. Don’t forward it “just in case” or because “it doesn’t hurt to try.” Delete it, and let whoever forwarded it to you know that it is a hoax.

Don’t let ‘em coax
You with a hoax, blokes
Make one keystroke:
Hit ‘delete,’ folks.

How to Report a Dinar Scam to the FBI

If you or someone you know has fallen victim to an Iraqi dinar (or Vietnamese dong, Indonesian rupiah, or any other foreign currency) “revaluation” investment scam, the FBI has set up a website to report the seller of these worthless currencies.

Currency revaluation schemes have been around for a long time, and have never once paid off for anyone except the people charging a commission for the sale. Iraqi dinar scams have been going strong since 2003, and the currency has yet to do anything except lose value.

There’s an article at Forbes.com that goes into further detail on this type of scam.

The IRS Is Using Private Debt Collectors Who Will Make Calls, but This Actually Changes Nothing

Sometimes fraud prevention can be boiled down to nice, simple rules that don’t leave much room for subtlety. Never wire money to a stranger. Just keeping that one rule in mind will keep you out of a lot of trouble, even if you forget the details of the scams that utilize the technique.

The IRS will never call you was another one of those hard rules, but as of 2017, it’s become a little more complicated. However, for the most part, nothing has really changed when it comes to fraud prevention.

Basically, the IRS will be contracting with four collection agencies, who will only be contacting certain taxpayers who have been delinquent for a significant period of time, whom the IRS has been unable to locate, and who meet certain other criteria. Furthermore, the collectors will not be demanding payments. Instead, they will be directing taxpayers toward electronic options for paying the IRS directly.

This means that some people will be getting calls from collection agencies on behalf of the IRS. The rest of the fraud prevention rules still apply: if they threaten you with incarceration or demand immediate payment, it’s a scam. If they’re talking about wiring money or loading up gift cards, it’s a scam.

Since con artists are nothing if not adaptable, I’ll add this point: if they do anything other than tell you about how you can pay the IRS directly on your own, it’s a scam. I’m sure someone is already gearing up to make calls claiming to be a collection agency, then telling victims they can pay over the phone with a credit card, with a wire transfer or with prepaid gift cards, or by visiting a fraudulent website. The collection agencies the IRS is using will not be asking for nor accepting payments from delinquent taxpayers. At all.

The actual website where you can pay your taxes, overdue or otherwise, is IRS.gov/Pay. And that’s pretty much the only thing the collection agencies contracted by the IRS are going to be allowed to tell you. Any mention of a different website to pay your taxes? Scam.

I recommend reading the full article below for more detailed information.

Don’t Fall for the Inevitable Western Union Settlement Scams (OR: Distant Early Warning)

In January of this year, Western Union reached a $586 million settlement with the FTC to refund some of the money people lost to scams between January 2004 and January 2017, and to create a functional fraud prevention program.

Consumers who can prove they were a victim of a scam that involved wiring money through Western Union between those dates, and who can back up their claims with documentation, may be able to get some money back. Not all of it, but some, which is better than none. The refunds will be handled through the Department of Justice, once they have the money from Western Union. It may take a year or so to verify and pay out claims after that.

So here’s your preemptive scam warning: don’t fall for the inevitable scams based on this settlement. At some point, somebody is going to start attempting to trick people into sending money in advance to claim their share of the settlement.

There will be a claims process through the DOJ. There will not be any prepayments made on your part, you will not be able to “speed up the process” by sending money, and the DOJ or FTC won’t ask you to purchase any gift cards (the preferred method of fraudulent payment these days, now that Western Union has taken enough of a hit to actually start paying attention to the problem). Nobody will contact you out of the blue by phone, email, or any other channel (I predict well-organized scammers who kept their victims’ contact information going after the people they already tricked once). You will submit a claim through the DOJ, wait a long time, and hope for the best.

In the meantime, if you were a victim of a scam that involved Western Union, keep any documentation you have from the incident. How much you can get back will depend on how much you lost and how many people file a claim, but getting something back is better than the nothing you were left with before.

Sources:

Stay vigilant.