Not fooling around
The Federal Trade Commission (FTC) has quickly put to use its new Impersonation Rule, which went into effect on—yes—April Fools’ Day. The rule is no joke, and, according to a June 28 FTC press release, the agency has used it to stop a student loan debt relief scheme in which the perpetrators pretended to be affiliated with the Department of Education and bilked more than $20.3 million from consumers seeking debt relief. According to the release, a federal court has temporarily halted the scheme and frozen its assets at the request of the FTC, while the agency seeks to end the deceptive practices. Since at least June 2021, the FTC release continues, California-based Panda Benefit Services (also doing business as Prosperity Benefit Services) and several named entities and individual operators preyed on consumers burdened with student loan debt and tricked them into paying hundreds to thousands of dollars in illegal junk fees toward loan forgiveness that did not exist. Among the tactics for enticing consumers were mailers with urgency references such as “FINAL NOTICE” and boasts of benefits like “tax free loan forgiveness.” Contrary to the scheme's promises, the FTC explained, in many instances the operators did not obtain loan forgiveness or lower payments for consumers; and, because borrowers of federal student loans were not required to make payments during the federal COVID-19 payment pause, consumers often went months or years before learning that they had not received the promised benefits. The FTC explains that the Impersonation Rule gives it stronger tools against scammers who impersonate government agencies and businesses. Under the rule, the FTC can seek to recover money for injured consumers and civil penalties against rule violators. The FTC also charged the defendants under the FTC Act, the Telemarketing Sales Rule, and the Gramm-Leach-Bliley Act. Way to go, FTC! Sending good vibes for a successful final outcome.
Gotta hate these imposter scams
We've written in the past about imposter scams arriving by text, email, phone, and, as in the previous story, even snail mail. Other imposters perpetrate their crimes in person, like the scammers who targeted Latino immigrants in several California counties (and possibly in Washington and New York, too). In a press release, the Orange County district attorney explained that his office charged two men with robbery and hate crimes for posing as United States immigration agents (complete with fake law enforcement badges) and threatening to have victims deported if they refused to hand over money and debit cards. The suspects are believed to be in the United States illegally and to have ties to Romanian organized criminal organizations. In the release, District Attorney Todd Spitzer said "the humiliation and fear these individuals inflicted on their victims because of their perceived ethnicity is nothing short of disgusting. In Orange County, we will not tolerate hate, and any crime motivated by someone’s ethnicity or race will be prosecuted to the fullest extent of the law.” The release goes on to provide details of the impersonators' brazen tactics to steal money from their targets. In several cases, they pretended to be federal law enforcement agents looking for counterfeit money, threatened victims with deportation, and stole their money. The targets included a local street food vendor, a father and son on a walk, a man riding a bicycle, and three men in a Home Depot parking lot. One of the targets had money stolen via his banking app after handing his phone over to the crooks. We'd encourage readers to remind vulnerable community members to contact police immediately if approached with requests for money or with threats of any kind. Perpetrators are looking for victims who may be afraid to report crimes or attempted crimes. Let's get the word out to help prevent this hateful crime.
A (car) lot to deal with
Car dealers in the crosshairs. You may have heard of the mid-June cyberattack by the BlackSuit ransomware gang against CDK Global, the company that provides dealer management software to 15,000 auto dealerships across the U.S.—more than half the country's dealerships. The dealer software, a ZDNET article explained, is used by dealerships to track what's on their lots, run credit checks, generate loan rates, complete sales contracts, process payroll, and more. Now, as a consumer group who's heard every imaginable complaint about car dealer shenanigans over the years, we know that the dealers’ troubles may not tug at your heartstrings. But, as ZDNET wrote, dealership customers were also impacted, and there are "three things you should know," so do read on. Two full weeks after the cyberattack, going into the Fourth of July weekend, ZDNET explained that (1) if you're planning to buy a car, you can expect it to take longer (quick tip: you may want to arrange your own financing ahead of time, which is always a good idea anyway); (2) a long line at the DMV may be part of the car buying process for a while (we'll keep our fingers crossed this will improve soon); and (3) you're not in the clear even if all you want is an oil change (you guessed it, service departments were impacted too). Check out the ZDNET article for the details.
Plenty of (V)room for trouble. The Federal Trade Commission announced in early July the results of an action it brought against online used car dealer Vroom. According to the FTC, Vroom advertised its cars as having undergone multiple inspections to ensure they were in good condition and to help alleviate consumer concerns about buying a used car without being able to inspect it before purchasing. (What!? We've always recommended having any used car inspected. But okay, it's a new world, and, hey, these were supposed to have gone through "184 points of inspection." What could go wrong?) Despite the company's assurance, the FTC explains that consumer complaints—including ones about cars being sold with loud grinding noises, bald tires and worn brakes—told another story. Consumers also complained that Vroom promised deliveries within 14 days, yet in some instances took three months or longer to deliver, without asking for consent to a delayed delivery or offering the option to cancel, as required by law. Vroom also allegedly failed to provide required warranty-related information. The good news for consumers is that, under the terms of a proposed settlement with the FTC, Vroom will be required to pay $1 million to be used to provide refunds to consumers who were harmed by the company’s unlawful practices.
Tips
Sending the love to military consumers. Are you part of a military family, or do you serve military consumers? No better time than July to learn about scams impacting military consumers and to spread the word about them. July is Military Consumer Month, and all month the Federal Trade Commission is posting loads of consumer advice on their Facebook and X social media pages and at MilitaryConsumer.gov. One warning in an FTC consumer alert reminds us that, no matter what stage of military life a servicemember is in, they can encounter imposter scams: someone pretending to be their bank’s fraud department, a government agency, a relative in distress, a well-known business, or a technical support expert. To learn more, the FTC recommends visiting FTC.gov/imposters. Our visit to MilitaryConsumer.gov rewarded us with a collection of blog posts on consumer topics that everyone can benefit from, including advice for avoiding used car seller tactics that could cost buyers extra time and money; student loan debt relief scams; and even updates to rules about eyeglass prescriptions. Pay a visit to the linked pages and share them with servicemembers you know.
When helping hurts. Longtime consumer advocate Chris Bjorklund reminded us in a recent consumer news story that even wary consumers can get pulled into a scam, and, importantly, that being well organized can go a long way to undoing the harm. Bjorkland described how a young woman was convinced that she could help prevent a supposed scam involving an order for Apple products by following instructions she received from a supposed mobile carrier representative. The woman was asked to accept whatever package came to her and to ship it back using the U.S. Postal Service (USPS). Although she thought the call and request were suspicious from the beginning, the woman wanted to help with the fraud case and did as instructed. If you're thinking this was a bad idea that could lead to trouble, you are correct. The woman ended up with a bill of more than $600, including the cost of an iPhone and AirPods. But you'll want to check out Bjorklund's article to see how having the USPS tracking receipt plus the ability to provide lots of information about the scammer helped this young woman undo the damage. We'd remind readers to follow their gut if something smells fishy, save everything related to any suspicious transactions or communications, and put aside your innate kindness and helpful nature next time someone says your assistance is needed to stop a scam. (You'll still be a superstar in our book.)
All roads lead to Rome (or Patagonia, or Cape Town, or Kazakhstan...). Were you among the predicted 60 million drivers hitting the road over the Fourth of July travel period? If that trip went smoothly, perhaps you’re now considering taking to more distant highways. If so, you'll want to take a look at a recent FTC consumer alert on how to avoid International Driver's Permit (IDP) scams, including websites trying to sell you a fake IDP. For starters, the FTC points out that in some countries, like Canada, you can drive with just your U.S. driver’s license. To learn about the requirements for the country you're traveling to, start by visiting this U.S. Department of State webpage. If it turns out you do need an IDP, the FTC wants you to know that the American Automobile Association (AAA) is the only official organization authorized by the State Department to issue one. Learn more in the FTC alert here.
Mis-deeds. CNN recently ran a story about the near theft of Elvis Presley's Graceland in an attempted home title fraud scheme. The purported scammer, CNN explained, presented documents claiming to show that Lisa Marie Presley, the recently deceased daughter of Elvis and Priscilla Presley, borrowed $3.8 million from Naussany Investments and used Graceland as collateral. A lawsuit by Elvis Presley’s granddaughter, Riley Keough, prevented the property from going to auction. CNN offered several expert tips for avoiding this type of scam. You may also want to check out a Motley Fool's "Beginner’s Guide" that covers what home title fraud is, how to avoid it, and what to do if it happens to you. In simple terms, Motley Fool explains that in home title fraud, a perpetrator steals a home by forging a deed and then either sells the property or takes out a loan against it without the homeowner’s knowledge. Then, when the mortgage goes unpaid, the property enters foreclosure. Citing the FBI, Motley Fool offers tips that include opening letters from mortgage companies, even if your name is not on them; periodically checking all information pertaining to your property through your county's deeds (or recorder’s) office; and having someone check unoccupied property you own for any “For Sale” signs or other unauthorized activity. Motley Fool also offers tips on how to decide if home monitoring services are worth it. Check out the links in this piece; they could help you avoid a Graceland experience and forced relocation to the Heartbreak Hotel.
Tips from a reader. Readers often write to us to let us know they appreciate SCAM GRAM's regular roundup of tricks and traps to watch out for. Last month, we heard from a reader who offered a great tip—a best practice, if you will—for dealing with those pesky email messages that, one way or another, try to get us to click on links: Never click on a button or link unless it's from someone you know personally. When notified about a problem with any particular business or government agency, such as a supposed fraud alert from a bank, explained our reader, go immediately to the website of that business or government agency and contact them directly at either the email address or the phone number listed on the website. If there really is a problem with the bank, for example, the bank will tell you so as soon as you confirm your identity. Another alternative, says our reader, is useful after hours, when a telephone call might not be answered: Search the internet for the name of the organization involved followed by the word "scam." Our reader says they have sometimes found the scam already well-described in the search results. Thanks for the tips, dear reader. We are happy to share them.
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