Article by Marcus Siu

APRIL FOOLS

Twenty years ago, on April Fools Day, a friend and I decided to play a joke on her soon-to-be husband. The plan would be for me to call him and impersonate someone who worked for a collection agency and tell him he owed money to them. I made the phone call to his home and disguised my voice in a manner that he wouldn’t recognize me. Since there was no answer, I left a voice message on his answering machine.

The next morning, my partner in crime and his soon-to-be wife said he was worried sick and couldn’t sleep the previous night. Feeling guilty, and feeling bad for the emotional duress we put on her fiancé, we eventually had to confess to him that this was just an April Fool’s joke before he had a nervous breakdown.

In a way, I guess you may be able to call this a “phone scam”, but without any true intent for monetary gain…just for a extra few laughs between friends.

However, if her fiancé was preyed upon by a very “seasoned” phone scammer today, he would have been an excellent prospect. Scammers nowadays are not only pretending they are from collection services, but also the IRS, Social Security, Medicare, retailers (Amazon or Apple), electric companies, phone companies, and even other for-profit organizations. They will call just about everyone with a phone number and will victimize anyone who picks up the phone and is willing to chat.

WHY ARE THERE SCAMMERS?

Ben Rothke web presentation’s “How to Avoid Being a Scam Victim when Your Phone Rings” was recently aired via webcast at the RSA Conference a month ago. He is a New York City-based Senior Information Security Manager with Tapad and has over 20 years of industry experience in information systems.

Rothke explains that scammers are not exclusively operating in third world countries but are operating even in some first world countries, too. It’s quite more lucrative for scammers in third world countries, who are normally living under poverty, where they can make a significant amount of money off just one scam with very low odds of being under the radar. The odds of being caught and prosecuted are even almost smaller, so in some ways they’re working with just pure impunity. Being a fraudsters in certain parts of the world can be quite profitable, especially attacking victims in affluent countries, such as the United States.

These are large organizations, highly structured scam operations and not just a one-offs. There’s management, cost enters, controls, IT, and even a security person, just like any normal companies have. These organizations are well run and highly efficient. American law enforcement is unlikely to be able to catch these scammers for a lots of reasons that are in their favor. International laws make it quite difficult. Jurisdiction is extremely difficult.

WHO IS THE TARGET?

“Older adults or are particularly susceptible to scammers for a lot of reasons as they see or they’re trusting. Grandparents are very giving – they’ve got unconditional love”, Rothke explains.

Rothke points out that scammers like to target the “not so tech savvy” elderly, who are generally more trusting, giving, unsuspicious and have a lot more time on their hands. They also feel very guilty about ending calls as they are accommodating to giving information out, which scammers adore.

This could easily be anyone’s mother or grandmother that they are taking advantage of. However, scammers are not just limiting this just to the elderly, but just about anyone who has a phone.

Recently in the news, an 82-year-old woman from Florida lost over $700,000 to scammers who convinced her that her granddaughter was in legal trouble and needed financial help. Over the summer, the woman, who was not identified, received a phone call from a woman claiming to be her granddaughter.

“It’s not just people who are who are clueless who are being victims I’ve had some friends professionals who became victims of these scammers”, Rothke declares.

If you know any elderly people who might be a prime target, it’s best to make them aware of scammers. Help them put controls on their bank accounts as a safeguard, even if they don’t do any online banking, and make sure they do not give out any personal information. Assure them that it’s okay to hang up on them, but most of all, let theses unrecognized calls go straight to voice mail, when possible.

HOUSE ADVANTAGE FOR PHONE SCAMMERS

These are all unsolicited calls – calls out of the blue. These scammers are willing to say anything and persuade the unprepared victim in giving them personal information, such as their bank, credit card, medical number, and just about any personal information that they can sell or use.

They will certainly pressure you with a deadline offer at the end of the call, with absolutely no callbacks allowed. Even if you tell them that you want to “think about it” and consult with your spouse, children, friends, or even lawyers, their tactic is to say once you hang-up, the offer is void. If they pressure you that there is a deadline, it is most likely a scam.

Rothke states, “the last thing they want you to do is think about it, because if you think about it and go to Consumer Reports, Better Business Bureau, or to speak to a spouse or a friend, you’re gonna know it’s a scam.”

Many times, spammers will even “spoof” their calls. For example, they will be able to make your caller ID look like it’s from the same area code and prefix, so it look like a legitimate local call that you would normally pick up. You may think it’s your doctor’s office or your mechanic.

If you do pick up the call, but still somewhat suspicious about it, it’s a good idea to ask your caller where exactly they are calling from. If they say they are from the same city you are located in, you should inquire about the streets or neighborhood where they are located to get a sense if they are really local or just lying through their teeth, which is usually the case.

“They’ll e-mail you, maybe they’ll text you, but very few legitimate businesses are calling people. Medicare doesn’t call people to sell them things. Amazon is not calling you, your electric company is not, so you know the fact that you’re getting an unsolicited call should put your guard up right there because they said if you get a cold call in 2021 almost certainty you know that it is a scammer on the other line”, Rothke concludes.

TOP PHONE SCAMS

AMAZON:

The Amazon-scam robocalls tend to start with someone saying there has been suspicious activity on your account, and then asks you to press 1 or call another phone number. Next, the scammer may ask for your Amazon account information. Or he may ask to help you by taking over control of your computer via software that lets him gain access to your credit card, banking and other sensitive information — so he can steal your identity and your money.

Recently in the news, a Rocky River man lost over $124,000 after two men claiming to work for Amazon convinced him his personal account was in danger and that he needed to move his money to a newly set up account. The resident told police he received a call from two men claiming to be from Amazon security who advised him that an unknown person accessed his personal account and had tried to charge $900 to it. The men, still identifying themselves as security, helped the resident set up an online account and attach his bank account to it. The men convinced him that he needed to move his money to the new online account.

It’s better to contact Amazon directly, if you have questions concerning your orders.

SOCIAL SECURITY ARREST WARRANT

Scammers posing as Social Security employees will claim your Social Security number was used for some illegal activity, such as bank fraud or drug trafficking, and that there’s a warrant for your arrest. They will threaten to freeze your bank account or 401k’s and ask you lots of personal and financial questions to determine how much they can scam you for.

It’s best to call Social Security directly to verify anything this serious.

CREDIT CARD INTEREST RATE REDUCTION SCAM

You get an unsolicited automated call from “card services” or a major credit card company promising to secure you a reduced APR and lower credit card interest payments. All they do is transfer your credit card debt to a new account and charge you 40 to 60% fee for that service up front. They will even mention the Restructuring Act from the Obama Administration to make it sound more credible.

These scammers would convince their victims to request wire transfers from Western Union, MoneyGram or even gift cards, which are non-traceable for something. Legitimate companies never ask you to wire money.

It’s against the law for debt-relief services to collect payment before they have done anything for you. Also don’t trust the company if the offer expires after you hang up.

EXTENDED AUTO WARRANTY SCAMS:

Scammers will offer extended auto warranty, but in reality, it’s not a warranty, since only the manufacturer can issue a warranty. What you buy at the dealer or from a third-party are extended service contracts (ESC), also known as “Vehicle Service Contracts”, which gets you a policy, but no coverage. They are worthless and should be avoided at all costs. If you believe it is legit, then you should call other dealers and inquire about these ESC’s.

SENIOR HEALTHCARE SCAMS

With over 50 million people seniors signed onto Medicare, there are even more scams targeted among the elderly to be concerned about. Medigap, drug or Advantage plans are used to enroll seniors into fake plans, identity theft, purchase of expensive and overpriced medical equipment, using high-pressure scare tactics like problems with your Medicare account, in which case they will ask for your ID number and bank/credit card details to fix it, which would make it easy for identity theft.

ELECTRIC AND ENERGY SCAMS:

Scammers will claim they are from your local energy supplier and say that you are on a commercial plan that needs to be moved to a lower-rate consumer plan. Given the unfamiliarity of kWh (kilowatt-hour) rates by most people, it makes it easier for scammers to say that money will be saved, but rates you’ll be charged will most likely be quadrupled. By the time the bill comes in 6 to 8 weeks, it will be too late, and they are stuck to pay for these exorbitant charges.

SOLAR ENERGY:

Solar seems like a no-brainer, so why wouldn’t anyone want to invest in it? Leave it to the fast talking salesmen scammers of Solar Energy to make it simple with no out of pocket expenses and install low quality solar panels. But with not knowing how the bills are processed, how the meters are read, and what you’re paying for. By the time you get your bill it could be two to three months into the scam.

In addition, they they know a lot of people like auto-pay, since it’s just much easier to have your monthly bill debited from your account. People like to go into paperless so they could go on for a few months and not to have to think about it. When their account overdraft kicks in four to five months later, they realize that they have overspent a lot more than they expected.

TRAVEL AND VACATION SCAMS:

Scammers will offer a free vacation, but the customer will still have to pay for a a reservation fee or some other fee that they claim will be worthwhile. For example, if the fee is $1000, then you will be getting $6000 worth of amenities, when all you will get are worthless travel certificates.

FUND RAISING FOR-PROFITS PAC’S

Political action committees (PAC’s) try to pose as legitimate charities, but are not. They capitalize on name confusion to deceive you. These companies enrich themselves at the expense of the donating public. “Americans for the Cure of Breast Cancer”, “Orphans Fund Diabetes Network of North America” are examples of 501(c3) charities. These PAC’s misled donors as to where their funds would go and what they would be used for. Of course, none of these would give you a tax deduction.

PHONE AND CABLE SERVICE

Just like electricity and energy scams, phone and cable scammers will claim to be from your current cell provider and promise you lower rates. They will attempt to get for your account information, since they won’t have it and then switch you to a different and more expensive provider.

BASIC RED FLAGS TO LOOK FOR:

Scammers won’t let you call back. They will say once you hang up, the offer will expire. No legitimate salesperson/businesses do this. They are using pressure tactics. Just because they called you doesn’t mean that you have to accept the offer.

Don’t make payments by gift card, prepaid debit card or wire transfer. Fraudsters favor these methods because they are difficult to trace.

Don’t give personal or financial data, such as your Social Security number, Medical, bank account or credit card account numbers, to callers you don’t know.

SAFEST SOLUTION:

Do not to answer the phone if you don’t recognize the phone number. If it’s a legitimate call from your doctor, mechanic or a friend (not in your contacts list), they will leave a voice message if it’s important enough. If you do answer the phone, don’t press any numbers based on prompts on the suspicious robocall. Just hang up.

REVENGE SOLUTION:

If you want to be a rebel and mess with the spam caller and and want some vendetta, my suggestion is to take the call and speak to them for a brief moment showing genuine interest in whatever they are selling. Then abruptly cut the conversation short and say “I need to put you on hold because someone is at the front door. Can I put you on hold for a moment?” As soon as they agree, put them on hold until they eventually lose patience and hang up.