Scam of the Day
Scam of the day – April 8, 2023 – FTC Sending Additional Refunds to Victims of Herbalife Pyramid Scheme
In the Scam of the day for January 14, 2017 I first told you that the Federal Trade Commission (FTC) had settled its claims against the multilevel marketing company Herbalife which sells nutritional supplements. The FTC claimed that Herbalife was an illegal pyramid scheme where affiliates’ earnings were tied primarily to signing up more affiliates rather than to selling products. Sometimes a legitimate multilevel marketing business may look quite similar to an illegitimate pyramid scheme, which is one of the reasons that so many people fall prey to these scams. For every legitimate multilevel marketing company, such as Mary Kay and Amway, there are many that are just scams. In a legitimate multilevel marketing company, investors make money by selling products to the public and by recruiting new salespeople. In a pyramid scheme the source of profits is based primarily on the recruiting of new members or salespeople.
Under the terms of the settlement, Herbalife was required to revamp its compensation system to provide for rewarding retail sales rather than primarily providing incentives rewarding distributors for recruiting new affiliates. In addition, Herbalife was to pay 200 million dollars in refunds to the 350,000 people harmed by their scheme. The FTC sent two rounds of checks to victims of the scam in 2017 and 2019. Now the FTC is sending an additional round of checks to victims of the scam. For more detailed information about the refund and how to get a check if this affects you, go to the middle of the opening page of Scamicide.com to the tab entitled “FTC scam refunds.”
TIPS
Anyone who is considering investing in what is represented to be a multilevel marketing business should always investigate the company and the terms of investment carefully before investing any money. In addition, you should also check out the company with the FTC and your state’s attorney general to make sure that the company is legitimate before investing any money. Here is a link to information from the FTC that you should consider before investing in a multilevel marketing business. http://www.consumer.ftc.gov/articles/0065-multilevel-marketing
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Scam of the day – April 7, 2023 – Electronic Tax Filing Company Hacked
Approximately 90% of taxpayers file their federal income tax returns electronically. Electronic filing is easy and generally secure. However, it has just been discovered that eFile.com an electronic e-filing software service authorized by the IRS was hacked and malicious malware inserted into the site. Someone using eFile would see a legitimate appearing browser update notice indicating that you needed to click on a download button to update your browser in order to access the site. If you clicked on the button you would download malware that could full access to your computer.
The full extent of the hack is yet to be determined, but it is a matter of great concern. e-File has a great deal of personal information of its users including their Social Security numbers.
TIPS
If you used e-File.com, saw the notice and clicked on the button to download the malware you should do an anti-virus scan using your security software to see if your computer was infected.
You should also change your e-File password and make sure that you have a unique password for each of your other online accounts so that if your e-File password was compromised, all of your accounts will not be in danger.
If you have not already done so, set up dual factor authentication for each of you accounts where it is available. This will protect you from having those accounts stolen by someone who may have access to your password.
https://www.transunion.com/credit-freeze
https://www.experian.com/freeze/center.html
Scam of the day – April 6, 2023 – IRS Warning About Income Tax Scams on Social Media
Federal Income Tax returns are due for most people on April 18th this year although California storm victims have until May 15th to file their federal income tax returns. The IRS is warning people about scams popping up on social media that already have gotten numerous people into trouble. It should go without saying, but social media is definitely not a place to go for reliable tax advice. According to IRS Commissioner Danny Werfel, “The IRS continue to see a lot of inaccurate information that could get well meaning taxpayers in trouble. People should remember that there is no secret way to fill out a form and simply get a larger refund that they aren’t entitled to. Remember if it sounds too good to be true, it probably is.”
Two of the scams to which Commissioner Werfel is referring are Form 8944 fraud and Form W-2 fraud. In regard to Form 8944 fraud, posts on social media are advising people to file a Form 8944 Hardship waiver Request in order to get a refund even if you owe income taxes. In regard to W-2 fraud, social media posts are telling people to use tax software to create a phony Form W-2 Wage and Tax Statement making up a large phony income, a large phony withholding and a phony company in order to get a substantial unearned refund.
TIPS
Form 8944 is a tax form that relates to professional tax preparers who are requesting a waiver in order to file paper tax returns rather than electronic tax returns. It does not relate in any way to a individual taxpayer obtaining a refund even if they owe income taxes. Filing the form in an effort to do so is a crime.
We are all familiar with W-2s that we get from our employer. The strategy suggested by the social media posts as to creating a phony W-2 in order to get a big unearned refund is actually a strategy used by income tax identity thieves who steal your identity and file an income tax return using your name and Social Security, but include one of these counterfeit, phony W-2s. It is absolutely illegal.
If you want real tax advice upon which you can rely, don’t go to social media, but instead seek out a licensed professional tax advisor such as a CPA.
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Scam of the day – April 5, 2023 – Vacation Rental Scams,
It is only early April, but already people are looking into renting a summer vacation home. Renting vacation homes rather than going to hotels has been increasingly popular in recent years. There are many excellent websites such as VRBO and Homeaway that offer wonderful vacation homes. Many people will also go to Craigslist and other similar sites. These websites can be easy and efficient ways to find a great vacation home.
Unfortunately, they are also a great way for scam artists to steal money from unwary people looking for a vacation home. The scam usually starts with a listing that looks quite legitimate and there is a good reason for that. The listing is often a real on-line listing that has been copied by the scammer who merely puts in his or her name and contact information. The price is usually very low which attracts a lot of potential renters. The potential renters are sometimes told that the owner is out of the country and that there are many people interested in the property so if the tenant wants to be considered for renting it, the tenant has to wire money to the landlord somewhere outside of the country. As I have warned you many times, wiring money is a scammer’s first choice because it is all but impossible to retrieve once you have found out that you have been scammed. Too often, unwary potential tenants wire the money and never hear anything further from the scam landlord. And as for the money, it is gone forever.
TIPS
There are a number of red flags to look for in vacation home rental scams. First, as always, if the price is too good to be true, it usually is just that – not true. Also be wary of landlords who are out of the country.
Never send your payment by a wire transfer, Zelle, Venmo or a cashier’s check. Use a credit card, PayPal or any other payment system with which you can retrieve your funds if the transaction is fraudulent. It is usually best to deal with websites that specialize in vacation homes, but you must remember that they cannot possibly monitor every listing to ensure that it is legitimate.
A great and easy way to determine if the listing is a scam is to check out who really is the owner by going on line to the tax assessor’s office of the city or town where the property is located and look up who the real owner is. If it doesn’t match the name of the person attempting to rent you the home, you should not go through with the rental. Also Google the name of the owner with the word “scam” next to his or her name and see if anything comes up to make you concerned.
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Scam of the day – April 4, 2023 – Romance Scammer Sentenced to Prison
In the Scam of the day for March 5, 2021 I first told you about the arrest of Kofi Osei in Massachusetts who was charged with using romance scams to steal $535,000 from a woman in California and two women in Florida. He used fake names and after gaining their trust concocted wild stories to justify his asking for funds. He told his first victim that he was working on an oil rig in Dubai that was involved in an explosion and needed money for a lawyer. He told his second victim that he was involved in an accident in France and was arrested and needed money for legal assistance. He told his third victim that he was working on an oil rig in Texas and there was a problem with his company’s bank account and he needed money to pay for drilling equipment. Now two years later, he has been sentenced to 4 1/2 years in prison and ordered to pay more than 4 million dollars in restitution.
While anyone can be the victim of a romance scam, according to the FBI, the elderly, women and people who have been widowed are particular vulnerable. Most romance scams are online and involve some variation of the person you meet through an online dating site or social media quickly falling in love with you and then, under a wide variety of pretenses, asking for money. Since 2019 approximately half of the reported instances of the romance scam have started on social media, particularly Facebook and Instagram rather than on dating sites or dating apps according to the FTC. One particularly scary statistic is that people over 70 years old victimized in a romance scam lose, on average, about $10,000 as contrasted to $2,800 for younger victims of romance scams.
TIPS
There are various red flags to help you identify romance scams. I describe many of them in detail in my book “The Truth About Avoiding Scams.” The most important thing to remember is to always be skeptical of anyone who falls in love with you quickly online without ever meeting you and early into the relationship who then asks you to send money to assist them with a wide range of phony emergencies.
Here are a few other things to look for to help identify an online romance scam. Often their profile picture is stolen from a modeling website on the Internet. If the picture looks too professional and the person looks too much like a model, you should be wary. You also can check on the legitimacy of photographs by seeing if they have been used elsewhere by doing a reverse image search using Google or websites such as tineye.com.
Of course you should be particularly concerned if someone falls in love with you almost immediately. Often they will ask you to use a webcam, but will not use one themselves. This is another red flag. One thing you may want to do is ask them to take a picture of themselves holding up a sign with their name on it. In addition, ask for a number of pictures because generally when the scammers are stealing pictures of models from websites, they do not have many photographs. Ask for the picture to be at a particular place that you designate to further test them. If you meet someone through a dating website, be particularly wary if they ask you to leave the dating service and go “offline.”
Recently, the dating sites Match, Tinder, Hinge and Plenty of Fish started a new public awareness program to help people recognize romance scams. One tip they give is to use the verification check on your matches to help confirm they are the person who appears in the profile photo. Also they advise you to set up video chats to confirm the person who they claim to be.
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Scam of the day – April 3, 2023 – Millions Affected by Major Data Breach
TMX Finance and its subsidiary companies TitleMax, TitleBucks and InstaLoan recently notified 4,822,580 of its customers that large amounts of their personal information was exposed in a data breach that lasted from February 3rd to February 14th. This particular data breach is extremely serious because the information stolen included names, dates of birth, Social Security numbers, financial account information, phone numbers, home addresses, email addresses and more of its customers. TitleMax is a private lender with 1,100 stores throughout the country.
A letter was sent to all of its affected customers recently informing them of the data breach and offering free credit monitoring for a year. Here is a copy of a sample of the notification letter courtesy of bleepingcomputer.com. https://www.documentcloud.org/documents/23735720-tmx-finance-sample-copy-of-individual-notice-l01
The type of personal information compromised in this data breach can readily lead to identity theft. In addition, information about the names, cell phone numbers and email addresses of customers which was also compromised can be used to target victims of the data breach with spear phishing emails or smishing text messages intended to lure them into identity theft or other scams.
As I have reminded you many times, we are only as safe and secure as the security of the companies, government agencies and websites that have our personal information. Even if you are extremely diligent in protecting your personal information, you can be in danger of identity theft and scams if your personal information falls into the hands of hackers.
So what can you do to protect yourself from these data breaches that will be occurring?
TIPS
One important lesson is to limit the amount of personal information that you provide to companies and websites whenever possible. For example, your doctor doesn’t need your Social Security number for his or her records.
You should make sure that you have a unique password for each of your online accounts so that if one of your passwords is compromised in a data breach, all of your accounts will not be in danger. If your information is compromised in a data breach, you should immediately change the password for that account.
If you have not already done so, set up dual factor authentication for each of you accounts where it is available. This will protect you from having those accounts stolen by someone who may have access to your password.
https://www.transunion.com/credit-freeze
https://www.experian.com/freeze/center.html
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Scam of the day – April 2, 2023 – Watch Out for Scams Related to the Nashville Shooting
Human tragedies such as the murders of six people at a school in Nashville, Tennessee bring out the best charitable impulses of many people, but unfortunately, they also bring out the worst impulses in scammers who use tragedies such as this to solicit contributions to phony charities and GoFundMe campaigns.
GoFundMe is the most prominent crowdfunding site. Crowdfunding is the name for the process by which people raise funds on websites for various projects from movies and books to the development of new businesses and charitable purposes. Unfortunately, as I have been warning you since 2012, the potential for crowdfunding scams is tremendous.
TIPS
You may be receiving phone calls, emails or text messages seeking contributions to charities that purport to be helping the families of the victims in Nashville, but unfortunately, whenever you receive a phone call, text message or email, you can never be sure that the caller is legitimate.
Charities are not subject to the federal Do Not Call List so even if you are signed up for the federal Do Not Call List, legitimate charities are able to contact you by phone. The problem is that whenever you are get a phone call, you can never be sure as to who is really calling you so you may be contacted either by a fake charity or a scammer posing as a legitimate charity. Using a technique called spoofing, the scammers can manipulate your Caller ID to make it appear that the call is coming from a legitimate charity when it is not. Similarly, when you are solicited for a charitable contribution by email or text message you cannot be sure as to whether the person contacting you is legitimate or not.
Never provide credit card information over the phone to anyone whom you have not called or in response to an email or text message. Before you give to any charity, you should check out the charity with http://www.charitynavigator.org where you can learn whether or not the charity itself is a scam. You can also see how much of the money that the legitimate charity collects actually goes toward its charitable purposes and how much it uses for fund raising and administrative costs.
In addition to charity scams related to the Nashville shootings, you can expect to receive emails, text messages and social media posts that purport to provide important information about the shootings. These communications may require you to click on links to obtain the information or videos. Unfortunately, if you do click on these links you may end up downloading dangerous malware on to your phone or computer. Never click on links from sources that you have not verified as legitimate. As for news and information about the Nashville shootings, the best thing to do is to limit your sources to respected, legitimate news sources with which you are familiar.
One of the good aspects of GoFundMe is its guarantee that if scams are discovered, GoFundMe will refund all donations made to the scammers. Here is a link to GoFundMe’s guarantee. https://support.gofundme.com/hc/en-us/articles/203604704-The-GoFundMe-Guarantee
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Scam of the day – April 1, 2023 – SIM Swapping is No April Fools Joke
A Subscriber Identity Module, more commonly known as a SIM card, is an integrated circuit that stores information used to authenticate subscribers on mobile devices, such as a cell phone. The SIM card is able to be transferred between different devices, and often is, when people update into a newer cell phone. SIM Swapping is the name for the crime where someone convinces your phone carrier to transfer your SIM card to a phone controlled by the criminal.
As more and more financial transactions, such as online banking, are now done through cell phones, identity thieves with access to their victims’ SIM cards are increasingly becoming able to intercept security codes sent by text messages for online banking as part of dual factor authentication and thereby providing the identity thief with the opportunity to empty their victims’ bank accounts and cause other financial havoc.
Recently Zena Elisa Dounson and Andrew Percy Trujillo were convicted of SIM Swapping charges. Dounson and Trujillo used the SIM swaps to manipulate the dual factor authentication used by their victims to access their victims’ cryptocurrency wallets.
TIPS
Perhaps the best thing you can do to protect your SIM card from SIM swapping is to set up a PIN or password to be used for access to your mobile service provider account. This will help prevent a criminal from calling your carrier posing as you and convincing your mobile carrier to swap your SIM card to the criminal’s phone merely by providing personal identifying information or answering a security question.
AT&T will allow you to set up a passcode for your account that is different from the password that you use to log into your account online. Without this passcode, AT&T will not swap your SIM card. Here is a link with instructions as to how to set up the passcode. https://www.att.com/esupport/article.html#!/wireless/KM1051397?gsi=9bi24i
Verizon enables customers to set up a PIN or password to be used for purposes of authentication when they contact a call center. Here is a link with information and instructions for setting up a PIN with Verizon. https://www.verizonwireless.com/support/account-pin-faqs/
T-Mobile will allow you to set up a passcode that is different from the one you use to access your account online. This new passcode is used when changes to your account are attempted to be made such as swapping a SIM card. This code will not only protect you from criminals attempting to call T-Mobile and swap your SIM card, but will also prevent someone with a fake ID from making changes to your account at a T-Mobile store. Here is a link to information and instructions for adding a new passcode to your account. https://www.t-mobile.com/customers/secure
Sprint customers can establish a PIN that must be provided when doing a SIM swap, in addition to merely answering a security question, the answer to which may be able to be learned by a clever identity thief. Here is a link to information about adding a PIN to your Sprint account. https://www.sprint.com/en/support/solutions/account-and-billing/update-your-pin-and-security-questions-on-sprint-com.html
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Scam of the day – March 31, 2023 – Critical Apple Updates
It is always important to update all of the software you use with the latest security updates and patches as soon as they are available. Numerous hacks and data breaches could have been avoided if individuals as well as companies installed security updates as soon as they became available. Hackers take advantage of the fact that many of us procrastinate installing security software to our great detriment. The major data breach at Equifax that affected 148 million people involved a security flaw in Apache software for which a patch had already been issued months earlier, but Equifax had not yet installed at the time of the data breach.
Apple has released security updates to address vulnerabilities in multiple products. An attacker could exploit some of these vulnerabilities to take control of an affected device.
TIPS
Here is a link to Apple’s page with all of the security updates and instructions as to how to install them. https://www.cisa.gov/news-events/alerts/2023/03/28/apple-releases-security-updates-multiple-products
If you use any of the affected Apple devices, it is critical that you install these updates as soon as possible.
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Scam of the day – March 30, 2023 – AI Voice Cloning Makes Grandparent Scam Worse
I am sure by now all of you are familiar with the grandparent scam where a grandparent receives a telephone call from someone purporting to be their grandchild who has gotten into some trouble, most commonly a traffic accident, legal trouble or medical problems in a far away place. The caller pleads for the grandparent to send money immediately to help resolve the problem. However the caller also begs the grandparent not to tell mom and dad. One would think that no one would be gullible enough to fall for this scam, but don’t be so hard on the victims of this scam. Scam artists have a knowledge of psychology of which Freud would have been envious and are able to use that knowledge to persuade their victims to send money right away. While this scam has been going on for approximately fourteen years, it continues to victimize people.
But now it is getting worse – far worse.
Through the use of readily available AI voice cloning technology, a scammer can obtain a recording of the grandchild’s voice from YouTube, TikTok, Instagram, Facebook or anywhere else the grandchild might post a video with audio and use that audio to create a call to the grandparent that sounds exactly like that of the grandchild and all it takes is AI voice-generating software and as little as 30 seconds worth of the grandchild’s audio. Recently, Ruth Card of Regina, Saskatchewan was swindled out of 3,000 Canadian dollars by a scammer who used AI voice cloning technology to make a call to Mrs. Card that appeared to come from her grandson, Brandon in which it sounded like Brandon was in jail and needed the money immediately for bail.
TIPS
Scammers often use the nicknames of the grandchildren when speaking to their intended victims. Sometimes they get this information from social media while in other instances they get this information from reading obituaries which may contain the names of grandchildren so merely because the correct name is used in the call is no reason to believe the call. Don’t respond immediately to such a call without calling the real grandchild on his or her cell phone or call the parents and confirm the whereabouts of the grandchild. If a medical problem is the ruse used, you can call the real hospital. If legal problems are the hook you can call the real police. You can also test the caller with a question that could be answered only by the real grandchild, but make sure that it really is a question that only the real grandchild could answer and not just anyone who might read the real grandchild’ s social media postings. Prudent families can also come up with a code word to use in an emergency which a scammer will never know.
Never wire money unless you are absolutely sure about to whom you are wiring the money and it is not a scam. Once you have wired money, it is gone forever. Also, students traveling abroad should register with the State Department’s Smart Traveler Enrollment Program at https://travelregistration.state.gov/ibrs/ui/. This program can help with communications in an emergency situation.
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