Scam of the Day
Scam of the day – July 30, 2025 – Real Estate Influencer Indicted for Ponzi Scheme
New Jersey real estate influencer and investor Cesar Humberto Pina, also known as “Flipping NJ” was recently charged with wire fraud, money laundering and other charges related to allegedly operating a Ponzi scheme in which he promised investors returns of 20% to 45% in five months for investing in his purported real estate flipping business. As anyone who watches HGTV knows, flipping houses involves buying houses, quickly updating them and then reselling them at a substantial profit. According to US Attorney Alina Habba, Pina used his social media influence and seminars throughout the country to promote the scam in which rather than use the money invested to purchase, renovate and resell the properties, he is accused of using the funds for his own personal purposes and paying earlier investors with money from later investors, the hallmark of a Ponzi scheme. According to US Attorney Habba, Pina stole millions from unwary investors.
TIPS
It is also important to remember that you should never invest in something that you do not completely understand. This was a mistake that many of Bernie Madoff’s victims made. You also may want to check out the SEC’s investor education website at www.investor.gov. Scammers can be very convincing and it may sound like there is a great opportunity for someone to make some money, but you must be careful that the person making money is not the scam artist taking yours. Additionally, investing with someone merely because you trust them because you have heard them on the radio, television or social media is a bad idea.
Be wary of seminars that offer get rich quick schemes that indicate that little effort or investment by you is required. Do your research with the FTC and your state’s attorney general to see if there have been complaints against any company that puts on such seminars. As always, if the promised returns appear too good to be true, they probably are. In this case, the promised returns should have been a red flag that this could be a scam.
As for flipping houses, here is a link to a Bankrate.com story about the pros and cons of house flipping.https://www.bankrate.com/real-estate/flipping-houses/
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Scam of the day – July 29, 2025 – Target Sued Over Gift Card Scams Part 2
In yesterday’s Scam of the Day I told you about a lawsuit filed against Target by four victims of the impersonator scam where scammers posed as government agents such as IRS agents and convinced their victims to purchase Target gift cards to send to them to resolve phony problems. Scammers are big fans of gift cards because they are easy to purchase, easy to send to the scammer and impossible to trace to the scammer. It is not even necessary for the scammer to be in possession of the actual gift card to use it. Sending the gift card numbers or taking a picture on your phone and transmitting it to the scammer is sufficient for the scammer to use the gift card to buy things that can then be sold and converted into cash.
Today’s Scam of the Day involves a class action filed by Target customers from 21 states who bought gift cards tampered with by scammers that resulted in the scammers emptying the gift cards of their value. The plaintiffs allege that Target is aware of this problem and has not done enough to stop it.
This type of scam is called gift card draining. The most common way gift card draining occurs involves scammers going to racks of gift cards in stores and using handheld scanners that are easy to obtain, read the code on the strip of the card and the number on the front. They then put the card back in the display and periodically check with the retailer by calling its 800 number to find out whether the card has been activated and what the balance is on the card. Once they have this information they either create a counterfeit card using the information they have stolen or order material online without having the actual card in hand.
Another common way gift card draining occurs is when scammers place a sticker with the barcode of a a gift card that the scammers possess over the actual barcode of the gift card in the rack. Thus when the card is taken by the gift card purchaser to the checkout counter to have the card activated, the funds used to purchase the gift card are credited to the card of the scammer. It is not until the gift card purchaser tries to use his or her card that it is discovered that there are no funds credited to the card.
Some retailers, in an effort to reduce gift card fraud put a PIN on the gift card so that if the card is used online, the user must have access to the PIN which is generally covered and must have the covering material scratched off in order to be visible. Unfortunately, many purchasers of gift cards are not aware of this so they don’t even notice that the PIN on the card that they are purchasing has already had the covering material scratched off by the scammer who has recorded the PIN.
TIPS
As wtih so many scams, the best place to look for a helping hand is at the end of your own arm. When buying a gift card, only purchase cards from behind the customer service desk and if the card is preloaded, always ask for the card to be scanned to show that it is still fully valued. This avoids all of the problems of tampering with the card before it is sold.
Always inspect the card carefully to make sure that the barcode has not been tampered with in any fashion and that the PIN is still covered. Unfortunately, many purchasers of gift cards are not aware of this so they don’t even notice that the PIN on the card that they are purchasing has already had the covering material scratched off by the scammer who has recorded the PIN
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Scam of the day – July 28, 2025 – Target Sued Over Gift Card Scams Part 1
Scammers are big fans of gift cards because they are easy to purchase, easy to send to the scammer and impossible to trace to the scammer. It is not even necessary for the scammer to be in possession of the actual gift card to use it. Sending the gift card numbers or taking a picture on your phone and transmitting it to the scammer is sufficient for the scammer to use the gift card to buy things that can then be sold and converted into cash.
In many instances the scams involved scammers posing as large companies or government agencies such as the IRS demanding payments. This is called an “impersonator scam.” It is important to remember that no legitimate company and no government agencies asks for or accepts gift cards as a payment method so anytime you are asked for a payment by gift card, you can be confident it is a scam.
In an interesting development, the FTC noted that Target gift cards were the most popular choice for scammers with scammers asking specifically for Target gift cards in twice as many instances as the next most popular gift card and even when the gift card requested by the scammers was not a Target gift card, the scammers asked their victims to purchase the particular gift cards at a Target store. Recently four victims of the impersonator scam In Pennsylvania sued Target alleging that Target failed to use its own security algorithms and real-time tracking software to prevent these scams. The plaintiffs further allege that Target benefited financially from these scams and did not take proper steps to stop it.
TIPS
Fortunately, scams requiring payment through gift cards are easy to avoid. Anytime anyone approaches you with a business transaction in which you are asked to pay through gift cards, you can be confident that it is a scam. The IRS has even had to post on its website that it does not accept gift cards as payments. An important thing to remember is that gift cards are gifts, they are not used as a payment method for any legitimate transaction so if you are asked to pay for any business transaction through a gift card, you can be sure it is a scam
It would be helpful if more companies that sell gift cards would routinely train their employees to recognize scams and require them to ask their customers when larger gift cards are being purchased as to the reason for purchasing the gift cards. The FTC has recently created new posters for retailers to put up near where they sell gift cards to warn consumers about gift card related scams.
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Scam of the day – July 27, 2025 – Massive Data Breach at Allianz Life
I have been writing a lot recently about data breaches which is not really surprising since last year alone there were 9,478 publicly disclosed data breaches exposing over more than 35.9 billion records globally and 2025 appears to be on its way to a record number of data breaches. Data breaches are an unfortunate fact of life for all of us and can readily lead to identity theft and other harm.
The most recent data breach involves Allianz Life, a major insurance company. Yesterday they confirmed that they suffered a data breach on July 16th due to a supply chain attack, which is when the cybercriminals target a company used by their real target to steal information. In this case the cybercriminals were able to access a database of personal information of a majority its customers, financial professionals and Allianz employees. In the United States alone, Alianz Life has 1.4 million customers. Like many recent data breaches, this was not a result of a sophisticated computer hacking, but rather done through social engineering which occurs when the cybercriminals contact a targeted company and pose as employees and convince helpdesks at targeted companies to provide computer access to the cybercriminals. The massive data breaches done by the group Scattered Spider in recent years have been effectively done through social engineering.
TIPS
Potential victims of this data breach should freeze their credit if they have not already done so. Freezing your credit is actually something everyone should do. It is free and easy to do. In addition, it protects you from someone using your identity to obtain loans or make large purchases even if they have your Social Security number. If you have not already done so, put a credit freeze on your credit reports at all of the major credit reporting agencies. Here are links to each of them with instructions about how to get a credit freeze:
https://www.transunion.com/credit-freeze
https://www.experian.com/freeze/center.html
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Scam of the day – July 26, 2025 – The Danger of Synthetic Identity Theft
Although I have been writing about synthetic identity theft for many years, many people are not familiar with the term “synthetic Identity theft.” Synthetic identity theft poses a significant threat to many people particularly children. Synthetic identity theft occurs when a criminal takes information from a variety of sources to create a new identity to take out loans, purchase goods and services, or fraudulently obtain credit cards. Synthetic identity thieves combine real and fake information to form a new fictional person. They may use your Social Security number and combine it with the name, address and phone number of someone else. The Federal Trade Commission (FTC) has said that synthetic identity theft is the fastest growing type of identity theft. Children are the most common victims of synthetic identity theft and it is often many years before the problem is discovered.
The problem of synthetic identity theft has gotten worse in recent years with as much as 85% of identity theft last year being synthetic identity theft which has increased 233% over the last five years.
Commonly with synthetic identity theft, criminals who set up a synthetic identity build the credit score of the synthetic identity by having people using credit cards obtained in the name of the synthetic identity and make regular payments until the credit score of the new synthetic identity is high enough for the ultimate payoff, which is referred to as the “bust out.” In the bust out phase, the identity thief uses the new synthetic identity to either make large purchases or take out big loans that are never paid back. Some synthetic identity thieves will take years to build the synthetic identity theft credit score by making payments on cell phone accounts, car loans and more.
TIPS
Some telltale signs of synthetic identity theft include being contacted about an account that you never opened or a debt that you didn’t incur. Also, look for aliases listed on your credit report that you do not use. A dramatic lowering of your credit score coupled with a lack of negative information on your primary credit reports are further indications of synthetic identity theft. The reason that your primary credit report will not show negative information due to synthetic identity theft is because when a criminal uses your Social Security number, but doesn’t use your name, the negative information caused by their actions does not appear on your regular credit report. Instead, the information is added to a sub-file of your credit report which will, however, cause your credit score to drop tremendously.
If you do find out that you have become a victim of synthetic identity theft, notify each of the three credit reporting agencies, Equifax, Experian and TransUnion of the crime and ask them to investigate and remove the false information from your sub-files.
Children are prime targets and particularly vulnerable to synthetic identity theft. In 2024, 915,000 children in the USA were victims of identity theft, much of it synthetic identity theft. Parents also should, as much as possible, try to limit the places that have their child’s Social Security number and become familiar with the Family Educational Rights Privacy Act which helps you protect the privacy of your child’s school records and enables you to opt out of information sharing by the school with third parties.
You also should freeze the credit reports of your children. Until 2018 there was no national law that allowed the credit reports of children to be frozen, but in the wake of the major Equifax data breach, Congress passed laws that now permit children’s credit reports to be frozen and unfrozen for free.
Here are the links to information about how to freeze your child’s credit reports at each of the three major credit reporting agencies.
https://www.transunion.com/credit-freeze
https://www.equifax.com/personal/education/identity-theft/freezing-your-childs-credit-report-faq/
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Scam of the day – July 25, 2025 – Amazon Phishing Email
Amazon’s popularity has not escaped scammers who tie many scams to Amazon including the phishing email copied below that can lead to identity theft and the hacking of your Amazon account. I have warned you many times over the years about scammers who send various types of phishing emails which purport to be from Amazon attempting to lure you into either clicking on links which can download malware, such as ransomware or providing personal information that can be used to make you a victim of identity theft.
I recently received an Amazon phishing email that is copied below. The email below is typical of many of those presently circulating. The latest Amazon phishing scam starts with an email that appears to come from Amazon informing you that an unauthorized person had accessed your account and your account has consequently been deactivated until you provide information to verify the account. Obviously anyone receiving such an email would certainly be concerned and might be lured into clicking on the link provided in the email (which I have disarmed) to remedy the situation.
This particular phishing email is very sophisticated, having a legitimate appearing Amazon logo, however, it is very simple to counterfeit a legitimate appearing logo. Often a telltale sign that the email is a part of a scam is that the email address of the sender has absolutely nothing to do with Amazon and that was the situation in this case. The email address from which it was sent appears to be a part of a botnet of hacked email addresses used to send phishing emails. All legitimate Amazon emails end in amazon.com. In addition, if you hovered your mouse over the link provided you would see that where it would send you had no relation to Amazon. Additionally, the email is not addressed to me by name, but rather just my email address which is another indication that this is a scam.
Here is a copy of the email presently being circulated
| Dear xxxxxxxxxxxxxxcom,
We have detected unusual activity on your account. To protect your security, we have temporarily locked your account. Please verify your identity to regain access. Possible reasons:
Verify Now In order to maintain the safety of your account, your account will be on hold until you fulfill the required forms. If you don’t complete account recovery within 3 days, we will lock your Amazon account permanently. Regards,
Amazon Customer Service This is an automated email. Please do not reply to this email.
|
| ©2025 Amazon.com, Inc. or its affiliates. Amazon and all related marks are trademarks of Amazon.com, 410 Terry Avenue N., Seattle, WA 98109. |
TIPS
While this is a very legitimate appearing email that uses the Amazon logo, it is clearly a scam. Never click on a link in an email or text message or provide personal information unless you have confirmed that the email or text message is legitimate. The telephone number to call if you suspect Amazon related fraud is 866-216-1075 or you can call their customer service number 888-280-4331 Never call telephone numbers that appear in phishing emails.
Also, because any of us can be scammed, it is a good idea to use dual factor authentication whenever possible to protect your various accounts so that even if someone actually had your password they would not be able to access your account. In order to set up dual factor authentication for your Amazon account use this link. https://www.amazon.com/gp/help/customer/display.html?nodeId=G3PWZPU52FKN7PW4
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Scam of the day – July 24, 2025 – Overpayment Scam
The overpayment scam is the basis for many scams including phony mystery shopper scams about which I have written many times. An example of the overpayment scam occurred when a British Columbia wedding photographer was scammed out of $4,600 through this scam. The scam began when the photographer was contacted by someone seeking to hire the photographer to take pictures at his daughter’s wedding. The photographer, Esther Moerman asked for a $700 deposit, but ended up receiving a check in the amount of $5,500. When Moerman reported to the scammer that the amount sent was incorrect, the scammer told Moerman that it was an accounting error and that the excess funds were supposed to pay for catering. The scammer then asked Moerman to wire the money to the caterer, which Moerman did. As you can guess, the scammers check was counterfeit and bounced even though Moerman’s bank initially gave her provisional credit which led her to believe that the check was valid. Once the check was found to be counterfeit, the provisional credit was removed from Moerman’s account, however, the money she wired to the phony caterer from her account was lost forever.
TIPS
This is just another variation on the scam whereby the victim, for whatever purposes receives a check in excess of the amount owed to the victim and asks the victim to send back the difference. There are a number of tell tale signs to look for and steps to take to avoid this type of scam. First, you need to remember that although a check may appear to have been cleared by your bank after a few days, all you are really getting is “provisional credit” and when the counterfeit check eventually bounces, the credit is taken back from your account and you are left having sent your own money to the scammer. The prudent thing to do when being paid by a check is to wait until the check has fully cleared before you can feel confident that the funds actually are in your account. This may take a few weeks. Most importantly, never accept a check for more than what is owed you and send the difference back. It is always a scam. Asking you to wire money from your account is also something about which you should be skeptical because once money is wired, it is impossible to get it back.
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Scam of the day – July 23, 2025 – Justice Department Charges Two With Forex Trading Pyramid and Ponzi Scheme
Many people are probably not familiar with forex trading. Forex trading is the name for the very speculative investing in trading foreign currencies. It definitely is not an investment for inexperienced investors and while it certainly is legal, there have been many scammers who use forex trading as a hook to scam people. Recently, Michael Shannon Sims and Juan Carlos Reynoso were charged with wire fraud and money laundering related to the activities of their company OmegaPro. According to their indictment, Sims and Reynoso operated OmegaPro between 2019 and 2023 posing as a legitimate investment platform in which they promised their investors returns of up to 300% in 16 months through forex trading done by “elite traders” according to Sims and Reynoso. Ultimately, according to the Justice Department, Sims and Reynoso swindled their victims out of more than 650 million dollars.
In fact, no trading actually occurred. Rather, OmegaPro operated as a Ponzi scheme paying off earlier investors with funds derived from later investors. In addition, not satisfied with merely operating a phony investment firm, Sims and Reynoso are accused of operating OmegaPro as a pyramid scheme in which their “investors” would earn payments for bringing in new investor-victims into the scam.
TIPS
No one should ever invest in anything they don’t understand. Forex investing is risky and complicated and should not be done unless you are knowledgeable about trading in foreign currencies. Due diligence should also include reading reviews of the investment company on sites such as Trustpilot and Forex Peace Army.
Before investing with anyone, you should also investigate the person offering to sell you the investment with FINRA’s Central Registration Depository. http://www.finra.org/industry/crd This will tell you if the broker is licensed and if there have been disciplinary procedures against him or her. You can also check with your own state’s securities regulation office for similar information. Many investment advisers will not be required to register with the SEC, but are required to register with your individual state securities regulators. You can find your state’s agency by going to the website of the North American Securities Administrators Association. http://www.nasaa.org/2709/how-to-check-out-your-broker-or-investment-adviser/
If investors had done their due diligence and looked into the backgrounds of Michael Shannon Sims and Juan Carlos Reynoso they would have learned that neither of them had any professional investment licenses, broker-dealer registrations or forex trading certifications.
Scam of the day – July 22, 2025 – VA Imposter Scams
Imposter scams have long been among the most lucrative for scammers. While there are many variations of this scam, the most common variations have involved scammers emailing their victims posing as a popular company with which we all do business or calling their intended victims on the telephone posing as some governmental agency such as the IRS or the Social Security Administration. The scammer then, under a wide variety of pretenses, demands an immediate payment or personal information that can lead to your becoming a victim of identity theft.
Recently the Federal Trade Commission issued a warning about scammers posing as the Department of Veterans Affairs (VA) contacting veterans and telling them that they owe money due to an overpayment of benefits. The emails and letters used by the scammers often appear to be legitiamte with official seals and logos, but these are easy to counterfeit.
TIPS
As I have often reminded you, whenever you are contacted by phone call, email or a text message you can never be sure who is actually contacting you. B.S. Be skeptical. Through the simple technique of “spoofing” it is very easy for a scammer to manipulate your Caller ID to make a call coming to you appear legitimate when it is not. Therefore you can never truly trust your Caller ID. Trust me, you can’t trust anyone. Email addresses can also be made to appear legitimate as can text messages when they are actually coming from a scammer.
Never click on a link, download an attachment, provide personal information or make a payment in response to an email, text message or phone call unless you have absolutely confirmed that the communication is legitimate.
If you are contacted by someone indicating money is owed to the government for overpayment of VA benefits, the first place to look is your VA gov account .https://www.va.gov/manage-va-debt/ Here you can check the status of your account and if you do indeed owe anything you can call the VA’s debt management call center at 1-800-827-0648. If you need assistance filing a claim or reviewing a VA decision, you can get a VA accredited representative to help you at no cost. https://www.va.gov/get-help-from-accredited-representative/find-rep/
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Scam of the day – July 21, 2025 – HR Department Vacation Scam
It is early July and many of us are thinking about taking our summer vacations that we look forward to all year, however, scammers are also taking advantage of our vacation interest to scam us and the companies we work for.
One new scam involves your getting an email that appears to come from your employer’s HR Department luring you to click on a link to submit your request for vacation time. Clicking on the link can either cause you to download dangerous malware that can lead to your becoming a victim of identity theft or luring you into providing your online credentials at work in order to get access to your company’s computers and data.
TIPS
Never click on a link or provide personal information in response to an email or text message unless you have confirmed that the communication is legitimate. Scammers can use email addresses that may appear to be legitimate and it is easy for a scammer to make a text message appear as if it is coming from a trusted phone. If you get a communication that appears to come from your HR department, contact them directly through an email or phone number that you know is legitimate.
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