Credit card and loan scams that cost consumers major debt usually happen to those who can at least afford it. Often, the scammers are in foreign countries and impossible to reach. But the Federal Trade Commission has caught up with some of the companies accused of ripping off consumers.
The FTC and state of Florida have stopped an operation that allegedly took millions of dollars from consumers with credit card debt. A federal court has frozen the assets of what the FTC calls a nationwide debt relief telemarketing scam.
Whether it's an advance fee loan scam or a promise of lower interest rates, many consumers are bombarded daily with calls from con men offering debt relief.
Craig Carnahan is a local consumer who receives these kind of calls, usually from someone with a foreign accent.
"On my caller ID they've shown up as several different things. They've shown up as info surveys. They've shown up as 000 and recently, my own name showed up. It's typically been people calling about reducing my credit card bill and I don't have a credit card," he says.
He says the calls come at an especially difficult time, as a family member is seriously ill.
"It almost classifies as being inhumane that people treat other people like this," Carnahan says.
Many consumers are bombarded with such calls, and some take the bait, like Diane Woods.
"He said, 'to make your credit score higher, we're going to need about 180 more dollars on a green dot money card,'" she explains.
Carmen Million, with the Better Business Bureau, says the victims are often those who can least afford to lose money.
"What we want consumers to know is that they should investigate these companies. They should investigate the offer," according to Million.
While assets are frozen in the Florida case, which allegedly operated under numerous different names, Million says it's rare for victims to get their money back.
"The good news is that they caught some of these scammers and they will make them pay to some extent. The bad news is for every couple of people they put away, there are a few more that want to take their place," she says.
The FTC has also stopped a massive payday loan fraud scam. Million says there are certain red flags when trying to borrow money.
"If somebody contacts them and tells them they are going to help them get out of debt, and they need a huge amount of money up front, that's the first sign of caution right there. The second one, and the one we're most concerned about, is when these scammers tell consumers to immediately quit paying their debtors."
So many consumers get calls from those with loan and credit offers, it’s hard to know if any are connected to those named in the FTC action. The companies keep changing their names.
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