Monthly Archives: October 2014

FTC Warns about Auto Loan Modification Scams

This information can be found at http://www.ftc.gov

Chances are you rely on your car or truck to get you where you need to go. But if you’re late with your car payments, your vehicle could be taken away from you.

If you’re having trouble paying your car loan and you’re worried about having your vehicle repossessed, you may think that doing business with companies that claim they can reduce your monthly car loan or lease payment can help you avoid repossession. These companies might charge fees of several hundred dollars up front, tout their relationships with consumers’ lenders, and bolster their claims to be able to significantly lower your monthly payments with glowing testimonials from “satisfied” customers. Some say that if they can’t make a deal with your lender, they’ll refund your money.

The promises may sound like a way to get out from under. But the Federal Trade Commission (FTC), the nation’s consumer protection agency, says it’s smooth talk by scam artists who are out to take your money and provide nothing in return. In fact, the FTC recently sued companies that made claims like these, but failed to deliver the auto loan modifications they promised or honor the refund policies they “guaranteed.” What’s more, in many instances, the companies never even contacted any lenders.

The victims of these auto loan modification scams tell the same story: After paying a fee for the promise of a loan modification, nothing was done to secure the results that were promised. The scam artists often compounded the problem by telling their clients to stop making their car payments while the companies claimed to be in negotiations with lenders. Some victims learned that the companies hadn’t done anything only after their lender contacted them about repossessing their vehicle. In some instances, the scam artists demanded additional fees to continue working on their client’s cases.

These scams may sound familiar. Some scam artists have taken a page from the mortgage loan modification fraud playbook, moving from trying to dupe homeowners in distress to preying on drivers who can’t make their car payments. The fraud is the same: people pay in advance for a service that is either never performed, or not performed as promised.

If You’re Behind On Your Car Payments

If you are having trouble making your car payments, contact your lender directly to discuss your options as early as you can. The longer you wait to call, the fewer options you will have. Typical auto loan modifications involve either deferring missed payments to the end of the loan or extending the loan term to reduce monthly payments. That choice actually increases the total amount you pay in interest, even with a lower interest rate. Creditors rarely reduce the amount of the principal or the interest rate in an auto loan modification.

If Your Vehicle Is Repossessed

If you don’t – or can’t – make timely payments on your vehicle, your creditor may have the right to repossess your car without going to court or telling you in advance. Your creditor also may be able to sell your contract to a third party, called an assignee, who may have the same right to seize your car as the original creditor.

Reporting Fraud

If there’s a possibility that you’ve been ripped off by an auto loan modification fraudster, file a complaint with the Federal Trade Commission and your state Attorney General.

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Durable Medical Equipment Fraud – Knee Brace

The Scheme: Medicare beneficiary receives a phone call stating their doctor has approved them for a knee brace and is asked for their Medicare number. Knee brace will be mailed to them. Beneficiary receives an item they assume is correct.

The Fraud: The company bills Medicare for two “adjustable knee joints, positional orthosis with rigid support,” but they send the beneficiary neoprene knee braces.

Medicare’s approved amount for the neoprene product is – $144. 88
Medicare’s approved amount for the knee joints is – $840.50
Dollars stolen from Medicare = $695.62

1833 knee brace example3
Actual item Medicare paid for but beneficiary did not receive this brace.
Item sent to beneficiary and paid for by Medicare
Item sent to beneficiary and paid for by Medicare

Major Retail Data Breaches Put You at Risk

by Barbara Parrott McGinity, LMSW

Seems like every other week we hear about a new company or retailer whose data security system has been breached by hackers. If you have shopped at Target or Home Deport, or bank with JP Morgan Chase, there is possibility that your personal information has been put at risk for use by thieves.

The first thought that comes to mind is how do you protect yourself from identity theft? These companies frequently offer free credit monitoring services for up to a year. You should take advantage of such offers, but remember, at the end of that year, you will have to pay to for continued credit monitoring.

But aside from the possible identity theft, how else are you at risk from these data breaches? The hackers not only steal credit information and personal identifiers, they also get information your name, the name of a spouse, your phone number, your email address and your mailing address. This type of information can be used to fool you into giving away more information or even worse, giving away your money.

Information like this can be used to make an email, phone call or letter to you sound personal in an attempt to lure you into a trap. The most likely way they will access you is by email. The email will be personally addressed, look like something official from a company you do business with, but will include some type of link you are asked to click.

If you follow instructions and “click,” then this link spreads a virus through your computer, stealing information, especially email addresses of friends and families. Then they receive an email that appears to be from you with a link, and the process goes on and on.

Maybe they send you an email with personal information and say they are with the FBI and accuse you of buying child pornography over the Internet. Or maybe they are the IRS and say they will put you in jail if you do not pay the money you owe them. The possibilities are endless. Remember, no government agency will contact you by email or phone and they do not ask people to wire money as a way to avoid jail.

What can you do? First of all, NEVER click on any links sent to you in an email from friends or family. Ask them what they are sending first. Second, if you think it is a legitimate email from a company, again, do not click on any links to a website. Open up your browser and type in the address to the website yourself. This way you will be sure to get to the correct website.

Remember, the people who are committing these data breaches are very smart. It is their job to steal information and to come up with a way to use it to their benefit. You can avoid being a victim twice if you think before acting. If you have a question or have a suspicious experience, call and we can discuss, 713-341-6184.