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The BBB has issued descriptions of the latest scams circulating around the country, including the newest one, the Economic Stimulus Bill Scam.
BBB also issued warnings about some companies that have very unsatisfactory records.
Many people aren't sure what form that stimulus assistance is going to take, and scammers already are taking advantage of that, says Reanna Smith-Hamblin, communications director of the Better Business Bureau of Louisville.
“Scammers are already rushing in to take advantage of the stimulus package,” she said.
“Don't fall for offer 'free money' for an offer of free money from the government to help pay bills. It doesn’t work that way. The government is not going to give you anything for free. So if you see the words, ‘free grant money,’ that should be a red flag.”
Smith-Hamblin said that certain types of grants are available, but the application process is very arduous and by no means a sure thing.
“Scammers are trying to take advantage of people who are not knowledgeable by targeting the stimulus and rescue plans, and the bail-out,” she said.
She added that the stimulus money mostly will enter the economy through state and local government spending and through existing government programs that require an application process. Organizations don't usually give out grants for debt consolidation or to pay for other personal needs.
In addition to the Stimulus scam, the Mortgage Rescue Plan Scam is also circulating. This is e-mail encouraging vulnerable consumers to contact unscrupulous would-be lenders through toll-free numbers.
“They have been making their rounds since President Obama announced the plan that helps homeowners avoid foreclosure,” Smith-Hamblin said. “Delete these emails! If you're looking to refinance your mortgage, talk to local banks and mortgage companies. Don't fall for an 800-number trap.”
Also, a bailout scam arrives as a low-interest credit card offer that uses the government bailout to trick consumers. In this scheme, the consumer receives an automated call from “Rose” at the United States Better Business Bureau, which does not exist. The consumer is told that President Obama signed a “credit card release bill” that allows the USBBB to cut the consumer's credit card debt in half. The representative asks for the consumer's personal information, including their credit card numbers.
BOX SEPARATELY Other BBB scams
Debtor Solution: This scam provides debt negotiation and consulting services. The company is displaying the BBB logo and using the BBB name on its Web site without permission. The BBB feels this may constitute false and deceptive advertising and may violate state or federal statutes due to its falsely implying BBB membership or affiliation. The company had a California address and an F rating with that BBB. The company has since changed to a Louisville address.
Puppy scam: A scammer poses as a breeder and places an ad for inexpensive or free puppies in the newspaper. Communicating only through emails, the scammer may claim that he is affiliated with a religious organization and is being relocated to a foreign country and needs to find a home for the puppies. He asks the buyer to wire money for shipping. The seller never receives the puppy and is out the money.
Craigslist scam: Be careful selling items on Craigslist. Though the Web site is legitimate, scammers take advantage of sellers by sending a check for the item for more than the seller is asking. The scammer asks the seller to wire the remaining money back. Days later, the bank calls saying the check was fake and the seller owes the bank the money. “Don't EVER wire money to someone you don't know and trust,” Smith-Hamblin said.
Cash4Gold: This company has a D rating with the BBB. Consumers complain that the company is not offering a fair value for the jewelry and that they've had a hard time getting their material returned. Cash4Gold's policy is that if you don't like the offer you're given, you have to ask for your stuff back within 10 days.
Rerun Media: This company does business as DVDPawn.com and GamePawn.com. The Web sites operate like online pawnshops, where consumers can sell their used DVDs and video games. Potential sellers register for an account and submit their list of game and movie titles for a quote. They then have 20 days to ship their items to the company. Consumers say they're not getting paid what they are promised, or not getting paid at all. The company has an F rating with the BBB.
Affordable Limo: This Louisville company has an F rating with the BBB. Consumers complain they are not getting what they paid for four hours up front, and they only received service for two hours, and others allege they were left stranded with no way to get home. Before you hire a company, check them out first with the BBB at www.bbb.org.
Spring Break travel scams: High school and college students seem to be attractive targets for dishonest travel operators. Be wary of offers that promise “the moon” for a very low price, or ones that require immediate purchase to lock in the announced rate. Before paying anything, request all details of the trip in writing, including total cost, restrictions where applicable, cancellation penalties, and exact names of the airlines and hotels included in the packet. For more tips, go to www.bbb.org.
Smith-Hamblin said scams can come through email, junk mail at one's home and through text messages on cell phones.
“One of the girls here got a text message about a loan from a credit union, and I got an e-mail about a mortgage rescue plan,” she said.
She added that if one is not sure something is a scam, check it out first.
“Look the company up on our database first,” she said. “Not every business not listed with us is scam but you should be skeptical. Also you can call us, too.”
For more information about these or other scams, visit www.bbb.org or call 1-800-388-2222.