Beware! Swindlers at Work

IMAGINE the scene. A storm has passed. Destructive winds have ceased their terrible onslaught, and rushing waters no longer pose a threat. Wide-eyed survivors emerge from their shelters, while off in the distance, tense and fearful evacuees return to survey the storm’s aftermath. Roofs are gone from homes; trees are uprooted and lie sprawled atop rain-soaked exposed interiors. Power lines are down, making emergency calls and messages impossible. Some homes, once havens for happy families, are gone—damaged beyond repair. What was once a quiet and serene community is now a scene of destruction and despair.

The community rises to the occasion—full of determination to rebuild. Neighbor helps neighbor; some heretofore had not even known one another by name. Men share tools and expertise. Women feed the working crew while older children baby-sit the young. From outside the community, caravans of crews with a willingness to help roll in—roofers, tree removers, carpenters, painters. With these, however, also come the swindlers, ready to exploit the survivors.

Huge down payments are demanded in advance of the repair work. Desperate homeowners hand over their money, only to find that the workers take off with it, never to be seen again. Roofers who “guarantee” their work repair open seams shabbily, and these leak profusely at the first rain. On the pretense of renting heavy equipment for tomorrow’s work, tree removers bilk victims of thousands of dollars in advance. Tomorrow never comes.

Add to the destruction and loss the heartbreak of homeowners who paid handsome premiums to insolvent or bogus insurance companies that now refuse to pay for damages incurred or whose offices are abandoned, the owners having fled. Those fortunate enough to have an insurance check in hand to cover damages find that all too often unscrupulous and unqualified contractors are there to fill the void when the few qualified ones are unable to handle all the work. As a result, shabby work is performed, much to the grief of the already distraught homeowners.

Victims of disaster are exploited again and again. What starts out as a devastated community coming together for the common good of all, turns out to be for some a heartbreaking illusion.

Following a hurricane, in one community candy bars soared to an unbelievable $4, and baby formula cost mothers $6 a can. At one store batteries could not be obtained without the purchase of a TV or a radio. Building suppliers filled their tills to the brim by selling goods at highly inflated prices. In another case mobile-home owners who had their homes towed to higher ground during flooding experienced a 600-percent price hike. Following an earthquake, an 84-year-old woman whose home was damaged received a call from someone posing as a government worker. The woman thought that the documents she later signed were applications for government assistance and food stamps. In fact, they were for an $18,000 mortgage on her home to finance what proved to be only about $5,000 worth of repair work.

Telemarketing Fraud

‘Congratulations, Mrs. S——! This is your lucky day.’ These may be the opening words in a surprise telephone call. ‘You are our grand winner of . . .’ Many people have received such calls stating that they have “already won,” that their prizes are “guaranteed.” The winning “prize” may be a new car, a home entertainment center, or perhaps a diamond ring.

Have you ever received such a call announcing that you were to be the recipient of a free gift? Did your heart race? Could you hardly believe your ears? If you responded to such a call, did you ever receive your prize? Or were you the victim of telemarketing fraud? If that has happened to you, you are not alone. According to Consumers’ Research magazine, in the United States alone, bogus telemarketers defraud about ten people every minute. Each year unscrupulous con men swindle $10 billion to $40 billion from consumers, about $7,500 every minute.

“Every year across Canada,” reported Reader’s Digest, “upwards of 150,000 people answer calls from fraudulent telemarketers who tell them they’ve ‘won’ or ‘been selected’ for a grand prize. And every year thousands of Canadians are taken in by these calls, spending an average of $2,000 each in order to get their prize.” An Ontario Provincial Police official declared: “Telephone scams are one of the biggest frauds in Canadian history.” He adds: “We know that it costs Canadians millions of dollars a year.” The figures mainly represent what is reported to the police. However, since it is estimated that only 10 percent of victims report their loss, it is impossible to determine the full extent of the problem accurately.

“We tell people they’ve won so they stop thinking clearly,” admitted one con artist. He added: “Then we pressure them into sending money, and we won’t take no for an answer.” Once a victim is taken in by the scam, his or her name may be sold to other telemarketing firms and placed on a “sucker” list. Their names may be sold to others who, in turn, will call them repeatedly. “When we’re working from a sucker list,” said a former Toronto telemarketing operator, “we get about 75 percent of the people to buy on the first call. That drops to about 50 percent by the third time we work the list. But once they’re in, some people just go and go; they chase their money.”

To what extent will those taken in by these bogus telemarketers go in chasing their dream of winning a fabulous prize? “We’ve had to work with banks to freeze some seniors’ assets to keep them from being bled dry,” said one police detective. One recently widowed woman was found to have sent 36 payments to 16 different telemarketers, totaling over $85,000. In return, she had received “half a roomful of worthless trinkets.”

Elaborate Scams for the Sophisticated

Those who practice these scams, however, do not discriminate. Their victims come from all economic levels of society. Even supposedly sophisticated professionals have been deceived. The deception orchestrated can be so insidious that even the most alert consumer may be victimized. Higher-priced scams targeted for sophisticated buyers may be advertised on television or in color brochures sent through the mail. They may include investments that promise high-yield returns—investments in motion picture studios, gold and gold mines, oil wells. The list seems endless. The results, however, are the same—a total loss.

“The extent of their deception is unbelievable,” said a victimized educated woman. “As a schoolteacher, I thought I was an intelligent person. . . . The promises were endless.” She lost $20,000 in a motion picture company scam.

Telemarketing fraud is an international problem. Investigators predict that it “will worsen in this decade.” But, beware! There are other kinds of swindling, and some scam artists have a favorite target—the elderly.

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Beware of the swindlers who come after a storm!

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“You’ve won a free prize!”—or have you?