Frauds and Scams

Scammer poses as courier to obtain credit card information

Scammers are posing as mail couriers, arriving to deliver a box of flowers and alcohol. The courier insists that the resident needs to pay a small fee via credit card as proof of receiving the package and that the person is of legal drinking age. As the victim scans the credit card to pay the fee, the courier’s mobile credit card machine is retaining the card information. The scammer then uses the credit card account information to make fraudulent online purchases.

Lesson: Do not pay a fee for receiving a package by mail; postage, including fees, is usually paid upfront by the sender. If you are not expecting a package and do not recognize the sender, you may wish to do research on the company/person before accepting the package to ensure it is legitimate or decline to accept the package.

‘Agent’ Scams Seniors out of nearly $490,000 in life insurance premiums

Seniors are more trusting of other seniors and a senior scammer in Hillsborough County took advantage of that trust. Two seniors attended 60-year-old Richard Incandela’s free presentation at a local church and became the victims of a life insurance a scam. The “agent” offered them a profit and the return of their principal through the sale of life insurance policies in their names that he would then sell as part of a Stranger-Originated Life Insurance (STOLI) transaction. The victims paid $489,426 in premium payments to the agent which he promptly deposited into his personal account for his personal use. The Department of Financial Services’ divisions of Insurance Fraud and Agent and Agency Services determined that Incandela was never licensed in Florida as an insurance agent. He was sentenced to 34 months in prison followed by 25 years probation and ordered to pay full restitution to the victims. Click Here for more details

Lesson: If it sounds too good to be true, it usually is. Before purchasing insurance, use our Verify Before You Buy page to ensure that the company, broker or agency is licensed to transact business in Florida.

Senior scammer falsifies documents to sell $4.6 million in products

Seniors in Pinellas County trusted an insurance agent to place their savings into financial investments, but sadly those investments were later deemed unsuitable for their needs. The agent induced several senior victims to sign blank documents and then, for personal gain, fraudulently completed the forms to qualify these consumers for unsuitable investments. It is estimated that victims invested over $4.6 million. The now-former insurance agent was convicted in September 2012 on eight counts of grand theft, exploitation, and theft from persons 65 years and older and faces up to 54 years in prison. See Press Release for more details.

Lesson: Never sign incomplete or blank documents and always review a prospectus for the product you are purchasing to ensure that it meets your financial needs.

Sweepstakes scam victim in fake lottery gets help securing accounts

A Palm Beach County consumer was receiving daily calls from a company that called themselves “National Sweepstakes” and claimed that she had won a lottery prize worth over $ 1 million. In order to receive her “winnings,” she was told she needed to send $20,000 to the Internal Revenue Service. Because the entire amount was not readily available in her account and had to be transferred from another source, the “company” said they would accept installment payments. After writing personal checks totaling $9,000, she requested additional money from her annuity to complete the payment. An employee from the annuity company contacted the Division of Consumer Services because she knew something was amiss. Consumer Services immediately contacted the Division of Insurance Fraud who had a detective at the consumer’s home within 30 minutes to explain the scam and assist her in closing her bank account to secure her remaining savings.

Lesson: Know that it is a red flag if you are notified of winning a lottery for which you never submitted an entry, or are asked to pay money to collect any prize. Click here to report fraud.

Man Posing as Insurance Agent Steals Senior’s Identity, Takes out $5 Million Policy

A man posing as an insurance agent met with a 70-year-old senior at his home to discuss an investment opportunity. During the meeting the senior unwittingly divulged sensitive financial information that the man later used to purchase a $5 million life insurance policy in the victim’s name. An investigation by insurance fraud detectives with the Department of Financial Services later determined that the man forged the senior’s signature on numerous documents and submitted the paperwork to the company using a stolen insurance agent license number. The con man was charged with multiple felony charges.

Lesson: Always make sure you are dealing with a licensed insurance agent and verify before you buy. Guard your personal information carefully and request copies of all documents you sign.

Computer Scam

Many seniors are very good with computers and enjoy having access to the internet to stay in touch with friends and family. Unfortunately, many scam artists attempt to prey on unsuspecting seniors who are not as familiar with computers and are easily tricked into revealing personal financial information over the phone or through email.

Phone/ E-Mail Pitch: You receive a phone call that the “Technical Department” needs to install new software on your computer.  They ask you a series of questions and instruct you to turn on your computer so they can remote into it to install the program.  The person on the phone says that you will then need to purchase new security software for $400 and asks for your credit card number.

Target: Anyone with a computer and access to the internet, but especially seniors.

Result: You have compromised your credit card information and have paid for computer software which most likely is not legitimate.  The scam artist may have also installed “spyware” which can harm your computer.

How to avoid this scam: Your internet provider or computer manufacturer should never call you and ask to reveal personal financial information over the phone or by email.  If you receive such a call or email, ask the person for a full name and phone number and then look up your internet provider’s number and call them directly. Never give out personal financial information by email or over the phone unless you initiated the phone call and you are certain of the person with whom you are speaking with. 

Grandparent Scam

This scam tugs at the heartstrings of seniors who have grandchildren.

Pitch- The caller identifies himself as your grandchild and states they have been arrested in another country and need money wired immediately, and please don’t tell mom or dad, since this will upset them.

Target: Seniors

Result: You wire the money, only to find out that your grandchild is safe.

How to avoid this scam- Tell your family to not post travel plans online. Con artists can use online information to contact family members. Don’t trust caller ID. Con artists can disguise the number that appears on the caller ID with a practice called “spoofing.” If you get a call from your “grandchild” asking for bail money, ask for the name of the bond company and call them directly to verify it is true.

When in doubt, ask callers questions that only your real family member would know the answer to or create a code word that only family members know to use in the case of an emergency.

Jamaican Lottery Scam

The scam begins with a telephone call from area code 876, congratulating the consumer on winning the Jamaican Lottery. Once the caller convinces the consumer of their new-found wealth, the only thing left to do is claim the jackpot. To do this, the consumer is told they have to send money to cover fees and taxes associated with their winnings.

Pitch: Congratulations! You have just won the lottery! But don’t tell your family or friends because they might want to take some of your money.

Target: Seniors living on a fixed income

Result: You wire money to the scammer so you can claim your prize and then you never hear from them again. Or they keep calling you and saying that the fees have increased and you need to wire more money.

How to avoid this scam- Look at the clues: you will not legitimately win a lottery you did not enter, and there is no Jamaican Lottery. If you hear you have won a “free gift,” vacation or prize, say “No thank you,” and hang up the phone.

Home Improvement Scam

Look out for home improvement contractors who leave your home worse than they found it. They usually knock on your door with a story or a deal – the roofer who can spot some missing shingles on your roof, the paver with some leftover asphalt who can give you a great deal on driveway resealing. Itinerant contractors move around, keeping a step ahead of the law…and angry consumers.

In-Person Pitch: I’ve got a deal on resealing your driveway (fixing your roof, trimming trees, etc.)

Target: All property owners, especially seniors

Result: At best, shoddy work or possibly a false injury claim against your insurance company. Or, they take your money and run.

How to avoid this scam- Check out the company with the Better Business Bureau. Collect copies of their license and contractor number to have for your records. Verify Before You Buy! Verify with the DFS’ Division of Workers’ Compensation if they have workers’ compensation coverage. If they don’t, you could be liable for any injuries.

Gold Buying Scam

In an economy of unpredictable investments and low rates of return, scammers are jumping on the band wagon to offer “hope.” It is this hope of getting ahead that has deceived consumers into purchasing precious metals from bogus companies that have no other intention than to steal hard-earned money from honest consumers.

Phone / Mail Pitch: Telemarketers pressure wealthy consumers with the threat of the falling stock market and the rising price of gold to “wake up” and take charge of their money by investing in gold. Another scam encourages seniors to pay for their gold investments with reverse mortgages.

Target: Wealthy consumers with money to invest in precious metals and seniors who want to add to their retirement savings.

Results: Consumers lose money by investing in gold that was never purchased.

How to avoid this scam: Do not be coerced by pushy telemarketers to make an “investment” that sounds too good to be true – because it usually is. Never send money to a company without full proof of their legitimacy. Check with the Better Business Bureau to ensure that the dealer is licensed.

 

Legal Notices 2013 © Florida Department of Financial Services