Saturday, December 13, 2008

Bank Woes? Foreclosures? Credit Crunch? A List of Scams From Kiplinger’s

"Think of a headline about the financial crisis, and criminals have found a way to exploit it. Bad credit? Bank problems? Home foreclosures? Each of these, and many more, comes with a matching scam, helping make today one of the most fertile periods ever for rip-offs.

The January issue of Kiplinger’s Personal Finance uncovers the most common schemes—and offers tips to help avoid them:

(1) Debt negotiation cons. Some debt-negotiation companies are counseling their clients to ruin—falsely claiming they can help repair credit reports. Others advise clients to stop paying their bills without telling them they could be sued by creditors.

How to Avoid It? Find a legitimate credit-counseling agency at or If you think you’ve been duped, call in a complaint: 877-382-4357.

(2) Mortgage-foreclosure rescue cons. More than half of homeowners who are late on their mortgage payments aren’t aware that lenders have programs to help avoid foreclosure, People who don’t know their options can fall prey to crooks who charge $1,000 or more for fraudulent foreclosure-avoidance services.
How to Avoid It? Find a housing-counseling agency approved by the U.S. Department of Housing and Urban Development (links are listed at

(3) Bank phishing cons. Criminals are preying on fears over recent news of bank mergers and acquisitions. Phishing schemes—e-mails designed to get you to relinquish private security information, including your Social Security number—falsely indicate that your bank has been acquired. The message may tell you, “We recently purchased ABC Bank. Follow the link below to renew your account information.”
How to Avoid It? Forward fraudulent e-mails to the Federal Trade Commission at Send a copy to the company that has been impersonated.

(4) Energy cons. Cold callers pitch energy-related limited partnerships that are often conceived in one state, involve drilling in another, and are sold to investors in still other states. Such a setup makes it tough for investors to check out the proposal, and tough for law enforcement to identify and expose a fraud.
How to Avoid It? If you’re tempted by such a pitch, start by checking the registration of the deal. Ask in which state the offering is registered, then contact that state’s securities agency to confirm that a security is really being offered."
--Source: The “Scams Ripped from Today’s Headlines” article

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