Common Financial Scams

Loan Modification Scam

These bogus companies promise to help you modify your mortgage, avoid foreclosure, reduce your monthly payment, all for an upfront fee. The upfront fees are called administrative or processing fees and might run you as much as $3,500. They will require you to give them lots of personal information about yourself, including your social security number, which is scary because most of them are thieves. In any event, you will not get your mortgage modified.  They also might advise you to stop paying your mortgage so that they lender will negotiate with you.  Many of them will just take your money and run. And don’t let the fact that the person operating the business is an attorney lull you in to believing the company is legitimate.  Some attorneys have been caught stealing peoples’ money too.

Burglar Alarm Scam

Under the guise of operating a burglar alarm service, thieves contact home owners offering a free security evaluation of your home.  Actually, they are just casing it so they can burglarize it later.  Do not accept free burglar alarm installation offers from companies that contact you.

The Jury Duty Scam

Thieves will contact victims by phone telling them they will be arrested if they don't show up for jury duty.  When the victim panics, the thief tells them they can avoid being arrested if they provide their social security and drivers license numbers.

The Locksmith Scam -- Most people aren't aware that 80 percent of the locksmiths advertised in the Yellow Pages and on the internet are scammers, which is scary, considering that everyday about 250,000 Americans call a locksmith.  What is the scam?  When a person is locked out of their home or car they call a locksmith and the locksmith quotes a small fee of about $25 to $100, but dishonest locksmiths will claim they can't unlock the door and will try to charge the victim more than a thousand dollars to drill out the lock and replace it and a lot of times, the entire door.  A competent, honest locksmith can get the door to a house or car unlocked 99 percent of the time.  You can search the Associated Locksmiths of America website at aloa.org or by phone at 214-819-9733 to find a locksmith that has passed a background check, and you can search for complaints against locksmiths at the Better Business Bureau website.  Remember that a legitimate locksmith should never charge you more than $100 and should be able to open your door without much effort.  It would be a good idea to go ahead and find an honest locksmith now and put his number in your phone's address book so that you have it ready just in case. Honest locksmiths have (1) an actual business - drive by it to make sure it is legitimate; (2) a local phone number which they answer with the actual name of their company and not a generic term such as "locksmith services" (no 800 numbers acceptable since 99% of them are thieves); (3) are members of Associated Locksmiths of America; (4) have their business name and contact information on their work vehicles; and (5) will give you a written estimate on company letterhead and a receipt after you pay.  When a locksmith shows up, ask for an ID with his name and address on it and ask if he has an ALOA membership card and do not believe him if he claims he can't unlock your door and more expensive, drastic measures must be taken.

Overseas Thieves Stealing Millions from Americans by Pretending to Be Debt Collectors

Thieves from India conspiring with someone living in America are purchasing old, uncollectible debt and contacting Americans claiming that they will be immediately arrested if they don't pay the debt that day. First of all, no one is arrested for nonpayment of consumer debt in the United States (only for alimony, child support and taxes) so do not believe them.  Unbelievably, the phony debt collectors have very thick, foreign accents and yet many of the American victims are so afraid they will be arrested that they are sending in money to the phony debt collectors, even if they don't owe the debt.  Never, never bow to a debt collector's threats that you will be arrested.  Instead, get their contact information and file a complaint with the FTC at www.ftc.gov. 


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