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CNN Live Saturday
Dollar Signs: Protection Yourself From Identity Theft
Aired September 27, 2003 - 16:29 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JUDY FORTIN, CNN ANCHOR: And now we welcome you to "Dollar Signs," where we help you make the most of your money. Today we want to help you protect yourself from scams. Think you're too smart to fall for one? Then you're just the mark. Modern flimflam artists like to cheat, but they'll have a tougher time of it after you listen to these tips from our financial correspondent Ali Velshi.
(BEGIN VIDEOTAPE)
ALI VELSHI, CNN FINANCIAL CORRESPONDENT: Sometimes you can spot a scam a mile away. Others present themselves in less obvious ways. And if you think you're too savvy to be conned by any old scam, think again. Like everything else, swindling has gone high-tech.
DAVID LAWRENCE, CONSUMER FRAUD SPECIALIST: Probably the most often attempted scams are Internet scams, because it's hard to trace backwards in the process. You can hide yourself fairly easily that way.
VELSHI: And today's con artist's could be after something more valuable than just a few dollar. They could be after your identity. Spoofing is one scam where you'll get an email from what seems to be a well known company. They use the familiarity and trust and logos of a well known brand, to get personal information.
JOANNA CRANE, FEDERAL TRADE COMMISSION: Another recent one was on Monster.com. And this has hit other job sites where scamsters will post a phony job offering. Then, they'll respond to applicants by saying, you're application looks great, we'd like to learn more about you, we need to perform an extensive background check, please send us detailed information. And they'll ask for your name, your date of birth, probably social security number and other key information for assuming your identity.
VELSHI: And what do they do with the information once they have it? Crimes range from emptying your bank accounts to taking out loans for cars and homes in your name. The question the scammer asks of you by phone, e-mail, or regular mail might also be a giveaway.
DAVID LAWRENCE, CONSUMER FRAUD SPECIALIST: A company will never ask you for information they already have. They will offer that information to you and ask you to confirm it. If a company is saying so what's your Social Security number again? What's that bank account number?
Say to them you tell me what you've got and I'll tell you what's correct or say give me the first five digits of my bank account and I'll give you the last five or the other way around.
VELSHI: Checking your credit report for unauthorized activity is one way to keep an eye on credit theft and if you do identify a potential scam or think you've been a victim of one, the first place to turn to for help is your local police department.
(END VIDEOTAPE)
VELSHI: Judy, one of the things that the experts had told me is that we have become so trusting of the amount of information that we give over the phone and now these days over the Internet that perhaps we're not as vigilant as we should be and that if you keep your eyes open for scams you can actually catch them.
We were talking about spoofing where a well-known company or somebody pretending to be from a well-known company sends you an e- mail, AOL, Monster, Citibank, they've all be victims of these things, so you really have to pay attention to what's being asked of you.
Be vigilant but, in the end, most of the business done over the Internet and, in fact, in telemarketing is legitimate business. So, we don't all want to become too suspicious of what's going on but we have to be vigilant -- Judy.
FORTIN: Ali, so people are sitting at home right now. How do they spot scams?
VELSHI: The one piece of information that's key, first of all if it's too good to be true watch out for it. Double check before you pursue it and the second one is the business of asking for information about you that they should have.
Banks and legitimate credit companies they will ask you things. They'll ask you to confirm things in a way that doesn't mean that you're giving them new information.
If somebody is asking you for too much information that you think they should already have if they are somebody you do business with, a bank or a lender, be very careful and that's one way to know what's going on.
FORTIN: That's good advice. All right, so you're educating yourself about how to spot a scam but what is the most popular types?
We want to bring in our other guest this afternoon Todd Mark who is with the Consumer Credit Counseling Service. He joins us in our Atlanta studio. Todd, where do we see some of these most popular types of scams?
TODD MARK, CONSUMER CREDIT COUNSELING SERVICE: Well, first off as Ali said there are so many things that come in, whether it's over the phone or in the e-mail and they grab you really where it hurts.
If you're looking for a job there's offers, pay us up front and we'll secure you a job. Looking for a credit card, you can't qualify on your own, well pay us some money. Guess what you're guaranteed to get one. It's so easy.
Of course, investment scams not as common as they were in the late '90s but the old, you know, we can take your money and double it in 90 days, trust us. Ooh, these are things you should be running the other way from.
FORTIN: Ali, who is most at risk to be scammed?
VELSHI: People who aren't as savvy in their use of the Internet or doing business on the phone. A lot of the people who are preyed on are, in fact, the elderly or people who use the Internet very rarely. They maybe send a few e-mails here and there and all of a sudden they don't get enough of these scam offers to know that they're not true.
There are these ones going around, I'm sure we've all seen them, where somebody claims to represent someone in a developing country who needs to get money out of that country and if you were to help them, be the front person for that, they'll give you tons of money just for being a nice guy.
Well, if you don't see these on a daily basis like so many of us do, you all of a sudden think well look here's something interesting. Here's something that could work for me. People who aren't exposed to all that's going on every day are most vulnerable to these things.
FORTIN: I think you're right.
Jack Otter with "SmartMoney" magazine joins us now. Jack, let me ask you what should you do if you think that you're being scammed who do you report it to? Who can you call? Who can you contact?
JACK OTTER, "SMARTMONEY" MAGAZINE: Well, if you don't mind I'm going to step back just one second and tell you that I don't think anyone should ever accept an investment offer through the mail, e- mail, on the phone. If you have money to invest go out and invest it. Do your research. Find out where you want to put it, what's appropriate for you, diversify and invest it.
FORTIN: OK, then what do you do if you think you've been scammed?
OTTER: Well, the first thing to do, I think, is to call the three credit rating agencies, Equifax, Trans Union, and I forgot one other. Hold on I'm going to take this out of my ear because I've got the delay going on and it's confusing me.
FORTIN: No problem.
OTTER: You want to call the credit unions and make sure that they know that you've been the victim of a scam. You also want to call the police, make sure you get a written police report because, as you go through the long and painful process of clearing your record, a lot of people are going to manage to see that report.
FORTIN: Todd, it's a... OTTER: And, of course, you need to check your bills every month when they come in and if you didn't charge that plasma TV to your credit card, well make sure you call the credit card company and find out who did and that you don't end up paying for it.
FORTIN: That's good advice for all of us. Todd, if someone has been scammed can they usually recoup their losses?
MARK: Oh, it's so hard. Ali was talking about one of the most famous of all time, the Nigerian scam where you're offered millions and millions of dollars to help somebody transfer their money over the United States.
Chances are if you give access to your bank account, they've got it. They're going to drain whatever money you have there and then they're going to try to get you for more money. They're going to say until we can pay the taxes we need some money upfront.
So, what happens? Your money is gone and this has gone on outside the country. It's outside even of legal jurisdictions at the state or federal level. So, you can almost kiss your money goodbye at that time and it's so sad.
As Jack was saying for identity that especially for you to get a police report and doing fraud alerts but when you've got your money stolen and sometimes it's just a matter of being naive and not knowing what to look for. You're pretty much out of luck and it's an expensive lesson learned.
FORTIN: You leave us on a pessimistic note there, all right.
MARK: Sorry.
FORTIN: All right, well your calls and your e-mails are next on DOLLAR SIGNS and, of course, you can still send your questions to dollarsigns@cnn.com or here's a toll free number that you can call, 1- 800-807-2620. We'll be right back.
(COMMERCIAL BREAK)
FORTIN: Welcome back to DOLLAR SIGNS.
We're talking about protecting yourself from rip-offs and scams with Todd Mark of the Consumer Credit Counseling Service, Jack Otter with "SmartMoney" magazine, and our own financial correspondent Ali Velshi. Gentlemen, thank you very much.
We're going to take a call right now from John in Virginia. John what's your concern or your question this afternoon?
JOHN: Yes. My concern, I'm 85 years old. I get a lot of these calls that come in on my telephone and they're on my caller ID box and they say anonymous or unavailable and they're always people that are trying to sell me something.
And I want to know if these people are trying to rip me off or do something how would I report them to the authorities when there's nothing that's displayed on my ID box and I want to know why when I think these kind of suspicious when these numbers say unavailable and anonymous why are these companies blocking their number and not showing their identification? Could you explain that to me?
FORTIN: All right, gentlemen, which one of you wants to tackle that question?
VELSHI: Well...
OTTER: Well...
VELSHI: Go ahead.
OTTER: I'll jump in and say that I think that people simply don't want you calling them back. I mean the old joke with a telemarketer is when they call you say I'm sorry, we're eating dinner right now. Why don't you give me your number and I'll call you while you're eating dinner?
So, I don't think it necessarily means they're trying to rip you off. I mean they might honestly be trying to sell you a magazine subscription. My thinking is you either don't pick up the phone or you tell them, you know, I'm not interested, if you'd like to sell me something send it to me in writing.
FORTIN: Todd, it's a timely topic with the do not call list in the news.
MARK: Absolutely and it's important. John, great job for being alert because you know, 23 percent of all scams are targeting the elderly, 70-plus. They're looking for people that are naive, not used to dealing with the consumer interaction on a day-to-day basis.
So, what I would suggest to you, John, why don't you let your answering machine screen all you calls. Say this is John I do not accept calls from telemarketers. If you're friend or family leave a message and I'll pick up if I'm here. That way you don't have to deal with any that's scam or even if it's legitimate.
FORTIN: Good advice. Our next call comes in from William in Tennessee, William hello.
WILLIAM: Hello. My question is if you have your bills automatically debited out of your checking account of if you pay for something you ordered off the television with like a debit card is that safe?
FORTIN: Ali, would you like to try to tackle that?
VELSHI: Yes. You know this comes right back to the original point of this. We over the last five or six years as consumers have started to conduct so much business over the phone and over the Internet with our credit cards that we have started to make the assumption that it is safe. Now, statistically most of the time it is. If you're dealing with a reputable company or if you're going over the Internet and it has verifiable security features, any major company for instance that you're doing business with, it will be safe and it will be secure generally speaking.
There are some very sophisticated hackers out there who have gotten into the data banks of lending companies and taken people's credit so there's no way yet of knowing that it's completely safe but, generally speaking, what you should do and I think you got this advice from our guests a little earlier, check your credit card statements to make sure that exactly what you charged is what shows up on there and once a year or more check your credit report to see that nothing has been opened up using your information and your credit.
You need to be vigilant about it. It's not 100 percent safe but generally speaking most businesses have made it safe for you to do business with them over the phone or over the Internet.
FORTIN: Jack, did you want to weigh in on that question?
OTTER: No, I'm sorry. I think he covered all the bases exactly right.
FORTIN: He sure did and you can't hear that advice enough these days, can you?
MARK: Judy (unintelligible).
FORTIN: Liz from Maryland is on the line. Todd, did you want to say one more thing?
MARK: Yes. Actually there's one important thing for one to know. Don't feel so afraid about using your credit cards over the Internet or having a direct deposit pulled out because there's a much greater chance when you're at a restaurant or a store that somebody that you give your credit card to, hand it over, they could swipe it right under the desk. There's a much greater chance of a fraud going on that way than over the Internet.
FORTIN: There's so much to think about. Our next call comes in from Maryland. Liz is on the line, hi Liz.
LIZ: Hi. I have one question but maybe I have a quick second question but my first question is I signed up for AOL and for the free, when they had the free trial and, you know, they give them your credit card as I guess security and then come the 90 days I called them and canceled it but they'll still putting the charges on my credit card. What should I do about that?
Also my second quick question is about the telemarketers. If you answer the phone can you tell them please take my name off the list and do not call me again? Is that effective also? Thank you.
FORTIN: All right, who wants to tackle this one? VELSHI: I'll take the do not call side of things very quickly because, as you know, this has been in the news every single day this week. Yes, in the end, it will work out. What you can do is tell any telemarketer take me off your list. Do not call me again and they, as a good business practice, should abide by that.
This may or may not be law sometime in the next few weeks but you can ask them for that. You can register. There is an existing do not call registry, a national one. Whether or not it's going to be enforced we're going to see over the next few days. But, yes, on the telemarketing side you can ask to be removed.
FORTIN: Todd, did you want to say something about this?
MARK: Sure. Liz, going back to your first question about your credit card with your Internet service, did you want to cancel that card and have that charged somewhere else?
LIZ: No, I just want to cancel the service actually.
MARK: When you signed up, Liz, did you commit that if you didn't cancel by a certain time that you were going to get a year or more of service?
LIZ: You know what I think it was in one of those little, little...
MARK: Liz, there's so many fine print things.
LIZ: Yes.
MARK: You got to look at the bottom of these deals. I want you as soon as we hang up, I want you to go back and look at your contract, see what you've signed up for. It very may well be that you're stuck with a year for the service or even longer.
And, Ali and Jack, I know you both know with a lot of credit card companies there are offers that will come through the mail or over the phone that you might agree to something for a week or a month. You'll take one of the checks for $2.50 and on the back it says, by the way, if you sign this up you'll be charged $80 a month for a garden club or a travel club, whatever it may be. You've got to pay attention to these things.
FORTIN: Read the fine print, right gentlemen, Travis in West Virginia standing by with a question hi Travis.
TRAVIS: My question was for the pyramid that are out there. Actually, I'm just getting ready to get involved with one. It's called herbal or Herbal Life or something like that. How can I tell is those are legit?
FORTIN: Jack...
(CROSSTALK)
OTTER: Well, I thought you might have been referring to the pyramid schemes, is that what you're talking about?
TRAVIS: I don't know if it's a scheme. If it was a scheme I probably wouldn't do it.
OTTER: Yes. I'm confused by the word pyramid but in any event I'll cover both. I mean if you have the slightest suspicion of something someone is trying to sell you that is all it takes absolutely not, don't even think about buying that product.
If it is something you want go to the store and see if they sell it there and if they don't look it up in the phone book, just try to get it some other way. When you get the slightest sniff of suspicion that's it, forget about it. Don't take calls from those people anymore.
One thing to look out for, what I thought you were talking about maybe was a pyramid scheme, a Ponzi scheme, and these are what Ali was referring to earlier, which is investment deals that seem too good to be true. They usually are.
FORTIN: Ali, did you have your hand raised?
VELSHI: I was going to point out some months ago one of our financial journalist colleagues did a study of these offers where they try and get you into a business dealing of some sort and this might be what our caller is talking about where they're inviting you to get involved in selling something or some kind of marketing program where they promise you some amount of money and you can work from home or you can work on your own time.
In almost all of these cases they didn't turn out to be legitimate. It turned out to be something where you had to pay the company money to get the tip that allowed you to learn how to sell these things and then the contact names. You know I think the best advice continues to be if it looks too good to be true it probably is too good to be true.
We're in a tough economy. It's hard to make money and if somebody is offering you a way to make money very easily, really, really think about this carefully and investigate it before committing any money at all to it.
FORTIN: All right we're going to hold that thought right there. More of your calls and e-mails with Jack Otter, Todd Mark, and Ali Velshi right after a quick break. We'll be right back.
(COMMERCIAL BREAK)
FORTIN: Hi again everyone and welcome back to DOLLAR SIGNS. We're answering your questions about scams and fraud.
Consumer Credit Counseling's Todd Mark, "SmartMoney" magazine's Jack Otter, and our own Financial Correspondent Ali Velshi are giving us tips on how to protect yourself.
We're going to take an e-mail right now from Marc in Weston, Florida, who writes in: "There are numerous ads on TV and the Internet concerning the consolidation of debt, cleaning up of credit, et cetera. What is the catch and are these all scams?"
Todd, would you like to begin?
MARK: Absolutely. Well, gee Marc, that's right up our ally since I'm with Consumer Credit Counseling Service, a national organization that does stuff like that. We're a non-profit. There's a lot of agencies that aren't non-profits that will really charge you up front massive fees to handle your debt load.
You don't need to be paying people massive amounts of money to help you with your debt. Go to a non-profit, whether it's CCCS or somebody else. You can get referrals from your local Better Business Bureau.
Make sure that they're accredited and certified appropriately and you shouldn't be charged anything up front to be getting help with your debt. Look for free budget counseling like CCCS does.
FORTIN: Theresa from New York is on the line, hi Theresa what's your question?
THERESA: Well, it's not a question. I actually, my husband and I were scammed on an Internet. We sold a vehicle on the Internet. We thought we did. The guy was from Africa.
He sent us a $10,000 check and we deposited it in our bank and it was in the bank for a week and they released the funds to under one day at the bank, said the check was fine and a week later the bank called us and said the check was fraudulent. We called the FBI. They referred us to the Secret Service. The problem is the bank wants us to pay $10,000 now.
FORTIN: Jack, what do you say to our caller?
OTTER: Well, first of all she did exactly the right thing in calling the authorities immediately and there seems to be one thing missing that I'm not getting. I mean if the funds have been spent then obviously that's a problem.
I'd get a lawyer. It seems to me that if you in good faith cashed this check I would think that the guy who wrote the check would be liable for that. Maybe Ali or Mark can correct me but I would be surprised that you would be liable for that check.
FORTIN: Ali.
VELSHI: Todd, what do you know on this one because I -- my response would be similar to Jack's that I think a lawyer needs to be involved in this. It's not entirely clear to me this is our caller's responsibility.
MARK: Sure. Now, Theresa is the car gone already?
VELSHI: I think she's (unintelligible). MARK: Maybe Theresa is gone.
FORTIN: I believe she's gone but, Todd, if the car is gone then what can she do? What's her recourse?
MARK: Well, so often when you've got money going overseas, you know, the check is going to bounce. It's a lot of times not legitimate. You need to be using an escrow service to protect yourself from getting some of these phony checks.
You can report it to the feds, whether you're talking about the Federal Trade Commission, your local state attorney general or consumer affairs. But if they're overseas there is no jurisdiction and chances are, I hate to tell Theresa this, but her money could be gone.
FORTIN: Yes, she won't want to hear that.
Brittany from Birmingham, Alabama writes in an e-mail question saying there are a lot of Internet work at home businesses. How do you know which ones are a scam and which ones really work? Ali, any guess on this one?
VELSHI: Yes, this is what I was talking about earlier. It comes down to the fact that you can work at home in the same way and for the same sort of pay that you would work somewhere else and, if it's reasonable, if you're typing things for people and they're paying you what seems to be a reasonable amount of money for it that might be a legitimate way to work from home.
There are people who have a virtual assistant job. They take in administrative work and they do things from home. It's these ones that promise you guaranteed amounts of cash per week or per month are the ones to look out for, especially, especially -- it's kind of like these credit counseling places, not like Todd's, the kind that want up front cash.
Anybody who wants up front cash from you to enable you to do work from home for them is highly suspicious and in most cases that we have looked at is not legitimate. It is just -- it's legal because they put everything in fine print but it's not legitimate. You're not going to make that money back.
FORTIN: All right, gentlemen, we're going to have to leave it there. I want to thank Consumer Credit Counseling's Todd Mark, Ali Velshi from CNN Financial News, and Jack Otter as well for helping us from "SmartMoney" magazine.
MARK: Thank you.
FORTIN: Thank you, gentlemen, we appreciate your expertise today.
Now here's what's ahead on CNN, "PEOPLE IN THE NEWS" featuring Hollywood nice guy Tom Hanks comes your way next.
Then, on "CNN LIVE SATURDAY" the Detroit Tigers on the verge of making history if they lose.
And at 7:00 p.m. Eastern, "THE CAPITAL GANG" with guest Madeleine Albright and Tennessee Congressman Harold Ford.
I'll be right back after a quick break with today's top stories.
END
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Aired September 27, 2003 - 16:29 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JUDY FORTIN, CNN ANCHOR: And now we welcome you to "Dollar Signs," where we help you make the most of your money. Today we want to help you protect yourself from scams. Think you're too smart to fall for one? Then you're just the mark. Modern flimflam artists like to cheat, but they'll have a tougher time of it after you listen to these tips from our financial correspondent Ali Velshi.
(BEGIN VIDEOTAPE)
ALI VELSHI, CNN FINANCIAL CORRESPONDENT: Sometimes you can spot a scam a mile away. Others present themselves in less obvious ways. And if you think you're too savvy to be conned by any old scam, think again. Like everything else, swindling has gone high-tech.
DAVID LAWRENCE, CONSUMER FRAUD SPECIALIST: Probably the most often attempted scams are Internet scams, because it's hard to trace backwards in the process. You can hide yourself fairly easily that way.
VELSHI: And today's con artist's could be after something more valuable than just a few dollar. They could be after your identity. Spoofing is one scam where you'll get an email from what seems to be a well known company. They use the familiarity and trust and logos of a well known brand, to get personal information.
JOANNA CRANE, FEDERAL TRADE COMMISSION: Another recent one was on Monster.com. And this has hit other job sites where scamsters will post a phony job offering. Then, they'll respond to applicants by saying, you're application looks great, we'd like to learn more about you, we need to perform an extensive background check, please send us detailed information. And they'll ask for your name, your date of birth, probably social security number and other key information for assuming your identity.
VELSHI: And what do they do with the information once they have it? Crimes range from emptying your bank accounts to taking out loans for cars and homes in your name. The question the scammer asks of you by phone, e-mail, or regular mail might also be a giveaway.
DAVID LAWRENCE, CONSUMER FRAUD SPECIALIST: A company will never ask you for information they already have. They will offer that information to you and ask you to confirm it. If a company is saying so what's your Social Security number again? What's that bank account number?
Say to them you tell me what you've got and I'll tell you what's correct or say give me the first five digits of my bank account and I'll give you the last five or the other way around.
VELSHI: Checking your credit report for unauthorized activity is one way to keep an eye on credit theft and if you do identify a potential scam or think you've been a victim of one, the first place to turn to for help is your local police department.
(END VIDEOTAPE)
VELSHI: Judy, one of the things that the experts had told me is that we have become so trusting of the amount of information that we give over the phone and now these days over the Internet that perhaps we're not as vigilant as we should be and that if you keep your eyes open for scams you can actually catch them.
We were talking about spoofing where a well-known company or somebody pretending to be from a well-known company sends you an e- mail, AOL, Monster, Citibank, they've all be victims of these things, so you really have to pay attention to what's being asked of you.
Be vigilant but, in the end, most of the business done over the Internet and, in fact, in telemarketing is legitimate business. So, we don't all want to become too suspicious of what's going on but we have to be vigilant -- Judy.
FORTIN: Ali, so people are sitting at home right now. How do they spot scams?
VELSHI: The one piece of information that's key, first of all if it's too good to be true watch out for it. Double check before you pursue it and the second one is the business of asking for information about you that they should have.
Banks and legitimate credit companies they will ask you things. They'll ask you to confirm things in a way that doesn't mean that you're giving them new information.
If somebody is asking you for too much information that you think they should already have if they are somebody you do business with, a bank or a lender, be very careful and that's one way to know what's going on.
FORTIN: That's good advice. All right, so you're educating yourself about how to spot a scam but what is the most popular types?
We want to bring in our other guest this afternoon Todd Mark who is with the Consumer Credit Counseling Service. He joins us in our Atlanta studio. Todd, where do we see some of these most popular types of scams?
TODD MARK, CONSUMER CREDIT COUNSELING SERVICE: Well, first off as Ali said there are so many things that come in, whether it's over the phone or in the e-mail and they grab you really where it hurts.
If you're looking for a job there's offers, pay us up front and we'll secure you a job. Looking for a credit card, you can't qualify on your own, well pay us some money. Guess what you're guaranteed to get one. It's so easy.
Of course, investment scams not as common as they were in the late '90s but the old, you know, we can take your money and double it in 90 days, trust us. Ooh, these are things you should be running the other way from.
FORTIN: Ali, who is most at risk to be scammed?
VELSHI: People who aren't as savvy in their use of the Internet or doing business on the phone. A lot of the people who are preyed on are, in fact, the elderly or people who use the Internet very rarely. They maybe send a few e-mails here and there and all of a sudden they don't get enough of these scam offers to know that they're not true.
There are these ones going around, I'm sure we've all seen them, where somebody claims to represent someone in a developing country who needs to get money out of that country and if you were to help them, be the front person for that, they'll give you tons of money just for being a nice guy.
Well, if you don't see these on a daily basis like so many of us do, you all of a sudden think well look here's something interesting. Here's something that could work for me. People who aren't exposed to all that's going on every day are most vulnerable to these things.
FORTIN: I think you're right.
Jack Otter with "SmartMoney" magazine joins us now. Jack, let me ask you what should you do if you think that you're being scammed who do you report it to? Who can you call? Who can you contact?
JACK OTTER, "SMARTMONEY" MAGAZINE: Well, if you don't mind I'm going to step back just one second and tell you that I don't think anyone should ever accept an investment offer through the mail, e- mail, on the phone. If you have money to invest go out and invest it. Do your research. Find out where you want to put it, what's appropriate for you, diversify and invest it.
FORTIN: OK, then what do you do if you think you've been scammed?
OTTER: Well, the first thing to do, I think, is to call the three credit rating agencies, Equifax, Trans Union, and I forgot one other. Hold on I'm going to take this out of my ear because I've got the delay going on and it's confusing me.
FORTIN: No problem.
OTTER: You want to call the credit unions and make sure that they know that you've been the victim of a scam. You also want to call the police, make sure you get a written police report because, as you go through the long and painful process of clearing your record, a lot of people are going to manage to see that report.
FORTIN: Todd, it's a... OTTER: And, of course, you need to check your bills every month when they come in and if you didn't charge that plasma TV to your credit card, well make sure you call the credit card company and find out who did and that you don't end up paying for it.
FORTIN: That's good advice for all of us. Todd, if someone has been scammed can they usually recoup their losses?
MARK: Oh, it's so hard. Ali was talking about one of the most famous of all time, the Nigerian scam where you're offered millions and millions of dollars to help somebody transfer their money over the United States.
Chances are if you give access to your bank account, they've got it. They're going to drain whatever money you have there and then they're going to try to get you for more money. They're going to say until we can pay the taxes we need some money upfront.
So, what happens? Your money is gone and this has gone on outside the country. It's outside even of legal jurisdictions at the state or federal level. So, you can almost kiss your money goodbye at that time and it's so sad.
As Jack was saying for identity that especially for you to get a police report and doing fraud alerts but when you've got your money stolen and sometimes it's just a matter of being naive and not knowing what to look for. You're pretty much out of luck and it's an expensive lesson learned.
FORTIN: You leave us on a pessimistic note there, all right.
MARK: Sorry.
FORTIN: All right, well your calls and your e-mails are next on DOLLAR SIGNS and, of course, you can still send your questions to dollarsigns@cnn.com or here's a toll free number that you can call, 1- 800-807-2620. We'll be right back.
(COMMERCIAL BREAK)
FORTIN: Welcome back to DOLLAR SIGNS.
We're talking about protecting yourself from rip-offs and scams with Todd Mark of the Consumer Credit Counseling Service, Jack Otter with "SmartMoney" magazine, and our own financial correspondent Ali Velshi. Gentlemen, thank you very much.
We're going to take a call right now from John in Virginia. John what's your concern or your question this afternoon?
JOHN: Yes. My concern, I'm 85 years old. I get a lot of these calls that come in on my telephone and they're on my caller ID box and they say anonymous or unavailable and they're always people that are trying to sell me something.
And I want to know if these people are trying to rip me off or do something how would I report them to the authorities when there's nothing that's displayed on my ID box and I want to know why when I think these kind of suspicious when these numbers say unavailable and anonymous why are these companies blocking their number and not showing their identification? Could you explain that to me?
FORTIN: All right, gentlemen, which one of you wants to tackle that question?
VELSHI: Well...
OTTER: Well...
VELSHI: Go ahead.
OTTER: I'll jump in and say that I think that people simply don't want you calling them back. I mean the old joke with a telemarketer is when they call you say I'm sorry, we're eating dinner right now. Why don't you give me your number and I'll call you while you're eating dinner?
So, I don't think it necessarily means they're trying to rip you off. I mean they might honestly be trying to sell you a magazine subscription. My thinking is you either don't pick up the phone or you tell them, you know, I'm not interested, if you'd like to sell me something send it to me in writing.
FORTIN: Todd, it's a timely topic with the do not call list in the news.
MARK: Absolutely and it's important. John, great job for being alert because you know, 23 percent of all scams are targeting the elderly, 70-plus. They're looking for people that are naive, not used to dealing with the consumer interaction on a day-to-day basis.
So, what I would suggest to you, John, why don't you let your answering machine screen all you calls. Say this is John I do not accept calls from telemarketers. If you're friend or family leave a message and I'll pick up if I'm here. That way you don't have to deal with any that's scam or even if it's legitimate.
FORTIN: Good advice. Our next call comes in from William in Tennessee, William hello.
WILLIAM: Hello. My question is if you have your bills automatically debited out of your checking account of if you pay for something you ordered off the television with like a debit card is that safe?
FORTIN: Ali, would you like to try to tackle that?
VELSHI: Yes. You know this comes right back to the original point of this. We over the last five or six years as consumers have started to conduct so much business over the phone and over the Internet with our credit cards that we have started to make the assumption that it is safe. Now, statistically most of the time it is. If you're dealing with a reputable company or if you're going over the Internet and it has verifiable security features, any major company for instance that you're doing business with, it will be safe and it will be secure generally speaking.
There are some very sophisticated hackers out there who have gotten into the data banks of lending companies and taken people's credit so there's no way yet of knowing that it's completely safe but, generally speaking, what you should do and I think you got this advice from our guests a little earlier, check your credit card statements to make sure that exactly what you charged is what shows up on there and once a year or more check your credit report to see that nothing has been opened up using your information and your credit.
You need to be vigilant about it. It's not 100 percent safe but generally speaking most businesses have made it safe for you to do business with them over the phone or over the Internet.
FORTIN: Jack, did you want to weigh in on that question?
OTTER: No, I'm sorry. I think he covered all the bases exactly right.
FORTIN: He sure did and you can't hear that advice enough these days, can you?
MARK: Judy (unintelligible).
FORTIN: Liz from Maryland is on the line. Todd, did you want to say one more thing?
MARK: Yes. Actually there's one important thing for one to know. Don't feel so afraid about using your credit cards over the Internet or having a direct deposit pulled out because there's a much greater chance when you're at a restaurant or a store that somebody that you give your credit card to, hand it over, they could swipe it right under the desk. There's a much greater chance of a fraud going on that way than over the Internet.
FORTIN: There's so much to think about. Our next call comes in from Maryland. Liz is on the line, hi Liz.
LIZ: Hi. I have one question but maybe I have a quick second question but my first question is I signed up for AOL and for the free, when they had the free trial and, you know, they give them your credit card as I guess security and then come the 90 days I called them and canceled it but they'll still putting the charges on my credit card. What should I do about that?
Also my second quick question is about the telemarketers. If you answer the phone can you tell them please take my name off the list and do not call me again? Is that effective also? Thank you.
FORTIN: All right, who wants to tackle this one? VELSHI: I'll take the do not call side of things very quickly because, as you know, this has been in the news every single day this week. Yes, in the end, it will work out. What you can do is tell any telemarketer take me off your list. Do not call me again and they, as a good business practice, should abide by that.
This may or may not be law sometime in the next few weeks but you can ask them for that. You can register. There is an existing do not call registry, a national one. Whether or not it's going to be enforced we're going to see over the next few days. But, yes, on the telemarketing side you can ask to be removed.
FORTIN: Todd, did you want to say something about this?
MARK: Sure. Liz, going back to your first question about your credit card with your Internet service, did you want to cancel that card and have that charged somewhere else?
LIZ: No, I just want to cancel the service actually.
MARK: When you signed up, Liz, did you commit that if you didn't cancel by a certain time that you were going to get a year or more of service?
LIZ: You know what I think it was in one of those little, little...
MARK: Liz, there's so many fine print things.
LIZ: Yes.
MARK: You got to look at the bottom of these deals. I want you as soon as we hang up, I want you to go back and look at your contract, see what you've signed up for. It very may well be that you're stuck with a year for the service or even longer.
And, Ali and Jack, I know you both know with a lot of credit card companies there are offers that will come through the mail or over the phone that you might agree to something for a week or a month. You'll take one of the checks for $2.50 and on the back it says, by the way, if you sign this up you'll be charged $80 a month for a garden club or a travel club, whatever it may be. You've got to pay attention to these things.
FORTIN: Read the fine print, right gentlemen, Travis in West Virginia standing by with a question hi Travis.
TRAVIS: My question was for the pyramid that are out there. Actually, I'm just getting ready to get involved with one. It's called herbal or Herbal Life or something like that. How can I tell is those are legit?
FORTIN: Jack...
(CROSSTALK)
OTTER: Well, I thought you might have been referring to the pyramid schemes, is that what you're talking about?
TRAVIS: I don't know if it's a scheme. If it was a scheme I probably wouldn't do it.
OTTER: Yes. I'm confused by the word pyramid but in any event I'll cover both. I mean if you have the slightest suspicion of something someone is trying to sell you that is all it takes absolutely not, don't even think about buying that product.
If it is something you want go to the store and see if they sell it there and if they don't look it up in the phone book, just try to get it some other way. When you get the slightest sniff of suspicion that's it, forget about it. Don't take calls from those people anymore.
One thing to look out for, what I thought you were talking about maybe was a pyramid scheme, a Ponzi scheme, and these are what Ali was referring to earlier, which is investment deals that seem too good to be true. They usually are.
FORTIN: Ali, did you have your hand raised?
VELSHI: I was going to point out some months ago one of our financial journalist colleagues did a study of these offers where they try and get you into a business dealing of some sort and this might be what our caller is talking about where they're inviting you to get involved in selling something or some kind of marketing program where they promise you some amount of money and you can work from home or you can work on your own time.
In almost all of these cases they didn't turn out to be legitimate. It turned out to be something where you had to pay the company money to get the tip that allowed you to learn how to sell these things and then the contact names. You know I think the best advice continues to be if it looks too good to be true it probably is too good to be true.
We're in a tough economy. It's hard to make money and if somebody is offering you a way to make money very easily, really, really think about this carefully and investigate it before committing any money at all to it.
FORTIN: All right we're going to hold that thought right there. More of your calls and e-mails with Jack Otter, Todd Mark, and Ali Velshi right after a quick break. We'll be right back.
(COMMERCIAL BREAK)
FORTIN: Hi again everyone and welcome back to DOLLAR SIGNS. We're answering your questions about scams and fraud.
Consumer Credit Counseling's Todd Mark, "SmartMoney" magazine's Jack Otter, and our own Financial Correspondent Ali Velshi are giving us tips on how to protect yourself.
We're going to take an e-mail right now from Marc in Weston, Florida, who writes in: "There are numerous ads on TV and the Internet concerning the consolidation of debt, cleaning up of credit, et cetera. What is the catch and are these all scams?"
Todd, would you like to begin?
MARK: Absolutely. Well, gee Marc, that's right up our ally since I'm with Consumer Credit Counseling Service, a national organization that does stuff like that. We're a non-profit. There's a lot of agencies that aren't non-profits that will really charge you up front massive fees to handle your debt load.
You don't need to be paying people massive amounts of money to help you with your debt. Go to a non-profit, whether it's CCCS or somebody else. You can get referrals from your local Better Business Bureau.
Make sure that they're accredited and certified appropriately and you shouldn't be charged anything up front to be getting help with your debt. Look for free budget counseling like CCCS does.
FORTIN: Theresa from New York is on the line, hi Theresa what's your question?
THERESA: Well, it's not a question. I actually, my husband and I were scammed on an Internet. We sold a vehicle on the Internet. We thought we did. The guy was from Africa.
He sent us a $10,000 check and we deposited it in our bank and it was in the bank for a week and they released the funds to under one day at the bank, said the check was fine and a week later the bank called us and said the check was fraudulent. We called the FBI. They referred us to the Secret Service. The problem is the bank wants us to pay $10,000 now.
FORTIN: Jack, what do you say to our caller?
OTTER: Well, first of all she did exactly the right thing in calling the authorities immediately and there seems to be one thing missing that I'm not getting. I mean if the funds have been spent then obviously that's a problem.
I'd get a lawyer. It seems to me that if you in good faith cashed this check I would think that the guy who wrote the check would be liable for that. Maybe Ali or Mark can correct me but I would be surprised that you would be liable for that check.
FORTIN: Ali.
VELSHI: Todd, what do you know on this one because I -- my response would be similar to Jack's that I think a lawyer needs to be involved in this. It's not entirely clear to me this is our caller's responsibility.
MARK: Sure. Now, Theresa is the car gone already?
VELSHI: I think she's (unintelligible). MARK: Maybe Theresa is gone.
FORTIN: I believe she's gone but, Todd, if the car is gone then what can she do? What's her recourse?
MARK: Well, so often when you've got money going overseas, you know, the check is going to bounce. It's a lot of times not legitimate. You need to be using an escrow service to protect yourself from getting some of these phony checks.
You can report it to the feds, whether you're talking about the Federal Trade Commission, your local state attorney general or consumer affairs. But if they're overseas there is no jurisdiction and chances are, I hate to tell Theresa this, but her money could be gone.
FORTIN: Yes, she won't want to hear that.
Brittany from Birmingham, Alabama writes in an e-mail question saying there are a lot of Internet work at home businesses. How do you know which ones are a scam and which ones really work? Ali, any guess on this one?
VELSHI: Yes, this is what I was talking about earlier. It comes down to the fact that you can work at home in the same way and for the same sort of pay that you would work somewhere else and, if it's reasonable, if you're typing things for people and they're paying you what seems to be a reasonable amount of money for it that might be a legitimate way to work from home.
There are people who have a virtual assistant job. They take in administrative work and they do things from home. It's these ones that promise you guaranteed amounts of cash per week or per month are the ones to look out for, especially, especially -- it's kind of like these credit counseling places, not like Todd's, the kind that want up front cash.
Anybody who wants up front cash from you to enable you to do work from home for them is highly suspicious and in most cases that we have looked at is not legitimate. It is just -- it's legal because they put everything in fine print but it's not legitimate. You're not going to make that money back.
FORTIN: All right, gentlemen, we're going to have to leave it there. I want to thank Consumer Credit Counseling's Todd Mark, Ali Velshi from CNN Financial News, and Jack Otter as well for helping us from "SmartMoney" magazine.
MARK: Thank you.
FORTIN: Thank you, gentlemen, we appreciate your expertise today.
Now here's what's ahead on CNN, "PEOPLE IN THE NEWS" featuring Hollywood nice guy Tom Hanks comes your way next.
Then, on "CNN LIVE SATURDAY" the Detroit Tigers on the verge of making history if they lose.
And at 7:00 p.m. Eastern, "THE CAPITAL GANG" with guest Madeleine Albright and Tennessee Congressman Harold Ford.
I'll be right back after a quick break with today's top stories.
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