Swindlers Are Calling!

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Swindlers Are Calling


8 Things You Should Know About Telemarketing Fraud

1 Most telephone sales calls are made by legitimate businesses offering
legitimate products or services.

But wherever honest firms search for new customers, so do swindlers.
Phone fraud is a multi-billion dollar business that involves selling
everything from bad or non-existent investments to the peddling of
misrepresented products and services. Everyone who has a phone is a prospect;
whether you become a victim is largely up to you.

2 There is no way to positively determine whether a sales call is on
the up and up simply by talking with someone on the phone.

No matter what questions you ask or how many you ask, skilled swindlers
have ready answers. That's why sales calls from persons or organisations that
are unknown to you should always be checked out before you actually buy or
invest. Legitimate callers have nothing to hide.

3 Phone swindlers are likely to know more about you than you know about

Depending on where they got your name in the first place, they may know
your age and income, health and hobbies, occupation and marital status,
education, the home you live in, what magazines you read, and whether you've
bought by phone in the past.

Even if your name came from the phone book, telephone con men (and
women) assume that, like most people, you would be interested in having more
income, that you're receptive to a bargain, that you are basically sympathetic
to people in need, and that you are reluctant to be discourteous to someone
on the phone. As admirable as such characteristics may be, they help make the
swindler's job easier. Swindlers also exploit less admirable characteristics,
such as greed.

4 Fraudulent sales callers have one thing in common: They are skilled
liars and experts at verbal camouflage.

Their success depends on it. Many are coached to "say whatever it
takes" by operators of the "boiler rooms" where they work at
rows of phone desks making hundreds of repetitious calls, hour after hour.
The first words uttered by most victims of phone fraud are, "the caller
sounded so believable..."

5 Perpetrators of phone fraud are extremely good at sounding as though
they represent legitimate businesses.

They offer investments, sell subscriptions, provide products for homes
and offices, promote travel and vacation plans, describe employment
opportunities, solicit donations, and the list goes on. Never assume you'll
"know a phone scare when you hear one." Even if you've read lists
of the kinds of schemes most commonly practised, innovative swindlers
constantly devise new ones.

6 The motto of phone swindlers is, "just give us a few good
'moochers,'" one of the terms they use to describe their victims.

Notwithstanding that most victims are otherwise intelligent and prudent
people, even boiler room operators express astonishment at how many people
"seem to keep their check books by the telephone!" Sadly, some
families part with savings they worked years to accumulate on the basis of
little more than a 15-minute phone conversation -- less time than they'd
spend considering the purchase of a household appliance.

7 The person who "initiates" the phone call may be you.

It's not uncommon for phone crooks to use direct mailings and advertise
in reputable publications to encourage prospects to make the initial contact.
It's another way swindlers imitate the perfectly acceptable marketing
practices of legitimate businesses. Thus, just because you may have written
or phoned for "additional information" about an investment,
product, or service doesn't mean you should be any less cautious about buying
by phone from someone you don't know.

8 Victims of phone fraud seldom get their money back -- or, at best, no
more than a few cents on the dollar.

Despite efforts of law enforcement and regulatory agencies to provide
what help they can to victims, swindlers generally do the same thing other
people do when they get money: they spend it!


That a Caller Could be a Crook

1 High-pressure sales tactics.

The call may not begin that way, but if the swindler senses you're not
going to be an easy sale, he or she may shift to a hard sell. This is in
contrast to legitimate businesses, most of which respect an individual's
right to be "not interested."

High-pressure sales tactics take a variety of forms but the common
denominator is usually a stubborn reluctance to accept "no" as an
answer. Some callers may resort to insult and argument, questioning the
prospect's intelligence or ability to make a decision, often ending with a
warning that "you're going to be very sorry if you don't do such and
such." Or, "you'll never get rich if you don't take a chance."

2 Insistence on an immediate decision.

If it's an investment, the caller may say something like, "the
market is starting to move even as we talk." For a product or service,
the urgency pitch may be that "there are only a few left" or
"the offer is about to expire." The bottom line is that swindlers
often insist that you should (or must) make your decision right now. And they
always give a reason.

3 The offer sounds too good to be true.

The oldest advice around is still the best: "An offer that sounds
too good to be true probably is." Having said this, however, you should
be aware that some phone swindlers are becoming more sophisticated. They may
make statements that sound just reasonable enough (if only barely) to keep
you from hanging up. Or they may make three or four statements you know to be
true so that when they spring the big lie for what they're selling, you'll be
more likely to believe that, too. That's where the verbal camouflage comes

4 A request for your credit card number for any purpose other than to
make a purchase.

A swindler may ask you for your credit card number -- or, in the most
brash cases, several credit card numbers -- for "identification,"
or "verification" that you have won something, or merely as an
"expression of good faith" on your part. Whatever the ploy, once a
swindler has your card number it is likely that unauthorised charges will
appear on your account.

5 An offer to send someone to your home or office to pick up the
money, or some other method such as overnight mail to get your funds more

This is likely to be part of their "urgency" pitch. It could
be an effort to avoid mail fraud charges by bypassing postal authorities or
simply a way of getting your money before you change your mind.

6 A statement that something is "free," followed by a
requirement that you pay for something.

While honest firms may promote free phone offers to attract customers,
the difference with swindlers is that you generally have to pay in some way
to get whatever it is that's "free." The cost may be labelled as a handling
or shipping charge, or as payment for an item in addition to the
"prize." Whatever you receive "free" -- if anything --
most likely will be worth much less than what you've paid.

7 An investment that's "without risk."

Except for obligations of the U.S. Government, all investments have
some degree of risk. And if there were any such thing as a risk-free
investment with big profits assured, the caller certainly wouldn't have to
dial through the phone book to find investors!

8 Unwillingness to provide written information or references (such as
a bank or names of satisfied customers in your area) that you can contact.

Swindlers generally have a long list of reasons: "There isn't time
for that," or "it's a brand new offer and printed material isn't
available yet," or "customer references would violate someone's
privacy." Even with references, be cautious, some swindlers pay off a
few customers to serve as references.

The caller may also be reluctant to answer questions by phone -- such
as inquiries about the firm or even how and where you can contact the firm.
The swindler may insist on contacting you "for your convenience."

9 A suggestion that you should make a purchase or investment on the
basis of "trust."

Trust is a laudable trait, but it shouldn't be dispensed
indiscriminately -- certainly not to unknown persons calling on the phone and
asking that you send them money. Even so, "trust me" is a pitch
that swindlers sometimes employ when all else fails.



To Avoid Becoming a Victim

1 Don't allow yourself to be pushed into a hurried decision.

No matter what you're told to the contrary, the reality is that at
least 99 percent of everything that's a good deal today will still be a good
deal a week from now! And the other one percent isn't generally worth the
risk you'd be taking to find out.

There may be times when you'll want to make a prompt decision, but
those occasions shouldn't involve an irrevocable financial commitment to
purchase a product or make an investment that you're not familiar with from a
caller that you don't know. And purchase decisions should never be made under

2 Always request written information, by mail, about the product,
service, investment or charity and about the organisation that's offering it.

For legitimate firms, this shouldn't be a problem. Swindlers, however,
may not want to give you time for adequate consideration, may not have
written material available, or may not want to risk a run-in with legal or
regulatory authorities by putting fraudulent statements in writing.

Also insist on having enough time to study any information provided
before being contacted again or agreeing to meet with anyone in person. Some
high-pressure telephone sales calls are solely for the purpose of persuading
you to meet with an even higher-pressure sales person in your home!

3 Don't make any investment or purchase you don't fully understand.

A beauty of the American economy is the diversity of investment
vehicles and other products available. But it's a diversity that includes the
bad as well as the good. Unless you fully understand what you'd be buying or
investing, you can be badly burned. Swindlers intentionally seek out
individuals who don't know what they are doing! They often attempt to flatter
prospects into thinking they are making an informed decision.

4 Ask what state or federal agencies the firm is regulated by and/or
is required to be registered with.

And if you get an answer, ask for a phone number or address that you
can use to contact the agency and verify the answer yourself. If the firm
says it's not subject to any regulation, you may want to increase your level
of caution accordingly.

5 Check out the company or organisation.

If you assume a firm wouldn't provide you with information, references,
or regulatory contacts unless the information was accurate and reliable,
that's precisely what swindlers want you to assume. They know that most
people never bother to follow through. Look at it this way: Most victims of
fraud contact a regulatory agency after they've lost their money; it's far
better to make the contact and obtain whatever information is available while
you still have your money.

6 If an investment or major purchase is involved, request that
information also be sent to your accountant, financial advisor, banker, or
attorney for evaluation and an opinion.

Swindlers don't want you to seek a second opinion. Their reluctance or
evasiveness could be your tip-off.

7 Ask what recourse you would have if you make a purchase and aren't

If there's a guarantee or refund provision, it's best to have it in
writing and be satisfied that the business will stand behind its guarantee
before you make a final financial commitment.

8 Beware of testimonials that you may have no way of checking out.

They may involve nothing more than someone being paid a fee to speak
well of a product or service.

9 Don't provide personal financial information over the phone unless
you are absolutely certain the caller has a bona fide need to know.

That goes especially for your credit card numbers and bank account
information. The only time you should give anyone your credit card number is
if you've decided to make a purchase and want to charge it. If someone says
they'll send a bill later but they need your credit card number in the
meantime, be cautious and be certain you're dealing with a reputable company.

10 If necessary, hang up.

If you're simply not interested, if you become subject to high-pressure
sales tactics, if you can't obtain the information you want or get evasive
answers, or if you hear your own better judgement whispering that you may be
making a serious mistake, just say good-bye.

SWINDLERS ARE CALLING is prepared as a service to the public by:

National Partners Association
Public Affairs and Education
200 West Madison Street
Suite 1600
Chicago, Illinois 60606-3447
800-572-9400 (in Illinois)

in association with:

Commodity Futures Trading Commission
2033 K Street, N.W.
Washington, DC 20581

Federal Trade Commission
6th & Pennsylvania Avenue, N.W.
Washington, DC 20580

Alliance Against Fraud in Telemarketing
c/o National Consumers League
815 15th Street, N.W.
Suite 516
Washington, DC 20005

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