Recently in Fraud Category

After any disaster, there's usually a second wave of problems that can occur in the form of what has become known as disaster fraud. People who want to contribute to the recovery are scammed by phony organizations, bogus emails, and fraudulent websites. And adding insult to injury, people who have suffered devastating home and property losses are often targeted by crooked contractors, fly-by-night home repair scammers, and identity thieves. That's not all: in the months after a disaster, thousands of flood-damaged cars make their way to the market duping unwary consumers. (See our prior post: Consumer alert: don't buy a flood-damaged car.)

Below, we're including an excerpt from our EAP's blog that offers useful links on common post-disaster charity and home repair scams. (For more resources, see their Hurricane Sandy Recovery Toolkit.

Sadly, there is no shortage of fraudulent opportunists willing to take advantage of people's generous nature. Be particularly careful of solicitations via phone, email, or social networking sites. The FTC Warns Consumers: Charity and Home Repair Scams May Appear After a Disaster. See the FTC Charity Checklist to get tips on how to avoid scams. You can also check out more a charity in advance through the Better Business Bureau's Wise Giving Alliance.

Report Fraud: The FTC works to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. To file a complaint or get free information on consumer issues, visit ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261.

Passwords for more than 6 million LinkedIn accounts were leaked by hackers this past week, and just after that was announced, there was a leak of more than 1.5 million eHarmony user passwords. The strong advice from security experts: Change your passwords now.

Here's the scoop: you should change your passwords for these accounts, and if those passwords were used on any other accounts, you need to change those, too. Run, don't walk, to change passwords if any of those accounts are related to your financial data.

Creating and managing passwords is a nuisance for many, but it is one of your first defenses against preventing identity theft and illegal access to your important accounts. It's something you should take seriously.

Here are some security tips:

• Ideally, you should use separate passwords for each account. At the very least, create and memorize unique, separate, and strong passwords for your banking and your email accounts, and any other accounts that have financially sensitive information. Do not re-use those passwords on other sites. That way, you would limit damage and exposure if one account is compromised.


• Take the time to learn about and create strong passwords. Microsoft Security Center offers simple advice on creating strong passwords, as well as a secure password checker, a tool that you can use to test the strength of a password.


• Make it a routine practice to change passwords regularly, particularly for key accounts. At a minimum, do it twice a year at daylight savings when you change your fire alarm batteries.


• Avoid storing credit card information online. Enter it in every time when making a purchase. Today's convenience might be tomorrow's headache.


• Never enter a password into an email or a site you have clicked through an email. Phishing can be very convincing. Instead, if you get a notice from a bank or some other account, go directly to the website from your browser and sign in there.


• Consider a password managing service. While we can't make a recommendation for a specific service, some popular ones frequently cited on tech forums include LastPass, KeePass, and 1Password. These have different features and benefits, and help solve the problem of remembering and storing passwords. While there are free versions of password management services, this seems important enough to consider paying an annual service fee for.

See our other posts on ID theft and scams.

This is a guest post from Renaissance Alliance member Ross Insurance Agency based on a post that was previously featured on the Ross blog.

Car accidents are a dangerous and unpleasant fact of modern life. Even the best driver will probably be involved in a car accident at least once during their driving years; statistically, one out of sixteen Americans will be in an accident each year, with the odds somewhat higher for young drivers. Even when accidents don't involve injuries, you don't want your insurance rates to go any higher. The last thing that anyone wants is to be involved in a car accident, or so you would think.

Unfortunately, that just doesn't hold true for criminals. The Coalition Against Insurance Fraud warns about staged car accidents - a common form of car insurance fraud. These faked accidents have been taken to a new level in Florida, where faked accidents often come complete with fake medical claims filed at fake clinics. Florida, a no fault state, seems to be particularly plagued with this kind of scam activity. As a result Florida drivers pay up to 65% more than drivers in other states for their car insurance.

We aren't immune to staged accidents happening here in New England, either - last spring, the Attorney General's office busted a Massachusetts auto fraud ring. A lawyer, a chiropractor and another person were convicted of working in cahoots to commit insurance fraud and larceny after staging several accidents. .

Avoiding Staged Auto Accidents

• Know what to look for. The Coalition link above has an article that describes the four most common types of scams - get familiar with them
• Keep alert. Most scams rely on you being distracted either right before the accident or at the point of the accident.
• Call police if you are in an accident. It can be tempting to ignore minor fender benders, but better safe than sorry.
• Don't trust your memory. With mobile phones, it makes it easy to document the scene of an accident. In addition to exchanging information, take photos of the accident scene, any vehicle damage, and the passengers in the other car.
• Report suspicious events. If you suspect fraud, call your state insurance fraud bureau (here's a link to the Massachusetts Insurance Fraud Bureau) or report it to the National Insurance Crime Bureau if you suspect a scam. The toll-free number is 1-800-835-6422 (24 hours a day, seven days a week).

The internet is a wonderful thing and a tool that many of us no longer know how we ever did without. Still, as wonderful as the internet can be, there are dangers online. Most of us are savvy enough these days never to click on a link in an email from a stranger but unfortunately, just as we have wised up, so have the scammers. There are new tricks out there that every citizen of this wired age should be aware of.

Clickjacking is one of the newer tricks in the internet scammers repertoire. First discussed in 2008, clickjacking has come into its own with the popularity of social media like Facebook. Clickjacking occurs when a scam artist or other internet-based bad guy places an invisible button or other user interface element over top of a seemingly innocent web page button. In a clickjack attack, an unwary Facebook user may click on a innocent looking web page, thinking that the link is fine. In reality, the invisible link they are actually clicking can activate a button that can do any number of things, including changing the privacy settings on their Facebook account, putting up a fake "like" on their Facebook feed, asking them to submit personal information or even, in a worst case scenario, activating something on their computer like a webcam or microphone. Not only is the immediate user affected, but a fake Facebook "like" can lead many of their friends to click as well. This is embarrassing as well as potentially dangerous. Clickjacking is so serious that both Facebook and the state of Washington have taken legal action against suspected clickjackers in recent weeks.

How can you make sure that you're not taken in? Always be sure that you are using the latest version of your chosen internet browser. The latest version of Firefox can be found here at Mozilla; Internet Explorer here at Microsoft and Google Chrome here. You may also want to consider some browser add-ons, like NoScript, available for free download here. As always, however, your best protection against scammers is your own common sense. Review your Facebook privacy settings often and make sure you're comfortable with how much you're sharing. Always be aware of what you're clicking on. Remember, anything that's promising something for nothing is too good to be true.

If you are concerned about your vulnerabilities to identity theft, find a New England Renaissance Alliance insurance agent to discuss identity theft insurance. And if you are a business, you may want to inquire about Cyberliability Insurance.

The IRS isn't the only one out to get your money this time of year. Unfortunately, this is the season for tax scam schemes, including the perennial favorite, email phishing. Email phishing, for the uninitiated, is a term referring to scam emails that take on the look and feel of an e-mail from legitimate corporations, trying to trick you into clicking on a link and entering your personal information. Sophisticated phishers can look exactly like legitimate emails if you don't know what to watch out for, and their links can lead you to ages that look remarkably like the real thing.

Phishing schemes have been around since the birth of the internet; they're the latest technological spin on a very old phone scam in which con artists called unsuspecting citizens asking for social security or credit card numbers. Just like the phone scam, the best way to react to a phishing email is to hang up: delete the email, don't click on anything and move on to the rest of your day. If you'd like to be a good citizen, you can forward the phishy email to phishing@irs.gov.

How serious is email phishing this time of year? The IRS puts it at the top of their "dirty dozen" list of tax scams. That means that it's incredibly common. You may well be the recipient of an unwanted tax scam phishing email this year. If you don't get one and want to know what they look like, Snopes.com, the well known rumor debunking site, has examples of a variety of tax phishing emails. (alert: Snopes site has popup ads).

How can you tell that an email is phishing? First, disregard any email that claims to be from the government. The IRS will never contact you by email or through any social media like Facebook or Twitter. This has been a policy for many years and it's unlikely to change. Therefore, if you receive any communication from the IRS in any other way besides mail, you can safely assume that it's faked.

Not all tax phishing emails purport to come from the IRS, though. Popular tax preparers H & R Block and Intuit, the makers of the well known tax software TurboTax, are also reporting phoney emails being issued supposedly under their name. Click links for their safety tips to protect against phishing). In a slightly different twist, H & R Block customers in Tennessee were even scammed by fake text messages. Just as in an email or phone call, texts that claim to be from tax entities should be ignored and reported. Remember, no reputable company other than your mobile phone carrier is going to contact you via text message. Intuit has an up to date list of current phishing scams on their website, so if you use TurboTax and receive any emails from them, check this list before replying or clicking on attachments.

To be safe, never click on an email attachment from anyone you don't know and make sure that any emails, even from friends, are really from them before you click. Always, always, think before you click. To use an example from my own email inbox, is it really likely that your old college friend is stranded in London without any cash and chose you to ask for a loan? If it looks suspicious, it probably is - and my friend was still in South Carolina.

Here's a good rule of thumb: If you get an email from your bank, your tax preparer, or an online merchant with an urgent request about your account, don't click the link in the email: instead, go directly to the bank or merchant website and sign in the way you normally would. If there is any urgent message, it will be listed under your account.

Presidents' Day weekend is traditionally a big car buying time. Manufacturers and dealers roll out incentives and discounts galore to lure buyers into a purchase. Is it really a good time for consumers to buy? The best time to buy is when you can afford it and when you've done your research. Rather than acting impulsively on any of the deals, you should plan your budget, your purchase goals, and do your research in advance - then, if any deals coincide with your pre-established budget, criteria, and goals - terrific!

Step by Step: Buying a new car - a good guide from Consumer Reports that covers choosing a car, what to expect at the dealership, getting the best price on your new car and your trade in, financing tips, closing the deal, and post-sale tips.

Safercar.gov Vehicle Shoppers - Consumer resources from the U.S. Department of Transportation, including 5 Star Ratings, which measure the crash worthiness and rollover safety of vehicles. Five stars is the highest rating, one is the lowest. The site also offers information on child safety, tire safety, safety technologies, and other topics.

Watch out for scams
One other thing to watch out for: The head of Consumer Affairs in Boston says to be on the alert for questionable fees. "NewsCenter 5's Susan Wornick obtained the results of a new state surveyin which state regulators, posing as consumers, called 180 car dealers across the state and found 130 charged some questionable fees that can drive up the final cost by hundreds or even more than $1,000."

Just another reason not to rush into things!

Other car-buying research tools
Consumer Reports: Step-by-step: Buying a used car

Edmunds True Cost to Own Vehicle Calculator

Insurance Institute for Highway Safety's Top Safety Picks for 2012 Autos

Myths and Truths About Timing Your car Purchase

The east coast is still recovering from Hurricane Irene and Tropical Storm Lee, and other heavy rain events. The succession of storms and hurricanes this season have resulted in fleets of vehicles being inoperative from flood damage. Unscrupulous car dealers are notorious for turning around these flood damaged vehicles and selling them to unsuspecting buyers. As a result the National Insurance Crime Bureau has released this list of Flood Vehicle Fraud Prevention Tips.

Here is what they recommend:

• Select a reputable car dealer.
• Inspect the vehicle for water stains, mildew, sand or silt under the carpets, floor mats, headliner cloth and behind the dashboard.
• Check for recently shampooed carpet.
  Inspect the interior upholstery and door panels for fading.
• Check for rust on screws in the console or areas where water normally doesn't reach.
• Check for mud or grit in the spare tire compartment, alternator crevices, behind wiring harnesses, around the small recesses of starter motors, power steering pumps and relays.
• Check inside the seatbelt retractors by pulling the seatbelt all the way out and inspect for moisture, mildew or grime.
• Check door speakers as they will often be damaged due to flooding.
• Have a certified mechanic inspect the vehicle prior to purchasing it.
• Ask about the vehicle's history. Ask whether it was in any accidents or floods.
• Inspect the title and ownership papers for any potential or questionable salvage fraud.
• Conduct a title search of the vehicle.
• Look under the hood for signs of oxidation. Pull back rubber boots around electrical and mechanical connections for these indicators: Ferrous materials will show signs of rust, Copper will show a green patina.
• Aluminum and alloys will have a white powder and pitting.
• Trust your instincts: If you don't like the answers or the deal sounds too good to be true, walk away!

Even if you aren't shopping for a vehicle you should be concerned about the aggressive flooding this year. According to The Atlantic Oceanographic and Meteorological Laboratory the Atlantic Hurricane Season lasts until November 30th, meaning there is still a chance of even more flooding that could affect your car your home.

Take steps to protect your property. Your car insurance may cover more than you think but homeowners beware: flood damage is not covered by most homeowners policies, you would require special flood coverage. Contact your insurance agent to ensure that your vehicle and your home are protected against any future flood damage before it's too late.

U.S. identity fraud is at an all-time high, and recent reports indicate that college students are at particular risk for ID theft, partly because it often takes them twice as long to learn that they have been swindled. Studies show that most fraud begins occurring with a week from when the data is stolen. But because college kids are less likely to track banking and credit card activity on a routine and timely basis, the fraud often goes undetected longer.

Additional risks that make college students susceptible to ID theft:
So-called "friendly fraud" -- fraud perpetrated by friends and family -- accounts for one in seven fraud cases.

College students are very active on social media sites, and may unwittingly share more sensitive information than they realize.

To deter ID theft, experts offer the following tips:

• Monitor your financial accounts regularly


• Be cautious about sharing identifying information on social networking sites


• Learn how to recognize and be alert for phishing scams


• Use secure passwords and change them frequently


• Log out of your computer when you are not using it


• Keep your computer up to date with the latest spyware and anti-virus software

For more resources on identity fraud, see the Federal Trade Commission's Identity Theft Site and the FBI's e-scams & warnings page.

Identity Theft Insurance
You may want to consider Identity Theft Insurance, but first be sure you learn more about what it does and doesn't cover before you purchase - many people have misconceptions. Also, check to see how any existing coverage you have, such as Homeowners, might protect you. And do your homework before purchasing. Check The National Association of Insurance Commissioners Consumer Alert, which notes that while policies are available, they do not protect you from becoming a victim of identity theft and do not cover direct monetary losses incurred as result of identity theft. Rather, they insure you for any costs that might be incurred in reclaiming your identity, such as hiring an attorney, taking time from work, and any administrative costs such as the cost of phone calls or postage.

A step-dad who drowned his 3-year old girl in her backyard pool to collect her life insurance, a landlord who set fire fatal to one of his tenants while trying to cash in on property insurance, and a doctor who made a fortune running an illegal "pill mill" that resulted in 68 fatal overdoses ... these and a handful of other killers, liars and cheats make up the rogue's gallery that is the 2010 Insurance Fraud's Hall of Shame.

The Coalition Against Insurance Fraud compiles these lists annually, highlighting some of the worst and most egregious examples of fraud from the prior year - but they are just the tip of an estimated $80 billion dollar iceberg. Sometimes, fraudsters act alone. Other times, fraud is perpetrated by organized crime rings.

Consumer attitude to insurance fraud can be highly frustrating. Research by the Coalition Against Insurance Fraud reveals, "Two of five Americans want little or no punishment for insurance cheats; they blame the insurance industry for its fraud problems because they believe insurers are unfair." Many of those who tolerate insurance fraud wrongheadedly view it as a battle between an everyman David vs a large corporate Goliath. But the truth is far different ... it's more a battle between criminals and you. After all, it's not the insurance companies who take the hit: it is a crime you pay for - money from your pocket. Fraud and theft are business expenses that get factored into the costs that honest people pay for insurance.

The idea that insurance fraud is victimless is a common myth. Besides adding to the cost of insurance for every honest consumer and honest business, thousands suffer even more serious consequences: Every year, people are bilked out of life savings by illegal investment schemes; health is endangered when people are swindled by phony health policies; injured employees and their families suffer when businesses fail to carry legally mandated coverage, and innocent people are killed and maimed in arson and staged auto accident fraud schemes. See videos of common criminal fraud schemes.

If you have been a victim or insurance fraud or suspect insurance fraud, here are some ways to take action.

• Report to your state insurance authority. Many states have specific insurance fraud bureaus
• File a complaint online with the National Association of Insurance Commissioners.
• Notify the insurer - Insurance company fraud hot lines
• Call the National Insurance Crime Bureau Hot Line at 1-800-TEL-NICB (1-800-835-6422). Cell phone users can also text the keyword "FRAUD" and their tip to TIP411 (847411). Or drop an email. Tips can be anonymous.
• Check to see if an insurer or an agent is legit and licensed in your state: State Insurance departments.

Whether it's via new media like social networks or "old school" technology like your home phone, don't let your guard down. The FBI recently has issued warning about two scams that are surfacing.

Denial of service phone attacks
The FBI has issued a warning about a new phone scam which uses telephone denial-of-services (d.o.s.) attacks to overwhelm victims' cell phones and land lines with thousands of calls. This diversionary tactic ties up service to give criminals time to empty out the victim's bank or brokerage accounts. Prior to the phone attack, the criminal would have obtained the victim's bank account numbers and password, either via malware that the victim has inadvertently downloaded or via information the victim gave out on the phone or in response to e-mail phishing. The subsequent DOS attack serves both as a distraction, and also prevents a victim from calling to make account changes to protect their accounts.

Social networking scam: your friend is stranded
Scammers send notices to your Facebook or Twitter contact list posing as you and telling your contacts that you are stranded after a robbery (or some similar calamity) and that you need help quickly. Of course, the requested help is urgent and would be in the form of cash. To avoid being taken in by such a scam, be alert and aware and simply verify any pleas for help before acting on them. And if you think your account has been hacked and that false messages are being sent to your contacts, post a note on your page alerting your friends and family that your account may be compromised and to ignore any such messages.

To protect yourself from these and other scams, the FBI suggests:

• Implement security measures for all financial accounts by placing fraud alerts with the major credit bureaus if you believe they were targeted by a TDoS attack or other forms of fraud
• Use strong passwords for all financial accounts and change them regularly
• Obtain and review your annual credit report for fraudulent activity
• If you are a target of a TDoS attack, immediately contact your financial institutions, notify your telephone provider, and promptly report it to the IC3 website at: www.IC3.gov

Other resources

• FBI - Common Fraud Schemes
• FBI - New e-scams and warnings
• FBI details most difficult Internet scams
• Census and survey scams
• 2010 - Recent Scams - as reported by the NY Consumer Protection Bureau
• Tips to avoid e-mail phishing
• 10 tips for social networking safety
• Common scams and scam resources
• On Guard Online
• How to reduce the risk of online fraud
• Stay Safe Online