How To Protect Yourself - Scams and Cons Explained

Protecting Your Financial Health

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Learn about scams before they happen. While we cannot offer legal advice we can teach and inform so you know what to watch for. Collection offers may sound valid, but companies want your money and may promise to help. This is your online scam, fraud and con prevention center

On these pages we tell you the truth about settlements scams, debt collector scams, false promises, and how companies later claim "There is no record of that conversation", and how to prevent future frustration

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The FBI says types of public corruption include:

Law Enforcement corruption at the state or local level typically involves the payment of bribes or kickbacks in exchange for official actions or inaction. It also includes any violation of law not necessarily connected to the official duties of law enforcement personnel.

Legislative corruption at the state or local level usually involves payment of bribes or kickbacks in exchange for official action or inaction. These bribes or kickbacks can be received by the legislators themselves, by aides, by staff persons, and/or by outside parties doing business with the government.

Municipal corruption involves illegal activities similar to legislative corruption. Common corruption schemes at a local level include bribes or kickbacks in exchange for: supporting local ordinances, approving local government bond issuance, reducing taxes unlawfully, fraudulently manipulating probate assets, and conspiring with others to rezone property or to influence land-use proposals.

Judicial corruption typically arises out of the corrupt influencing of state or local judges, juries, or court personnel (clerks, bailiffs, probation officials, and other administrative staff). Common corrupt schemes include: payments to judiciary personnel in exchange for dismissal of charges; reduction of charges, bonds, or sentences; waiver of fines; return of forfeitable property; and favorable probation conditions.

Contract corruption usually involves the payment of bribes or kickbacks to local or state officials in exchange for favorable treatment on government contracts. Potential subjects are private contractors, anyone acting on their behalf, and public officials involved in the contracting process (procurement officers, purchasing agents, city councilpersons, and county commissioners).

Regulatory corruption involves payment to local, state, or federal officials in exchange for favorable action or inaction pertaining to identification documents, licensing, and inspection and zoning variances. Unlawful payments are commonly known as bribes and kickbacks.

Prison corruption involves corrections officers taking unlawful payment for acts directly or indirectly related to their job. Common schemes include: smuggling contraband into the facility, granting unlawful privileges, and prematurely releasing inmates.

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Debt Collectors offer a credit card - how the scam works

Debt collectors send inviting offers to some debtors and actually offer you a credit card that you can use to pay off your old debt - normally credit card debt.

This scam works because many people believe they are doing the right thing by paying their old debts. The scam is similar to a pyramid scheme, and the debt collector is using other people's money.

Perhaps you owed $1000 when you quit paying your old credit card bill. The debt collector paid $95 for the account. Look at the balance the collector says you owe. Let's assume it is now around $1495

Now look at the interest rate on your "new credit card" and you will see it is probably near the maximum allowed by law, but at least 21 percent.

Consider how long the debt has been in a charge off status. Are you near the statue of limitations for your state? Would the debt drop off of your credit report any time soon? Consider these questions.

The scam works because normally you did not receive the offer by certified mail. The collector doesn't even know if you received the mail. But once you respond they know how to start the pyramid scheme.

Issuing a credit card to someone who defaulted on a credit card in the past seems like risky business. In real life the new debt will be packed into asset back receivables, sold on the bond market as if it a regular credit card receivable, and the risk to the issuer is diluted.

You might be charged $100 to $300 for your new card, plus high interest, and it serves no purpose other than paying off an old card. Thus the pyramid scheme.

The collector knows where you are, and the fine print says you have no recourse and cannot sue. Everyone makes money on the deal, and your payments will be very high. They expect you to make the minimum monthly payment. These companies often call your home every day, sometimes more than once a day, around the time the payment is due.

See more by reading how the FTC busted CompuCredit for this scam

2010/09/03 · by T. Blake