Telemarketing Fraud Facts

1. Telemarketing Fraud Facts • Prizes and sweepstakes were the top telemarketing fraud in 2001 • Avg. loss to sweepstakes fraud last year: $3,119/person

2. Telemarketers... • Make it appear the good, service, or charitable cause being offered is worth the money you’re asked to send • Try to obtain immediate payment before you can inspect the item of value you expect to receive • Try to resemble legitimate businesses or government agencies

3. How can I be harmed? • Receive nothing in return for money you sent • Receive something of inferior value to what you expected • Required to pay in advance • Use misleading statements:“You must act immediately because this is a limited time offer.” “Your neighbors have already taken advantage of this offer, so don’t waste time!”

4. Telemarketing Do’s • Ask telemarketers for the name and address of their company and clear explanation of the offer • Call Consumer Affairs office in the company’s location to ask if complaints have been made. • Ask about refund policies • Ask for written material to study before making a decision

5. More Do’s • Get advice from family and friends; accountants or bankers before making big purchases or investments • If you don’t want to be called, ask to be put on the company’s “do not call” list. • If request violated, you can sue for up to $1,500. • Report violations to the Office of Consumer Affairs: 800-552-9963 • Share tips with family and friends. Con artists typically target the elderly.

6. Telemarketing Don’ts • Don’t pay for any prize or send money to increase your chances of winning. It’s illegal to charge for entering contests. • Don’t be intimidated into buying something over the phone. • Don’t give any bank account information • Don’t give your credit card number over the phone unless you made the call.

7. Telemarketers must disclose... • The seller’s identity • That the purpose of the call is to sell • The nature of the goods or services offered • That no payment or purchase is necessary to win if a prize is offered

8. Telemarketers cannot... • Call again after you have asked them not to • Call before 8:00 a.m. or after 9:00 p.m. • Withdraw money from your checking account without your verifiable permission • Misrepresent the offer or the goods or services offered or make false statements to get you to pay • Seek payment for credit repair services until these services have been delivered

9. Exceptions to this Rule • Calls are placed by the consumer • Catalog sales • Calls seeking charitable donations • Calls involving sales that are not completed, and payment is not required until after a face-to-face sales presentation • Business-to-business calls (unless nondurable office or cleaning supplies are being offered)

10. Legitimate Uses of Telemarketing • Religious and other organizations calling their own members and participants • Political campaigns • Businesses targeting people who cannot be reached by any other way

11. Removing your name from lists • Tell major telemarketing companies to remove you from solicitation lists: • Direct Marketing Association, Telephone Preference Service, P.O. Box 9014, Farmingdale, NY 11735 • Tell major direct mail companies to remove your name from their lists: • Direct Marketing Association, Mail Preference Service, P.O. Box 9008, Farmingdale, NY 11735

12. More Examples • Scholarship Fraud “Congratulations, you’ve been selected as a finalist for a nationwide scholarship” • “Guaranteed results”, “We do all the work”, “Not available elsewhere”, “May cost some money” • Pyramid Schemes (a.k.a. Multi-Level Mktg) “Sales distributors needed for nationwide ….” • Emphasize recruiting distributors rather than selling a product

13. Still More Examples • Health Fraud • Arthritis Products, Cancer Clinics, AIDS Cures, Instant Weight Loss, Baldness Remedies, Wrinkle Removers, Sexual Aids, Nutritional Schemes, Muscle Stimulators …. • Home Improvement/Repair & Disaster Services “I just finished a job in the area and have some leftover material ….” “I can do it… but I need half the money up-front” • #1 complaint to consumer agencies in 2000

14. Warning Signs • “Free”, “Guaranteed”, “No Risk”, “Limited Time Only” • “May I have your credit card number …” • Testimonials (Who are these people?) • Fantastic claims, ultra-low prices • High pressure sales tactics • Sales pitches aimed at your weaknesses • Unwilling to provide written information • “Just give me 1% of your trust …”

15. How to Protect Yourself • Let your Common Sense take over! • “If it sounds too good to be true, it probably is!” • Why are you lucky enough to be in on the secret? • When in doubt say “NO” • Don’t make a decision if you don’t fully understand what’s going on • Don’t be pressured into buying • Ask for more information and more time to consider • Hang up on high pressure salespersons

16. Added Protection • Ask detailed questions, require detailed answers • Research the firm and the product • Get ALL information in writing before agreeing • Never pay cash • Leave a paper trail, take advantage of consumer laws • Never pay in advance (more than 1/3) for services

17. How to Complain • Clearly identify the problem and what you think is a fair settlement • Gather your records • Receipts, work orders, contracts, warranties, canceled checks, etc. • Complain directly • Start with the person/firm who made the sale • Document your complaint process • Dates, Who you talked to, Copies of letters, etc. • Don’t Quit until you get results

18. Who Will Listen? • Office of Consumer Affairs • for Arlington: (703) 228-3260 • for Fairfax County: (703) 222-8435 • elsewhere in VA: (800) 552-9963 • State Attorney General’s Office • 800-451-1525 • Better Business Bureau • www.bbb.org • Federal Trade Commission • www.ftc.gov, 1-877-IDTHEFT