Every year consumers lose money to scams. Simply put, scams are designed to separate you from your money, while you receive nothing of value in return. Just because scams are often directed toward senior citizens, don’t let down your guard. They can and do happen to anyone. According to the Federal Trade Commission (FTC), in 2002, American consumers lost $5 billion online alone to scams. $5 BILLION!

This is a battle for your hard earned dollars and Credit Advisors Foundation shares 5 basic rules of engagement in the battle for your bucks.

You’ve heard it before: if it sounds too good to be true, it probably is. Scammers have used every imaginable way, (and some you’d never imagine) to separate you and your money. Some may come to your door, others may call. They’ll work through email, ‘businesses’, and may tell you there is unclaimed property in your name. Scammers send fraud solicitations in the U.S. mail, replace ATM’s keypads to access you account information, set up fake websites, advertise fraudulent ‘scholarship’ programs, impersonate utility workers, as well as, get you to dial 900, 500, or 700 numbers or make emergency calls to 809 and other area codes (these are NOT United States area codes-these area codes connects you to a number outside the U.S. with charges as high as $25 per minute, so check it out before calling).

Just say ‘NO’. If it’s legit, you can change your mind later. Refuse high-pressure sales calls, especially if you have not requested information from or ever done business previously with the company. Many people mistakenly believe that all businesses are legit, regulated or registered with the government. Think again. Consumer protection agencies are usually only effective after the fact, when a duped (too-trusting) consumer reports a scam or fraud.

Use caution: guard your personal information closely. Never give out your personal information to an unknown caller or emailer. Remember, even if you have done business with the company in the past, some scammers have been known to send ‘legitimate’ looking letters and emails, as well as, make professional service calls to ‘update’ or confirm your personal information. Protect yourself. Take the time to look up the telephone number and call the company back, before giving out your information. Professionals making legitimate information requests will understand your caution and applaud your efforts to maintain the security of your personal information. Examples of information requested can include, but is not limited to: social security number, credit card numbers, checking account numbers, and email address. (See the CAF Defeat Debt newsletter, November 2003 story , located on our website, on identity theft). Remember, you can ask why this information is needed and request to review the company’s sales offer in writing. (Please note: fortunately, the telephone company does not need us, ‘their customers’ to assist them in repairing their lines. If a telephone company representative contacts you and asks you to call a number to assist them in line testing-hang up the phone and immediately contact your telephone provider.)

If you have to pay money to get the Big Bucks, take a pass. Be especially cautious if you are notified you are a winner but you must pay money to claim your prize (they may ask for your credit card number: see rule #3). Other versions of this scam include paying money to receive your previously unclaimed property, or paying to redeem a ‘free’ trip. There are, also, many scholarship scams that fall into this category, such as, requiring advance fees, application fees, redemption or disbursement fees that you must pay to receive the scholarships. These are scams.

Research, research, research: check with the BBB (Better Business Bureau), state attorney general, FTC, local television and radio websites, even your local police department website for scam updates. No one is immune. Recently, one of our local consumer watch television reporters ran a report about himself. It seems someone had been calling military bases across the U.S., using his name, trying to gain information on troop deployment. Ignoring the national security implications, such information could conceivably be used to begin working scams on family members still at home. The FDIC was also recently listed in a scam email telling depositors that unless they confirmed requested personal information they would relinquish their rights to insurance on their deposits. Possible scam? You bet. The FDIC quickly issued a statement in an effort to notify depositors of the scammer’s hijinks. Always check out new companies or individuals with whom you are doing business. The standard places to check (those listed above and others) can give you valuable information, as can a search of the world wide web for ‘scams’.

Finally, your best defense against scammers is knowledge and caution; but if you suspect you or a family member has been a victim or target of a scam, please report it. Reports of scams can be made to the BBB, FTC, your state’s attorney general, and your local police department. Also, consider reporting scams to local consumer news reporters. Every report made could help someone avoid being scammed in the future.

Tax season is no fun...for anyone, but if you owe taxes Credit Advisors Foundation can help! Our certified credit counselors can set you up on a program to make payments to your outstanding balance each month. We’ll make arrangements with the IRS on payment amounts and forward that payment to the IRS right along with your payments to your other creditors. The IRS will work with people that owe taxes, however, as expected, they have a stipulation. You’ll need to explain your reason for owing back taxes. If you lost your job and lived off your 401(k) without paying tax on that money, you probably owe quite a bit. What about being bumped into a higher tax bracket when you and your spouse’s incomes are combined? You can owe substantially in both of these situations, and the IRS will set up a payment plan for both reasons, but there is one important difference.

If you owe taxes due to a period of unemployment, from the view of the IRS chances are you won’t have these problems next year. Be aware, while on a payment plan any refund you have due in future years will be credited towards the past due balance. However, if you owe because you and your spouse’s combined income bumps you into a higher tax bracket, then you will be in the same situation next year unless you adjust the amount of money deducted from you paycheck throughout the year. If you owe money in any given year during your repayment plan, you will be removed from the repayment plan and your full amount of taxes will be due. You must correct whatever the problem is that got you in the situation of owing Uncle Sam. Unemployment, hopefully, will not happen to you twice in two years, but having an insufficient amount deducted from your paychecks will put you right back in the same situation next tax season. The IRS wants to avoid this, they want you to have a refund due to you while you are in the repayment plan because they can then credit that refund to your past due amount. Call one of our certified credit counselors today to discuss your tax situation. The IRS is very flexible in allowing citizens to pay their tax debt and with CAF on your side, we’ll take care of the negotiating, so you don’t have to worry.

This month the word search words are reminders of our article topics, reminding you of taxes, and using caution against scammers.

Bills Cabbage Certified Consumer Counselor Deposits Fraud Money Property Repayment Scams Tax