Category Archives for Consumer Issues

Beware of Health Scams

Published in Pawtucket Times, December 19, 2014

Like millions of older baby boomers and seniors, some nights you just can’t get to sleep. It’s very late and you begin channel surfing. Does this sound familiar? Many TV viewers may ultimately find themselves, usually from 2:00 a.m. to 6:00 a.m., watching an infomercial announcer pitch a health product or service, always claiming your health will improve, or that the aging process can be stopped or reversed, if you just purchase that bottle of dietary supplements, weight loss product, baldness remedies or sexual enhancement supplements, that home exercise machine, even register for a memory improvement course. The lists of products pitched on these paid commercials are endless.

The Vancouver, BC-based International Council on Active Aging (ICAA), a nonprofit group that supports professionals who develop wellness facilities, programs and services for adults over 50, calls on older consumers to beware of false promises and products with little health benefit. “Unfortunately, as people over 50 pursue this goal, many succumb to what one industry insider calls graywashing – claims that chip away at older adults’ retirement nest eggs with dubious promises of renewed youth and health,” says Colin Milner, CEO and founder of ICAA, who coined the term, graywashing.

There is No Fountain of Youth

According to Milner, there is no shortcut to improving your health. “Yet, people spend billions of dollars a year on products that claim there is,” he observes. “Many products also say they will turn back time,” he says, noting that the research shows these claims to be unsubstantiated.

Milner points to a statement by the National Institute on Aging (NIA), one of 27 Institutes and Centers of the National Institute of Health, which states: Despite claims about pills or treatments that lead to endless youth, no treatment has been proven to slow or reverse the aging process.” Be aware, warns Milner, as health fraud scams are abundant.

According to NIA’s Age Page, “Beware of Health Scams,” health product scams offer viable “solutions that appear to be quick and painless.”

As to dietary and weight loss supplements, American consumers spend a small fortune on potions claiming to help shed pounds, many sold over the counter. Be careful. Some supplements contain hidden illegal drugs and other chemicals that could cause serious harm.

The NIA fact sheet also claims that most dietary supplements are not fully tested by the Federal Drug Administration, a federal agency charged with protecting the public’s health. In 2014, FDA issued 63 Warning letters to companies that cited unapproved or unsubstantiated claims, tainted products or other health-fraud-related violations.

So, think carefully before you purchase that item. It is important to talk with your physician before you begin taking a supplement or using a health product remedy.

The NIA Fact Sheet notes that arthritis remedies, using Magnets, copper bracelets, chemicals, special diets and electronic devices, oftentimes unproven, can be quite expensive, potentially harmful, and unlikely to help. There is no cure for some forms of arthritis and rest, exercise, heat and some drugs, are the best ways to control the painful symptoms.

Health scams oftentimes target very sick people, especially those afflicted with cancer, in an attempt to trick people who are desperate for any remedy they can find. Buzz words to beware of include: “quick fix,” “secret ingredient” or “scientific breakthrough,” says NIA’s Fact Sheet.

Furthermore, weight loss, sexual enhancement and bodybuilding “supplements” are especially suspect, too, warns the NIA Fact Sheet. Some vitamins may help, but some supplements can harm people taking certain medicines or with some medical conditions. In particular, avoid those supplements claiming to shrink tumors, solve impotence or cure Alzheimer’s. There is no cure for Alzheimer’s Disease at this time.

Milner urges older Americans not to be swayed by personal testimonials featuring “real people,” or “doctors,” often times played by actors who claim amazing cures. These testimonials are no substitute for real scientific studies, and can tip you off to a scam. In general, never purchase or start taking a medical treatment without first talking to your healthcare professional, particularly if you already take other prescribed drugs, recommends Milner.

Don’t Become a Victim of Scam

Be knowledgeable about the health care products you buy, suggests Milner, noting that the NIA Fact Sheet recommends that a person question what he or she sees or hears in ads or online. Always ask your physician, nurse, pharmacist or other healthcare provider about products you’re thinking of buying. Most important, avoid products that “promise a quick or painless cure.” Beware of claims that a health care product is made from a “special, secret or ancient formula” or it can “only be purchased from one company.”

Also, be wary if the infomercial claims the product can cure a wide variety of medical conditions or even successfully treats a devastating disease like Alzheimer’s or chronic arthritis. Put your credit card away and hang of the phone if you are required to make an advance payment or there is a very limited supply of the product.

“Science may be getting closer to a Fountain of Youth, says Milner, but, “we’re not there yet. “The pillars of healthy aging are simple. They include a sensible diet, regular exercise, good sleep habits, meaningful relationships, and engagement in life,”

A Final Note for Rhode Island’s AG…

The Consumer Protection Unit at the Office of Attorney General receives very few consumer complaints about deceptive health and beauty products, because most of these products are regulated on the federal level. The best advice they can offer consumers is to file a complaint with the federal Consumer Financial Protection Bureau, or CFPB. Although these types of products are not regulated by individual states, and therefore the Attorney General has no jurisdiction over the sale of such products, Attorney General Peter Kilmartin reminds consumers that the age old tip applies when considering a purchase, “if it sounds too good to be true, then it probably is.”

One way consumers can protect themselves, says Kilmartin, is to “ask for medical documentation backing up the claims and to ask and understand the refund policies before making a purchase. Another way to protect yourself is to pay by credit card, not debit card. Many credit card companies will allow you to dispute payment if the product or service doesn’t match up to its claims.”

For more information about the National Council on Active Aging go to http://www.icaa.cc/.

FDA s created a new website (www.fda.gov/ForConsumers/ConsumerUpdates/ucm278980.htm) to help consumers protect themselves from fraudulent health products and schemes.

Herb Weiss, LRI ’12, is a Pawtucket-based writer covering aging, health care and medical issues. He can be reached at hweissri@aol.com.

Aging Panel Looks into Debit Card Scams

Published in Pawtucket Times, November 21, 2014

The U.S. Special Committee on Aging continues to direct its investigative spotlight on phone scams involving reloadable prepaid debit card.  Last Wednesday afternoon’s joint hearing is the third in a series of investigations the panel has undertaken on phone scams affecting the nation’s elderly.

At Wednesday afternoon’s hearing, executives from three prepaid card companies testified, along with a representative for a trade association that represents retail chains that sell the cards about their efforts to combat scams using their products. Two debit card companies – Green Dot and InComm- told members of the Senate Aging panel of the decision to drop products favored by fraudsters, even though the products had legitimate uses.  Although the third company, Blackhawk, did not drop products, it tightened up its security measures on its similar reloadable debit card product.

Putting a Light on Common Scams

Last year, the Senate Aging panel took a look at Jamaican lottery schemes, which the Federal Trade Commission (FTC) resulted in an estimated $300 million in losses for victims in 2011.  Following this hearing, another hearing examined the rise of grandparent scams in which a fraudster takes on the role of a grandchild or law enforcement officer to trick seniors into sending money to get their grandchildren out of jail.  In both incidences, scammers routinely instructed seniors to send them money via reloadable prepaid debit cards.

At the Nov. 19 Aging hearing, Chairman Bill Nelson (D-FL), of the Senate Special Committee on Aging, acknowledged that it is difficult to stop fraud against seniors, but “we are chipping away on it.”  He reported that federal legislation, “Phone Scam Prevention Act of 2014”cosponsored with Senator Joe Donnelly (D-IN), was introduced that day to make it easier for persons to actually know who is calling them, and give them the tools to protect themselves against fraud.

Adds, Ranking Minority Member Susan M. Collins (R-Maine), a common theme emerging from the Senate Aging panel’s hearings on senior scams is the use of prepaid debit cards. “Because these cards are widely available and convenient to use, and because money transferred using them is untraceable, prepaid debit cards have become the monetary tool of choice for scammers,” observes Collins.

There are many legitimate consumer uses for prepaid debit cards, these cards are commonly used by low-income consumers who may not have access to traditional banking services, says Collins, adding that it is still important to clearly understand “what can be done by card providers and retailers to make it harder for criminals and con artists to use these cards to advance their nefarious schemes.”

Adds Senator Sheldon Whitehouse, a member of the Aging panel, “Seniors are too often targets of phone scams that rely on pre-paid debit cards or wire transfers.  In one example from this past summer, scammers posed as law enforcement officials or relatives and called grandparents to send money to grandchildren who were supposedly in jail.  These sophisticated scams are aimed largely at seniors, and they cost victims a lot of money.  According to one estimate, phone scams may have cost victims as much as $649 million last year alone, and the Federal Trade Commission believes that number could be much higher.”

“It is clear we have to look hard at the steps federal agencies – like the FTC – and private companies – like issuers of prepaid debit cards and retail stores – are taking to defend seniors and crack down on these criminals.  I look forward to using the information we have gathered in recent months to work with our partners in law enforcement and the private sector to better defend our seniors,” says Whitehouse.

From the AG’s Office

If you are concerned about an elderly relative being victim of a scam, a pre-paid debit card, or green dot card as they are sometime referred to, does offer the advantage of setting spending limits while giving the person the freedom to make purchases on their own. Unfortunately, there is downside.  If a person falls victim to a scam that utilizes a pre-paid debit card, there is no recourse with the financial institution to get the money back,” said Attorney General Peter Kilmartin. “Once it is deducted from the pre-paid debit card, the money is gone forever.”

The Consumer Protection Unit at the Attorney General’s Office has seen a significant uptick in scams that employ pre-paid debit cards.  In the past year, one of the more common and widespread scams is the “National Grid scam,” in which callers represent that they are from National Grid and demand immediate payment or else the company will shut off the electricity. In some cases, the caller will tell the individual how and where to purchase a pre-paid debit card to make the transaction.

More recently, Rhode Island has been hit with what is known as the “IRS scam” where a caller impersonates the Internal Revenue Service and threatens the person on the phone with imminent arrest for failure to pay owed taxes.  Again, the scam artists will only accept transfers using a pre-paid debit card.

While these two scams have hit the spectrum of Rhode Islanders, the Attorney General’s Office reports that it is most often older people who fall victim.  “Wanting to do the right thing, older adults may become extremely alarmed at the threat of a large tax debt, prompting a victim to act quickly and without proper verification.  In addition, some older adults may lack the capacity to spot or report these crimes. Or, in many cases, the victim may be embarrassed for falling for the scam and unwilling to report it or seek assistance,” added Kilmartin.

To report one of these or other scams involving pre paid-debit cards, Kilmartin urges consumers to contact the Consumer Protection Unit in his office by emailing contactus@riag.ri.gov.  “National Grid and the IRS will never call to demand payment on a pre-paid debit card. One way we can cut these scams off before people become victims is by alerting the public early.  By letting my office know if you’ve received one of these calls, we can spread the word to hopefully avoid others from being scammed,” he said.

Herb Weiss, LRI ’12, is a Pawtucket writer who covers aging, health care and medical issues.  He can be reached at hweissri@aol.com.

 

Credit Breaches Are Hazardous to Your Financial Health

Published in Pawtucket Times, October 17, 2014

It seems to happen all the time. Just recently Target Corporation, Home Depot, Dairy Queen and Neiman Marcus – followed by Michaels, and more recently JPMorgan Chase and Kmart – found their data systems being breached. I thought that I had dodged the bullet from being a victim until last month when I received a letter from my local savings and loan warning me about a potential security breach affecting my credit card.

Data breaches and hacking annually affect millions of Americans, costing billions of dollars and countless hours for consumers to correct problems resulting from identity theft and fraud that results in their checks bouncing and being accessed late fees.
Data Breaches Not a Rare Occurrence

What exactly is a data breach? Simply put, a data breach occurs when a company’s database, typically containing customer information, is hacked by sophisticated malware programs that can infiltrate a company’s network, sometimes for months before being noticed.

“Not that long ago, we were taught to always know where your wallet or purse was to ensure we didn’t fall victim to a pickpocket. Yesterday’s common street thief is today’s computer hacker, and it is often months before you realized they’ve virtually picked your pocket,” said Attorney General Peter Kilmartin.

According to the Rhode Island Attorney General, his staff has been busy in the past year informing consumers about the data breaches at some of best-known retail and financial companies. He says last year, there were multiple reports of massive data breaches at the nation’s largest corporations. According to a recent survey, 43 percent of companies have suffered one data breach this past year, and 60 percent say they’ve been struck by multiple data breaches in the last two years.
“In today’s technology–driven and paperless retail marketplace, it is inevitable that some, if not all, of your personal and financial information – credit card and banking information, email, and social security number – will be compromised,” warns Kilmartin.

Congressman James Langevin has been a leader on the issue of cyber security, and is leading efforts inside the Washington Beltway. “Stories of public data breaches are becoming increasingly common, and if a Fortune 500 company is susceptible to these types of breaches, we can be sure that similar attacks are possible among other retailers and businesses,” said Congressman Jim Langevin, the co-founder and co-chair of the Congressional Cybersecurity Caucus. “I have been sounding the alarm on cybersecurity for years, and I fear the consequences if we delay any further the steps needed to strengthen our technology infrastructure,” said Langevin.

The Democratic lawmaker, serving the second congressional district since 1991, says, “I am particularly concerned about the potential for cyber attack against critical infrastructure, including our power grid, wastewater management and banking and health care systems, just to name a few. All of these essential services are tied into technology, and it is going to take both a strong commitment from government and a continued partnership between public and private industry in order to get us where we need to be on cyber security. Securing these networks must be a priority, and I believe it is a crucial component of our national and economic security strategies.”

Kilmartin says make no doubt about it, data breaches are a crime, but law enforcement has significant hurdles to overcome when investigating cyber crimes. “Companies that have been targets of recent data breaches are working with federal law enforcement authorities to investigate how the breach happened and who is responsible,” he notes, stressing that early evidence shows that most of the sophisticated criminal enterprises that commit cyber crimes operate outside of the United States, often in Eastern Europe. “The hackers are out of the reach of traditional law enforcement and US Courts, but that has not stopped local, state and federal authorities from investigating,” he says.

Consumers Must Become Their Own Watchdog

“Consumers in today’s world need to continually monitor their electronic purchases, their personal medical information, as well as their banking records. Consumers can follow all the rules to protect their information, and if a business or other entity entrusted with this information is vulnerable, consumers, through no fault of their own, can still be impacted. Many times, a consumer’s first contact with law enforcement may be dealing with the aftermath of a data breach or identity theft. Please know that we are there to help you and will thoroughly investigate to resolve these crimes,” stated Colonel Steven G. O’Donnell, Superintendent of the Rhode Island State Police.

Kilmartin also confirmed that he and attorneys general in several states are looking into these data breaches and hope to get answers from the companies targeted as to how and why they took place. “There are multi-state investigations by attorneys general into how these companies left consumer information vulnerable to an attack,” he said, noting, “as consumer advocates, we are determined to get to the bottom of these data breaches and to work with the companies to better protect the consumer.”

Kilmartin believes it is up to consumers to be their own watchdog: “While companies and law enforcement officials are trying to put an end to this trend, the only way someone can protect themselves is to be vigilant in monitoring their personal and financial information. And by that, I mean check your banking and credit card statements regularly and limit how much information you share with companies.”

Keeping Credit Card Thieves At Bay

Kilmartin says, “I always tell consumers that the best way to protect yourself from scams is education. Being wary of potential scams, and being a savvy consumer is the best way to stop a scam artist in their tracks.” He offers the following common sense tips to protect your credit:

Check your credit card and debit card statements regularly, and on a line-by-line basis. One may think to only look for large unauthorized charges, but thieves may place a small charge – only a few dollars – to check if the card is active. If that charge goes unnoticed, thieves will then make a large unauthorized purchase. Report all suspicious charges, no matter how small. And, check your statements every day if possible. “It may be too late to recoup some or all of your money if you don’t report it immediately,” said Kilmartin.

If you notice an unauthorized charge, report it to your financial institution immediately, cancel the card and have the bank issue you a new one.

Kilmartin recommends consumers take advantage of free credit monitoring many affected companies are offering. “Companies who have been impacted by a data breach don’t want to lose customer loyalty. Many offer up to one free year of credit monitoring for any consumer who shopped there during the breach,” he adds.

Consider adding a fraud alert to your credit report file to protect your credit information. A fraud alert can make it more difficult for someone to get credit in your name because it tells creditors to follow certain procedures, which may include contacting you directly, before authorizing the credit card, says Kilmartin, noting that while this may delay your ability to obtain credit immediately, it will protect you from someone fraudulently opening a credit card in your name.

Kilmartin urges Rhode Islanders to be suspicious of emails, phone calls, or text messages claiming to be from your bank or a retailer you shopped at. Hackers may not have gained access to all the information they need, and will often use the information they do have, like name, date of birth or credit card number to convince you to part with even more sensitive information, such as passwords or social security numbers. When in doubt, call your financial institution directly with questions. The phone number is usually on the back of credit cards and debit cards.

Update your computer’s anti-virus software. Just as hackers have wormed their way into secure databases at large-scale companies, they can worm their way into your computer.

Change your passwords. The most basic way to stop an intruder is to lock the door. Set strong passwords and don’t reuse them for different accounts, especially for accounts that involve your banking or credit card information.

Go “old school” and pay with cash or check. While we have become accustomed to using credit and debit cards to make everyday purchases, every company still takes U.S. currency.

Under federal law, you are entitled to one free copy of your credit report every 12 months from each of the three nationwide credit reporting agencies. You may obtain a free copy of your credit report by going to http://www.annualcreditreport.com or by calling (877) 322-8228.

Herb Weiss, LRI ’12, is a Pawtucket writer who covers aging, health care, and medical issues. He can be reached at hweissri@aol.com.