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Category: Scams

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Online car-selling scam nets $4 million, prosecutors say

Cars
For more than three years, six foreign nationals ran an Internet vehicle-selling scam that bilked customers out of more than $4 million without delivering a single car, motor home or boat, according to a federal indictment out of Los Angeles this week. 

The indictment charges six people from Germany, Russia, Romania and Latvia with conspiracy to commit bank and wire fraud and money laundering.

Starting in 2007 through 2010, the group put vehicles up for sale on auto-trading websites such as EBay Motors, Edmunds.com and Craigslist and collected at least $4 million from customers, according to the U.S. Attorney’s office.

The funds were put into at least 110 bank accounts that were fraudulently set up using fake identities, according to the indictment. The money was then sent to Europe using wires, carry-on luggage or mailed packages, according to the indictment.

Prosecutors point to Romanian national Corenliu Stefan Weikum and Russian national Yulia Meshina-Heffron -– who both went by a slew of aliases –- as the ringleaders of the scheme.

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Scam watch: Bank theft, e-books, mortgage modification

Santa Ana resident accused of running illegal robocalling network

Scam watch: Computer virus warning, Ponzi scheme, fake BBB email

-- Tiffany Hsu

Photo: Larry Steagall / Kitsap Sun / AP Photo

Scam watch: Bank theft, e-books, mortgage modification

Bank employee is sentenced to 15 months in federal prison after pleading guilty to stealing nearly $100,000 from the accounts of two customers.


Here is a roundup of alleged cons, frauds and schemes to watch out for.

Bank theft -- A Central California bank employee has been sentenced to 15 months in federal prison after pleading guilty to stealing nearly $100,000 from the accounts of two customers. Brenda Hurtado, 26, pleaded guilty in August to committing theft by a bank employee. A former employee of U.S. Bank in Arroyo Grande, she admitted changing the contact information for two customers in their 80s, closing their accounts and issuing herself cashier's checks for the closing balances. It is a good idea to check bank statements regularly to avoid mistakes, improper charges or theft, consumer advocates say.

E-books -– Consumers should take care when purchasing electronic books for devices such as Amazon’s Kindle or the Barnes & Noble Nook, the Better Business Bureau said in a recent bulletin. Some websites have been offering e-books for sale that were pirated or contain harmful malware, the BBB said. The bulletin cautions consumers to check the URL to make sure it begins with https://, a sign that it is secure, and to use reputable websites to avoid being victimized.

Mortgage modification -– Five people have agreed to repay millions of dollars to victims who they duped by promising to help them reduce their mortgage payments but providing no services after receiving their fees of $4,250. According to a lawsuit filed last year by the Federal Trade Commission, the defendants offered a “Government Mortgage Relief Program,” even though they had no affiliation with the government. The company promised full refunds if they were unsuccessful at reducing mortgages, but failed to return the money and disconnected their telephones.

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Scam watch: Computer virus warning, Ponzi scheme, fake BBB email

L.A. radio talk host indicted in alleged Ponzi scheme

Scam watch: Discount electronics, holiday cons, telemarketers

-- Stuart Pfeifer

Photo: U.S. currency. Credit: Vahid Salemi / Associated Press

Santa Ana resident accused of running illegal robocalling network

Santa Ana resident accused of illegal robocalling

After tens of thousands of people complained about getting automated telemarketer calls from companies owned by Roy M. Cox Jr., the Federal Trade Commission has accused the Santa Ana resident of illegal robocalling.

The federal agency contends that Cox and his coterie of companies have buzzed phone numbers on the National Do Not Call Registry since at least 2008 while masking their identities, actions that violate the FTC’s telemarketing sales rules.

In addition to Cox’s Laguna Niguel-based Castle Rock Capital Management Inc., the FTC alleges he runs operations based in Panama, Hungary, Argentina and the Republic of Seychelles. His clients include companies selling credit card interest rate reduction programs, extended automobile warranties and home security systems.

The FTC accused Cox’s network of obscuring its caller ID and instead appearing on customers’ phones as vague entities such as “card services,” “credit services” or “private office.”

The agency also contends that Cox and his companies were aware of -- or at least made a point of not finding out -- that the numbers they were calling were included on the national no-call list.

The FTC’s complaint aims to get Cox to pay civil penalties and stop dialing.

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Be vigilant against telemarketing fraud, FBI advises

-- Tiffany Hsu

Photo: A telephone. Credit: Wes Bausmith / Los Angeles Times

Be vigilant against telemarketing fraud, FBI advise

Scam watch: Computer virus warning, Ponzi scheme, fake BBB email

Laptopfoto
Here is a roundup of alleged cons, frauds and schemes to watch out for.

Computer virus warning -- The Federal Trade Commission has started mailing refunds to 300,000 consumers who were victims of a scam in which they were tricked into buying unnecessary software to remove nonexistent viruses and spyware from their computers. The perpetrators of the scheme caused ads to appear on victims’ computers, informing them that a “system scan” had detected viruses and other threats that needed to be removed immediately. In December 2008 the FTC obtained a court order putting a halt to the scheme. The FTC alleged that the defendants conned more than 1 million consumers into buying software products such as Winfixer, Drive Cleaner and Antivirus XP to remove the malware the bogus scans had supposedly detected. Consumers who believe they are entitled to a refund or have questions may call the settlement administrator toll free at 1-877-853-3541 or visit www.FTC.gov/refunds for more information.

Ponzi scheme -- A San Diego investment manager was arrested on charges that he ran a $25-million investment fraud, in which he falsely claimed that he made huge profits trading stocks. Federal prosecutors alleged that Robert L. Holloway lost millions trading stocks, diverted more than $1 million of investors’ money to himself and used new investor money to pay returns to early investors. The scheme operated from 2005 to 2007, prosecutors said. Holloway, 54, is charged with four counts of wire fraud and one count of filing a false tax return.

BBB emails -- The Better Business Bureau is cautioning businesses and consumers about an email that falsely claims to be from the BBB and could infect computers with damaging viruses. The email subject line reads, “Complaint from your customers,” and contains a link to a site not affiliated with the consumer protection group. Consumers should not click on the link because it could cause their computers to be infected with a damaging virus. Anyone who has already clicked on the link should have their computers scanned for spyware, viruses or other potential problems, the BBB said. The group is working with law enforcement to determine the source of the emails.

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L.A. radio talk host indicted in alleged Ponzi scheme

Scam watch: Discount electronics, telemarketers

Scam watch: Cyber Monday, pre-IPO fund, tech support

-- Stuart Pfeifer

Photo: A laptop computer. Credit: John Adkisson / Reuters 

L.A. radio talk host indicted in alleged Ponzi scheme

SECphoto

The former host of a popular Persian-language financial radio talk show has been indicted on charges that he defrauded investors -- including some of his show’s listeners -- out of $20 million in a long-running Ponzi scheme.

John Farahi, 54, was accused of falsely promising clients of his company, New Point Financial Services, that he would invest their money in corporate bonds insured by the Troubled Asset Relief Program. He actually spent the money on personal expenses, paying returns to early investors and on highly speculative options trades in which he lost millions of dollars, prosecutors said.

The scheme ran from 2005 until 2010, according to an indictment returned late Wednesday by a federal grand jury in Los Angeles.

Farahi hosted a daily financial talk show, “Economy Today,” for about eight years on Los Angeles' KIRN-AM (670) until 2010, when the Securities and Exchange Commission filed a lawsuit that accused him of defrauding New Point investors.

Farahi’s former attorney, David Tamman, was also charged in the indictment. He’s accused of conspiring with Farahi to obstruct an SEC investigation of the fraud scheme.

Tamman did not immediately respond to a telephone message seeking comment. Farahi could not be reached.

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-- Stuart Pfeifer

Photo: A briefing room at SEC headquarters in Washington. Credit: Bloomberg News

Consumer Confidential: Unhealthiest cereals, email scam warning

Cerealpic
Here's your why-do-fools-fall-in-love Wednesday roundup of consumer news from around the Web:

-- So what are the unhealthiest cereals? Glad you asked. According to the Environmental Working Group, Kellogg’s Honey Smacks, at nearly 56% sugar by weight, leads the list of the 10 worst children’s cereals. In fact, a one-cup serving of the brand packs more sugar than a Hostess Twinkie, and one cup of any of 44 other children’s cereals reviewed has more sugar than three Chips Ahoy! cookies. No. 2 on the bad-for-you list is Post Golden Crisp (51.9% sugar by weight), followed by Kellogg's Froot Loops Marshmallow (48.3%), Quaker Oats Cap'n Crunch's OOPS! All Berries (46.9%) and Quaker Oats Cap'n Crunch Original (44.4%). So what's good? You can't go wrong with a nice bowl of homemade oatmeal. (ConsumerAffairs.com)

-- Heads up: The Better Business Bureau is warning about a malicious email circulating the country. It says the email appears to come from a Better Business Bureau employee about a recently filed complaint with the organization. The email tells recipients to review the matter and advise the organization of their position on the complaint. Recipients are directed to a link which the email claims will take the reader to the BBB website. In fact the link takes recipient elsewhere, where a virus can be downloaded to your computer. An attachment with the mail may also contain a virus. The BBB says that if you get an email like this, delete it. Pronto. (WAVY.com)

-- David Lazarus

Photo: Some kids' cereals are nearly half sugar by weight. Credit: Gene J. Puskar/Associated Press

 

Scam watch: Discount electronics, holiday cons, telemarketers

Tablet photo
Here is a roundup of alleged cons, frauds and schemes to watch out for.

Discount electronics -– Consumers should be careful when shopping for electronics on the Internet during the holidays, the Better Business Bureau said. Some shady people have marketed deeply discounted electronics on the Internet, but have no intention of shipping the merchandise once they receive payment, the group said.  Other scammers use ads for discount tablets, laptops and other items to get victims to click on links that infect their computers with viruses, the group said. Consumers should avoid sites that promote free or dramatically reduced prices or those that will only accept only electronic transfers or e-checks as payments, the group said.

Holiday season scams –- The holiday season is a time for celebrating with friends and family. But it’s also an opportunity for con artists to take advantage of people’s generosity, according to consumer protection advocates. The Better Business Bureau has issued a warning to consumers to take care when making contributions to charities during the holidays. The group recommends researching charities on websites such as guidestar.org to make sure the charity is properly licensed. On top of that, consumers should avoid charities that use high-pressure telephone pitches. Any donations should be made directly to the charity, not to a third party or an individual soliciting contributions, the Better Business Bureau said.

Do not call list –- The Justice Department has filed a lawsuit against a Southern California company it said has been violating telemarketing laws by using automated or “robo” callers to make sales pitches over the telephone and contacting people who have listed their numbers on the National Do Not Call Registry. The lawsuit alleges that Sonkei Communications Inc. and its principals, Peter Turpel and Joseph Turpel, violated the Federal Trade Commission’s Telemarketing Sales Rule. The company is based in Newbury Park. Individuals who believe they were improperly contacted by the company can call the FTC at 1-877-FTC-HELP (1-877-382-4357).

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Cyber Monday: Feds seize 150 websites in counterfeiting crackdown

Scam watch: Cyber Monday, pre-IPO fund, tech support

Scam watch: Social Security, malware, investments

-- Stuart Pfeifer

Photo: Tablet computers are expected to be a hot item this holiday season. Credit: Adam Hunger / Reuters 

Cyber Monday: Feds seize 150 websites in counterfeiting crackdown

Federal authorities have seized 150 Web domain names they said were used to traffic counterfeit brand-name merchandise
Federal authorities have seized 150 Web domain names they said were used to traffic counterfeit brand-name merchandise.

The website seizures targeted the illegal sales of a host of counterfeit products, including professional sports jerseys, golf equipment, DVDs, shoes, handbags and sunglasses, authorities announced Monday.

Visitors to the sites now find a banner that says the domain name has been seized by federal authorities and that copyright infringement is a federal crime.

During the investigation, federal law enforcement agents made undercover purchases of a host of products from online retailers, officials said. In most cases, the goods were shipped directly into the United States from suppliers in other countries.

If the trademark holders confirmed that the purchased products were counterfeit, seizure orders for the domain names of the websites that sold the goods and associated websites were obtained from federal judges, authorities said.

"The sale of counterfeit goods cheats consumers and robs legitimate businesses -- both large and small -- of the fruits of their hard-earned work," said Assistant Atty. Gen. Lanny A. Breuer, who oversees the Justice Department's criminal division. "We will not tolerate those who seek to profit by abusing the Internet and stealing intellectual property at the expense of authors, artists and inventors. The Department of Justice will continue to work aggressively to combat intellectual property crime."

The seizures were part of an ongoing investigation authorities dubbed "Operation In Our Sites," which targeted online counterfeiting and piracy. Since its launch in 2010, the operation has seized 350 domain names that were allegedly used to sell counterfeit goods.

Agencies involved include the Justice Department, Immigration and Customs Enforcement and the FBI.

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Scam watch: Cyber Monday, pre-IPO fund, tech support

Stocks surge, boosted by American shoppers, European leaders

Black Friday: Holiday weekend shoppers set sales, traffic records

-- Stuart Pfeifer

Photo: Counterfeit apparel bearing Burberry tags in Hong Kong. Credit: Bobby Yip / Reuters

Consumer Confidential: Cyber Monday, scams, leaping lords

Cyber Monday usually marks the first big jump in online spending for the holidays
Here's your unchained-melody Monday roundup of consumer news from around the Web:

--It's Cyber Monday, so don't put away your credit card quite yet. The first Monday after Thanksgiving usually marks the first big jump in online spending for the holidays. Millions of consumers are expected to storm retail websites for Web-only deep discounts, special promotions and free shipping. ComScore reported Sunday that U.S. retail e-commerce spending rose 26% on Black Friday compared with the same day last year. The firm reported $816 million in online sales for the day, up from $648 million. Meanwhile, a record number of people headed to stores and shopped online from Thanksgiving Day through Sunday. They rang up an estimated $52.4 billion in sales during the four-day weekend, up from $45 billion last year, according to the National Retail Federation. That's a whole lot of economic stimulus. (Los Angeles Times)

--And a word of warning: Keep a watchful eye out for cyber-scammers and hackers. Your best bet is to use a major retail company's official website instead of using other online vendors you may not be familiar with or don't know the reputation of. Make sure you type in the retailer's Web address directly into the browser and start it with https:// to ensure that the site is secured. If you click on a pop-up site to purchase an enticing gift, you could be handing out your personal information to an awaiting cyber-thief. Also, watch out for deals that are too good to be true. They often are. (FoxNews.com)

 --Speaking of holiday shopping, the price of partridges, pear trees and turtle doves has spiked this year, pushing the cost of every item mentioned in "The Twelve Days of Christmas" above $100,000 for the first time. Holding mostly steady this year: maids a-milking, ladies dancing, lords a-leaping and gold rings. The 364 items repeated across all the song's verses would cost $101,119, an increase of 4.4% over last year, according to the annual Christmas Price Index compiled by PNC Wealth Management. Those with the money to spend would end up with 12 drummers drumming, 22 pipers piping, 30 lords a-leaping, 36 ladies dancing, 40 maids a-milking, 42 swans a-swimming, 42 geese a-laying, 40 gold rings, 36 calling birds, 30 French hens, 22 turtle doves and 12 partridges in pear trees. In case you were looking for that extra-special gift. (USA Today)

-- David Lazarus

Photo: A surge in online sales is expected for Cyber Monday. Credit: Justin Sullivan / Getty Images

 

Scam watch: Cyber Monday, pre-IPO fund, tech support

Facebook2
Here is a roundup of alleged cons, frauds and schemes to watch out for.

Cyber Monday -- Online shoppers can expect to find many discounts the Monday after Thanksgiving, or Cyber Monday. But the biggest online shopping day of the year also can present opportunities to Internet criminals. The Better Business Bureau has some recommendations to avoid scams on Cyber Monday, including: installing anti-virus software, shopping only at trusted sites, avoiding deals that sound too good to be true, paying with a credit card because those charges can be disputed and looking for the “s” in https:// -- a sign that a website is encrypted.

Pre-IPO fund -- For investors who had been excluded from recent initial public offerings of hot companies, one Florida-based hedge fund seemed like a golden opportunity. Operators of the Praetorian Global Fund claimed to hold pre-IPO shares of coveted companies such as Facebook, Twitter and Groupon. Investors responded in droves, piling more than $12.6 million into the fund since August 2010, much of it through a broker in New York. What the investors didn’t know was that the fund was operated by a convicted felon named John A. Mattera and held no pre-IPO shares, the Securities and Exchange Commission alleged in a recent lawsuit. Instead, Mattera used most of the investors’ money to support a lavish lifestyle, spending it on private jets, luxury cars and fine art, the SEC said. The U.S. attorney’s office in Manhattan filed criminal charges against Mattera, who was arrested Nov. 17.

Tech support phone calls -- North Carolina consumers have reported getting calls from phony tech support specialists who are out to access their personal information and use it to steal their money, North Carolina Atty. Gen. Roy Cooper said. More than a dozen North Carolina residents have called Cooper’s Consumer Protection Division in November to report suspicious calls from phony tech support specialists claiming to be partners with Microsoft or Windows. The consumers are directed to a website through which the scam artists are able to access all data stored on the victims’ computers, Cooper said. The calls seem to target seniors and other consumers who may not be technologically savvy. Cooper and other law enforcement officials encourage consumers to never provide personal information such as bank account or credit card numbers to a stranger over the telephone. If you have a concern about your computer, contact the manufacturer directly.

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Scam watch: Social Security, malware, investments

Scam watch: Credit cards, weight-loss supplement, chimney sweeps

Scam Watch: Acne treatment, StubHub email, real estate loans

-- Stuart Pfeifer

Photo: Facebook founder Mark Zuckerberg. Credit: Paul Sakuma / Associated Press 

Scam watch: Social Security, malware, investments

SECphoto
Here is a roundup of alleged cons, frauds and schemes to watch out for.

Social Security -- Thieves have been impersonating Social Security Administration employees in an attempt to steal seniors' personal information, AARP said in a recent bulletin. The con artists call seniors, claim to be updating their records and ask for seniors’ Social Security numbers, birth dates and bank account numbers, AARP said. Consumers should never disclose such information over the telephone to strangers, AARP said. If concerned, consumers can call or visit a Social Security office to verify that the contact was legitimate.

Malware -- The U.S. attorney’s office in Manhattan has charged seven international suspects -- six from Estonia and one from Russia -- with operating an Internet fraud scheme that infected more than 4 million computers worldwide with malicious software, or malware. At least 500,000 computers in the U.S. were infected during the scheme, which ran from 2007 until October, the U.S. attorney’s office said in a news release. The malware enabled the suspects to hijack Internet searches and re-route computers to certain websites and advertisements that paid the suspects for Web traffic. The scheme generated $14 million in illegitimate income for the suspects, the news release said. Victims’ computers were infected with the malware when they visited certain websites or downloaded certain software to view videos online, according to an indictment.

Investment fraud -- The Securities and Exchange Commission has accused a San Diego investment advisor of failing to disclose that his firm received a 10% commission whenever clients invested in a nonpublic stock offering he promoted. The SEC said it has initiated administrative proceedings to determine whether Western Capital Pacific Management and its president, Kevin James O’Rourke, inappropriately profited when clients purchased shares of Ameranth Inc. in 2005 and 2006. The company paid Western Pacific a 10% “success fee” each time it directed a client to purchase shares of its nonpublic stock, the SEC said. In addition, the SEC accused O’Rourke and the firm of misrepresenting the liquidity of a hedge fund they operated.

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-- Stuart Pfeifer

Photo: The Securities and Exchange Commission. Credit: Bloomberg

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