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Internet fraud: Your weekly ScamWatch

March 6, 2011 |  5:37 am

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

Internet businesses: Acting at the request of the Federal Trade Commission, a federal judge has frozen the assets of a company that charged steep fees to consumers hoping to set up online businesses but provided little in return. According to an FTC lawsuit, Ivy Capital Inc. and 29 co-defendants allegedly have taken more than $40 million from people who paid thousands of dollars believing Ivy Capital would help them develop their own Internet businesses and earn up to $10,000 per month. But the promised products and services were worthless, the complaint alleged. Ivy Capital’s “expert” coaches lacked the promised knowledge and experience, its website-building software programs did not work properly, and the lawyers and accountants the defendants said would provide assistance did not exist.

Video rental machines: The FTC has recovered more than $3 million that will be refunded to investors who were duped in an alleged scam that promoted video rental machines as a business opportunity, the FTC said in a news release. The FTC sued American Entertainment Distributors and several individuals and related companies in 2005, saying the advertisements to own video rental machines under the “Box Office Express” brand falsely claimed that investors could make significant profits. The FTC alleged that the defendants tricked investors into paying $28,000 to $37,500 apiece for video rental vending machines, telling them they could expect to earn between $60,000 and $80,000 a year, or recoup their initial investment in six to 14 months. Most investors typically lost money after buying the machines, the lawsuit said.

Foreign travel scams: Consumers should take caution to avoid thieves when traveling abroad, the Better Business Bureau cautioned in a recent bulletin. The bulletin addressed two common schemes: Pickpockets have been known to try to divert victims’ attention by spilling something on them, then snatching a wallet or purse while helping clean up the mess. In another scam, a telephone call is placed to a victim’s hotel room, encouraging them to call a family member in distress. The phone number that’s left can cause a charge of hundreds of dollars to be added to a phone bill, the bulletin said.

Stolen bank accounts: The FBI is seeking the public's help in identifying a man who has used phony identification to drain victims’ bank accounts in the San Francisco Bay Area, Sacramento and Reno. The man, who used personal information to impersonate account holders at several banks in 2009 and 2010, was captured on surveillance photographs released by the FBI. Anybody with information about the suspect can contact the FBI at (415) 553-7400.

-- Stuart Pfeifer