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CHIPS Articles: FTC sues phone scammers who promised free money

FTC sues phone scammers who promised free money
Fraudsters pose as government officials and Amazon representatives
By Seena Gressin, Attorney, Division of Consumer & Business Education, FTC - October 31, 2016
Here are two telemarketing scams with a familiar ring:

In one, a caller says you’re eligible for a grant to pay for home repairs, medical costs, or other personal needs. She asks your age, income, and other questions, saying she needs to determine the amount you can receive. After she gets your information, she says you qualify for tens or even hundreds of thousands of dollars in government or corporate grants. You’ll need to pay a few thousand dollars upfront but, she says, you’ll get the fees back when you get your grant.

In the other, the caller says he represents Amazon and is offering you a website that will bring you thousands of dollars in commissions when people use it to link to Amazon.com and make purchases. The caller says you need to pay fees — ranging from several hundred to several thousand dollars — but that you’ll earn your money back, and more, in no time.

What do the scams have in common? They’re a pack of lies. The only people who get money are the people who run the scams.

In a complaint announced today (Oct. 28), the Federal Trade Commission says a Phoenix-based telemarketing operation bilked consumers out of millions of dollars with these scams. The complaint named three people and five companies as defendants. At the FTC’s request, a federal court froze the defendants’ assets and put a receiver in charge of the companies, ensuring no one else loses money.

The FTC says the defendants used official-sounding names like Federal Government Grant Assistance Center, US Federal Grant Department, Amazon.com Associates Program, and Amazon Affiliate Program for their scheme. And, the FTC says, they often embellished the grant scheme by posing as government officials. According to the FTC, people who paid did not receive any grants or commissions and the defendants ignored their requests for refunds.

The FTC investigated the case in cooperation with the Phoenix Police Department and the Arizona Attorney General’s Office.

We have tips for avoiding grant and internet business scams. And remember, if you suspect a fraud, please file a complaint with the FTC.

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