1. Illegal or unlicensed Small Loan companies – Several Payday Loan companies claim they are in the Kansas City area, but are actually located outside the United States. Several that use addresses in the Kansas City area are located in the Federation of Nevis and St. Kitts, West Indies. When we determine that he companies are unlicensed to do business in Missouri, they claim they do not have to follow American law. That is obviously not true. We have worked with regulatory agencies and raised awareness about these companies enough to get cease & desist orders against them in a few states. Unfortunately, they change their names and start anew. These companies often take money from consumer checking accounts without permission and continue to deduct funds long after the loans are paid off many times over. Kansas City was hammered hard by these groups last year.
2. Debt Negotiation/Loan Modification – These companies became so problematic that they prompted Congressional action in the form of the 2010 Credit Debt Settlement Act. Consumers in financial trouble were turning to businesses making claims that they could reduce debt in exchange for a substantial up-front fee. Taking the advice of the debt settlement companies, consumers no longer paid their debts. They found themselves in worse situations with less money and more debt. Some even lost their homes.
3. Work-at-Home opportunities/Mystery Shopping – The BBB has had Work-at-Home opportunities on its top ten scam list for nearly 100 years. Stuffing envelopes, assembling fliers, mailing forms and any other variation of the scheme will never make consumers money. They are always scams. Mystery shopping exists, but the demand is so high for mystery shoppers the companies rarely need to recruit. Receiving mail or emails about mystery shopping will always lead you to scams.
4. Sweepstakes – That formal looking piece of mail may make consumers think they’ve won it big, but they haven’t. These companies send out advertisements that look like notifications of prize winnings. They always ask for money. No one needs to pay money if they’ve won money.
5. Advance Fee Loans/Counterfeit Check Wire Transfer – It is primarily a Canadian scam that targets Americans. These groups mail out forged checks stolen from companies in the United States and say it is to pay the taxes on their lottery winnings or some other nonsense. They ask people to send back a portion of the money and to keep the rest. The consumer’s bank will not figure out the check is fake until it’s too late. One of these cons can easily knock out someone’s savings.
6. Timeshare Resale – They ask for a substantial amount of money up-front. Consumers never hear from them again. In 2010, we had two open up in the Kansas City area and disappear when they ran out of victims.
7. Homeopathy (quackery/miracle cures) – The Acai berry is the most famous of late, but quackery has been around since a time long before the BBB. We’ve fought it our entire existence. Miracle cures, weight loss “secrets,” and bracelets that balance the natural energy of your body are all scams. They sell smoke and mirrors.
8. Phishing – This has become an epidemic. Social networking sites are plagued with fake offers and provocative advertising aimed at stealing personal information. Phishing scams can do serious damage if they get a hold of the right information. Thankfully, many social networkers are savvy and quickly warn their friends.
9. Census Scams – As with any major government action, scams hitch a ride. Every ten years, scammers send out mass mailers and emails claiming to be the Census Bureau. They hope you will provide sensitive financial information. Now that 2010 has passed, this one will probably disappear for another decade.
10.Haiti Earthquake Scams – Con artists posing as charitable organizations is an old concept. This year, however, Americans were exposed to a major disaster close to home and we felt compelled to donate to the ruined country. Con artists were all over it, blasting emails, sending fliers, telemarketing, forging checks, creating websites. A good number of donors called the BBB to make sure they weren’t dealing with scams. Not everyone was so fortunate to avoid them.