Critter Corner: A New Scam Targeting Victims of Scams

Dear Commander Bun Bun,

On Tuesday, I read Mr. Farr’s article about the marriage scam, and was upset to see this is happening. I wanted to tell you about another instance in which my grandmother was scammed out of her money, not once—but twice! It was by someone offering to help her get her money back from the first scam. Do you know anything about this new scam, so others can be warned?

Thanks for your help!

Nadja Stwanz


Dear Nadja,

Some older consumers are being conned TWICE by so-called asset-recovery companies promising to help recover the money lost in the initial fraud, the Consumer Financial Protection Bureau (CFPB) warns.

Many don’t realize that anyone can file complaints to regulators, such as the Federal Trade Commission, at no charge. Fraudulent asset recovery companies are charging hundreds or thousands of dollars up front but offer services such as these, that victims could do on their own for free.  In many cases, they even file claims that are too old to be legally valid or don’t have the right documentation. To bait victims, many of them claim to have contacts at government agencies that could help recover money, but warn the victim to keep this information secret.

The scheme came to the CFPB’s attention after it received about 400 complaints in recent months concerning consumers on whose behalf one Florida-based company had filed complaints, according to Stacy Canan, deputy assistant director of the CFPB’s Office for Older Americans. The asset-recovery company wasn’t authorized to file the complaints for these consumers, who were all older than 62 and had been victims of previous scams, such as bogus timeshare investments and work-at-home schemes, Canan says. The CFPB contacted some of the consumers, who said they were unaware the company had filed the complaints on their behalf.

It’s unclear how these asset-recovery companies identify people who have already been victims of scams. The asset-recovery company could be the same group that defrauded the person in the first place. Or it could be that the names of victims were added to a “suckers list” and sold to different con artists.

And why are these consumers falling victim again? A recent study funded by AARP and conducted by psychologists at Stanford University found that consumers who are in a heightened emotional state — common after being scammed — are more vulnerable to deceptive sales pitches. “This is another reason why we think the reload pitch is so successful,” Doug Shadel of AARP says.

The CFPB said there are some red flags consumers should watch out for, such as:

•   companies asking for a fee up front to recover lost money;
•   a demand for secrecy;
•   claims that a company has special government access for filing complaints.

Canan reiterates that “(i)t’s important for consumers to know [that] submitting a complaint with the CFPB or the FTC is free — absolutely no charge,” Canan says.

Hope this is helpful and that your grandmother is never the victim of a scam again!

Commander Bun Bun

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