Seniors Protection against

Telemarketers FRAUD

If you’re a senior, you may find yourself bombarded with telephone calls from

telemarketers offering you everything from “fantastic investment opportunities” to home

repairs (for an unbelievably low price). The callers always seem nice, and their offers can

seem irresistible. Well, that’s a clue, because if it sounds too good to be true, it probably is:

Most of these incredible offers aren’t on the level.

This booklet is designed to help you sort through these telemarketing offers so you can

recognize which offers are on the up-and-up and which are probably scams. It will also

tell you about a variety of things you can do if you get one of these calls, including the

simplest thing of all—just hanging up. Many seniors like you are proving that, armed

with the right education, they can spot these criminals and protect themselves from their

schemes. They are proving that they can be as clever as the con artists, as astute as necessary

to detect deception, and as confident as need be to keep from being fleeced.

Please read this booklet and take to heart the tips and techniques it offers. Remember,

when it comes to hanging up on telemarketing fraudsters, it isn’t rude

Con artists who use the telephone may think seniors are ripe for the picking, but many savvy

seniors are standing their ground with these fraudsters and giving them a good run for their money.

A telemarketing criminal told investigators, “It’s an article of faith in this business to go after the old

folks.” Well, chances are these “old folks” may have something else in mind. Welcome to

Seniors and Telemarketing Fraud 101. Telemarketing fraud is defined as using the telephone

in a scheme to cheat someone out of their assets—their earnings, savings, pensions, valuables—

by deceptive and illegal means. Telemarketing fraud violates the Federal Trade

Commission’s Telemarketing Sales Rule (www.ftc.gov, go to “For Consumers,” click on

“Telemarketing,” then go to “Straight Talk About Telemarketing”). This rule requires the

caller to tell you the truth and not hide anything. It spells out your rights and gives state

law enforcement officers the authority to prosecute fraudulent telemarketers who operate

across state lines. Of course, these con artists may be breaking local and federal laws too. The

FTC also operates the National Do Not Call Registry (888-382-1222, www.donotcall.gov),

which will limit, but by no means eliminate, calls from telephone marketers.

Sad as they are, other figures need to be considered too. Ten percent of people

over 65 and nearly half of those over 80 suffer from some form of memory loss,

dementia, or Alzheimer’s disease. These conditions can make them likely targets

for telemarketing criminals. Seniors account for an ever-increasing

share of the population. Thirty-five million Americans, about 13 percent of the

population, are 65 or older. And by 2030, that number will more than double. The

first of the 75 million Baby Boomers will begin to turn 65 in the coming years. But

the trouble starts earlier than that. One study says that fully half of telemarketing

fraud victims are 50 or older.

Facts About Seniors

Never give personal information to someone on the phone unless you initiated the call

and have confidence in the person or agency receiving the call.

Legitimate business callers will not ask you for this information over the phone. If a caller asks for personal

information such as a credit card number or Social Security number, just say:

“I don’t give out personal information over the phone. I’ll contact the company directly

and provide them with the necessary information.”

Then hang up. Remember, it isn’t rude, it’s shrewd.

To Make Unscrupulous Telemarketers Go Away

Despite such consumer protections as the Telemarketing Sales Rule and the National

Do Not Call Registry, fraudulent telemarketers prey on seniors with promises of huge prizes,

fantastic investment returns, and unbelievable deals on all sorts of merchandise—

even vacation packages. They craft schemes to take advantage of those of limited

means and those who are affluent, of those who are isolated and those who are active.

These predators treat everyone as fair game. Nonetheless, the rules and responses below

will stop them cold.

In addition to rushing you, some unscrupulous telemarketers will try to convince

you not to talk to anyone about the call.

They might tell you if you divulge the offer to anyone else, it could jeopardize the deal. This is a warning sign.

In cases like this, discuss the offer with friends or family members before you agree to anything. If

the caller persists, say:

“I’d like to take some time to discuss this with my family and friends, and I’ll get back to you if I’m

still interested.”

Then hang up. Remember, it isn’t rude, it’s shrewd.

It can be hard to understand all the details of a verbal offer.

What you hear may not be what the caller is saying, or what he or she said may not be entirely

accurate. The best way to proceed is to have the material mailed to you so you can read it carefully

and at your leisure. If the caller isn’t willing to send you written information, say the following:

“If you can’t mail me the information, then I can’t talk to you.”

Then hang up. Remember, it isn’t rude, it’s shrewd.

If the caller tells you he or she wants to give you something

for free, then you shouldn’t have to pay to receive it.

Often, the caller will tell you that you need to pay a handling charge or pay taxes on the prize,

but that should be a red flag. Tell them:

“I shouldn’t have to send money for something that’s free.”

Then hang up. Remember, it isn’t rude, it’s shrewd.

So-called limited time offers should not require an immediate decision right then and there.

A caller from a legitimate business will not rush you, so if you are considering dealing with someone

who has contacted you over the phone, sleep on it for a day or two. While thinking it over, you may find a better

offer or decide you don’t need or can’t afford whatever is being offered. Just tell the caller:

“I’d like some time to think about this. Tell me how I can get in touch with you.

If I’m interested, I’ll call you back.”

Then hang up. Remember, it isn’t rude, it’s shrewd.

Fraudulent telemarketers are dangerous for many reasons. One is that they use many of

the same persuasion tactics that legitimate salespeople use. While that can make it hard to

tell the good telemarketers from the bad ones, the difference is that with fraudsters, there is never a

prize, the vacation deal is no bargain, the product isn’t worth its asking price, the work is shoddy or

never completed, and so it goes. Fast-talking telemarketing predators use a variety

of tactics to overcome a senior’s reluctance to take their bait. One thing they’ll try to do is focus the

discussion away from reality to keep their target focused on the “prize” or scam. They’ll repeat

themselves over and over, overstating the value of the prize, emphasizing how lucky the target is to

have been selected, and urging the target to act right away. One way these con artists decide on what tactics

to use is by asking lots of questions about things they have no business knowing. It’s like taking an

inventory of their victim’s life. They’ll ask about family and children, finances, marriage, political

affiliations, and former occupations. In a recent study by the National Institute of Justice, one

perpetrator says he looks for what he calls a victim’s emotional Achilles heel and tries to exploit

it. The study goes on to say that “fraudulent telemarketers have perfected stratagems that

overcome victims’ initial resistance, prey on their psychological issues, and induce victims to make

purchases.” In essence, the telemarketers are interviewing their prey to see what they like and

what will move them to action. Then they tailor heir pitch to the answers.

Whether they’re selling magazines (at grossly inflated subscription prices), demanding money

to deliver “free” prizes, trying to convince you to make costly (but unnecessary) home repairs, or

engaging in bogus sweepstakes schemes (where you have to pay a cash “fee” upfront to get a

much larger sum), telemarketing criminals use a number of recognizable techniques.

“. . . fraudulent telemarketers have perfected stratagems that overcome victims’ initial resistance,

prey on their psychological issues, and induce victims to make purchases.”

—National Institute of Justice

The Authority Tactic

When using this technique, the criminal first establishes an aura of authority over the intended

victim, then proceeds to browbeat the target. The goal is to bully the target into buying into a

scheme that isn’t in his or her interest.

The Scarcity Tactic

A con artist using the scarcity tactic relies on the target’s desire for a product that the fraudster says

is in short supply. Fraudster: “If you don’t act now, I can’t guarantee this offer will last.

It may expire any moment. You’d better act right now.”

Savvy Senior: “No, I’ll wait and see. Send me something in the mail. I’ll look the offer over and

if it still looks good, I’ll contact you.”

Remember, it isn’t rude, it’s shrewd.

Fraudster: “Listen to me, Mary. Like I said, you’re a bright person, you know the law. You’d better

pay the fee for this prize now or I can’t tell what will happen to you. You might end up in jail.

Rules are rules, you know. I can help you only so much.”

Savvy Senior: “I know enough about the law to know not to talk with you. If it were really a

prize there wouldn’t be a fee. I don’t like your attitude. Don’t call me back. Goodbye!”

Remember, it isn’t rude, it’s shrewd.

The Reciprocity Tactic

When using this tactic, the con artist relies on a sympathetic reaction from the target. Essentially,

the pitch is that if the target doesn’t buy into the criminal’s scheme, then the con artist—often posing

as a salesperson or contractor—won’t get a commission or some other type of reward.

Fraudster: “Harry, let’s work this out for both of us. I work strictly on commission. If you don’t

buy this vacation package, I won’t make any money. But I know things are tough at your end

too. How about if I do something nice for you,

Here are the tactics they’ll use when they come at you—along with a thing or

two to tell them in response

and you do something nice for me? Since you can’t afford the $2,000 purchase price, I’ll waive

part of my commission and you can pay only $1,000. That way, we’ll both make out.”

Savvy Senior: “Sorry about your commission, but I’m not going to send you any money. I need

to see your offer in writing so I can decide whether it’s worth all that you say it is. Mail me

the offer and, if I’m interested, I’ll get back in touch with you.”

Remember, it isn’t rude, it’s shrewd.

The Social Proof Tactic

The social proof technique relies on the target’s need to belong and is especially effective on seniors

who are alone. The technique is based on making the target feel that if everyone is doing

something, then it must be good. Basically, the pitch is that everyone is taking part in this particular

scheme—so why doesn’t the intended victim? Fraudster: “Everyone’s buying one of these timeshares

in Arizona. Right down the street from you, Mrs. Jones has bought one. And I just got

off the phone with Mr. Smith on Maple Street. He’s buying too. There’ll be lots of people there,

all of them just like you. So let’s get you signed up now. All you need to do is give me your credit

card number so I can get your reservation deposit right now.”

Savvy Senior: “No thanks. I’m not about to jump on the bandwagon. And I’d never give out

my credit card number to someone I don’t know. Sorry!”

Remember, it isn’t rude, it’s shrewd.

                                                             Other persuasion techniques include:

   ■ Phantom fixation, where the scammer offers a prize or reward so great that it is “too good” to pass up    

   ■ Similarity, where the scammer convinces the intended victim that they both have the same values          

   ■ Consistency, where the scammer uses the target’s own words against the victim to convince him or her

       that what the target is describing is exactly what the scammer is selling

   ■ Contrast, where the scammer compares his or her product to ones the target is familiar with.

      Of course, the scammer tells the intended victim that his or her product is a much better value,

      but in reality, it isn’t. Always keep in mind that these con artists are a heartless bunch. To them,

      committing crimes against seniors is just making a living. They’ll even blame their victims for falling for their con.

Learning To Stop Criminals in Their Tracks

Why are telemarketing criminals so successful?

GRADUATE SCHOOL:

First, it’s important to know that it’s not their victims’ fault. These con artists are clever, well-rehearsed,

and always seem “very nice.” But the truth is just the opposite: They prey on their victims’ decency,

vulnerability, and, in many cases, their isolation. Here’s what you can do to stop these

criminals in their tracks.

■ Give out your credit card number only when you initiate the transaction or when you know

the merchants or deal with them on a regular basis.

■ Guard your Social Security number carefully, and never give it to strangers.

■ When someone calls to offer goods or services that you have to pay for, tell the caller to send

you a description of the offer in writing so you can read it over before making a decision.

■ If a contractor calls you to offer home repairs, check his or her reputation with your local

Better Business Bureau and inquire at your county or city offices to see if any complaints

have been lodged for nonperformance. Remember, the references the contractor provides

may be phony.

■ Check out a charity before you give. Read up on it at the library or on the web. Call the

charity to find out if it has authorized the use of its name. If the telemarketer claims that the

charity will support local organizations, call the local groups to verify. Be extra careful of

requests for help that follow disasters. Make out your check to the charity itself, not to the

caller, and mail it to the charity’s listed address.

A Sucker Isn’t Born Every Minute

Telemarketing criminals sometimes work out of “boiler rooms,” where many well-trained con artists

work together. They may use the names and phone numbers on “sucker lists” of

people who have responded to a previous telemarketing, Internet, or mail fraud scheme. These sucker lists are

then sold back and forth. If you’re on one, you’re sure to be a repeat target. The trick is to follow the tips in this

booklet and avoid getting listed in the first place.

■ Read the terms of an offer a couple of times to make sure you completely

understand it. Ask a friend or family member to look it over with you.

■ Be cautious of callers who say that you’ve won a prize—

pay no money to claim it, no matter what they say.

■ Refuse to pay any fees or costs for a “free” offer.

■ Hang up on callers posing as officials of U.S. Customs and Border Protection who say

they’ve received an international parcel for you and you must authorize a fee over the

telephone to get the parcel delivered. This government agency will never make such a call.

■ Wire money only to family members or people you have known for a long time. Wiring

money is as good as sending cash, and you may be helping a crook who has defrauded

you make a quick getaway.

■ If you buy lottery tickets, buy only those issued in the United States. Almost all foreign

sweepstake and lottery ticket offers, including the huge number that originate in Canada, are fake and, in addition,

 it’s against the law to participate by phone or mail in these cross border frauds.

■ Be aware that the phone numbers on your caller identification display can be deceptive.

By using Internet technology, con artists can make it look like they’re calling from your

community even though they may really be thousands of miles away.

■ Beware of offers to help you recover money that you have lost in previous scams. These

“recovery” schemes are almost always fraudulent and just add insult to injury.

■ Tell the caller you need time to think things over. Don’t be pressured into a quick decision.

■ Hang up immediately on all telemarketing calls received before 8:00 a.m. or after 9:00

p.m. These calls are a sure sign of a rip-off, and they violate the Telemarketing Sales Rule.

■ Be extra cautious if the caller is much more excited than you are.

Facts About Fraud

Seniors age 60 and older are victims of 49 percent of telemarketing scams involving

medical care products and services, 46 percent involving investments, 41 percent

involving prizes and sweepstakes, and 40 percent involving magazine sales. And

the amounts of money lost can be enormous: The average loss in

prize/sweepstakes schemes was more than $7,000 per victim for the period

January to June 2005. One other detail is important to keep in mind: By using the

telephone, the criminal can pressure or fluster the victim directly—or, worse,

pretend to befriend him or her. The chosen method of payment is intended

to be quick and easy (for the criminal)— a wire transfer, a messenger pickup, or

private mail service.

■ Tell callers to take your name off their contact lists if you don’t want to hear from them

again. If they call back, they’re breaking the law, and you can feel comfortable hanging up on them.

■ End all unwanted calls quickly. If possible, rehearse with your family or friends how to

hang up on suspicious calls. You need only hang up, not explain or apologize.

Remember, it isn’t rude, it’s shrewd.

Don’t Call Me. I’ll Call You!

To reduce the number of annoying and downright dangerous telemarketing calls you

get, sign up with the Federal Trade Commission’s National Do Not Call Registry,

888-382-1222, online at www.donotcall.gov. After 31 days, the number of telemarketing

calls you get should drop and stay that way for five years. (Charities, nonprofit groups,

and political organizations may still call you.) But remember: Unscrupulous fraudsters wil

always try to reach you, and they have many ways of getting your name and number.

Furthermore, telemarketing con artists will sometimes pose as representatives of the

FTC or the Do Not Call Registry and call you in an attempt to get your Social

Security number or other important personal information that they can use to

steal your identity, among other things. The FTC will never make such calls.

You can also write to the Telephone Preference Service of the Direct Marketing Association

(DMA), PO Box 1559, Carmel, NY 10512, or go to www.dmaconsumers.org/cgi/offtelephone.

After the end of the calendar quarter in which you enroll, the number of calls you get should

diminish. However, you’ll still hear fro  companies of which you are a customer and

from those that are not members of the DMA.

Legitimate telemarketers won’t be turned off if you use the techniques

described. Rather, they’ll treat you like an educated consumer. They shouldn’t pressure you to act right away,

and, what’s more, they won’t ask you to pay a fee for something that’s supposed to be free. When you

say “no,” they’ll thank you for your time and end the call. But if they

display any of the warning signs listed in the examples on the

preceding pages, it’s probably not wise to deal with them.