BUSINESS LAW 101 / Telephone Scams

By Albert L. Kelley, Esq.

 

I’m going to take a break from my series on starting a business to address a public safety issue. Over the last week, three people have asked me for advice regarding telephone calls they received saying they owed money. One call was allegedly from the IRS and the other two were from law enforcement. In all three the people were told they owed money that had to be paid immediately or they would be arrested. I advised the persons to ignore the calls and to report the numbers to their local law enforcement agencies.

These calls are getting more frequent and more aggressive. And no one is immune. I received a call a few months ago advising that I had a charge related to a legal matter and they wanted me to pay it by sending them Wal-Mart gift cards (Aside from the absurd nature of the call, I knew it was a scam as we do not have a WalMart in Key West). Interestingly enough, while I was typing this article, I received a scam call regarding an insurance offer.

This is a huge problem that costs more than people realize. In 2015, it was reported that 17.5 million people are targeted by telephone scammers each year, and the losses from telephone scams exceed $40 billion per year! $5 million of that amount is accounted for by the IRS scam I mentioned above.

There are numerous variants of the telephone scam. One of the most dangerous is the one ring scam. Here the scammer calls you but hangs up after one ring. When you call back to find out who called you, you are charged a fee for making an international phone call and a per minute fee for every minute you stay on the line.

Another recent scam is the “Yes” scam. Here, the caller will ask “Can you hear me?” When you say “yes”, the scammer records your voice and uses it to authorize charges to your phone.

Other scams will include contest prize winners, travel packages, investment schemes, money laundering requests, and healthcare offers. As a general rule, do not buy anything over the phone, do not make investments with unknown stock brokers, do not schedule vacations and do not buy insurance from a telephone agency.

It is time to beat the scammers. Know the clues. If a caller tells you they are from the IRS, hang up. The IRS will not call you. Their system is based on mail. If you receive a call from law enforcement, ask what agency they are with, ask the officers name and badge number. Then hang up and call the agency directly. If you are given a number to call, do not call it. Look up the number yourself. Scammers are able to mask area codes so that the call appears to be a local one. This is often done through internet phone services which allows the scammers to manipulate the numbers. They can even trick your Caller ID to show the call is from the federal government or local police department. Do not trust your Caller ID and do not redial their number. If your phone rings once and hangs up, do not call the number back unless you recognize the number. If it is important, they will call you back. Or register with a reverse phone look-up site. If someone calls with an offer that sounds too good to be true, it is. Hang up! Register your phone with a National Do Not Call Registry. Block any call that sounds like a scam. Do not speak until you know who you are talking with. If a caller asks if you can hear them, a mere grunt works as a response without allowing authorization. And report any scam number to the FCC so they can investigate. While these cases are hard to stop as many originate outside the United States, in 2016 over 700 people were arrested in India and at least 20 in the US in relation to the IRS scam calls.

Al Kelley is a Florida business law attorney located in Key West and previously taught business law, personnel law and labor law at St. Leo University. He is also the author of “Basics of Business Law” “Basics of Florida’s Small Claims Court” and “Basics of Florida’s Landlord-Tenant Law” (Absolutely Amazing e-Books). This article is being offered as a public service and is not intended to provide specific legal advice. If you have any questions about legal issues, you should confer with a licensed Florida attorney.

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