Ripoffs and Scams
The Yelp and Zagats of charities and non-profits
Filed under: Ripoffs and Scams, Wealth, Charity, Fraud
If you want to find a good hairdresser in your area, you go online to Yelp.com. A good restaurant: Zagats.com. But where do you go to find a worthy -- and trustworthy -- charity to donate to? Try GreatNonprofits.org, a site that's trying to make it easier for all parties involved in a nonprofit -- volunteers, staff workers, donors and the needy -- rate it as a place to fund. GreatNonprofits.org was started by Perla Ni, former publisher of Stanford University's Social Innovation Review, after people came to her post-Hurricane Katrina, asking what charities to fund. Ni didn't have a clue -- there was no measurement system online rating charities beyond the income/expense ratios. The charities she did find in New Orleans providing most of the shelter, food and water were small, obscure ones that weren't getting any media or celebrity attention.
That's the case everywhere -- lots of small nonprofits doing good work but lacking the time and money to promote their efforts. GreatNonprofits.org has reviews for about 400 nonprofits to date, most of them in the Bay Area where Ni's organization is based, but there are more than one million charities in the Web site's database waiting to be reviewed, if you have some insight to share.
As-Seen-On-TV: How to find out if it works...before you buy!
Filed under: Ripoffs and Scams, Shopping
Who hasn't been curious about an "As-Seen-on-TV" product? No longer limited to late night infomercials, shortened versions of these ads pushing everything from weight loss to get-rich-quick schemes are now commonplace on prime time television. Under the constant bombardment of these "miraculous" products, it's only a matter of time before one catches your fancy. Thankfully, the internet is full of personal accounts and reviews which can help you find out if these products work, "as-seen-on-TV."
Here are three easy ways to find out if an as-seen-on-TV product is worth it, all before the "20 minute" special offer to double your order expires.
- InfomercialRatings.com
- ASOTV.info
No bonuses for those who need taxpayer money to stay afloat!
Filed under: Ripoffs and Scams
Pardon me if I don't feel sorry for the executives who aren't getting bonuses after they required taxpayer money to keep them afloat. How heartless of me. But something in me says that wealthy CEOs who run their companies into the ground and need to pick my pocket to stay in business shouldn't be rewarded for that. Today's news is that the CEO and chairman of Citigroup aren't getting bonuses for 2008. And that's news why? Seriously. If you need to steal money from taxpayers, then you don't deserve a bonus, period. There should be no "news" that you're going without a bonus.
Lottery sales weaken: Good!
Filed under: Ripoffs and Scams
The Wall Street Journal reports (subscription required) that the soft economy is taking its toll on a business that had been thought to be part of the holy trinity of recession-proof vices: alcohol, tobacco and gambling.California has reported that its lottery ticket sales are down about 10% over the past few months, along with a drop of 4% in Texas. Nationally, lottery ticket sales are down a little under 2% from July through September versus the same period in 2007. Of course, many retailers would kill to have their sales down just 2% so the lottery is still outperforming. It may not be recession-proof but it certainly qualifies as recession-resistant.
Psychic business booms: Proceed with caution
Filed under: Extracurriculars, Ripoffs and Scams, Recession
Everywhere you turn, it seems that the economic news is dismal. As foreclosures and college tuition costs skyrocket, while jobs and 401K's evaporate, what are Americans doing about it? The answer may surprise you: they're checking in with psychics.The reason is simple on the face of it. Lots of people want someone to tell them what to do. Should I sell my house, downsize and relocate, cash in the remnants of my stock portfolio? Should I tell me daughter that she will have to start at a community college because I'm not sure that I can pay the mortgage and still help her with tuition?
Here's what a legitimate psychic will tell you: "I don't know. I can't tell you what you should do. I can only tell you what you're going to do."
I've been a psychotherapist for 35 years. Most of that time, I've been fascinated by the paranormal. I've worked with psychics and mediums in the United States, England and Israel. I travel nationally doing seminars about psychic events in the lives of clinicians and clients. Here's what I know.
Amex drops credit limit on customer for shopping where poor people shop
Filed under: Cards, Ripoffs and Scams
Apparently, even those of you with pristine credit histories should be careful about shopping when the poor people shop. At least, that was the experience of Kevin Johnson of Atlanta, who had the credit limit on his American Express card slashed because he shopped in the wrong stores, despite having no negative information in his credit history.
According to the Atlanta Journal-Constitution, Johnson received a letter from American Express explaining that his limit had been dropped because other customers that shopped where he chose to shop have a poor history of paying their credit card debt to AMEX. Looking at his spending history, Johnson couldn't fathom what stores AMEX was referring to, since his statement showed the same kind of charges most of ours do; restaurants like Ruby Tuesday, retailers such as Wal-Mart, and, of course, Starbucks.
A company spokesperson contacted by the Journal-Constitution declined to comment on the incident, but did confess that as part of the company's ongoing attempt to manage risk it takes into account purchases made by the cardholder from vendors who tend to draw a higher percentage of credit card deadbeats.
If I were a retailer, I would be livid at the thought that American Express was punishing its customers for shopping at my store. As a consumer, I believe that any credit card company that would adjust the terms of my agreement based on the credit worthiness of other people who shop where I shop should be obligated to tell me which stores would damange my credit worthiness. Or are they more interested in forcing me to shop at upscale (read: overpriced) retailers so they can make more money?
Average consumer is vulnerable to Ponzi schemes
Filed under: Ripoffs and Scams, Fraud, Investing
Those "investment" dollars sound small, but in today's tight economy, it's not chump change for many families. Here are some tips I offered on CNBC's On the Money to help consumers identify investment Ponzi schemes.
And check out this video for some other key phrases used to help identify Ponzi schemes and business opportunity scams.
How to run your own Ponzi scheme
Filed under: Ripoffs and Scams
Want to make $50 billion? Take a lesson from Bernard Madoff, and you too could be perp-walking into the Attorney General's office. Just follow these simple steps --
1. Establish a great reputation for acumen. Sporting a legendary family name, and serving as the head of NASDAQ are examples of how to burnish your esteem.
2. Immerse yourself in a social circle of rich people that share your background. Be convivial and cultivate strong friendships. In your heart, though, remain committed to ripping them off for all they have.
3. Start small. Offer to invest a few grand from a few friends, with the promise of better than expected returns. Call this the first layer.
4. Invest some of the money and pocket the rest. To make up any difference between actual returns and those that you promised, offer to invest a few grand from more friends, (the second layer), and use this money to supplement the payoff to the first round of investors -- and provide more pocket change for yourself.
Where in the world are our bailout dollars going?
Filed under: Ripoffs and Scams
Early in November, I wrote about the $700 billion bailout, which was actually part of a much larger bailout plan that many taxpayers were ignorant to, totaling about $2.5 trillion at the time. The new tally is up to $8.5 trillion, according to information posted by Bloomberg late last month.For those who might have missed the details, I'll say it again: The tab for the various bailouts taxpayers are funding is now up to at least $8.5 trillion. There is a laundry list of beneficiaries of this extreme act of charity by the taxpayers. We're spending $5.5 trillion in the financial markets. The Federal Deposit Insurance Corporation (FDIC) is spending $1.5 trillion. The Treasury's TARP and other programs total $1.1 trillion. The Federal Housing Administration (FHA) is spending a measly $300 billion.
There comes a point when the numbers become so large that consumers can no longer grasp the true magnitude of them. $8.5 trillion is over 60% of our entire nation's Gross Domestic Product in 2007. Think of what that money can buy. If you want to be truly sickened, check out this list of what just $1 trillion can buy.
Or look at it this way... With just over 300 million Americans alive today, our government has just spent over $28,000 for every single man, woman, and child alive in our great country. I think I need a bailout to pay for my piece of the bailout. How about you?
Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.
Story of wealthy retiree raises ire in times like these
Filed under: Retire, Ripoffs and Scams
Stories like these hit consumers hard during times of extreme belt-tightening. Jon Reddin is retiring from his position as a district attorney for Milwaukee County after 35 years on the job. And he'll be taking more than a million dollars of taxpayer money with him.Reddin gets a lump sum payout of $976,499 immediately upon retiring. In addition to that, he'll be getting monthly pension checks of $6,070, or $72,840 a year. Not a bad payday, if you can get it.
What's behind this massive windfall for Reddin? It stems from the locally recognized "pension scandal" that occurred in 2000 and 2001. Milwaukee County lawmakers approved a benefit package for county employees that included these lavish pension benefits. When taxpayers found out the real cost of these benefits, all hell broke loose. But it was too late. The benefits had been approved and the lawyers said it couldn't be undone.
So during a time when families, businesses, and governments are struggling to make ends meet, retirees are walking away with huge sums of money that seem like a slap in the face to the rest of us. I realize that Reddin didn't ask for this benefit, and he's simply collecting what shady lawmakers assigned to him. It doesn't decrease the sting of the reality of a million dollar retirement benefit courtesy of taxpayers, however.
Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.
Who is protecting investors?
Filed under: Ripoffs and Scams, Investing
The Securities and Exchange Commission is charged with protecting investors, investigating allegations of wrongdoing on Wall Street, and generally policing public companies. Yet recent failures lead investors to question how effective the SEC is. It is being reported that the SEC had several chances to uncover the massive Ponzi scheme allegedly perpetrated by Bernard Madoff. And we're not talking about some insignificant shreds of information that were presented to them. We're talking about credible information presented to the SEC on numerous occasions over the last ten years or more.
In 2000, Harry Markopolos approached the SEC with solid evidence that Madoff's purported trading strategy couldn't possibly be as he said it was. Madoff said he was generating consistent double digit returns (even when the markets were down) by buying and selling options on the S&P 100 stock index. Yet Markopolos proved that there weren't even enough options available on the S&P 100 to support this strategy. The SEC appears to have done nothing related to this, and Markopolos continued to report his concerns to the SEC over the next several years.
Not all Wal-Mart bargains are really bargains
Filed under: Ripoffs and Scams, Shopping
Every retailer loves a sucker customer who walks in the door convinced he will find the lowest prices in their store. In this Christmas of paucity, Americans are abandoning the mall experience for what they perceive to be the motherlode of bargains, Wal-Mart. Unfortunately, those bargains are often illusory.
As MainStreet's Jeffrey Cretan points out, the price of many low-volume items such as high-def televisions aren't any better than what can be found at the big-box stores. In fact, in Consumer Reports' rankings (subscription required) of walk-in electronics stores, Wal-Mart finished dead last, with an average score on price and worst scores on selection, quality, service, and checkout.
Other departments fare little better. Consumer Reports ranks the chain's drugstore last among mass merchants, with above average prices, and last again in small appliances, with average prices and worst quality and service.
Wal-Mart shines, no doubt, in high-volume items such as clothes, shoes, school supplies and inexpensive house furnishings. However, it needs to make money as much as any chain, so a shrewd shopper will comparison shop items of significant cost. Who knows -- you might even find that a retailer with good service can beat Wal-Mart on the price of that mega-TV for which you have been drooling.
Federal Trade Commission shuts down the "scareware" trade
Filed under: Ripoffs and Scams, Technology, Fraud
The good news is that the FTC has won an injunction to end the peddling of those useless black hole downloads. What's more, a federal court has frozen the assets of a group of businesses which are said to have been flourishing in the scareware trade. You might recognize some of the names from your Internet travels. They include: "WinFixer," "WinAntivirus," "WinAntispyware," "AntivirusXP" and "XP Antivirus 2008", among others.
The temporary court order is an intended precursor to a permanent ban against scareware, flimflam artists.
So, there's good news in the blogosphere, knowing that bogus hard drive cleaners have been shelved at last. However, we must all remember to always take adequate precautions to protect our precious computers: install, and keep updated, one of the many good quality protective software packages available for protection against computer viruses, would be hackers, and spyware.
I cannot overstress this; It's an Internet jungle out there.
1099 for your valentine: How one man redefined 'working girl'
Filed under: Ripoffs and Scams, Tax, Relationships
That should have been her first clue. Later, he reported the money he'd paid her, $10,500 in all, on a 1099-MISC form. Eventually Yang was asked to pay taxes on that $10,500 (and another $40,000 of unreported income that she didn't dispute, did she have other boyfriends for whom she did work, I wonder?), and complained to the tax commissioner that the money from Shih was, in fact, a gift.
Tax court ruled in her favor, though she still owes taxes on the $40,000 not in dispute. There is no evidence of why the two broke up; I'm thinking irreconcilable tax brackets may have been a factor.
Car rental companies are up to their old tricks again
Filed under: Budgets, Ripoffs and Scams, Transportation, Travel
Back in June, consumers were puffed up with pride when Hertz announced it was ending its policy of overcharging customers for gas. If you returned the car without filling the tank all the way again, Hertz gave customers the option of pre-buying gas set according to the going rate at the pumps in that city, plus a $7 fee. Considering that before then, it was gouging us for twice the market rate of gas, or some $8 a gallon, the policy revision was a breath of fresh air.We're gasping again. A few weeks ago, with none of the P.R. fanfare that accompanied the policy's implementation, Hertz quietly eliminated them. We're back to square one. As gas prices became more manageable, the rental car company's panic evaporated, and now that it isn't so desperate for our business, its true colors are returning.
Hertz's policy, poorly disclosed to customers, has also been that if you drive less than 50 to 100 miles during your rental, you are automatically charged a refueling fee. Even if your tank was returned full. That policy, too, seems to live on, unchanged. (I've asked Hertz to tell me if it does. No response so far.)
In early summer, the Maryland Attorney General was threatening to sue car rental companies over practices like these, and some bystanders thought that the legal pressure was what convinced them to relent. Something must have changed behind the scenes -- back-room deals, perhaps? -- because Hertz is no longer playing ball.
