The Consumer Federation of America (CFA) recently released its 2017 report of consumer scams based on data from local consumer agencies across 23 states who identified solar energy installations and home alarm system sales as newcomers to the game. Scammers continue to primarily target elderly or disabled consumers, according to the CFA.
Scammers in alarm sales are reportedly sending consumers letters that look like those from government agencies warning homeowners that their neighborhoods might be unsafe due to the nationwide opioid crisis. The letters offer ‘free’ alarm systems. Should one fall for it, however, they’ll quickly realize the contracts are loaded with clauses which could liquidate their bank accounts.
“Alarm systems are supposed to protect consumers, but consumers need better protection from rogue alarm companies and salespeople who try to take advantage of them,” said Susan Grant, CFA’s director of consumer protection and privacy.
Those hoping to save on home energy costs who opt to sign up for solar-panel installations are generally lied to about the extent of government incentives offered and are often told their electric bills will cease entirely. Sometimes, incompetent installers damage roofs in the process. Other home improvement complaints include incompetent workmanship or failure to complete tasks.
A multitude of auto-industry scams concerning new and used car sales as well as shoddy repairs and bill disputes are prevalent. “When the car you just bought breaks down or the roofer takes your deposit and disappears, it’s not just an inconvenience, it’s a disaster,” Grant said. “These problems can cause significant financial and physical hardship for consumers.”
In some cases, express consent to charge for repairs was never received. In others, demo work on homes was completed, but the contractor never returned. Thus, individuals were left without a place to live. Other top complaints on the list include those internet sales, utility fraud, retail, lending and debt collection, rental property management, healthcare, furniture and appliance sales, and travel.
Seth Crossno, an online personality in the Raleigh, North Carolina area, better known as William Needham Finley IV, and his friend, Mark Thompson were recently awarded $5 million in damages in their lawsuit against rapper Ja Rule’s partner, Billy McFarland. McFarland is facing federal prison charges for luring people to the Bahamas on the premise of a luxurious getaway and event. When the unsuspecting travelers arrived, they were made to stay in FEMA-style tents surrounding a gravel pit with insufficient hygiene facilities, low-quality food, and not enough water to drink. The celebrity-packed festival they were offered tickets to attend never existed.
Stacy Miller, the attorney representing Crossno and Thompson, said he and his clients had asked the court to “to send a message to these people who defrauded North Carolina consumers.” McFarland, he said, “created this big event. He lured these young men away from their homes to another country. It was a very dangerous and scary situation.”
“This could be portrayed as a bunch of millennials got scammed,” said Crosno. Thompson added, “They obviously spent a great deal of money on their marketing campaign.”
Other top travel industry scams include failure to deliver a package altogether, and billing and cancellation disputes.
Unfortunately, consumers continue to be lured into shady situations across a multitude of industries. Tactics have gotten more advanced, and scammers are using legitimate consumer concerns to offer illegitimate goods and services. Buyers beware.