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India Currents gave me a voice in days I was very lost. Having my articles selected for publishing was very validating – Shailaja Dixit, Executive Director, Narika, Fremont
While trawling the Internet for part-time jobs in September after being furloughed from her travel company in March, Sumathi Rao, a New York-based travel agent, spotted a job offer in her FB newsfeed she could not pass up. It seemed too good to be true
The Fouray Foundation (account now suspended) had an opening for a Fundraising Assistant. Their pitch was promising. She could work from home. Her responsibilities would include helping her manager Didiane Marcheterre (possibly an alias), write to donors for contributions. Funds from the charitable foundation would supposedly support non-profit hospitals, medical workers, and healthcare projects. The salary, at $1000 a week, thought Rao, would nicely supplement the $300 lost wages assistance New York state benefit offered to eligible workers looking for jobs. It would serve as a cushion until the pandemic eased off and her old job, hopefully, was reinstated.
So Rao contacted Fouray. A follow-up message invited her to send her resume and ask questions about ‘the excellent option’ posted in the ad.
After a promising interview with Marcheterre, Rao was set to go. All she needed to do next said Fouray, was to buy ‘bitcoins’ from an ATM, so they could ‘deposit money in her account’ via a direct deposit authorization. The odd request raised an alarm bell. Rao says she trusted her instinct and responded with a firm no. And that was that.
When recounting her experience with former colleagues at her travel agency, Rao discovered that several of them had also been approached by Fouray. A little more digging revealed complaints filed by other victims against the foundation for fraud. Rao promptly reported Fouray to the Federal Trade Commission (FTC). An internet search on the Fouray Foundation will now only produce an ‘Account Suspended’ message.
With record unemployment inflicted by the economic downturn and job losses, people like Sumathi Rao are simply looking to make ends meet. Scammers are taking advantage of their desperation with false promises of making money in the financial crisis, warned attorneys from the FTC at an EMS ethnic media briefing on December 15.
So if an opportunity seems too good to be true, it usually is. During the pandemic, scammers are ramping up fraudulent get rich schemes across the nation. “Scammers make big promises when pitching a fake money-making opportunity,” explained Rhonda Perkins, an attorney with the FTC, “but that’s just an income illusion.”
Impact of Income Scams
The volume of reports to the FTC “reached the highest levels on record in the second quarter of 2020,” added Kati Daffan. In the first 9 months of 2020 alone, people reported losing more than $150 million to harmful scams.
The FTC has joined forces with federal, state, and law enforcement agencies to announce action against deceptive income scams, said Daffan, pointing out that the 15 FTC cases represented in the sweep accounted for an alleged injury of more than a billion dollars.
Who Gets Targeted?
Scams tend to target certain communities, stated Daffan, who went on to describe scams currently under investigation at the FTC. In one case, scammers were pitching fake sou-sous savings clubs and illegal pyramid schemes on social media at communities that have historically engaged with Sou Sous – which are rotating savings clubs originating out of West Africa and the Caribbean. They promise big payouts to individuals out of a common savings fund sponsored by trusted family and friends. The majority of people in these fake schemes end up losing considerable amounts of money said Daffan.
Another FTC case featured a scam pitched at Latina women through Spanish language TV ads, which proposed a work-from-home scheme to make money from selling luxury goods to others in their community. An investment scam called Raging Bull promised profits through secret trading techniques to older people, retirees and immigrants – they lost at least $137 million in the last three years. Other scams targeted students, veterans and college age adults in a variety of bogus opportunities.
According to FTC data, the average loss to scam over $500 affected more people who lived in zip codes that skewed older, but when the loss to scam was less than $500, those affected tended to live in zip codes with a black majority population. But more data is required said Daffan, to fully determine who is getting affected by income illusion schemes.
Operation Income Illusion
In an effort to combat income scams the FTC has launched Operation Income Illusion. The campaign is designed to raise awareness about consumer fraud and counter the proliferation of get rich quick scams – the many pyramid and chain letter schemes – flourishing on social media.
Daffan explained that the campaign wants to alert people to soundbites and false promises used in business coaching and job scams to catch people’s attention about making money. She warned consumers to watch for options that talk about working from home or starting their own business with little time and effort. People need to be on their guard about prospective fake jobs, investment schemes, coaching courses, business offers, pyramid schemes, and reshipping scams, cautioned Daffan.
An FTC video offered additional advice on how to avoid income scams which come in many forms, and offer money-making opportunities online, through real estate, in the stock market, or by selling goods. But the most obvious sign of a scam are ones that promise megabucks if consumers use ‘their methods.’
Spot the Sham
Perkins suggested looking for absurd claims in a typical pitch that includes words and phrases like –
‘amazing wealth’
succeed online’
‘earn hundreds of dollars per hour from home’
‘what if an online millionaire offers you his entire business no strings attached’
These sort of offers only guarantee only one outcome warned Perkins – that buyers will be out of their hard-earned money. Most scams guarantee success in a short time, which is unrealistic. She urged people to do their research before investing in any income schemes, and search online using the company name with keywords like scam, complaint, and review, and to be wary of glowing testimonials that could be fake or misleading. The best course of action said Perkins, would be for consumers to simply walk away.
So Buyer, Beware. If you see one of these offers, remember that the only people getting rich are the scammers selling the system.
Meera Kymal is a contributing editor at India Currents
HELPLINES
Report scams to www.ReportFraud.ftc.gov and if people can’t get online, call 1.877.FTC.HELP (1.877.382.4357).
To find out more about
Vaccine Scams at: https://www.consumer.ftc.gov/blog/2020/12/covid-19-vaccines-are-pipeline-scammers-wont-be-far-behind
MLM Businesses and pyramids at: https://www.consumer.ftc.gov/articles/0065-multi-level-marketing-businesses-and-pyramid-schemes
Sou-sous at: https://www.consumer.ftc.gov/blog/2020/08/real-or-fake-savings-club
Other resources at www.ftc.gov/languages.