Monday, November 06, 2000

Net scams using government


Buyers beware: Agencies don't offer stay-at-home work

The Associated Press

        COLUMBUS — Authorities say con artists are using the names of federal agencies to lend credibility to phony work-at-home schemes.

        However, “the government does not license itself out that way,” said Federal Trade Commission spokesman Harold Shapiro. “We do not offer work-at-home opportunities.”

        The promotions, which prey on stay-at-home moms and elderly and disabled people, pop up on Internet sites, help-wanted newspaper and magazine ads and utility poles.

        For a fee, typically less than $100, they offer lists of government jobs, information on work-from-home job opportunities or kits on how to get government jobs.

        The U.S. Postal Service, the Social Security Administration, the National Park Service and the FTC are among the federal departments routinely mentioned.

        “It's information you can get by visiting the local post office or accessing the federal government job site online,” Mr. Shapiro said.

        He said that although the government at times runs help-wanted ads, it does so through its own agencies, not third-party groups.

        “It's very easy to work for the federal government, and you can do it at no cost — except time,” he said.

        Linora Garringer of the Columbus suburb of Hamilton Township said she lost $85 to one of the schemes.

        “They told me I would be working with HUD (the U.S. Department of Housing and Urban Development) and could make money by locating people who are owed money by HUD,” she said.

        She responded to an ad for a Salt Lake City company that uses nearly a half-dozen names, including American Advertising and Success Marketing.

        “I'm thinking this is backed by the U.S. government,” Mr. Garringer said. “Surely, it has to be legitimate.”

        “It's the famous old scam of associating yourself with the government, somehow,” said Russell Berhmann, president of the Salt Lake City Better Business Bureau, which has been trying to track down American Advertising.

        Mr. Berhmann said some con artists select business names that sound similar to government agencies. “When you throw the government's name out there, a lot of people let their guards down,” he said. “That is about as low as you can get.”

        HUD does owe millions of dollars in refunds to home buyers who made early payoffs on mortgages insured by the Federal Housing Administration, said HUD spokeswoman Veda Lamar.

        The job of finding those individuals is contracted to companies that bid on the work, even though anyone can file a request under the Freedom of Information Act to obtain a list of names for each state, Ms. Lamar said.

        American Advertising had promised Ms. Garringer that she could earn as much as 20 percent of the amount owed to each home buyer she located.

        “They've taken a legitimate process and turned it it into a scam on unsuspecting people,” Ms. Lamar said.

        In recent days, HUD has referred American Advertising and other operators of such schemes to the FTC for investigation.

        Mr. Berhmann said the company has been elusive, constantly changing names and addresses.

        “All our correspondence to them has come back,” he said.

       



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