Google, Facebook enlisted to help fight online economic stimulus scammers

You knew some chuckleheads somewhere would hop on the economic stimulus plan with a way to scam it online.  Indeed the Federal Trade Commission today in a press conference said the problem has quickly become serious.

The FTC said it was seeing significant upticks, though it didn't offer specific amounts,  in Web site scams and e-mail phishing frauds looking to drain money from consumer's credit accounts and download malicious software or spyware that can be used to make them a victim of identity theft, according to Eileen Harrington, acting director, of the FTC's Bureau of Consumer Protection.  

"Web sites may advertise that they can help you get money from the stimulus fund.  Many use deceptive names or images of President Obama and Vice President Biden to suggest they are legitimate.  They're not," Harrington said.

Harrington said the agency has enlisted the help of Google, and Facebook to help eliminate the ads for deceptive Web sites. Harrington said the FTC was working with other ad services to combat the problem but declined to name them.

In the Web site arena, the FTC says sites such as  Presidentobamagrants.com or Officialstimulusgrants.com suggest that for a small sum of money - as little as $1.99 in some cases - consumers can get a list of economic stimulus grants they can apply for, said .  But two things can happen: the number of the credit card the consumer uses to pay the fee can fall into the hands of scam artists, or the $1.99 can be the down payment on a "negative option" agreement that may cost hundreds or thousands of dollars if the consumer does not cancel.  

She noted that many illegitimate sites use photos of Obama and Vice President Joe Biden to give the appearance of authenticity, the consumer protection agency said in a Monday e-mail. Sites also use logos from ABC, CBS, CNBC, CNN, FOX, NBC, MSNBC, and other major media outlets to make them appear legitimate.

E-mail messages may ask for bank account information so that the operators can deposit consumers' share of the stimulus directly into their bank account.  Instead, the scammers drain consumers' accounts of money and disappear.  Or bogus e-mail may appear to be from government agencies and ask for information to "verify" that you qualify for a payment.  The scammers use that information to commit identity theft.  Some e-mail scams don't ask for information, but provide links to find out how to qualify for funds.  By clicking on the links, consumers have downloaded malicious software or spyware that can be used to make them a victim of identity theft, Harrington said.   

Harrington noted that the government doesn't charge for grant information and that the site,  recovery.gov has all legitimate government grant information most consumers need.

The FTC warnings come on the heels of other scam notices.  For example, the Small Business Administration this week issued a phishing  scam alert warning companies not to respond to letters falsely claiming to have been sent by the SBA asking for bank account information in order to qualify them for federal tax rebates. The fraudulent letters were sent out with what appears to be an SBA letterhead to small businesses across the country, advising recipients that they may be eligible for a tax rebate under the Economic Stimulus Act, and that SBA is assessing their eligibility for such a rebate. The letter asks the small business to provide the name of its bank and account number. Such phishing letters should be ignored or reported to the SBA.

In addition, the Better Business Bureau this week warned consumers to be wary of companies that offer "free" advice on how to get government grants. The BBB has received hundreds of complaints from consumers who went to Web sites such as www.federalgovernmentgrantsolutions.com that sold information on how to get grant money from the government.  Two Las Vegas based companies, Grant Instructor and Raven Media, have set up dozens of Web sites and received 409 and 295 complaints respectively from consumers across the U.S. and both have earned an F grade from BBB.  Another company based in Utah, Grant University, has received more than 300 complaints from across the country in the past year and has an F rating from BBB.

The FTC last week reported that for the ninth year in a row identity theft - particularly in Arizona and California -- was the number one consumer complaint filed with the Federal Trade Commission in 2008.  Of 1,223,370 complaints received in 2008, 313,982 - or 26%- were related to identity theft.

The FTC ‘s list in the  "Consumer Sentinel Network (CSN) Data Book for January-December 2008," states that credit card fraud was the most common form of reported identity theft at 20%, followed by government documents/benefits fraud at 15%, employment fraud at 15%, phone or utilities fraud at 13%, bank fraud at 11 %and loan fraud at 4%. The CSN received over 1.2 million complaints during calendar year 2008.

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