5 scams spreading like a virus in recession |
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"A month after the fraudulent company has been paid, the victim will see that these negative items have been challenged and removed from his credit report," says Bartholomy. "But that is only temporarily. As soon as the negative item is verified as authentic, it's put back on the credit report."
Besides paying for nothing, the victim is vulnerable to identity theft from the scammers, Bartholomy says.
How to avoid this scam: Anyone can receive a free credit report once a year from each reporting agency -- Equifax, TransUnion and Experian -- at Annualcreditreport.com. So you can access your report three times a year and challenge inaccurate items yourself for free.
"Instant" credit repair isn't a legitimate option, and nobody can fix your credit but you, Bartholomy says.
3. Cash-for-gold scam
Offers abound to pay you for your unwanted
gold, silver or platinum -- usually jewelry. You're told to
place it in an envelope provided by the company and mail it in.
In return, the company says it will send you the cash value of the
gold within 24 hours.
Durst says these companies use the calendar against you. They claim it takes seven to 10 days to receive your jewelry, when actually it takes only three to four days.
"This gives them time to assess the value of the gold and, in doing so, they date and cut a check immediately, usually for an amount that the customer isn't happy with," says Durst. "Then, the check isn't mailed for several days."
When the check is finally sent, it's too late to return it. By the fraudulent company's rules, it must be sent back within 10 days of the date on the check. Of course, reaching customer service to complain is next to impossible. When customers do finally get through, they have their own meltdown because their gold has already been melted down.
And if you do get a check for your gold, it's only for a fraction of what it's worth.
How to avoid this
scam: If you have any one-of-a-kind heirlooms or antique
jewelry, you should take them to a reputable jeweler or antique dealer
for an appraisal, Durst says.
"Those unique pieces may be worth considerably more than their weight in gold," Durst says.
Any other gold could be taken to your
local pawn shop or jeweler. Durst suggests going to several to find
the one that will pay you the most.
4. Mystery shopping scam
The victim answers a newspaper or Internet ad asking for mystery shoppers. He or she is sent a training assignment and a cashier's check for a few thousand dollars. The assignment letter tells the mystery shopper to cash the check at the bank, go to a certain retail store and write a report on the cleanliness and service.
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