JACKSONVILLE, Fla. – Scammers will target anyone who will let them, that's a fact. But there are some groups more vulnerable than others, and criminals take full advantage. One group often targeted: those associated with the military.
"It hurts to see anyone be victimized by a scammer, but it takes a special kind of lowlife to take advantage of those who put their lives on the line to protect our country," said Tom Stephens, president of the Better Business Bureau serving Northeast Florida and Southeast Georgia.
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In fact, I found that in 2016, 11 percent of scam reports made to the local BBB were connected to members of the Armed Forces. But, Stephens says that number is likely much higher.
"Unfortunately, young service members often don't report being scammed or taken advantage of because they are embarrassed," he explained.
The most common 2016 scams reported in our area, by those associated with the military, breakdown like this:
Employment scams: 15%
Sweepstakes/lottery scams: 9%
Online purchase: 9%
Advance fee loan: 6%
Tech support: 6%
Rental/housing scams: 3%
Of those, the highest median dollar loss was about $7,000. Stephens points out that advance fee loan scams were second in median dollars lost at about $5,000.
Stephens tells me service members are specifically targeted for three reasons.
1. Many can be young and naive.
2. They have a steady paycheck.
3. The military has the allotment system which guarantees payment to the business in question with each paycheck.
"I would also add that because they grew up in the online world they are very comfortable with online transactions but may not be schooled in ways to identify an online scam," Stephens explained.
Will Amos, a U.S. Marine Corps veteran and co-founder of the free, nationwide, veteran-owned business database, VeteransList.US, has concerns about another scam that's becoming all too common as well: fraudsters claiming to be military veterans when they are not.
"Veterans are a tight knit community and for the most part we are more than willing to give the shirt off our back to help a brother or sister in need. Sometimes people will take advantage of this and pretend to be a veteran in need and take money or resources from well-meaning veterans, charities, and businesses. They usually end up getting sniffed out, but it hurts the credibility of the real veterans who truly do need a little help," Amos explained.
Stephens says this type of scheme doesn't normally get reported to the Better Business Bureau, but as an advocate for every consumer, he knows it happens.
"It's the same type of thinking that causes people to pad their resume. It's reprehensible," Stephens added.
Another scam is plaguing members of the military community. According to new numbers released by the Federal Trade Commission, imposter scams topped its list of complaints from military consumers in 2016. Imposter scams come in many varieties, but work the same way: a scammer pretends to be someone trustworthy, such as a government official or computer technician to convince a person to send money.
Stephens says anyone who is targeted in any kind of scam should contact law enforcement and his or her service branch's Moral and Welfare section. You're also encouraged to notify the FTC and the BBB's Scam Tracker site. Stephens says most scam victims will never recover their money, so the objective of the Scam Tracker is to help keep someone else from falling prey.
Business complaints made to BBB by those associated with the military
While not every ripoff is an actual scam, someone can make a complaint about a company to the Better Business Bureau in order to try and make a wrong into a right, or at the very least, make others aware of the problems they have had with a particular business.
While there is no requirement for someone to disclose a military association when making a complaint to the BBB, many do. Last year, 575 complaints against businesses in our area were people identifying themselves as either active military, retired military or military dependents. The highest percentage came from dependents and retirees.
"That makes sense because active duty are often deployed leaving the spouse to run the household," Stephens said.
By the numbers, in just the first half of 2016, from January to June, most of the complaints to the BBB in Northeast Florida and Southeast Georgia were associated with members of dependents with the Navy, followed by Army, Air Force, Marines, the Department of Defense and then Coast Guard.
Most of the complaints made to the local BBB in the first 6 months of 2016 were about collection agencies. (See information below about how to deal with a debt collector.)
Coming in a close second were new car dealers, followed by movers and cable and satellite companies.
Auto dealers and repair shops are really the most common complaints Stephens says he and the BBB get from military and veterans. He is especially concerned with younger service members who do business with what he calls "buy here, pay here" used car lots. The reason: interest rates are very high.
Amos says he sees and hears a lot about the same issue.
"Lots of young privates come out of bootcamp and for the first time have some money in their pocket, but still have a limited knowledge of personal finance," said Amos. "They will end up going to a car dealership off base and buying a brand new Ford Mustang at 20 - 25 percent interest. I have heard stories of up to 30 percent."
You can find resources for military and veterans here.
Advice for service members to avoid scams and ripoffs
The Federal Trade Commission has a section on its website set up specifically to help members of the military avoid scams and ripoffs.
Debt collectors
As the local BBB saw a number of complaints last year regarding collection agencies, same thing with the FTC. If you are dealing with a debt collector, the FTC recommends you do the following:
Take notes if you talk to a debt collector: the date and time you talked, the person’s and the company’s name, their address and phone number, and their answers to your questions.
Ask for a written notice about your debt. It’s called a “validation notice,” and debt collectors have to send it. If you don’t think the debt is yours, follow instructions on the notice.
Hang up if a debt collector harasses you, curses, or threatens you. They’re not allowed to do that. Report them to the FTC.
Pay attention if you get a “summons” or notice about a lawsuit. The summons should include the name of the court, its clerk, and a phone number to verify. If you don’t go to court, you automatically lose. Talk to your PFM or legal services if you get a court summons.
Avoid loan scams and ripoffs
The FTC says if a service member needs money fast, they could fall victim to a ripoff. Companies that make quick loans – for example, payday and car title lenders – sometimes charge extremely high interest rates. They can be very expensive ways to borrow money. But the Military Lending Law says payday lenders can only charge up to 36% for service members. Before opting for a quick loan, the FTC says consider the following:
Can you get money from anywhere else? Consider a loan from your bank or credit union. Even using a credit card may be better than a payday or title loan.
Shop around for the best deal you can get on the APR, fees, how soon you have to repay the money, and what happens if you don’t pay on time.
Facing financial trouble? There’s help for you. Talk to your PFM about your choices. Do you need more time to pay your bills or a possible advance on your paycheck? Do you want to talk with a certified credit counselor about managing your money? Do you want some help from a military relief society? Call DoD’s Military OneSource help line 24/7 at 1-800-342-9647 to discuss alternatives.
Don't become a victim of a scam
The FTC says more and more schemes combine new technology with the lies they tell in order to get people to send money or give up their personal information.
1. If someone calls asking for money or personal information, hang up. It’s easy to fake Caller ID, so don’t use it to decide whether a call is real.
2. Is it a recorded sales pitch? Robocalls like that are illegal. Hang up. Don’t press a number to speak to a person or be taken off the list. That could just lead to more calls.
3. Before you give up your money or personal information, stop and check it out. Type a company or product name into your favorite search engine with words like “review,” “complaint” or “scam.” Search for a phrase that describes your situation, like “IRS call.” Search for phone numbers to see if other people have reported them as scams.
4. Talk to someone you trust. Con artists want you to make decisions in a hurry, so slow down. Tell a friend -- before you give up your money or personal information.
5. If you decide to pay someone, consider how you pay. Credit cards have fraud protection built in, but some payment methods don’t. Wiring money through services like Western Union or MoneyGram is risky. It’s nearly impossible to get your money back. That’s also true for iTunes cards and reloadable cards like MoneyPak, Reloadit, or Vanilla. Once you share the number on the card, the money is gone. Remember that the government and honest companies won’t insist that you use these payment methods.
6. Never deposit a check and wire money back. That’s a big sign of a scam. Banks have only a few days to make funds from deposited checks available. But it can take weeks to uncover a fake check. If the check you deposited turns out to be fake, you have to repay the bank the full amount.
You can sign up for the FTC’s free scam alerts and get the latest tips and advice about scams. You can find more advice from the FTC for military and veterans here.