ID Theft and Web Scams Top Consumer Complaints
Posted by configure on 24 January 2002 - 11:50 · no comments & 245 views
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ID theft accounted for the bulk of complaints, representing 42 percent of the total 204,000 reports entered into the FTC's Consumer Sentinel database in 2001. Internet auctions and services and computer complaints, at 10 percent and 7 percent of fraud reports, respectively, were the second and third most frequent sources of complaints, the FTC said.
FTC associate director for planning and information Hugh Stevenson told NewsFactor that a good portion of ID theft and other complaints, such as foreign money offers, are tied to the Internet, referring to the intermingling of the Web with scams by phone or mail.
"Defining exactly what is Internet-related is tricky," Stevenson said. "A substantial chunk of this stuff is Internet-related, though."
Growing Net Threat
The FTC said the growth of the Internet is driving an increase in scams, including: unscrupulous auctioneers; failure to deliver goods on time, as promised or at all; and deceptive offers and hidden charges surrounding Internet and computer services.
"The Internet's coming on," FTC spokesman Derick Rill told NewsFactor. "You see more and more Internet activity, and with that you see accompanying fraud."
Stevenson said the Internet service and computer complaints covered such things as ISP trial offers with unclear terms or difficult canceling procedures, Web design and maintenance services with undisclosed site charges, and equipment purchased online.
Ferreting Out Fraud
The FTC said the number of complaints, particularly about identity theft, has risen sharply since the establishment of online reporting and dissemination of a toll-free phone number (1-877-FTC-HELP).
The FTC's Stevenson told NewsFactor that the 204,000 fraud complaints filed in 2001 are about double the number of complaints recorded in 2000.
"Fraud hasn't doubled," Stevenson said. "Certainly, some of what this reflects is increased outreach and increased willingness to report fraud."
The FTC's Consumer Sentinel database collects complaints from more than 50 law enforcement and private sector partners, with data contributed by such groups as the National Fraud Information Center, Canada's Phonebusters, the Internet Fraud Complaint Center and local Better Business Bureaus.
Protection Tips
Also prominent among the top consumer fraud complaints were: shop-at-home catalog offers; advance-fee loans and credit protection; prizes, sweepstakes and gifts; and business opportunities and work-at-home plans. The FTC warned consumers to disclose credit card and other information only to companies they know and trust.
The commission advised Internet users and other consumers to "walk away" if a company does not clearly list its name, address and telephone number.
"A Web site alone or a mail box drop should raise suspicions," the commission said in a statement.
Howard Beales, director of the FTC's Bureau of Consumer Protection, called the Sentinel database "a valuable tool for state and federal consumer protection agencies that investigate and prosecute fraud."