FBI says insurance fraud assumes many forms
Wallingford, CT – June 11, 2009 – As baby boomers enter their silver years, they are becoming targets of sophisticated medical insurance fraud.

Connecticut Better Bureau President, Paulette Scarpetti, says victims are easy prey for fraudsters.

“Consumer education can help people in need of medical attention protect themselves from these crimes. Medical insurance fraud doesn’t only contribute to skyrocketing insurance premiums, but they can also compromise patients’ health.”

The Federal Bureau of Investigation (FBI) has issued an alert about the top four most common types of health Insurance frauds: Medical Equipment Fraud, “Rolling Lab” Schemes, Services not performed and Medicare fraud.

Medical Equipment Fraud:
Individuals are offered “free products” from equipment manufacturers. Insurers are charged for products that were not needed and/or may not have been delivered.

“Rolling Lab” Schemes:
Unnecessary and sometimes fake tests are administered at health clubs, retirement homes or shopping malls and billed to insurance companies or Medicare.

Services Not Performed:
Customers or health care providers bill insurers for services never rendered by changing bills or submitting fake ones.

Medicare Fraud:
Medicare fraud can take the form of any of the schemes described above, and seniors are frequent targets of Medicare schemes, especially by medical device manufacturers who sell medical equipment and offer seniors free medical products in exchange for their Medicare numbers.

The fraudsters will either forge a physician’s signature or bribe an MD for merchandise or a service, and then bill Medicare for medical devices that were neither needed nor ordered.

Estimates by government and law enforcement agencies place the loss due to health care fraud as high as 10 percent of our nation’s annual health care expenditure—or a staggering $226 billion—each year.

Other types of healthcare fraud target the patients with Medical Identity Theft: using a person’s name or other identifying information without that person’s knowledge or consent, to obtain medical services or goods, or to submit false insurance claims for payment.

Medical identity theft frequently results in erroneous information being added to a person’s medical record, or even the creation of an entirely fictitious medical record in the victim’s name.

Methods used to carry out healthcare fraud include:

•Misrepresenting non-covered treatments as medically necessary covered treatments for purposes of obtaining insurance payments—widely seen in cosmetic-surgery schemes, in which non-covered cosmetic procedures such as “nose jobs” are billed to patients’ insurers as deviated-septum repairs.

•Falsifying a patient’s diagnosis to justify tests, surgeries or other procedures that aren’t medically necessary.

•Billing a patient more than the co-pay amount for services that were prepaid or paid in full by the benefit plan under the terms of a managed care contract.

•Connecticut Better Business Bureau offers the following advice to prevent consumers from becoming targets of healthcare fraud:

•Protect your health insurance ID card like you would a credit card. In the wrong hands, a health insurance card is a license to steal. Don’t give out policy numbers to door-to-door salespeople, telephone solicitors or over the Internet. Be careful about disclosing your insurance information and if you lose your insurance ID card, report it to your insurance company immediately.

•Report fraud. Call your insurance company immediately if you suspect you may be a victim of health insurance fraud. Many insurers now offer the opportunity to report suspected fraud online through their Website.

•Be informed about the health care services you receive, keep good records of your medical care, and closely review all medical bills you receive.

•Never sign blank insurance claim forms.

•Never give blanket authorization to a medical provider to bill for services rendered.

•Ask your medical providers what they will charge and what you will be expected to pay out-of-pocket.

•Do not do business with door-to-door or telephone salespeople who tell you that services of medical equipment are free.

Scams involve attempts at identity theft

Wallingford, CT – May 19, 2009 – As the 2010 Census gets under way, Connecticut Better Business Bureau cautions consumers to be cooperative but careful about providing personal information to would-be census workers who make contact by phone or show up at their front door.

More than 140,000 U.S. Census workers are fanning out across the nation to verify the addresses of households and count and gather information about every person at every address in the U.S., including their age, gender, race and other relevant data.

Connecticut Better Business Bureau President, Paulette Scarpetti, notes many people are cautious about providing personal information to unsolicited phone callers or visitors. While the Census is an exception to the rule, unscrupulous operators are posing as government employees in an effort to get as much sensitive personal information as possible.

“Scammers know citizens are required by law to respond to the U.S. Census Bureau and give out some personal information, but that does not include detailed personal financial information.”

Law enforcement authorities in several states have issued warnings that scammers have begun posing as Census employees and knocking on doors asking for donations and Social Security numbers. Complicating the situation is the fact that Census workers may contact households by mail, telephone and visits.

Connecticut Better Business Bureau offers the following tips on how to tell the difference between a U.S. Census worker and a con artist:

•Legitimate Census representatives will have a badge, handheld device, canvas bag and confidentiality notice. Always ask to see their identification and never invite anyone you do not know into your home.

•Census workers who show up at your door will only verify address information and never ask for personal financial or Social Security information. Do not give those details to anyone, even if they claim to need it for the U.S. Census.

•While Census workers may eventually contact you in a number of ways, they will not contact you by e-mail. Never click on a link or open any attachments in an e-mail purporting to be from the U.S. Census Bureau.

More information on the Census is available at http://www.census.gov. Consumers also may find more information on avoiding identity theft and fraud at www.bbb.org.

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Trying to help a good cause could get you ripped off by fraudulent magazine salespeople

Wallingford, CT – May 8, 2009 – Better Business Bureau warns that deceptive door-to-door magazine sales crews are hitting the pavement in Connecticut, and looking to earn a quick buck this summer. In the last 12 months alone, BBB’s across the nation received 1,100 complaints from consumers in 46 states against more than 50 companies that are selling magazines door-to-door. A number of these complaints were filed by Connecticut consumers.

Many of these companies employ crews of high school and college-age people who are trying to earn money over their summer break. These crews are sent to communities to knock on doors and sell magazines—sometimes without appropriate licensing. In the sales pitch, the representative might explain they are working to help raise money on behalf of a charity, for a school trip or even selling subscriptions to support troops in Iraq.

A Greater New Haven woman said a pair of students claiming they were from the University of Rhode Island, knocked on her door, said they lived “down the street,” and were selling magazines and books to “go to London.” Later, when she became suspicious, she called police, filed a report with Connecticut Better Business Bureau and put a stop on her check.

Connecticut Better Business Bureau President, Paulette Scarpetti, says victims readily believe the phony sales pitch and often pay hundreds of dollars by check. However, complaints allege the sales reps took the checks and the magazines never arrived.

“We are alerting consumers to this scam to prevent an epidemic of door-to-door magazine fraud. We encourage all Connecticut residents to be vigilant, and to inform their children, parents and grandparents about this type of operation.”

Scarpetti adds that consumers are not the only victims of this scam.

“The young salespeople also are being taken advantage of by their employers, forced to work long hours and having their wages withheld from them.”

BBB offers the following advice to avoid getting scammed by a door-to-door magazine sales scam:

•Always research the company with your Better Business Bureau at www.bbb.org before issuing a check for a magazine subscription.

•The Federal Trade Commission’s Three-Day Cooling-Off Rule gives the customer three days to cancel purchases over $25 that are made in their home or at a location that is not the seller’s permanent place of business. Along with a receipt, salespeople should also include a completed cancellation form that customers can send to the company to cancel the agreement. By law, the company must give customers a refund within 10 days of receiving the cancellation notice.

•Victims of fraudulent magazine sales can file a complaint with their Better Business Bureau at www.bbb.org, local law enforcement, and the state Attorney General’s office.

Wedding insurance becoming more popular to ensure worry-free walk down the aisle

Wallingford, CT – April 21, 2009 – With the number of commercial bankruptcies on the rise, some brides and grooms are being burned by bankrupt vendors. Connecticut Better Business Bureau says wedding insurance is becoming a popular hedge against vendors who may close-up shop and leave couples in the lurch on their wedding day.

According to Travelers Insurance, more than 40 percent of all wedding insurance claims filed during the past two years involve unforeseen problems with vendors and venues, some of which went bankrupt.

The cost of a wedding is considerable, averaging $28,000.

Connecticut Better Business Bureau President, Paulette Scarpetti, says wedding insurance can help soon-to-be newlyweds from taking a major financial hit before they reach the altar.

“There are many product and service vendors involved in wedding planning, including venues, catering, bridal shops, and photographers, any one of which can suddenly close their doors before the exchange of vows.”

Aside from vendor no-shows, comprehensive wedding insurance can also cover a wide variety of other mishaps, including cancellation due to bad weather, health issues involving key participants, military deployment and non-delivery of goods, such as bridal gowns or a wedding cake, photographers and others under contract who do not deliver as promised.

To illustrate the potential for losses, BBB serving Charlotte, South Carolina received a flood of complaints from desperate brides about a bridal shop which had recently closed its doors after deceiving its customers. According to customer complaints, the shop continued to take money from customers but never paid its designers so the dresses never arrived. One jilted bride paid $10,000 for a gown and 13 bridesmaid dresses, but the shop closed-down and kept her money only two weeks before her wedding. The store continued to take orders for new dresses and passed-off floor samples as originals.

Connecticut BBB offers the following advice for those contemplating the purchase of wedding protection insurance:

Shop for the insurance before paying deposits on any wedding-related services.

Comparison shop for insurance policies and pay close attention to the fine print for any limits on claims, as well as the amount of the deductibles. According to the Insurance Information Institute, wedding coverage will typically cost between $125 and $400, depending on the amount of coverage.

Ask vendors if they have their own insurance coverage to protect you if there’s a problem. Payments made by credit card also offer couples the opportunity to contest charges by vendors who do not follow through on their commitments, or if there related problems.

Keep good records and all receipts in the event you have to file a claim with the insurance company.

Always research insurance companies, wedding goods and event service providers by checking Reliability Reports free of charge online at www.bbb.org.

Popular social networking sites being used by hackers, con artists and ID thieves

Wallingford, CT – February 17, 2009 – Perhaps it was just a matter of time: Cyber-criminals have moved to popular social networking sites to spread viruses and steal users’ identities.

Sites like Facebook and MySpace have become fertile ground for hackers and scammers to lure unsuspecting users into downloading computer viruses and divulging personal information.

Connecticut Better Business Bureau President, Paulette Scarpetti, says scammers have found a new platform from which to do damage.

“As of December, Facebook had an estimated 150 million active users of all ages, many of whom are unaware that there are people on the same site trying to corrupt their computers and steal their identities. This is a wakeup call for all users, and especially, parents because of the vulnerability of young people on social network sites.”

The popularity of social networking sites has grown exponentially in recent years as a venue for finding and reconnecting with old friends we know and trust.

Better Business Bureau, however, warns that scammers know they can take advantage of that trust by posing as friends, family members and co-workers in order to commit cyber crime.

Common social networking schemes include:

“Friend in Distress” Scam

Facebook users may receive an e-mail from a friend saying they are in dire trouble – and need money wired to them.

The recipient is unaware their friend’s account has been hacked and that the message was sent by cyber criminals who ask that the friend wire them money. If the Facebook user wires the cash, they then discover their friend is safe, the e-mail was a scam and that there is no way of recovering the money.

Phishing Friends

A particularly aggressive computer virus called “Koobface” made the rounds on MySpace and recently hit users of Facebook. Users receive a message from a friend saying “You look awesome in this video,” and which contains a hyperlink to an outside web site to view the video.

When the victim clicks on the link they are told they have to update the popular Internet browser plug-in Adobe Flash. Agreeing to the download installs the virus onto the victim’s computer and monitors Internet activity to potentially steal personal information. Victims of the Koobface virus have experienced considerable difficulty removing it, and in some cases, simply scrapped their computers.

Your BBB has some advice for staying safe on social networking sites:

Be wary of messages from friends or strangers that direct you to another web site via a hyperlink.

Before wiring money to a “friend in distress,” users should attempt to contact the friend directly to confirm the situation. If that is not possible, BBB recommends asking a question to which only the friend would know the answer.

Keep important information private. While some social network sites allow the user to share phone numbers, birthdates, e-mail and postal addresses, BBB recommends against posting such information to prevent a cyber thief from gathering enough information to steal a user’s identity.

Be selective when accepting friend invitations. BBB warns it is best to decline a request for friendship from someone the user doesn’t know.

More advice on staying safe online is available at www.bbb.org.

Connecticut Better Business Bureau has advice for securing your mail and reducing potentially “dangerous” junk mail

Wallingford, CT Wallingford, CT – While many Americans believe most identity theft occurs during online transactions, consumers need look no further than their own home for a potential “open door” to identity thieves: The mailbox.

According to a Javelin Strategy and Research survey, more than eight million Americans became the victims of ID theft this past year, with nearly a half million the result of stolen mail.

Connecticut Better Business Bureau President, Paulette Hotton Scarpetti, says there is a significant risk of identity theft from your own mailbox.

“Thieves can steal pre-approved credit cards, bank, credit card and other financial statements, as well as a wealth of other material to enable them to ultimately steal your identity.”

There are a number of measures consumers can take to protect themselves from these criminals:

1.Secure your mailbox

Consider replacing your mailbox with a slot in your door or a locked mailbox which requires a key to remove mail.

2.Reduce junk mail

One person’s garbage is an identity theft’s goldmine. Fifty-six percent of identity theft is the result of direct contact with the victim’s personal information by rifling through a mailbox or trash can.

3.Shred sensitive material

Many people consider junk mail a nuisance and simply throw it out. But some of that unwanted mail may contain pre-approved credit offers that may be used to open fraudulent accounts. Make sure they are shredded before throwing them out.

4.Opt-out of Junk Mail

You can reduce the risk of mailbox threats by opting-out of pre-screened, pre-approved credit card offers by calling 1-888-567-8688 or visit www.optoutprescreen.com. You will be asked for personal information including your name, address, date of birth and Social Security Number. This information is used to process your request and remains confidential.

You may also stop unwanted junk mail by contacting the Direct Marketing Association and asking to be removed from their marketing list at www.dmaconsumers.org/cgi/offmailing.

Finally, carefully read materials from your financial institutions to look for an “opt-out” clause which will enable you to prevent the sharing of your personal information with other parties.

Outgoing mail is also at risk of being hijacked, so consumers are urged to drop off mail with payments and other sensitive information in a U.S. Postal Service letter box.

For more helpful tips to prevent identity theft, please visit www.bbb.org.

Connecticut Better Business Bureau says watch out for bank card fees and potential problems with retail gift cards

Wallingford, CT – December 1, 2008 – Hard cash is on many wish lists this year as families try to find a balance between holiday spending and paying for essentials. A popular option this season is the pre-paid bank card, or as they are also known, “stored-value” cards.

The cards are similar to pre-paid gift cards but may be used anywhere credit cards are accepted, allowing shoppers more flexibility as to where the money can be spent. These cards, however, are not without a downside and Connecticut BBB is providing advice on the purchase and use of pre-paid bank cards.

Connecticut Better Business Bureau President, Paulette Hotton Scarpetti, says buyers and recipients of these cards must pay special attention to their terms and limitations.

“Use of these pre-paid bank cards may involve substantial fees and limitations, and they vary, so BBB recommends consumers pay special attention to details when giving or using a pre-paid bank card. In other words, read the fine print and ask lots of questions about the cards’ restrictions.”

One BBB recently researched one bank-issued card and discovered more than 27 different fees, ranging from under a dollar to $20. These fees may be attached to contacting customer service, loading more money onto the card (recharging), and inactivity. One card even had a weekly base fee of $1.95, which adds up to more than $100 a year to use the card.

Pre-paid cards are often branded by major credit card companies, and while they promise zero or limited liability if a credit card is lost or stolen, the same protections do not necessarily apply to stored-value cards, which should outline whatever protection is afforded to the holder.

Retail gift cards – Buyer beware!

In the midst of the recent closures and bankruptcies of several major retail chains, consumers are concerned about buying gift cards and what might happen if the store goes out of business before the card is used.

According to Scarpetti, consumers have good reason to think carefully before deciding whether to buy a store gift card.

“Because there is no way of telling in advance whether a retailer will go out of business, your BBB advises you think carefully about gift card giving. The sad fact is that if a retailer closes its doors before a gift card is used, the holder is typically left with a worthless piece of plastic.”

Many consumers, in an effort to avoid a “holiday credit card hangover” are increasingly turning to debit cards and cash purchases, and even giving cash or checks as presents rather than gift cards.

What if your favorite store goes bankrupt?

If a store files for Chapter 11 bankruptcy protection, it a signal it intends to continue operations while sorting out its financial problems. While some may still honor gift cards others have no choice but to stop redeeming them. Gift cards are treated as a loan to the company, not as cash.

If, however, the firm is filing for Chapter 7, meaning it intends to give up and simply close down, consumers are at the back of the line behind creditors who are owed money.

Connecticut BBB has some pointers when considering buying a gift card:

-Check out businesses at www.bbb.org to see whether any government actions or bankruptcy information is posted on a Reliability Report.

-Ask if the gift card has an expiration date or may be redeemed online and whether there are any location limitations using the card.

Finally, if you receive a gift card, use it as soon as possible. You never know how long its issuer will be in business.

For more information on giving and using gift cards, and managing credit and debit cards this holiday season, go to www.bbb.org.

Connecticut Better Business Bureau alerts homeowners about common scare tactics used by unscrupulous service providers

Wallingford, CT – November 12, 2008– As Connecticut consumers begin winterizing their homes, a warning from your BBB: watch out for “furnace-fixing” con artists.

While most furnace repair companies are honest, reputable and fair, there are a few that may try to frighten you into repairing or replacing the core of your home heating system, even when it is functioning properly, according to Paulette Hotton Scarpetti, President of Connecticut Better Business Bureau.

“Unscrupulous furnace repair companies may warn you that your furnace is leaking dangerous gases that could explode or harm people in the house. The most important first step—is don’t panic. Ensure your home is safe and then get your furnace inspected by your oil company or a second repair service.”

BBB offers the following tips to ensure you don’t get fleeced by disreputable operators:

•If you are told your furnace must be replaced because it is too small, think back to whether it has ever failed to properly heat your home. If you do buy a furnace, don’t waste money on a furnace that is unnecessarily large for the size of your home.

•Check the warranty on your heating system. Many of them come with long-term warranties

•Always get a second or third opinion as to whether repairs or replacement are needed. All bids should be in writing and provide a full description of services provided and materials used.

•When considering a bid, compare more than cost. Check the size and efficiency rating of the equipment each bidder proposes, and then ask how they arrived at recommending a particular sized system.

If you determine repairs or replacement is necessary, select a contractor with a solid reputation for dependable, reasonably-priced work. Ask friends, neighbors and family members for recommendations, and check out any company you’d like to hire at bbb.org for a Reliability Report.

Do not hesitate to call your public utility if you heat with natural gas, and ask a serviceman to inspect your system. If you believe you are in physical danger, leave your home until your heating system is checked out.

Growing number of consumers opting to trade-in gas-guzzlers for used vehicles

Wallingford, CT – September 4, 2008 – As Americans watch gasoline prices rise, consumers are moving away from their luxury cars and large SUVs for more fuel efficient vehicles. While some consumers are waiting for more hybrid cars to hit the showrooms and marketplace, others are buying what they believe are fuel efficient used cars.

According to Connecticut Better Business Bureau President, Paulette Hotton Scarpetti, it is time to remind people about an important checklist when shopping for a used vehicle.

“Information is power in the hands of a consumer. Used car buyers should learn all they can to save time and money, and prevent problems that can turn a good idea into a nightmare. If a consumer walks into a used-car lot uninformed, what was a good, money-saving idea could end up eating away the savings if the car is a lemon.”

There are several rules of thumb for used vehicle buyers relating to selection of a seller, selecting the car and financing. One of the most important is, if you have your eye on a particular vehicle, pay a trusted mechanic to inspect the car. The extra out-of-pocket expense may save you money down the road if major problems are discovered.

Connecticut BBB offers the following tips for used car buyers:

Do your homework: The Internet can be an invaluable tool for researching and comparing a particular vehicle’s reviews as a used car. Shop for a car that can deliver many miles on a gallon.

Give the car a once-over: A used car inspection can tell many stories about its history and reliability and always should be made in daylight, to ensure you can see any dents, paint defects cracks and other imperfections. Check the accelerator and brake pedal for signs of wear. If they are excessively worn on a car with “low mileage,” the odometer may have been tampered with to turn back the mileage. Also examine the ease with which windows, doors and the trunk open and close. Problems with these may indicate collision or body damage.

Test drive: If the car meets your standards, it is time to go for a test drive. Make a series of stops, starts and turns at different speeds. Drive over rough road and listen carefully for any noises such as clunking and rattling. Never purchase a vehicle without first driving it.

Know the law: If you are buying from a used car dealership, the Federal Trade Commission (FTC) Used Car Rule requires the dealer to post a window sticker disclosing terms of warranty, information on the availability of service contracts, a suggestion the buyer have the vehicle inspected and that the dealer put all promises in writing;

Many complaints to BBBs from used car buyers concern problems found during inspection, and they received only verbal promises from salespeople that the problems would be fixed. Because the commitments were not put in the written sales contract, however, the repairs were often not carried out and the customer was left with no recourse.

If the car is sold with a statement specifying the car is being sold “as is,” this means the consumer must pay for any repairs needed after purchase.

Shop around for financing: Go to several financial institutions with the seller’s proposed purchase and finance contract. This is when a high credit score can result in lower financing interest rates. Compare the annual percentage rate, required down payment and length of the repayment period.

Finally, don’t shop alone when selecting a used vehicle. A second set of eyes and ears can help you uncover any red flags about a particular vehicle, and improve your chances of making a purchase which will pay for itself in gasoline savings.

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