Insurance Ranks Third on Fla. Attorney General’s List of Common Scams

February 8, 2006

Insurance scams, especially hurricane-related complaints, ranked third in a list of top categories of fraud complaints received by Attorney General Charlie Crist’s office in 2005. The top categories on the list, released to kick off the Feb. 5 to 11 National Consumer Protection Week, were complaints about builders and contractors, which also included identity theft and internet-related complaints.

The top 10 fraud related complaints include:

1. Builders/Contractors: To avoid being scammed by a bad builder or contractor, ask to see their certified contractor’s license and always get at least three bids and references. Ask for a written contract with accurate estimate. Don’t pay in cash.

2. Auto Repairs: Make sure the mechanic is licensed and certified. Ask for a written estimate of the repair costs. Potential car buyers should check whether the car they are considering for purchase is listed as a flood vehicle at the National Insurance Crime Bureau at http://www.nicb.org or with Carfax at http://www.carfax.com/cfm/general_check.cfm?partner=PRL_A.

3. Insurance: The most common subject of insurance complaints during 2005 was hurricane-related issues, including problems with claims processing and non-renewals. Consumers should also be wary of companies offering cheap insurance packages with unrealistic terms.

4. Financial/Banking/Lending: Mortgage fraud and lending scams were prevalent last year. Be sure that all of the terms of any loan are fully disclosed and check the broker’s credentials to ensure they are properly licensed and certified.

5. Internet-related: Scams that emerged last year included a check overpayment scam and phishing, a form of identity theft. Never give out personal identification information to a stranger over the internet, and be wary of anyone who writes a check for too much money, then asks to have the difference wired back to them.

6. Telecommunications/Cable: Problems with bills and service contracts were common in 2005. Always read bills carefully and dispute unnecessary charges with the service provider.

7. Collections Agencies: Debt collectors may not lie to consumers or threaten them to collect payments. They are also not allowed to call after 9 pm.

8. Credit Reporting: Consumers are entitled to one free credit report every 12 months. Beware of companies that offer quick solutions for clearing bad credit. If a credit repair company says it will be able to remove negative information from a credit report, the company is not telling the truth.

9. Identity Theft: Identity theft is the criminal use of an individual’s personal identification information. Identity thieves steal information such names, Social Security number, driver’s license information or bank and credit card accounts and use the information to establish credit, make purchases, apply for loans or even seek employment. Always protect personal identification information closely.

10. Timeshares: Timeshare scams occur both at the time of the original purchase and at the resale. Beware of a hard sales pitch or an up-front fee. Consider reselling the timeshare “by owner,” by placing an advertisement in a newsletter or magazine read by potential timeshare buyers, or listing the timeshare with a licensed real estate broker in the area where the resort is located.

Crist said Nigerian bank scams were also on the top list of complaints, as were scams involving solicitation or telemarketing and fake charities.

In addition to releasing the list of top complaints, Crist’s office cautioned consumers to be aware of scams that have become more common in the past year. Last July, the Attorney General’s Office launched a new consumer protection tool, designed to keep provide consumers with immediate updates on fraud protection measures. Through the new Consumer Alerts service, citizens can now subscribe to an electronic notification network and receive fraud warnings directly as they are announced. Citizens may
subscribe to Consumer Alerts by visiting the Attorney General’s website at http://myfloridalegal.com and clicking on the red “Subscribe to the Attorney General’s Electronic Newsletter and Consumer Updates” link at the top of the page.

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