Office Depot Employees Blowing The Whistle On Outright Scams

from the reputation-is-a-scarce-good dept

For many years, there have been stories of various shady online electronics (especially camera) retailers (many of whom are based in the same neighborhood in Brooklyn). The main scam is to offer super cheap prices on cameras to get you "in the door" (either online or in person), and then focus on trying to sell you all sorts of massively over-priced add-ons and warranties. If you turn them down, they suddenly "discover" that the original product you ordered is out-of-stock. At times, over the years, various authorities have cracked down on such resellers, though they often pop right back up under a different name.

Still, folks who know the business were well aware of such shady companies and often knew to avoid them... but it's a bit different to find out that some large brand name retailers appear to be doing the same. Laptop Magazine is reporting on a series of whistle-blowing employees at Office Depot, detailing how they pulled off similar scams. The typical "oh, that's out of stock" trick is apparently quite common, but it even gets more advanced, with some employees creating photoshopped price signs, in order to "hide" the price of an expensive warranty add-on in the "list price" for a computer. These practices are quite illegal, and it looks like the report might trigger some FTC interest, especially given the multiple reports, suggesting that this isn't just a few rogue employees.

It does make you wonder what Office Depot was thinking. The obvious answer is: "anything for a sale," but that doesn't tell the whole story. Sooner or later, companies that do this sort of thing are going to get caught -- and when that happens (beyond the fines), the damage to a company's reputation can be massive and debilitating. It just seems like the cost of being outed is so high, it's ridiculous that any company would encourage such behavior.

Filed Under: pricing, scams, warranty
Companies: office depot

Porn Shakedown Company Takes Its Business Model And Moves On

from the good-riddance dept

Last year, a company called Platte Media came to light in the UK, after it started running a slightly bizarre spyware extortion scheme. The company would suck users in with a site promising licensed blockbuster movies, then take users through a registration process that involved installing some adware on their PCs. It didn't actually have the movies, just some trailers, and drove users to pornographic content. If users didn't cancel the "trial" they'd unwittingly agreed to in the process, they'd start getting popups on their screen, demanding payment of subscription fees. But the company has now shut up shop in the UK, though it's not clear if it's because the company wasn't properly paying taxes or because of scrutiny from the country's Office of Fair Trading. The company says it's pulled out for business reasons, but nobody will likely care too much, as long as it just goes away.

Filed Under: scams, spyware

Scamming Looks Like A Growth Industry In These Economic Times

from the jobseeker-beware dept

Scammers look they're being stimulated by the government's stimulus plan, and it seems likely that they're finding plenty of marks in these gloomy economic times. For instance, fake job ads that are fronts for identity theft are up 345% over the last three years. It wouldn't be a stretch to think they'll become even more common, as more and more people start searching for jobs -- and their desperation leads them to lower their defenses in hopes of landing employment.

Filed Under: economy, scams

ATM Hackers Caught Following Car Chase And Gun Shots

from the just-like-the-movies dept

A few years back, there were some stories about how some scammers had found online manuals for popular ATMs, which included a default password, which was rarely changed (yes, that's an amazingly stupid design). This meant that it was fairly easy to program the ATM to believe that it held different denomination bills. For example, you could program it to think that it held $5 bills when it actually held $20s -- and then if you took out "$40" you would be given 8 bills -- or $160. Not surprisingly, other hackers have replicated this scam a bunch of times -- aided in large part by ATM owners who still haven't changed the default password.

Still, if you were a scammer pulling such a scam, you might think that it would make sense not to pull it at the same store multiple times. But, that's exactly what two guys did last year, where they tried to hit a local restaurant's ATM for the fourth time. By that point, the manager had been alerted to look out for them, and called the police on them when they came in again. There was a bit of a mess after that, as the manager tried to pull a gun on the scammers, and there was some sort of scuffle, a gunshot, and then a car chase... but eventually the guys were arrested. So, once again: ATM makers: stop offering machines with default passwords. ATM owners: change the default password on your machines. Scammers: don't be so dumb as to try to rip off the same place multiple times (or, maybe that's what we want, since it makes them easier to catch... but it's still dumb).

Filed Under: atm, scams, theft

The Stimulus Package Appears To Be Stimulating Scammers...

from the they-wanted-job-creation... dept

This probably isn't much of a surprise for most folks, but scammers have wasted no time at all in using news about the massive government stimulus plan to try to trick suckers into various scams. Many of these are scams trying to get people to sign up to pay a "fee" to find out how they can get their "stimulus check" even though the stimulus program isn't sending out checks to individuals. Expect to see plenty more similar scams as well.

Filed Under: scams, stimulus

DEAR CITIBANK: I WOULD LIKE REQUEST TO YOU HELP IN SECURING 27 MILLION DOLLARS US

from the writes-itself dept

As the US government looks to take over a bigger chunk of Citibank, you might wonder what the bank has been doing with its money lately. Apparently, part of it was going to a slightly more ambitious than usual Nigerian 419 scam. The scammer and some colleagues tricked Citibank into believing they represented the National Bank of Ethiopia, that country's central bank -- and convinced Citibank to then transfer $27 million to accounts they controlled. It doesn't sound like the scam actually worked in the end -- as questions arose, and the receiving banks transferred the money back eventually. Also, the supposed mastermind behind the scam has now been arrested. But, apparently, 419 scammers have figured out that, given how well various banks have managed their money over the last few years, they're just as good as targets, compared to clueless spam recipients.

Filed Under: 419, advance fee, nigeria, scams
Companies: citibank

That Person Asking For $3000 On Facebook Might Not Actually Be Your Friend

from the this-is-a-public-service-announcement dept

"Fears of impostors increase on Facebook" screams the CNN headline, followed by the tale of a guy who fell for a scam after one of his friends' Facebook account was hacked. Apparently the friend's status said "Bryan NEEDS HELP URGENTLY!!!", and the guy got a direct message saying his friend had been robbed in London and needed money to get home. So the guy did what any reasonable person would do -- he wired $2800 to a London bank account, while his friend was sitting safe and sound at home in Seattle. This type of scam is apparently becoming more common on Facebook, but it's part of the larger issue of impersonation that could grow to be a problem for it and other social networks. Social-networking profiles have become proxies for our real offline personalities, and the fact that people will buy into them wholeheartedly, like the guy in the above scam, speaks not necessarily to their gullibility but also to the level of faith people put into them. For instance, an Italian soccer star is reportedly looking at legal action against Facebook after discovering that somebody had put a fake profile of him up on the site and linked to some Nazi material. Impersonation and false profiles are something that Facebook and its ilk need to deal with sooner, rather than later. If their users' trust in the veracity of online profiles is lost, the social networks will lose a large part of their attraction.

Filed Under: scams, social networks
Companies: facebook

Redlight Camera Operator Arrested For Scam Involving Shortening Yellow Light Timing

from the it's-about-money,-not-safety dept

We already know that at least six US cities have been found to have illegally reduced the timing on yellow lights at intersections where red light cameras were installed. However, over in Italy things have gone even further, with the guy behind one red light camera system now getting arrested for being a part of a scam involving decreasing the time on yellow lights from the required 5 seconds to 3 seconds. Apparently a bunch of police officers and municipal government employees are under investigation as well -- though it was a suspicious police chief questioning why they were seeing so many red light offenders, that resulted in the scam unraveling.

Filed Under: italy, red light cameras, scams

Lawyer Sues Citibank For Not Stopping Him From Losing Money In Nigerian Scam

from the blame-goes-around dept

A lawyer in Houston is suing Citibank after he got scammed in a variation on the classic Nigerian email scam. There are a few interesting tidbits here that are worth discussing. First, the details: the lawyer, who does collections work, was contacted via email by a company that claimed to be a Japanese company that was trying to collect money from four clients in the US -- offering a contingency fee to the lawyer for help in getting the customers to pay up. Soon after that, the "Japanese company" claimed that one client had agreed to pay some of what it owed -- and it sent the law firm a check for $367,500. Citibank said the check cleared, and the law firm wired $182,500 to the company. Of course, it later turned out that the check was fraudulent, and the law firm was out the $182,500.

This is a variation on a popular version of the Nigerian email scam. The way it usually works is that the scammer buys something that's for sale... and then sends a check that's for significantly more than the purchase price using some sort of excuse. Once the check "clears," the seller is asked to wire back the excess money. This version is interesting in that it's slightly more sophisticated -- carefully going after law firms that do collections. Rather than being a totally "out of the blue" situation, they worked hard to make it seem like business as usual until the scam is done. Sneaky.

While it's easy to mock the lawyer for getting tricked, the basic version of the scam and this more sophisticated version both rely on a very unclear part concerning check processing. Most people assume that once a check "clears" it's confirmed as valid. That's not true. Banks clear the check before it's actually validated, and the scammers exploit both the time between these two events and the fact that most people assume (or are told) that once a check clears, the money is definitely theirs. There are a few ways to solve this that banks could take. They could not clear the check until it's absolutely declared valid. Or, they could make it much clearer that, while the money is available, the check has not been validated and the money could be pulled. Since most banks do neither, the guy's lawsuit against Citibank is at least somewhat understandable -- though, it's unlikely a court will agree with him.

Filed Under: 419, advance fee, law firm, nigeria, scams
Companies: citibank

Facebook's Lack Of Hacking Resolution System For Nigerian Scammers

from the seems-like-a-problem dept

In the past week, you may have seen various news stories about Nigerian scammers hacking into Facebook, and then sending their "friends" messages, saying they're stranded in London without money. It is, of course, just the latest improvement on the venerable old Nigerian 419 scam, this time upgraded to use hacked/phished Facebook accounts to trick trusting friends into coughing up their money. However, one of the biggest issues is raised by Yehuda Berlinger, who points out that for those who are hacked, Facebook doesn't seem to have any reasonable way to contact them and fix the problem. Considering how much of your "identity" might be tied up in your social networking profile, you would think that a company like Facebook would have a ready made system in place to handle such "emergency" situations.

Filed Under: 419, hacking, phishing, scams, social networks
Companies: facebook