Current Events in April 2014

If you're on Facebook, Twitter or any other social media where people post links and videos (for that matter, if you so much as have an email account), beware: a new scam uses morbid curiosity about the missing Malaysia Airlines flight to trick people into clicking links that will install various forms of malware onto their computers.

The Better Business Bureau issued a warning about this particularly nasty April Fool, urging everyone “Don't fall for click bait teasers promoting exclusive footage of found passengers. It sounds like a sick April Fool's joke, but it's a real scam.”

The way it works is, you see an attention grabbing post, comment or message urging you to watch a "Video of Malaysia MH370 Plane Found in Bermuda Triangle. Passengers alive," or telling you that "[NEWS FLASH] Missing Plane Has Been Found!"  

Malware installed

 What happens next? You click on the link but, instead of a news site, you're taken to a third-party website, possibly with a pop-up urging you to update your video player. But if you click on the link, instead of a new video player you install malware on your computer instead.

Depending on just what sort of malware you're downloading – the BBB didn't say, and you do not want to make the discovery yourself – your machine might be infected with anything from pornographic popups making your computer well-nigh unusable, to keylogging software that records (and informs the scammers) of every keystroke you type—including any passwords or other confidential information.

How can you protect yourself from malware link scams? If you ignore or temporarily forget the rule “Never click on unfamiliar links,” the Better Business Bureau offers five additional tips to help protect you:

Don't take the bait. Stay away from promotions of "exclusive," "shocking" or "sensational" footage. If it sounds too outlandish (Bermuda Triangle, really?) to be true, it is probably a scam.

Hover over a link to see its true destination. Before you click, mouse over the link to see where it will take you. Don't click on links leading to unfamiliar websites.

Don't trust your friends' taste online. It might not actually be them "liking" or sharing scam links to photos. Their account may have been hacked. But it may also be clickjacking, a technique that scammers use to trick you into clicking something that you wouldn't otherwise (especially the Facebook "Like" button).

On Facebook, report scam posts and other suspicious activity by following these instructions.

On Twitter, if another user is sending you links to malware or other spam, report it to Twitter by following these instructions.  

In ancient Greek mythology there was a multi-headed monster called the Hydra, which was extremely difficult to kill because anytime you chopped off one of its heads, two new ones grew in its place. Even so, fighting a hydra is ridiculously easy compared to stamping out scam artists — every time you expose or prosecute one, dozens more arise to replace it.

To demonstrate, check out this random sampling of news stories—not even from the past week, but just from the past two days. We'll start with the good news: on March 31 the Federal Trade Commission announced that it managed to crack down on a massive telemarketing scam that bilked elderly Americans out of roughly $20 million.

But March 31 was also the day security blogger Brian Krebs first asked “Who's behind the 'BLS Weblearn' credit card scam?” (Short answer: some very sophisticated thieves, and meanwhile, if you have a credit or debit card, check your bill extra-carefully in case it contains any fraudulent charges from names like “BLS Weblearn” or “PSI Weblearn.”)

Also on March 31, news station KSDK 5 in St. Louis warned AT&T customers to watch out for a new scam wherein phishers lured people to a fake AT&T website in hopes of stealing their personal information and installing malware programs on their computers.

Despicable new scam

That day, we here at ConsumerAffairs warned you about a despicable new scam wherein fake IRS agents threaten innocent people with arrest or deportation unless the victims cough up large sums of cash. That particular IRS phishing scam announced on March 31, with thieves contacting their victims over the telephone, is not to be confused with the other IRS scam announced on March 31, where thieves send their victims bogus emails that look to be from the IRS Taxpayer Advocate Service.

Also on March 31, the Madison County sheriff's office in New York State warned residents with home-based businesses to watch out for a con artist posing as a vendor to target small-business owners in the area, and police in Collinsville, Illinois warned residents to watch out for scammers pretending to be power company representatives threatening to turn off the electricity to a given address unless the victim made payment over the phone.

The Macomb Daily in Michigan reported a similar scam the next day; for at least the past year, scam artists in Oakland County posing as utility-company employees stole thousands of dollars from area restaurants and other small businesses. The Journal-News reported a similar scam in North Carolina, targeting residents who get their power from Duke Energy.

If you live in Douglas County, Colorado, your local sheriff's office spoke to the news media on April 1 to warn residents away from a “jury duty phone scam” -- a caller claiming to be from the sheriff's department says you're facing arrest for having missed jury duty, but if you make a payment over the phone, the charges will go away.

They sound convincing

It's worth pointing out: scams like these can sound particularly convincing because – yes, power companies really can turn off electricity for non-payment (or lost payments). The IRS really does go after delinquent taxpayers. Sheriff's departments do have authority to collect fines, conduct foreclosures and enforce liens in certain instances — and skipping out on jury duty (or even honestly overlooking a jury-duty notice) really will get you in trouble.

However: in all such cases, even if you genuinely do owe extra utility fees, more taxes, a missed-jury-duty penalty or what have you, these organizations never demand payment over the phone, nor do they require payment in cash, or with a pre-paid money card or some other untraceable source.

And, while all such organizations will tell you “Pay up by a certain time or face consequences,” that time is always at least several days in the future, not “Pay up within the hour else you lose your electricity, or even your freedom.”

Stay up to date on developing scams -- check our Scam Section regularly.

The Senate may vote this week to raise the federal minimum wage from $7.25 to $10.10 per hour. Although it has no chance of passing the Republican-controlled House, the measure is still raising business leaders' blood pressure.

“Raising the standard of living for low-skill, low-wage workers is a valid goal,” National Retail Federaion Senior Vice President for Government Relations David French said in a letter to the entire Senate. “But there is clear evidence that mandated wage hikes undermine the job prospects for less skilled and part-time workers.”

On the other hand, Sen. Dick Durbin (D-Ill.) says people who go to work every day shouldn't live in poverty. Durbin and Illiniois Gov. Pat Quinn (D) spoke at a downtown Chicago rally yesterday.

“If you work 40 hours a week and you do a good job, you shouldn’t have to live in poverty, and that’s what raising the minimum wage is all about,” said Quinn, who first called for bumping the state's current $8.25 minimum wage to at least $10 an hour during his 2013 State of the State address.

Businesses endangered

But 20 business groups ranging from fried chicken restaurants to a florists group say the higher wage would endanger their businesses.

"For many businesses, this 39 percent increase could truly be the difference between continuing to operate and going out of business. "We respectfully ask that you oppose S. 1737 and other similar proposals to raise the minimum wage," the trade groups say in their letter to the Senate.

Where do consumers fit into all of this?

The usual arguments apply, of course. Business groups say a higher minimum wage would mean higher prices and less competition. Labor unions say higher pay would put more money in consumers' pockets, which would benefit both businesses and consumers.

Interestingly, a recent survey conducted by the Small Business Majority, a national small-business organization, found that 57 percent of small-business owners support increasing the minimum wage in three stages from $7.25 to $10.10 per hour.

Here are some other findings from the report:

• 82% of small-business owners surveyed pay their employees more than the federal minimum wage.
• 52% of entrepreneurs think increasing the minimum wage will boost consumer demand for small businesses.
• 54% of business owners think raising the minimum wage would decrease pressure on taxpayer-financed government assistance programs to make up for low wages.

"The current minimum wage isn't sustainable, which is why we pay our workers more,” said Clifton Broumand, owner of Man and Machine in Landover, Md., quoted in a Small Business Majority press release. “It's in our best interest as a company to pay more than the current minimum wage because it helps us retain good employees and that has a direct effect on our bottom line. Increasing the current minimum wage is not only the right thing to do, but will have a positive impact on our economy by putting more money in consumers' pockets, which will help businesses like mine and many others."

Sound-bite politics

The National Retail Federation's French, on the other hand, said that instead of focusing on “sound-bite politics,” Congress should focus on advancing long-term economic policies that would "provide employers with the certainty they need to make strategic investment decisions and improve hiring opportunities for all workers."

“Policymakers have other tools, such as increasing the earned income tax credit, fixing the tax code, education improvements, immigration reform, transportation funding, and strong trade alliances that will aid in achieving that goal without creating more unemployment,” French wrote. “Finding more opportunities for those trying to start out is a better economic approach than restricting the amount of jobs for those seeking employment.”

Name any large legitimate business or organization you can think of, and there exist countless scammers fraudulently posing as members of said business or organization in hopes of stealing your money.

The U.S. government is no different, and with the April 15 tax-filing deadline fast approaching, there's a larger-than-usual number of scammers fraudulently posing as tax agents.

The first thing you must remember is that the Internal Revenue Service will never send you an unsolicited email even if you do owe them money. It says so right on the IRS website: “The IRS does not send out unsolicited e-mails asking for personal information. An electronic mailbox has been established for you to report suspicious e-mails claiming to have been sent by the IRS.”

Dialing for dollars

But the latest fake-IRS scammers aren't using email to contact their victims. The Federal Trade Commission put out a bulletin warning potential victims (especially people of south Asian descent) of a despicable new scam wherein thieves posing as IRS agents call victims and threaten them with immediate arrest (and even deportation, in the case of immigrants) unless the victims immediately pay over the phone.

Protecting yourself from this scam is a bit trickier, because you can't necessarily assume “All unsolicited phone calls allegedly from the IRS are scammy,” the way you can about unsolicited emails. And if you get a phone call and hear phrases like “I'm from the IRS” and “you'll be arrested,” it's understandable that even an innocent person might feel scared, maybe even close to panic — but that's exactly what the scammers are counting on. They want your fear to override your good sense, at least long enough to separate you from your hard-earned money.

What to do

If you get such a threatening call, allegedly from the IRS, what can you do? On the one hand, you don't want to give money to scammers, but at the same time, you dare not risk ignoring legitimate messages from the taxman, either.

The main thing you must remember (to protect yourself not only from fake IRS phishers, but all phishers) is to get your own contact information. The FTC reports that the latest batch of fake-IRS scammers mostly called from the phone numbers (321) 352-6893; (202) 803-4825; (585) 310-3285; and (202) 241-2073. If your call comes from one of those numbers, you can pretty much ignore it.

But suppose your call comes from a number you don't recognize — or you find a message on your voicemail, saying they're from the IRS and you'd better call them back or else. Before you call them back, go online and search for the contact information of the IRS office nearest you. Even in a worst-case scenario – you really are in trouble with the IRS, and that's a bona fide IRS agent who just called you – a legitimate IRS agent will give you a name and contact number which you can verify by doing your own independent online search.

Then again, if you really were in trouble with the IRS, you'd have known about it long before any agents picked up the phone to call you — when you owe the IRS money, they first try contacting you through the old-fashioned U.S. Mail.

Not that soon

Also: while the IRS genuinely does have deadlines, and will even tell certain American taxpayers “Give us X dollars by Y date or face nasty legal consequences” … that deadline is never "less than 24 hours from now." The IRS will not contact you out of the blue and tell you “Pay up right now or you'll be in prison before sundown,” nor will the IRS make arrest threats over the phone.

By contrast, the FTC warns that the latest scammers told some of their victims that if they didn't pay up immediately, “an officer will be at your doorstep in 30 minutes.”

These victims were even urged to speak to the fake IRS agent before bothering to call their local police –needless to say, real IRS agents going after real tax scofflaws have no need to keep the police out of the loop, because real IRS agents have the law on their side.

If you really are in trouble with the IRS, you'll know about it long before anyone from the agency gives you a call — you'll have a pile of gimme-money letters from the IRS, chock-full of agent ID numbers and agency-contact numbers that are easily verified by a simple online search.

When policymakers refer to the “digital divide,” most often they are referring to an economic disparity in who has access to the Internet.

Because high speed Internet usually costs $40 or more a month low-income consumers, it is argued, often lack access. The digital divide has also separated rural consumers from urban dwellers, since high-speed Internet has been harder to find outside the city.

But there appears to be another digital divide, having nothing to do with how much money you have or where you live. It has to do with how old you are.

It's true that millions of seniors are very active on the Internet and are very comfortable using it. But it is equally as true there are millions of seniors who aren't.

When asked to explain why enrollment under the Affordable Care Act was so far short of goals, Senate Majority Leader Harry Reid (D-NV) struggled last week for an answer before finally blurting “people need to be educated on how to use the Internet.”

The response drew jeers from Republicans but Reid may have been trying to articulate something real that may only now be dawning on policymakers.

Enrolling in Obamacare has to be done online. Millions of people are challenged by that.

No longer optional

Using the Internet was once a helpful option for people who needed to interact with corporations and government agencies. But recently it has gone from being an option to being mandatory.

If you'll indulge me I'll recount a couple of personal examples from just the last two weeks.

My neighbor Doug, a retired engineer in his early 80s, called me in a panic. It was time to file the neighborhood association's tax return with the state, which had been his job for years.

He had just discovered that now it must be done online. Though he had a computer and used the Internet for some things, he was either unwilling or unable to try to file the return online.

The previous week my father and step-mother wanted to bid on a foreclosed property being auctioned by Citrus County, Fla. The county had automated the auction process, requiring it to be carried out online.

But not to worry, the county provided a training class in how to do it. Of course, the course was in the form of a webinar! Completely befuddled, they turned to me for assistance.

Glass half-empty?

A 2012 report by the Pew Research Internet Project found that, for the first time, more than 50% of Americans 65 and older used the Internet. But that means nearly 50% don't.

And “using the Internet” can mean different things. It can mean sending an email or checking Facebook for the latest pictures of the grandchildren.

It doesn't necessarily mean filing a tax return or signing up for Obamacare. Yet the assumption now is that everything can be and should be done online.

To save money, businesses and government agencies increasingly interact with the public only online. Have a question that isn't listed in the FAQs? Good luck talking to a human being.

For consumers comfortable with technology, getting things done online is often faster and smoother. But for a rather large segment of the population, the often mandatory requirement that you use the Internet means they can't fully function in today's world.

AdWeek has a truly bizarre story about voice-activated personalized advertising on “non-commercial, listener-supported” National Public Radio smartphone apps, and since the story is dated “March 30” this presumably means it is not an April Fools' joke but an actual genuine thing, even though it contains this quote:

NPR …. believes the ads — which will be heard at the end of news items — have captured the imaginations of its tech-savvy audience.

“People have had to wait for their phones to wake up and then tap on their screens to learn more from our sponsors,” said Bryan Moffett, vp of digital strategy and ad operations at National Public Media, an NPR subsidiary. “With these ads, you simply speak. When our test group heard [the call to action] ‘say download now’ or ‘say learn more,’ we universally heard them respond with ‘huh,’ sounding pleasantly surprised.”

Using technology from XappMedia, Moffett plans to charge a CPM rate “north of $20,” he said, for 15-second spots, which include the ability for the consumer to extend the ad with audio or video.

So — working again under the assumption this is a genuine article rather than an April Fool — in the advertising world, or at least the part focusing on NPR listeners, people actually like commercial advertising, to the point where if they see or hear an ad they think “These wonderful sponsors — who are they? How can I learn more? Dammit, smartphone o'mine, hurry and wake the hell up so I can tap you and find out! And if those sponsors' commercial messages can be extended with audio or video, so much the better.”

An online search for more information about this new frontier in personalized advertising on listener-supported non-commercial platforms resulted only in articles or blog posts referencing the original AdWeek piece, so between that and the precariousness of verifying online information on April Fools' Day, those of you who still view advertising as something to tolerate rather than something whose presence should be sought out and expanded in your own everyday lives can still console yourselves with the thought “Maybe this is all an elaborate prank.”

A federal judge has issued an injunction temporarily halting what the Federal Trade Commission says was a multi-million-dollar telemarketing fraud that targeted seniors across the U.S., scamming tens of thousands of them.

In shuttering the scheme, pending trial, the court found that the FTC was likely to prevail and that funds should be preserved so they can potentially be returned to the victims of the telemarketing fraud scheme.

“The defendants’ conduct in this case was simply outrageous. They targeted and called senior citizens and lied to them to get their bank account information. Then they used this information to withdraw money from their bank accounts,” said Jessica Rich, Director of the Federal Trade Commission’s Bureau of Consumer Protection. “Consumers can count on the FTC to be aggressive in the fight against this type of fraud”

The multi-million-dollar operation was headed by Ari Tietolman, who worked through several companies he had established in Canada, where he lives

The defendants used a telemarketing boiler room in Canada to cold-call seniors claiming to sell fraud protection, legal protection, and pharmaceutical benefit services. The cost for the defendants’ alleged services ranged from $187 to $397.

In some instances, the telemarketers impersonated government and bank officials, and enticed consumers to disclose their confidential bank account information. The defendants used that account information to create checks drawn on the consumers’ bank accounts. They then deposited these “remotely created checks” into corporate accounts they established in the United States.

The U.S.-based defendants then transferred the money to accounts controlled by the Canadian defendants, according to an analysis of bank records.

The defendants’ businesses include First Consumers, LLC, Standard American Marketing, Inc., and PowerPlay Industries LLC.  First Consumers, LLC is a Pennsylvania company formed in 2010. Consumer complaints and bank records indicate that from at least June 2009 until June 2013, the company scammed consumers using its own name and three other names: Patient Assistance Plus, Legal Eye, and Fraud Watch.  The three other individual defendants who assisted in the scheme are U.S. nationals: Marc Ferry, Charles Borie, and Robert Barczai.

The refund check is no longer in the mail -- it’s already in the bank. That's the way it is for some 57 million taxpayers so far this year.

According to the Internal Revenue Service (IRS), more than $170 billion in income tax refunds have bee, deposited directly into taxpayers' bank accounts as a growing number of people choose speed and convenience over receiving a paper check. So far this year, almost 85% of all refunds have been directly deposited.

And it doesn't matter if you e-file or snail-mail a paper tax return. If you choose the latter, just make sure you include your account information.

Take your pick

Direct deposit is not limited to banks. Mutual funds, brokerage firms and credit unions are all eligible to receive direct deposits. Before making this choice, however, taxpayers should make sure the financial institution accepts direct deposits for the type of account chosen.

Taxpayers also have ability to split refund deposits among two or three different accounts or financial institutions. For instance, a refund could be split among a savings account, a checking account and an Individual Retirement Arrangement (IRA). Refunds may be split when a taxpayer e-files or by filing Form 8888, Direct Deposit of Refund to More Than One Account.

A refund should be deposited directly only into accounts that are in the taxpayer's own name, the taxpayer's spouse's name or both if it's a joint account.

Those who choose direct deposit get their refunds at least a week sooner, and direct deposit eliminates the chance of a lost, stolen or undeliverable refund.

The tax season to date

Here are the latest 2014 filing season statistics:

General Motors is recalling 174,046 model year 2013 and 2014 Chevrolet Cruze vehicles equipped with a 1.4L turbo engine, and manufactured between November 28, 2012, and March 7, 2014.

On the affected vehicles, the right front half shaft may fracture and separate. If the half shaft fractures and separates while driving, the vehicle would lose power and coast to a stop. If the parking brake is not applied, the vehicle could move unexpectedly. Either condition increases the risk of a crash.

GM will notify owners, and dealers will inspect and replace the right half shaft, as needed, free of charge. Parts for the remedy are not currently available.

GM will send an interim letter to owners the week of April 28, 2014. A second owner letter will be mailed when parts are available. Owners may contact Chevrolet at 1-866-694-6546. GM's number for this recall is 14079.

This is an expansion of a recall initiated in 2013. Some of those vehicles were repaired using defective parts. Those owners will be advised that they must have their vehicles remedied again under this campaign and that having the earlier recall completed did not remedy their vehicles.

Dyson Inc., of Chicago is recalling about 393,000 portable electric heaters in the U.S. and Canada.

The heaters can develop an electrical short and overheat, posing a fire hazard.

Of a million heaters sold globally, the company said it is aware of 82 incidents worldwide of the recalled heaters short-circuiting and overheating, including four reports of heaters with burned or melted internal parts. No injuries or property damage has been reported.

“Around the world, we have seen four cases of heaters with contained burning. Although there have been no instances of personal injury or damage to property, it’s four too many. We ask owners to visit www.dysonrecall.com to register their machine, which will be fixed, cleaned, serviced and returned to them, with a new two year parts and labor warranty, free of charge,” said Max Conze, Dyson CEO.

This recall is for all Dyson Hot heaters and Dyson Hot+Cool heaters with model number AM04, and all Dyson Hot+Cool heaters with model number AM05. The heaters are 23 inches tall with a round base and an upper body shaped like an elongated ring.

The heaters have no external fan blades. They are made of plastic and were available in the colors silver, black and silver, blue and gray, gray and silver, pink and gray, purple and gray, and white and gray. Each heater came with a remote control.

The model number is found above the Dyson logo on the product information sticker on the underside of the heater’s base.

The heaters, manufactured in Malaysia, were sold at Bed Bath & Beyond, Best Buy, Costco, Fry's, Kohl's, Lowe's, Macy's, Sears, Target and other retailers nationwide, and online at Abt.com, Amazon.com, Dyson.com, Groupon.com, HSN.com, QVC.com and Walmart.com from September 2011, to March 2014, for about $399.

Consumers should immediately stop using and unplug the recalled heaters and contact Dyson for a free repair.

Consumers may contact Dyson toll-free at (866) 297-5303, 8 a.m. to 8 p.m. CT Monday through Friday and 9 a.m. to 6 p.m. Saturday and Sunday.

General Motors is recalling 489,936 model year 2014 Chevrolet Silverado Light Duty Regular Cab, Double Cab, and Crew Cab 1500 series and model year 2015 Suburban and Tahoe; GMC model year 2014 Sierra Regular Cab, Double Cab, and Crew Cab 1500 Series and model year 2015 Yukon and Yukon XL vehicles equipped with a 6-Speed Automatic Transmission (feature code MYC).

The subject vehicles may have a transmission oil cooler line that is not securely seated in the fitting. If the line is not securely seated and transmission oil leaks from the fitting, the oil could contact a hot surface and cause a vehicle fire.

GM will notify owners, and dealers will inspect the transmission oil cooler line connection and repair the vehicles, as needed, free of charge. The recall is expected to begin on April 28, 2014.

Owners may contact Chevrolet at 1-866-694-6546 or GMC owners may contact GMC at 1-866-996-9463. GM's number for this recall is 14121.

Kids who get flu shots are 74% less likely to end up in a hospital's intensive care unit than those who don't, according to a study by the Centers for Disease Control and Prevention (CDC), published in the Journal of Infectious Diseases.

The study is the first to estimate vaccine effectiveness (VE) against flu admissions to pediatric intensive care units (PICU). It illustrates, according to CDC, the important protection flu vaccine can provide to children against more serious flu outcomes. The agency recommends annual flu shots for everyone 6 months and older -- especially for children at high risk of serious flu-related complications.

“These study results underscore the importance of an annual flu vaccination, which can keep your child from ending up in the intensive care unit,” said Dr. Alicia Fry, a medical officer in CDC’s Influenza Division. “It is extremely important that all children -- especially children at high risk of flu complications -- are protected from what can be a life-threatening illness."

Children younger than 5 years and children of any age with certain chronic medical conditions like asthma, diabetes or developmental delays, are at high risk of serious flu complications.

Reducing the risk

Fry’s team analyzed the medical records of 216 children age 6 months through 17 years admitted to 21 PICUs in the United States during the 2010-2011 and 2011-2012 flu seasons. They found that flu vaccination reduced a child's risk of ending up in the pediatric intensive care unit for flu by an estimated 74%. These findings show that while vaccination may not always prevent flu illness, it protects against more serious outcomes.

Though flu vaccination was associated with a significant reduction in risk of PICU admission, flu vaccine coverage was relatively low among the children in this study: only 18% of flu cases admitted to the ICU had been fully vaccinated.

More than half (55%) of cases had at least one underlying chronic medical condition that placed them at higher risk of serious flu-related complications.

How much protection?

CDC usually measures flu VE against “medically attended flu illness” -- that is, how well it protects against having to go to the doctor for flu symptoms. During the 2010-2011 and 2011-2012 seasons, the midpoint VE estimates against medically attended illness were 60% and 47% respectively.

"Because some people who get vaccinated may still get sick, it's important to remember to use our second line of defense against flu: antiviral drugs to treat flu illness,” Fry said. “People at high risk of complications should seek treatment if they get a flu-like illness. Their doctors may prescribe antiviral drugs if it looks like they have influenza."

Symptoms of flu may include fever, cough, sore throat, runny or stuffy nose, body aches, headache, chills, and sometimes diarrhea and vomiting.

Flu causes hospitalizations in children each season, but how many children are affected varies, depending on the severity of the season. CDC estimates that 20,000 children younger than 5 years are hospitalized on average each year.

For children younger than 18 years, published studies suggest an annual range of flu-related hospitalization rates of between one child and seven children per 10,000 children. Between 4% and 24% of hospitalized children require PICU admission.