Current Events in October 2022

With home sales declining sharply over the summer, more people are renting apartments and are paying more when they find one.

So imagine finding a great two-bedroom apartment in a convenient location at a bargain price. You’d jump on it, right? That’s what scammers are counting on.

Earlier this year the FBI’s Boston Division reported a spike in apartment rental scams. Victims would find listings on social media and Craigslist with pictures showing a roomy, well-kept unit. The rent was always less than the market rate.

“We have seen a significant increase in the amount of money being lost by people who are desperate for a good deal,” Joseph Bonavolonta, special agent in charge of the FBI Boston Division, said in July. “Scammers are cashing in on renters who need to act quickly for fear of missing out, and it’s costing consumers thousands of dollars, and in some cases, leaving them stranded.” 

With competition rising for the best apartments, some people are taking them sight unseen. Scammers collect photographs from legitimate listing sites and create a phony listing, using a real address that isn’t even a rental.

The “landlord” sends the victim a lease and requires an upfront deposit, along with the first month’s rent and an application fee. Once the victim pays, the “landlord” and the apartment disappear.

In 2021, the FBI says 11,578 people reported losing $350,328,166 due to these types of scams, a 64% increase from the previous year. The bureau says the actual number is probably higher since many people are hesitant about admitting they were victimized.

Red flags

There are a number of red flags that renters should be aware of. For starters, if the “landlord” refuses to meet in person or talk on the phone, that’s a bad sign.

If you are asked to rent an apartment or home without inspecting it, that’s another sign that the person you are dealing with probably does not have access and that it’s not a real listing.

Also, you should be suspicious that the property or transaction could be a scam if:

• The advertised price is much lower than that of similar properties. 

• Ads for the property have grammatical and spelling errors or overuse capital letters. 

• The ad uses uncommon spellings of words, like "favour" instead of "favor." 

• You can only work with an agent. The agent says that the owner is too busy, out of the country, or otherwise unavailable to handle the rental. 

• The owner or agent isn't able to let you enter the home or apartment or charges you a fee to view it. 

• The owner or agent uses high-pressure sales tactics. They may urge you to rent quickly before someone else gets the property.

The restaurant world – both dine-in and drive-thru categories – is in full give-the-consumer-what-they-want mode. 

And it’s a pretty wild scene, too. McDonald’s is among those trying out new menu twists by test-selling Krispy Kreme donuts, and restaurants giving customers the option to customize their menu choices are starting to emerge.

Just recently, IHOP introduced a new Choice menu, designed to give consumers more choices throughout the day as opposed to breakfast, lunch, and dinner segments.

Choices are good, but deals rule

The overriding thing that consumers are looking for at restaurants, though, are deals that save them money. According to a new study by Yelp, diners across the U.S. are looking for budget options wherever they can find them.

"While U.S. inflation doesn't appear to be slowing down, Yelp's data shows consumers are increasingly looking for more affordable options to counter this uncertainty," said Pria Mudan, data science leader at Yelp. 

"It's clear consumers are mindful of their wallets with Yelp searches related to affordable groceries and fast food concepts noticeably up from last year."

What restaurants have the best deals?

In a new study by Datassential, the 10 restaurant chains that scored best with consumers who rated them “best in class” or “above average” on value for the dollar break out like this:

10. Togo's

9. Hwy 55 Burgers, Shakes & Fries

8. Golden Corral

7. Flame Broiler

6. Cook Out

5. In-N-Out Burger

4. Del Taco

3. Cicis Pizza

2. Papa Murphy's

And, drum roll, please…

1. Little Caesars, with an impressive 71% of consumers rating them “best in class” or “above average” when it comes to the best bang for a buck. 

People of a certain age may remember when a landline phone only rang when a friend or family member wanted to talk. Not anymore. Robocallers have figured out there’s a massive untapped audience they can turn into a tidy little revenue generator.

So much, in fact, that illegal and spoofed robocalls have become the FCC's top consumer complaint and the agency’s top consumer protection priority for the 100 million Americans who still have landline phones. 

If you don’t have a landline phone, you may push that metric aside, but those landline lovers received more than 5 billion unwanted calls just last month, an increase of more than 2 billion unwanted calls since July, according to imp's latest Landline Report.

Key findings of the study 

"We're seeing a big uptick in the unwanted call volume on landline phones as we head into the election season," said imp's president George Lightbody.

"Close to one-third of all U.S. households rely on their landline phone as an essential tool for communicating. But it is becoming increasingly difficult for landliners to cut through the noise and actually use their phones."

Here’s what imp’s study found:

• 83% of landline owners are actively bothered by unwanted calls: Nearly one-third of all households in the U.S. still have a landline. Of those households, eight out of every 10 households report being actively bothered by unwanted landline calls.
• 87% of landline calls are unwanted: Households with a landline phone receive on average 46 calls per week. Landline users classify 40 of these 46 calls as "unwanted." According to imp’s study, only six of the 46 calls are "wanted" calls from friends and family.
• Traditional call blocking is only a 5% solution: Of the 40 unwanted calls received each week, only two would be stopped by traditional call blocking devices. All of these 40 unwanted calls are, essentially, what imp calls “telephone invaders.”

The FCC refuses to give up

The problem with robocalls is that it’s basically a game of whack-a-mole. No sooner does the FCC whack one robocall company but another pops up. Unfortunately, advancements in technology make it cheap and easy to make massive numbers of robocalls and to "spoof" caller ID information to hide a caller's true identity.

FCC Chairwoman Jessica Rosenworcel and her staffers get these calls too. As she said during one of the Commission’s monthly meetings: “I’m a consumer, too. I receive robocalls at home, in my office, on my landline, on my mobile. I’ve even received multiple robocalls sitting here on this dais. I want it to stop.”

The FCC knows that these calls are a major concern of millions of Americans, and is sending out cease-and-desist letters like there’s no tomorrow. Until the day when there’s no more robo-anything, the agency suggests that consumers with both landline phones and digital phones take these steps to keep robocallers at bay:

• Don't answer calls from unknown numbers... Let them go to voicemail.

• If the caller claims to be from a legitimate company or organization, hang up and... call them back using a valid number found on their website or on your latest bill if you do business with them.

• If you answer and the caller (often a recording) asks you to press a button to stop receiving calls... or asks you to say "yes" in response to a question, just hang up. Scammers often use these tricks to identify, and then target, live respondents, or to use your "yes" to apply unauthorized charges to your bill.

• If you answer and the caller asks for payment using a gift card... it's likely a scam. Legitimate organizations like law enforcement will not ask for payment with a gift card.

• If you receive a scam call... file a complaint with the FCC Consumer Complaint Center by selecting the "phone" option and selecting "unwanted calls." The data we collect helps us track trends and supports our enforcement investigations.

• If you have lost money because of a scam call... contact your local law enforcement agency for assistance.

• Ask your phone company if it offers a robocall blocking service. If not, encourage them to offer one. You can also visit the FCC's website for more information about illegal robocalls and resources on available robocall-blocking tools to help reduce unwanted calls.

• Consider registering your telephone numbers in the National Do Not Call Registry... Lawful telemarketers use this list to avoid calling consumers on the list.

While consumers may be accustomed to receiving spam calls or texts, a new bank-related text message scam may come with costly consequences.  

The scam starts the same way: consumers receive a text message seemingly from their bank alerting them to potential fraud on their account, or a notice that their account is being closed, or their debit card is being deactivated.

Some messages may include a link to click to take further action, while others prompt the victim to reply directly to either approve or decline the “charge.” 

In either case, consumers are urged not to take any action. When links are clicked, they often lead to sites that look like banking websites but instead are traps that ask for personal information, and ultimately, money. When messages ask for a response, scammers are opening the door to the next step in the scam. 

After the text messages, scammers move onto phone calls, in which they pretend to be from the bank, and have been assigned to help get the victim’s money back – which happens by sending money to themselves through Venmo or Zelle. Needless to say, this is a red flag! 

However, rather than recovering any “lost money,” the scammers are actually directing victims on how to link their Venmo or Zelle account to their own bank account. Based on several reports, victims who do end up sending money have struggled to get it back, leaving them out thousands of dollars. 

In other instances where scammers pretend their victims’ accounts are going to close or a hold is on the account, it’s really a pull for personal information. To reinstate the allegedly “closed account,” victims are required to reset all of their personal data – email address, social security number, date of birth, etc. 

Avoiding bank scams

Both Wells Fargo and Bank of America, as well as the Federal Trade Commission, have published resources for consumers to help them avoid bank phishing scams in the future. 

The biggest piece of advice to consumers is to never respond to these messages or calls, and never click on any links. Taking the time to call your bank and confirm something is legitimate can protect you from falling prey to a scam – and also save you money and stress. 

Both Wells Fargo and Bank of America state that no banking representative will ever ask for customers’ debit card PIN, account number, or any other confidential information over the phone. Additionally, you aren’t likely to be contacted out of the blue by bankers – that’s another sign of a scammer. 

While scammers have the capability to make phone numbers look like they’re coming from your bank, or even change the caller ID, it is up to consumers to be discerning. It can be helpful to save your bank’s phone number or the five-digit codes banks often use when sending text messages to customers. 

Scammers are also likely to make the situation seem urgent or ask you to send money to yourself using a digital wallet app or some other type of digital currency. Banks aren’t going to do either of those things, and these requests should indicate to consumers that they’re working with a scammer. 

If you do receive a scam text or call, block the number, and report it. Both Androids and iPhones have the capability to report numbers as spam or junk, and numbers can also be reported to the FTC here.  

Who among us hasn’t shared a password or two among friends and family? Well, those free rides may soon be over starting with a new Netflix policy.

The company has been wringing its hands for nearly six months trying to figure out how to approach its tsunami of sharing which is estimated to be 33% of all Netflix subscribers.

Doing the math, that’s a fairly substantial choke on the company’s revenue stream, too – nearly $739 million a month possibly lost to password-sharing.

Netflix isn’t going to try and recoup all that lost revenue by making every password sharer repent for their sins, but it is instituting a plan that it thinks is a win-win. Beginning in early 2023, it will add fees to anyone’s plan who has “extra member” sub-accounts outside of a subscriber's household.

How much is this going to cost you?

While the company did announce its intentions, it remained mum on how much this is going to cost any rogue customer. However, the fee schematic is currently being tested in a handful of Latin American countries and weighs in at close to a fourth the rate of a "standard" Netflix plan. 

Grumbling aside, if that winds up being the case in the U.S., each subaccount would cost somewhere between $3.50 and $4, a far cry from being a total deal breaker. Besides, Netflix can probably make up more of its lost revenue as new subscribers buy into its new ad-supported streaming service. 

The forecast for that new ad-driven model is good, at least in the company’s eyes. “We really anticipate that [the ads-based plan] is going to be a pro-consumer model that will be more attractive, bring more members in because the consumer basic price is low,” Gregory K. Peters COO & Chief Product Officer of Netflix, commented in the company’s latest earnings call.

Rapidly rising mortgage rates, coupled with near-record-high home prices, have priced many buyers out of the housing market. But there are signs in various industry reports that the result of high mortgage rates could improve affordability in the months ahead.

With fewer buyers, the shortage of available homes that plagued buyers over the last two years is finally moving in the other direction. RE/MAX, a national brokerage firm, reports the inventory of homes grew 3.9% in September over August and is up 30.4% year-over-year. The number of homes on the market is growing, even though new listings were down 7.6% last month.

"After a sustained period of quick sales that kept the housing cupboard relatively bare, a supply of two months presents a lot more options for homebuyers," said Nick Bailey, RE/MAX president and CEO. "For a long time, six months of inventory was the standard for a balanced market that favored buyers and sellers evenly. Now, with the evolution of technology and various changes in homebuying patterns, the new standard is becoming four months. We're halfway to that level, and the market is making steady progress toward balance.” 

Competition helps buyers

When there is an ample supply of available homes, sellers face more competition and buyers have more choices. When that happens, home prices usually soften.

A new report from real estate broker Redfin shows that’s already happening. After analyzing nationwide listing prices, the broker says 7.9% of sellers dropped their price during the four-week period ending Oct.9. That’s about double the rate from last year as the market has shifted at a near-record pace.

“Prospective homebuyers and sellers barely had time to get used to 5.5% mortgage rates over the summer before they rose to nearly 7% this month,”  said Redfin Deputy Chief Economist Taylor Marr. “The second sharp rate increase this year, together with nerves about inflation and the direction of the economy,  is dragging home-sale activity down further than it was over the summer and pushing homebuyer sentiment down near its all-time low.”

At long as mortgage rates remain at their present levels there is little benefit for buyers. For many, mortgage payments on the median-priced home are still out of reach. But rates may not remain in that range forever.

The outlook for mortgage rates

Rates could move even higher between now and the end of the year, but some in the industry think buyers could see some relief. The Mortgage Bankers Association (MBA) predicts rates could average around 5.5% by the end of December.

Rising mortgage rates are the indirect result of the Federal Reserve’s aggressive policy to squash inflation – specifically to slow the growth in home prices. That policy has contributed to a sharp rise in the yield on the Treasury’s 10-year bond – which directly influences mortgage rates. When the Fed declares victory and returns to a normal credit policy, mortgage rates could come back down.

With a lower median home price and mortgage rates in the 4% range, affordability conditions could improve to the point that people currently priced out of the housing market could see more choices and affordable monthly payments.

Wouldn’t you just know it? Within hours of President Biden’s student loan forgiveness going live, who shows up but scammers trying to get their piece of the action.

These scammers don’t have a loan they personally want forgiven, but they would like a crack at seeing how they can leverage the personal, private information of the millions of applicants who do.

Fortunately, the Federal Trade Commission (FTC) anticipated that something like this would happen and has advice on how applicants or parents of applicants can spoil the day for the scammers.

Scams to be on the lookout for

Ready?

Apply at StudentAid.gov/DebtRelief. The FTC says don’t go anywhere else other than the OFFICIAL loan forgiveness website. Nowhere else. At the moment, all applications have to be done online and it’s available in both English and Spanish. There will be a paper version, but it won’t be available for a while.

Don’t pay to apply. Applying for student loan forgiveness is f-r-e-e, FREE. If someone calls you up and says you need to pay an application or processing fee, hang up the phone because they’re a scammer. 

Patience will pay off. The application process is expected to be as slow as molasses, so pack a lunch and sit tight. “As people file their applications, [the Department of Education (ED)] will review them on a rolling basis,” K. Michelle Grajales, an attorney in the FTC’s Division of Financial Practices, cautioned. “Follow the process…not those who say they can put you in front of the line. Because those are scammers.” 

Know what to share, where, and when. Here’s where things can be tricky, so heads up. The “real” application – the one online – has to have personally identifiable information like your name, Social Security number, phone number, address, and when you were born, but it does NOT require applicants to upload or attach any documents like, say, a photo of your Social Security card.

There are three “howevers” that applicants need to pay attention to when it comes to documentation and communication:

• However #1: AFTER you file your application, the FTC says it’s likely that you’ll hear from ED — to upload tax documents verifying your income — or to give updates on your application. 

• However #2: Those emails will ONLY come from noreply@studentaid.gov, noreply@debtrelief.studentaid.gov, or ed.gov@public.govdelivery.com. IF you get an email that claims to be about the application, pay extremely close attention to the sender's address for emails, looking for slight typos. If an email does NOT have one of those three email addresses, then it’s a scam.

• However #3: The items the application does NOT ask for include your Federal Student Aid ID (FSA) or your bank account number or credit card number. If someone calls and says, “Oh, we need your bank account number to process your application,” it’s a scam.

Follow ED’s process if your application is denied. “Anyone who says they can get you approved (for a fee) is a scammer. Your email notice will have instructions,” Grajales said.

What should you do if you have questions? Call FSA’s dedicated phone line at 1-833-932-3439. Oh, yeah – Grajales said callers can expect long wait times, too. Sorry.