DISB Scam Tracker

Type

Definition

Complaint Narrative

Advance Fee Scam

Scammer requests an upfront payment, promising a future service or huge return on investment.

Individuals claiming to be representatives of a fictitious US Government Agency. The fictitious agency was purportedly located in the District of Columbia. The victim, a British citizen, was told to pay $12,000 in advance fees to recover their stock market losses by exchanging worthless stocks. It's important to remember that if a government agency were to reach out to advise you of money owed to you, they most certainly would not ask for money in advance. The scammers often use letterhead, names, email addresses, and websites that closely mirror legitimate government agencies. Should you be contacted and told you have money coming, do not give any personal information, and do not click on the links provided. If you are given a phone number to call to verify, don’t! Always search for the legitimate agency and their number or email. You will see the difference. Remember, verifying information is a powerful tool to protect yourself from scams.

Affinity Scam by Licensed Individual

Scammer targets members of an identifiable group (e.g., cultural, religious, or ethnic community) and curries favor with them to rope them into a fraudulent investment opportunity.

An independent Insurance Agent/Financial Advisor/Securities Broker befriended an elderly female District resident and, over many years, developed a very close and trusted personal friendship. Initially, the Financial Advisor sold appropriate and secure securities to protect the senior’s best interest for her retirement/twilight years. Over time, the senior began to fully trust and depend on the financial advisor to assist her with routine errands to the bank, grocery store, pharmacy, and medical appointments and provided security by screening all family/neighbors' access to the senior in her home and later, rehabilitation center.

Once the senior was under the control of the Financial Advisor, he manipulated the senior to access and control the senior’s personal banking and investment accounts by changing the bank signature cards and adding himself as a beneficiary on all accounts. Later, he moved much of her money into very questionable investments for the senior. The Financial Advisor also added his family members as beneficiaries and removed the beneficiaries that the senior had selected without the senior's knowledge and consent. After the senior’s death, the Financial Advisor immediately attempted to collect all the decedent's assets. The victim had no family members that lived close by or that were in regular contact.  Older victims are often reluctant to talk about financial matters, especially if they think they may have made a mistake. (With the cooperation of several DC agencies, ECPD successfully investigated this case, and DISB’s Office of General Counsel successfully prosecuted the Financial Advisor in court.)

Bank ATM Skimmers

ATM card skimmers are illegal devices placed over the card slot or inside the card reader of an ATM machine to collect card information for fraudulent purposes.

A DC victim used her bank card at a bank and found that someone had used her card number to make purchases nearly a thousand miles away at a Sam's Club store in Illinois. The victim has never shopped at Sam’s Club. The card has always been in her possession. However, ATM skimmers are like invisible thieves, becoming increasingly sophisticated and more difficult to detect. It's crucial to be vigilant. Often skimmers do not fit over the card insertion slot perfectly. If you look closely, you may see gaps, or the visible receptacle is not even. Sometimes, they will be loose and will wiggle when you hold on to it. When using an ATM, be sure to check your balance for the next couple of days to ensure that your card is not being used without your knowledge. The same can be true of using a credit card in a vending machine. In those cases, check your credit card account regularly to be sure no one is using your credit card without your knowledge.

Celebrity-Romance Scam

Scammer adopts a fake online profile to gain a victim’s affection and trust and then uses the illusion of a romantic or close relationship to manipulate and/or steal from the victim.

Through an online social network, the victim met someone she thought was a celebrity. Eventually, the victim believed she had become romantically involved with this celebrity she had never met or seen live. This “celebrity” asked her for money an investment as he was short on cash. She sent money via Coinbase and wire transfers. She lost over $200,000. Remember, if it is too good to be true, it probably is. In this instance, the purported celebrity was a well-known person quite a bit younger than the victim, who could be seen on TV almost daily. The real celebrity is worth millions, and none of it makes sense to most, but these scammers are excellent at identifying potential victims. Talk to family members or friends who can help you to steer clear from being victimized. Yet the victim in this case believed the relationship was real. Online research or reaching out to the real celebrity’s representatives would have made it clear that this was a hoax. However, sometimes people, especially older people, can be lonely and thus vulnerable. Further, a senior’s online skills may vary person to person.

Another victim lost money in a romance scam. The subject solicited the victim over a dating site and referred her to a bogus investment platform. The victim lost over $157,000 from fictitious investments. Here, simple research online or with a legitimate investment firm would have revealed the obvious. Remember, it is much easier to con someone online than in person, so always beware.

Elder Affinity

Scammer targets members of an identifiable group, such as the elderly, and curries favor with them to rope them into a fraudulent investment opportunity.

A Federal government employee who was working in the District’s Capitol Hill area befriended an elderly female after providing some repairs to her multimillion-dollar townhouse. The employee would visit the senior daily to make sure she was doing okay, and he would provide friendly conversation. The senior used a wheelchair, had suffered a stroke, and required nursing assistance 24/7. Eventually, the Federal employee, who was married and living in Maryland with his family, convinced the senior that he was close to her and expressed an interest in securing funding for his personal use. The senior interpreted the employee’s comments and gestures as a romantic relationship, which it was not. As a result, the senior provided the employee with $52,000 for a truck, money for a boat, and funds for other personal items. Again, with no close family or friends to check up on her or inquire, this scenario continued. The victim continuously thought the relationship was romantic and legitimate.

Fraudulent Government Correspondence

Scammers send a fake letter, email, or text message that appears to be from a government agency, often demanding personal information, immediate payment, or threatening legal action, including arrest, with the goal of deceiving the recipient into sending money or providing sensitive, personal information.

Some DC residents have received official-looking correspondence, allegedly from the federal government. The correspondence states that the recipient must submit business records and payment of $119 or face a fine of up to $10,000.00. The correspondence may appear as an official-looking form (possibly titled Form #5102 Mandatory Beneficial Reporting Form). Instructions state that checks should be submitted to the “Annual Records Service.” Anyone receiving suspicious, official-looking correspondence asking for personal information and or money should contact DISB’s Enforcement and Consumer Protection before responding.

Ghost Broker Fraud

Fraudulent or unlicensed individual who pretends to be a legitimate insurance agent or broker in order to sell fraudulent insurance.

Ghost brokers may apply for a genuine policy in your name, keep your premium payments, and then cancel the policy shortly thereafter — all without your knowledge. This practice allows the fraudsters to deceive unsuspecting "customers" into thinking they have a legitimate policy. The victim may only find out the policy was canceled after making an insurance claim.

Ghost brokers typically advertise cheap insurance on social media sites or messaging apps. According to the National Association of Insurance Commissioners (NAIC), insurance fraudsters typically tout policies that are much cheaper than competitors' policies. DISB can assist residents who suspect they are being duped.

Insurance Adjuster Scam

Fraudsters impersonate a legitimate insurance adjuster or exploit the claims process, to deceive policyholders or insurance companies for financial gain. The scam typically targets consumers who have filed insurance claims, often in stressful situations like accidents, property damage, or natural disasters.

An elderly DC resident reported that her property was damaged by a fire in 2017. A former DC licensed public adjuster contacted the complainant and promised to assist in adjusting all claims against the insurance company arising from the fire loss. The complainant trusted the adjuster and gave him power of attorney to endorse all checks from the insurance company and receive a 10% fee of the total amount of money paid by the insurance company for the cost of the repairs. When the insurance company issued a check for $283,703.47, the adjuster and his business partner endorsed the check, made minimal repairs, and abandoned the property. DISB ordered the adjuster to pay the complainant’s estate restitution of $283,703.47.  Before hiring a public adjuster make sure they are currently licensed by DISB and do your due diligence by checking their reputation with consumer protection organizations like the BBB. You should also conduct online searches for any complaints or negative information about the public adjuster.

Investment Scam Via Real Estate

Scammers trick people into investing money in fake or non-existent real estate investment opportunities, causing investors to lose their money.

A Maryland resident was approached by the subject, a friend of her former neighbor. The subject is a principal broker whose business is located in the District of Columbia. The subject offered the victim an opportunity to invest in two real estate properties, which he said could be flipped for a profit. The victim’s total investment would be $50,000, which was $25,000 per property. The subject promised the victim that if she invested $50,000, she would receive 12 monthly dividend payments of $500 totaling $6,000, and, at the end of the twelve months, she would also receive her initial investment of $50,000. Subsequently, the victim never received the $500 monthly payments, nor was her initial investment returned. Always be wary of a friend introducing you to someone who wants money. The friend may mean well, or the friend has invested and is trying to keep the “ball” rolling. Ask your friend how they know the person, ask the broker for references, and make sure you see a contract in advance and have a professional review any contract before signing.

Mortgage Loan -modification Scam

Scammers falsely promise to help homeowners lower their mortgage payments or avoid foreclosure by modifying their original loan terms.  

In 2020, an older DC resident reported receiving an unsolicited email from a California-based company representative. The fraudulent company claimed to offer modification through a “Government Backed Financial Hardship Program.” The complainant communicated with the company’s representative, who advised her to stop paying her mortgages to her legitimate lender, make all mortgage payments to the new company, and ignore all further communications from her lender. The complainant lost a total of $25,000 to the scam company.

ECPD assisted the complainant in reporting the scam to her lender and obtained a modification. The first red flag the complainant missed was that the initial offer was unsolicited. Yes, companies use cold calls and emails, but you need to pay close attention if it's unsolicited. Loan modifications are always in demand, especially in challenging economic times. However, if you have a mortgage, you have an obligation to whoever holds the mortgage. Never stop paying your mortgage at someone else’s direction. The mortgage holder, even if not easy to work with, can give you information about the company that contacted you.