AUDIO: Watchdog Nation Confronts “Inspector Luigi” The Scammer

Note: Columnist Dave Lieber revisits the story of retired American Airlines captain George Kahak in this 2014 Dallas Morning News column, “A man who fell for, and lost, everything.” After it appeared, readers requested to hear the original audio of Lieber talking to scammer “Inspector Luigi” who pretended to be a U.S. Customs Agent. Watchdog Nation reprints this 2009 post with the sound recordings below.

Ever wonder what a scammer sounds like? Listen to a vulture who preys upon the elderly with a phone call. He wants the 86-year-old man to wire money to a foreign country. But this scam can be stopped when you know how it works. That’s the basis of consumer protection and my Watchdog Nation.

Please let me introduce you to Inspector Luigi. (This next video is an intro, but you can skip to the actual audio files below.)

He is with the U.S. Customs Service — or so this fraud says. He called my pal, George Kahak, who probably holds the world title as victim of the most scams.

I first wrote about George in my Dave Lieber Watchdog column in The Fort Worth Star-Telegram in 2009. The story is so fascinating that I reprinted it in my book — Dave Lieber’s Watchdog Nation.

I’d love for you to read the short chapter on George in this memorable excerpt.

So the other day George called me. He was about to get bit again. He won a half million dollars in a lottery. But the organizers wanted to explain to him how to claim his prize. It involved him sending money to them.

As always, I warned him off. But this time, when Inspector Luigi called George, I was there.

I asked George if I could take the phone. Then I told Inspector Luigi that George is hard of hearing. Meanwhile, I taped it for you.

Captain George Kahak. He died in 2010.

Captain George Kahak. He died in 2010.

Please listen to the slick, deep voice of this con artist. He’s a beaut. Each segment is just a few minutes.

In Act I, he explains the scam to me in detail.

Listen here: https://soundcloud.com/davelieber/inspector-luigi-part-i

In Act II, he continues his ridiculous explanation.

https://soundcloud.com/davelieber/inspector-luigi-part-ii 

In Act III, well, here’s the real drama. He tells me where to wire the money. Then, The Watchdog confronts him. (This sound file ends when the good inspector hangs up on me.)

https://soundcloud.com/davelieber/inspector-luigi-part-iii

In Act IV, I call back a few days later and Luigi pretends he is some other guy who answers the phone. When he tries to connect me — surprise — I get disconnected.

https://soundcloud.com/davelieber/inspector-luigi-part-iv 

And in the finale, Act V, he tries to pretend, once again, that he is someone else. But it’s obviously his voice.

https://soundcloud.com/davelieber/inspector-luigi-part-v 

WHY DOES THIS MATTER?

Bastards like Luigi do this every day. There are thousands of them. They prey on your grandmother, your parents, your friends and neighbors. They are so convincing that they get enough victims to make this worthwhile. Luigi is a classic case.

Watchdog Nation can’t stop the Inspector Luigis of the world from operating, but you can expose them and make it clear to all exactly how they operate.

Please share this blog post with those whom you care about.

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Dave Lieber, The Watchdog columnist for The Dallas Morning News, is the founder of Watchdog Nation. His book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, won two national book awards in 2009 for social change. Please use these icons below to share this warning message on Facebook, Twitter and your other favorite social sites.

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Watchdog Tip of the Day: Scammers love Craigslist


Scammers love to sell their fake stuff on Craigslist. If you’re shopping or hiring off Craigslist especially, keep your fraud antenna on high. Is it a scam? Listen to the voice in your head. That’s the advice from Dallas Morning News Watchdog desk administrator Marina Trahan Martinez.
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More Watchdog Nation News:

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The Watchdog: The terrible life and death of a Dallas-Fort Worth con man

I always think it’s easier in today’s digitized, easy-to-hide society for a confidence man — or con man — to make more money as a crook than as an honest man. Victims are easy to find. The chance of getting caught and punished is slim.

But now the lonely death of North Texas con man Brian Littlefield causes me to rethink my disturbing theory of evil and the often lack of accompanying justice. His final days show why the desperado life may not be worth living.

Littlefield was one of the most hated men in North Texas. He owed money to dozens, no hundreds, of companies and individuals. His goal in life seems to have been never pay for anything. His debts, shown in nine bankruptcy filings (nine!), reveal that with certainty.

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Few know he died sometime in late August. A notice of his death never appeared.

“Some people get obituaries, and some people don’t,” explains Don Willis, who followed the ugly arc of Littlefield’s life.

Littlefield owned a business, Discount Appliance Service Co., for which he placed ads offering to fix refrigerators, washers and the like. He’d show up at someone’s house, take a deposit and sometimes attempt a repair. But when the fix went bad, the chance of getting him to return was null and void.

“My refrigerator wasn’t cooling,” said a woman from Fort Worth, where Littlefield set up shop. “He said it needed Freon. He added something, but it became warmer. I called several times. No response. I called to stop payment on the check, but he already cashed it.

“He goes directly to the check writer’s bank and cashes the check. We ended up getting rid of the refrigerator as he completely ruined it.”

Typically, he’d install a used part and tell the customer it was new. Or he wouldn’t finish the job. Then he’d disappear.

Stories about his act are as easy to find as dead leaves in the fall. One man paid a service fee and money for a part that didn’t work. “I left a message, and he never called back.” A few years later, the man’s father fell for the same thing. The father paid $50 upfront, then Littlefield actually returned, but he wanted another $50.

The father gave it to him. “He never saw him again and would not return calls,” the son remembered. “Dad said he felt like a chump.” Like father, like son.

Another man named Brian Littlefield often paid the price. “I used to get phone calls for this guy,” the other Littlefield remembered. “I had people who would call my answering machine and cuss me, saying ‘You took my washer/dryer.’ But it’s not me. I’m a financial adviser.”

Once, they even talked by phone. “Hey, I’ve got a lot of people calling for you,” the good Littlefield told the bad one.

The bad one didn’t care. “There are some that I will not call back because they are yelling and screaming and being hostile on an answering machine,” he told me in 2007 when I found him in East Texas. “I have a policy: If someone is hostile, I will not call them at all.”

“Why do they get hostile?” I asked.

“I’m not sure why.”

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Aside from his appliance scams, Littlefield manipulated the court system, too. Forget that many thought the court system should be going after him. That didn’t happen. “No one with any power is stopping him from preying on the people,” one victim said. He was adept at legal maneuvers, serving as his own lawyer. He lost small claims court cases the way marathoners lose pounds. When he lost, he didn’t pay.

His nine bankruptcies, about one a year during the last decade, were designed to stave off housing evictions. (Lists of his creditors show he owed every business imaginable from bail bondsmen to electricity companies, banks, the government and video rental stores.)

Every time a landlord would prepare to evict him, he’d file bankruptcy to grab another 60 or 90 days before hitting the street to do it elsewhere. Not one bankruptcy was completed.

He was evicted more than two dozen times for nonpayment of rent, one lawyer said. “He drove a lot of people just about nuts. He knew how to throw up roadblocks.”

A property manager said, “I am pretty sure he holds our office record for going the longest period of time dodging an eviction action. He was skilled enough to run up the landlord’s legal bills and extend his occupancy without spending his own money.”

Littlefield admitted none of this. He didn’t run off with the money for no reason, he once explained. “If you change your mind, the deposit is forfeited,” he said with the confidence of a con.

“I would say I’m a good repairman, subject to making mistakes like anyone else. Everyone is human. Everyone makes mistakes. I’m not perfect. But I have been doing this for many years.”

He was known for giving tips about crimes to area police. Police didn’t charge him with theft because his bad business practices were considered a civil matter. “I’ve never been convicted of a felony,” he bragged.

He spent the last year of his life squatting illegally in an abandoned house in west Fort Worth. It was the perfect setup. No rent. No fee. No one to bother him.

He was sick with diabetes and other ailments. He didn’t work anymore. He had a horrible growth on his face that made him an ogre to look at. And when he died nine weeks ago, nobody noticed. Not for a week.

At age 52, the con man died alone in a fetid house not his own. Friendless and broke.

Read the latest Watchdog Nation reports from Dave Lieber at The Dallas Morning News Watchdog page.

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Are you tired of fighting the bank, the credit card company, the electric company and the phone company? They can be worse than scammers the way they treat customers. A popular book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, shows you how to fight back — and win! The book is available at WatchdogNation.com as a hardcover, CD audio book, e-book and hey, what else do you need? The author is The Watchdog columnist for The Dallas Morning News. Visit our store. Now revised and expanded, the book won two national book awards for social change.

AVAILABLE IN HARDCOVER, CD AUDIO BOOK, ON ITUNES (AUDIO), KINDLE AND IPAD.

 

Part 1: For 2011, protect yourself by following these do’s and don’ts

Read Part 2 of this series here

Together, we learned a lot in 2010 that can make 2011 easier. As we close out a year that has been difficult for many, here are lessons from Watchdog stories past.

As readers of the Fort Worth Star-Telegram Dave Lieber column first learned, The Watchdog learned in 2010 that consumers should ask why a particular store or company sells a product or service at a price far below what others are asking. Watches, electronics and other items sold at lower prices are sometimes import models that cost less because they don’t come with a U.S. warranty. “Too good to be true” applies more than ever.

Similarly, if an investment adviser is hawking a financial product that offers much higher returns than other investments, investigate why. Every state has a government-run website where you can check the background of financial advisers. In my home state of Texas, check out Texas financial advisers and their records at www.ssb.state.tx.us. The U.S. government site is www.adviserinfo.sec.gov.

If a website showcases a TV reporter touting a product, do an Internet search to see whether the reporter and TV station are real. Creating fake media is a new tactic. Also, beware of websites that display logos of the major TV networks or Oprah Winfrey’s show and claim “as seen on TV.” Anyone can slap a logo on their Web page.

Dave Lieber's Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong

Adult children should consider keeping a closer eye on elderly parents, who can fall prey to swindlers. Stress that they shouldn’t make investments without consulting others. Tell them not to buy anything from salesmen who knock on their door or call or send come-ons by mail or e-mail.

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Beware of door-to-door salesmen selling alarm systems or trying to get you to switch electric companies and that evergreen scam, concrete guys who “just finished a job down the street.”

Skip reading the “terms and conditions” of any transaction at your peril. Donald Hufstedler thought he was getting a free book for only a $1.95 shipping charge. After he got a bill for $90, he called and complained. He was told that he had unknowingly agreed to the purchase. The ad stated, “You’ll get a free* trial.” Don’t ignore the asterisk. Fine print is never fine for you.

Watch for sales words and phrases that should scare you (not entice you): deep discount, pennies on the dollar, greatly reduced prices, promotional gift, prize, incentive, complimentary gift and, of course, that four-letter word, free.

For Texas readers: Instead of worrying about your smart meter, get smart about your electricity contract. Do you know the rate you pay per kilowatt-hour? Most people don’t. Do you know when your contract expires? If you are paying more than 10 cents per kilowatt-hour, you may be overpaying.

For Texas readers: Go to Google’s search page and type in “Dave Lieber Electricity Guide” to find my suggestions about how to shop for a better deal. Or for a hard copy, send a self-addressed stamped envelope to: Dave Lieber, Star-Telegram Watchdog, P.O. Box 1870, Fort Worth, TX 76101. Hundreds of Texans have saved using my guide.

Get your free annual credit report, as is allowed under federal law, at the government-approved website www.annualcreditreport.com. But once on that site, beware of links that offer other services for sale. No need to buy them. (And don’t get confused with freecreditreport.com, which sells a lot of information and isn’t government-approved.)

In financial disputes, explore small-claims court as an option. You don’t need a lawyer. And if you win, the other side usually has to pay your filing fees.

Don’t put outgoing mail in outdoor blue collection boxes. Go inside the post office to drop off your letters. It’s too easy to steal from the outdoor boxes. Even the post office advises this.

If a friend sends you an e-mail, especially from a foreign country, claiming that he or she is in trouble, don’t believe it. Check with relatives and friends. Usually it’s a con artist assuming your pal’s identity.

Once every six months or so, audit your monthly bills. Contact your credit card companies and ask for a lower interest rate. Ask for better deals from companies that provide your TV, land-line and cellphone service, electricity and Internet connections. Ask for specials. Tell them the competition is offering a lower rate. If you don’t get your price lowered, try again in a few weeks. Plans change constantly, and unless you ask, they won’t tell you.

Use your cellphone to take photos and videos of car accidents you are involved in, unruly salespeople, people you sign contracts with, anything to back your story later.

If someone pressures you to buy now before a “deal” goes away, run for the exit door.

If you have a problem with a collection agency, read the federal Fair Debt Collection Practices Act and learn your rights.

No, sorry, but you didn’t win that foreign lottery. How do I know? Well, you should never be asked to send money to get legitimate contest winnings.

In Part 2, here, I’ll share a few simple principles that should help you avoid problems in 2011.

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Dave Lieber, The Watchdog columnist for The Fort Worth Star-Telegram, is the founder of Watchdog Nation. The new edition of his book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, is available in hardcover, as a CD audio book, ebook and hey, what else do you need. Visit our store. Now revised and expanded, the book won two national book awards in 2009 for social change. Twitter @DaveLieber

Dave Lieber book that won two national awards for social change.

Part 2: Five simple ways to protect yourself in 2011

Read Part 1 of this series here

Listen, I want to cut my workload. So my first action in 2011 is to show you how to avoid problems or quickly solve any you have. You won’t need The Watchdog.

As readers of the Fort Worth Star-Telegram Dave Lieber column learned first, my methods are free and take mere seconds. The trick is to remember to do them. Here are my five core principles of Watchdog Nation.

1. Check it out.

The single most important piece of advice. If you do your homework before you sign a contract, hire someone or buy something, you dramatically decrease the chance you’ll find yourself in trouble.

Always remember to take advantage of the greatest research tool ever: the Internet search box. Check the reputation of a company or person and look for any obvious problems through a quick online search.

In the search box, simply type an individual’s name, the company’s name or the product you are considering, along with the words rip-off and scam. Learn in seconds if angry customers can alert you to past problems. Why do I recommend those two words? When Americans get angry, those are the keywords they most often use to complain.

If you find a few negative comments, they could be from disgruntled customers with an ax to grind. But if there are hundreds, you found what you needed to know. If you don’t have an Internet connection, contact your local librarian for help.

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More Watchdog Nation News:

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2. Hold customer service people accountable.

When you have a problem with a company, don’t speak to nameless people in customer service on the other side of the world. They know who you are, so find out about them. On a blank sheet of paper — your “power sheet” — record the name, employee ID number and location of the person on the phone. Jot down the date and time of your call.

After getting this information, say the following: “Before I tell you my problem, I want to let you know as a courtesy that I am taping this call for customer-quality control.”

They are already taping you. Now they believe you are taping them. Suddenly, it’s an equal relationship.

You don’t have to tape the call. Just the idea is good enough. But if you want, go ahead. Taping a call is legal in many states. Find out your law here.

3. Find the company’s point of vulnerability.

If you have a problem, use a search engine to learn about how others are dealing with the same problem. You are not alone. Usually, someone else has already found and posted a possible solution that the company doesn’t want you to know.

Usually, it’s one of four possibilities:

A class action lawsuit you can join.

An attorney general in one of the 50 states who is investigating.

A regulatory agency in your home state looking into the problem.

A TV or newspaper reporter who has covered the problem.

Call the company and ask for a supervisor. Share with the supervisor the details of your power sheet (whom you previously spoke to and what they didn’t do). Tell the supervisor you are taping the call because if he or she can’t resolve your problem, you will take it to the regulator or TV reporter. In other words, serve up the company’s point of vulnerability.

Supervisors can make problems go away. You just gave them the reason.

4. Ask a bunch of questions.

Dave Lieber's popular button was written about in USA Today.

Americans are usually two questions shy of getting the information they need. Sometimes, out of embarrassment (we seem pushy), we stop asking questions too soon.

Ask two more questions and find out what the salesman isn’t telling you. Penetrate the secrets, the fine print details, the good, the bad and the ugly.

5. Find their pressure point and squeeze.

The Watchdog doesn’t believe that anyone should complain to a company with more than three phone calls or one letter. Your first two calls can go to customer service. Then comes the supervisor. If that fails, move on to the pressure point.

Nearly everyone we deal with today has to answer to somebody. Businesses are audited, licensed, regulated, inspected, certified, registered or approved by some state or federal agency.

In the pre-Internet days, you needed to know your way around a law library to figure out who regulated what. Now all you have to do is ask a search engine.

Example: Let’s pretend a home warranty company won’t fix something it’s supposed to. A search shows that in my home state of Texas, these companies are regulated by the Texas Real Estate Commission. Every two years, the commission audits the financial records of each company and then renews its license. And hey, the commission also takes complaints. Find similar agencies in your home state.

Some companies are good at ignoring irate customers. Getting rid of a government overseer? Not so easy.

These principles are included in my book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong (watchdognation.com).

If you’d like The Watchdog to visit your community group in 2011 to share these lessons in detail, all you have to do is ask. My resolution for 2011 is to show you how to be your own watchdog.

Read Part 1 of this series here.

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Dave Lieber, The Watchdog columnist for The Fort Worth Star-Telegram, is the founder of Watchdog Nation. The new edition of his book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, is available in hardcover, as a CD audio book, ebook and hey, what else do you need. Visit our store. Now revised and expanded, the book won two national book awards in 2009 for social change. Twitter @DaveLieber

Dave Lieber book that won two national awards for social change.

America meets Watchdog Nation/Listen to Fun Radio Interview

Listen to this fun interview!

Dave Lieber’s Watchdog Nation is shared with thousands of listeners across America on Robin Young’s popular radio show, Here & Now. The show is heard on more than 160 public radio stations across America.

Listen here 

Dave Lieber's Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong

Dave Lieber

Robin Young

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More Watchdog Nation News:

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THE STORY BEHIND THE RADIO INTERVIEW

A producer at a national talk radio show recently got bit by a common scam. She signed up for a low-priced teeth whitening product on the Internet and then got hit with excessive charges on her credit card. She tried for weeks to cancel.

Producer Karen Pelland decided to turn her bad fortune into good journalism. She produced a segment on the scam for her show, Here & Now. The show is created at WBUR-FM in Boston and heard on more than 160 public radio stations across the nation.

She searched the Internet and found these two Dave Lieber Watchdog Nation reports on teeth whitening:

Trial offers are trouble: Watch out for teeth whiteners sold on the Internet

Dentists angry about non-dental teeth whitening clinics

Dave Lieber was invited on the show. When Dave talked to host Robin Young on air, they explored the producer’s smart handling of her scam. (She got her money back!) Robin and Dave also talked about many other scams popular in America and how to beat them. Do you know that the garage door repair business is beset with overcharging repairmen? That companies advertising free credit scores usually charge? That these days even middle school students are getting scammed?

Do you know why most scammers get away with it? Do you know how to prevent getting scammed? Or if you do get scammed, do you know how to get relief?

Listen to the fun radio interview here.

[audio:hereandnow_0708_2.mp3]

Robin Young web links:

Here’s Robin Young’s Here & Now show.

Here’s the Public Radio International story about this Dave Lieber interview.

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Dave Lieber, The Watchdog columnist for The Fort Worth Star-Telegram, is the founder of Watchdog Nation. The new revised and expanded edition of his book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, is available in hardcover,  an e-Book and a multi-set CD.

Save time, money and aggravation. This book changes lives. That’s why it won two national book awards in 2009 for social change.

Shop for the new 2012 revised edition at Dave Lieber’s Yankee Cowboy Store and, of course, world headquarters at WatchdogNation.com.

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Watchdog Nation Changes Lives: Two People Who Learned to Fight Back

Watchdog Nation is changing the way people protect themselves.

Watchdog Nation sets you up for the rest of your life. With simple steps that take only a second and are free, you can know that you are making the right decisions.

Terry Martin of Euless, Texas writes to Watchdog Nation founder Dave Lieber:

“I know you must get dozens of letters each day in regards to the big corporate  companies and their incompetence. I have read your book, Dave Lieber’s Watchdog Nation. And the one thing that struck a nerve with me is: never give up. The stories in your book had so much common sense, and I admired the way you helped the victims find a fair and ethical way or relief from all of their problems.

“Dave, your book inspired me to fight AT&T. I never gave up. It was a long and tedious fight, but I feel I won the battle. Thank you again for all the help and inspiration you gave me. Sincerely, A Huge Fan, Terry Martin.”

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More Watchdog Nation News:

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America meets Watchdog Nation/Listen to Fun Radio Interview

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Tim Durkin writes to Watchdog Nation:

“I just finished listening to your multi-CD audio book of Dave Lieber’s Watchdog Nation, just in time to learn how to handle an emergency where I live, thank goodness.

“My next door neighbor rang my bell at midnight. She told me the glass on her front door was shattered and the wood was splintered. She worried that someone had broken into her house.  We called the police.

“The robbers had torn off her electric meter to disable any alarm, and then kicked in her door and helped themselves to everything they wanted. They did this in broad daylight.

“Because I had finished the Watchdog Nation audio book and was enjoying my new honorary citizenship, I knew what to do. I immediately began an Internet search to find the strongest deadbolts and locksets. I kept reading until I found a video for Strikemaster Pro II which affords steel protection to any door frame, which is the weakest part of a door. I was amazed when I placed and order and the owner of the company called.

“Ed Anderson is passionate about trying to keep the bad guys out of your house. Anyone who has been robbed will tell you that losing their possessions is one thing but losing their piece of mind is really the bigger thing.

“I installed my Strikemaster in about 10 minutes. And when I told Ed about my neighbor and how she lost her family photos in the burglary, he asked if it would be OK if he sent my neighbor a free Strikemaster.

“My point is that your Watchdog Nation inspired me to quickly search for the  best and most inexpensive solution to solve my problem and my neighbor’s. I buy into it. It works. I can’t wait until the next problem. OK, not really. Best wishes, Tim Durkin.”

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The tool you carry can protect you

Many of us carry a device in our pockets and purses every day that can protect us, but when trouble comes, we forget to use it.

It’s your cellphone, especially those smartphones that can take photos and record sound and video.

I bring this up because Dallas County Assistant District Attorney Stephanie Martin recently complained at a fraud conference I attended that she has trouble prosecuting some cases because it’s difficult to accurately identify the bad guy.

Sometimes when victims claim that a con artist got them to sign a fraudulent contract, she can’t show that the con artist was even in the room.

So before you sign any expensive contracts, why not ask the other party if you can take a photo to commemorate the occasion? If the person balks, that’s a warning sign.

The Watchdog’s phone is set so one button turns on a video camera and another button leads to a voice recorder.

The other day on a highway, when a rock-hauling truck dumped a load of pebbles on the Watchdog Nation mobile’s windshield, I dictated the truck’s license plate and state registration number into my phone. At the next stoplight, I took a photo.

If I find a windshield crack, I’m ready.

Twenty years ago, when I was in an auto accident, the other driver later told his insurance company that he wasn’t even there. After that, I stored a disposable camera in the glove compartment. That’s no longer necessary.

You have to remember to use this wonderful tool when needed most. Often, though, in the heat of the moment, people forget to pull out their backup. This is your Watchdog Nation reminder.

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Dave Lieber, The Watchdog columnist for The Fort Worth Star-Telegram, is the founder of Watchdog Nation. The new 2010 edition of his book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, is out. Revised and expanded, the book won two national book awards in 2009 for social change. Twitter @DaveLieber

Dave Lieber book that won two national awards for social change.

Is MoneyGram up to its old tricks?

I won’t let go of MoneyGram.

On the one-year anniversary of the MoneyGram’s $18 million settlement with the Federal Trade Commission for its role in allowing gullible Americans to wire money to Canadian scammers, I went out and searched to see if it’s still happening.

It is.

Dave Lieber's Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong

I didn’t have to go far to find a victim. Only a few miles from Watchdog Nation HQ to find another victim of the Granny Scam who sent the money through MoneyGram, even though the company promises that it has cleaned up its act.

But first I must apologize to R. for passing on bad information. When a year ago, I first reported how MoneyGram had to pay $18 million back to customers who wired money to scammers, I attached an advice box to the column. (See last year’s video and Watchdog Nation report on MoneyGram here.)

The box stated, “If you were scammed in a MoneyGram wire transfer, here’s how you can apply for your part of the $18 million settlement.” I recommended calling MoneyGram and the Federal Trade Commission. That’s what MoneyGram and the FTC told me to tell readers at the time.

So R., who lives in Bedford, Texas followed my advice. A month before, he had received a letter telling him he won the Maple Leaf Lottery. His prize, he was advised, was $520,000! It made sense. He had traveled in Canada and entered a few contests. Now all he had to do was deposit the first prize check in his bank, then take that money and wire it to Canada for his taxes and fees so he could get the rest.

He did as told. A few days later, he got a note from his bank that the check was a counterfeit. He lost $4,000. (An embarrassed R. asks that he not be identified.)

My original notes from last year quote an FTC spokesman telling me, “We’ve got $18 million here, and that’s going to mean a bunch of money going back to defrauded consumers.”

Not to R.

“Nope,” he says. “Got nothing.”

After he filed complaints with MoneyGram and the FTC, he never heard back.

He asked for help, and I contacted MoneyGram on his behalf. A company spokeswoman verified that his claim was not included in the settlement because it came after the redress program had ended. Besides, R. had no proof that he faxed his complaint to MoneyGram in the first place. (Remember to get written or taped confirmation!)

An FTC spokesman tells me that the $18 million ran out almost immediately after the settlement was publicly announced.

“At that point, literally, both the FTC and MoneyGram were inundated with complaints from victims,” FTC’s Todd Kossow said.

If the new complaints had been added, “They would have diluted the pool,” he said.

He estimated that “the amount lost by consumers through fraud-induced money transfers using MoneyGram’s system likely was in the hundreds of millions of dollars for the years 2004 through 2008.”

R. wouldn’t have qualified anyway, Kossow explained, because, as MoneyGram stated, his transaction occurred after the qualifying period for settlements ended in 2008.

The government says 34,000 redress checks were mailed to victims — totaling $18 million. The average check was $520. But most victims lost a lot more than that in various scams in which money was wired to MoneyGram outlets in Canada.

The original FTC complaint accused MoneyGram of helping U.S. consumers transfer $84 million to scammers in this country and abroad. The FTC alleged that 10 percent of MoneyGram’s Canadian agents (134 employees) were involved in the scams as partners.

MoneyGram’s executives were warned and did nothing, the agency said. Company whistle-blowers were disciplined or fired. The FTC alleged that company leaders said fixing the problem was too costly.

At the time, MoneyGram announced that it would not fight the complaint to avoid “battling it out through a long and costly trial.”

Recently, MoneyGram spokeswoman Lori O’Briant told me the company has worked hard to beef up its anti-fraud efforts, including increasing fraud specialists on staff, using “a new multimillion dollar Fraud Prevention System that helps stop fraud before money is sent.” She said it also had built closer relationships with law enforcement agencies around the world, updated its money transfer forms to alert consumers of potential danger and improved its hiring practices.

So how’s that working?

Well, in September 2010, a 74-year-old Hurst, Texas woman was swindled out of $6,000 in “the granny scam” when she wired money to Canada thinking it was for her nephew. Hurst police tell me that $3,000 was wired through Western Union, and $3,000 was wired through MoneyGram.

R. says there’s really no policing to detect and punish those involved. “I even spoke to the Royal Canadian Mounted Police, and their attitude was, ‘We’ll be looking out for them. We know it’s happening, but it’s hard to catch them.'”

R. also filed a complaint with the U.S. Postal Inspection Service (his “winning” letter arrived in the mail). But nothing came of that, either. Service spokeswoman Amanda McMurrey says, “Typically, in these situations, there’s not much we can do except forward that on to the government of Canada.”

The best defense, she says, is to understand that a bank will deposit cash for a check into a person’s account in a few days, but if the bank later learns the check is a counterfeit, the account holder is responsible for repaying the money.

Requests for wire transfers are a telltale sign of a scam. Never wire money to anyone without double-checking the circumstances and individuals involved.

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In fairness, Watchdog Nation wants to share MoneyGram’s response to the above in full:

“At MoneyGram, we take consumer fraud very seriously. Our ability to provide safe and reliable payment services for our consumers is critically important to our business.

“Over the last year, MoneyGram has renewed it commitment to preventing fraud. Measures undertaken by the company include:

  • Tripled anti-fraud staff
  • Intensified operational scrutiny of transactions with a new multi-million dollar Fraud Prevention System that helps stop fraud before money is sent
  • Expanded global outreach with law enforcement and regulatory agencies
  • Reporting to and communicating with FTC and partnering with other financial services providers, law enforcement agencies and industry councils to promote consumer awareness
  • Updated our money transfer send form to better educate customer and raise awareness of scams
  • Created new agent facing policy – enhanced requirements for applicants to become a MoneyGram agent, as well as enhanced agent education/training to mitigate fraud

“As a result of our actions, we have prevented more than $30 million dollars in fraud this year alone. In addition, fraudulent transactions sent from the United States to Canada have decreased by 75% since May (Canada has historically been one of the most active fraud corridors).

“Additionally, in order to protect and educate our customers we:

  • Post warnings on our website on various kinds of scams, as well as warn consumers that MoneyGram should not be used for Internet purchases
  • Clearly communicate and warn customers about possible fraudulent transactions on our money transfer forms – including asking if the customer is sending money for the purchase of a car, or rent an apartment, or claim a lottery, etc.
  • Provide training for agents to help spot possible fraudulent transactions
  • Clearly alert consumers to never send money to people they do not know
  • We ask customers who believe they have been a victim of fraud to contact us at 1-(800)-MoneyGram as well as report it to local police. We can then work with police and federal authorities who will further investigate the scam.”

Lori O’Briant
Corporate Communications & Media Relations Manager
MoneyGram International

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Read the FTC’s Consumer Alert “Money Transfers Can Be Risky Business”

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Dave Lieber, The Watchdog columnist for The Fort Worth Star-Telegram, is the founder of Watchdog Nation. The new 2010 edition of his book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, is out. Revised and expanded, the book won two national book awards in 2009 for social change. Twitter @DaveLieber

Dave Lieber book that won two national awards for social change.


Watchdog Nation’s oldest citizen celebrates her 100th birthday

Of all the people Watchdog Nation has tried to help in the past several years, Ruth Wingfield is our favorite.

Today, she celebrates her 100th birthday. That officially makes her the oldest citizen of Watchdog Nation in the world today.

Dave Lieber's Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong

I know she’s a citizen of Watchdog Nation because whenever she gets angry at someone trying to rip her off, her first instinct, after calling me, is to demand: “WHO REGULATES YOU? I’M GOING TO FILE A COMPLAINT.”

Dave Lieber's Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong

I met her in 2008 when Cigna, her health insurance company, did her a big bowl of wrong. She wrote a $4.80 check she owed them. But then, at 98 years old, she put the decimal point in the wrong place. She wrote the check for $480. And when she complained later, the company refused to give her the money back. They said it could take a month or more.

Here’s the story I told earlier of how she got her back money.

At the time, she couldn’t remember my name was Watchdog, so she called me “Dogpatch Guy” — and I put that in the story.  For weeks afterward,  people called me “Dogpatch Guy.”

“I put you on the map,” she jokes.

Anyway, she’s been ripped off before, and she doesn’t like it. Somebody cashed out one of her insurance policies years ago (without her knowledge), and the agent involved was fired. She also got angry after she received a free cell phone but later learned she had to pay large bills. She also bought a phone for hard-of-hearing adults that turned out to be a dud, too. So she’s real suspicious.

Maybe that’s why she’s lived to be 100.

In the video box at the top of this post, shot on her birthday, she tells about her latest escapade.


Dave Lieber's Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong

Ruth Wingfield, 100, and the dude she calls "Dogpatch Guy"


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Final note: Wingfield was an outstanding semi-pro women’s basketball player in the 1930s. She played with the legendary Hazel Scott. Last week, Nancy Lieberman, probably the greatest American woman’s basketball player alive today, presented Wingfield with a cake and an autographed basketball.

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Dave Lieber, The Watchdog columnist for The Fort Worth Star-Telegram, is the founder of Watchdog Nation. The new 2010 edition of his book, Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, is out. Revised and expanded, the book won two national book awards in 2009 for social change. Twitter @DaveLieber

Dave Lieber book that won two national awards for social change.