Fake authors use deception to lure investors

Here’s a statistic that alarms Watchdog Nation more than any other: According to a new survey, 1 out of 5 Americans age 65 or older have “been taken advantage of financially in terms of an inappropriate investment, unreasonably high fees for financial services or outright fraud.” Read the survey here.

Advisers are about to be reigned in somewhat with the new consumer financial protection bill weaving through Congress. One provision requires full disclosure of broker fees, commissions and other charges levied on investors. In the past, some folks thought if they invested $50,000 they actually invested $50,000. Read about one such case here.

Here’s another example of duplicity that ensnared investors: A Concord, New Hampshire company, Lincoln Financial Securities Corp., sold the contents of an investment book written by another company’s chief executive officer. According to the Texas State Securities Board, six different agents of Lincoln, all based in Texas, put their names on the cover as co-authors with Mark Matson, the actual author. They used the book to attract clients and establish their own credibility.

However, the six agents didn’t write the book. They just wrote a preface to it.

Title of the book?

The Dirty, Filthy Lies My Broker Taught Me and 101 Truths About Money & Investing.

Ironic, eh?

The book cover in question, provided by the Texas State Securities Board, which blocked out one "author's" name and photo.

After the Texas securities board inquired, David Booth, president of Lincoln Financial, told the Texas agents to stop using the book.

On June 15, 2010, Texas regulators entered a disciplinary order that fined Lincoln Financial $40,000 and reprimanded the firm. Read the order here.

What will they think of next?

If you hear of investment folks using deceptive practices to entice clients, write to Dave Lieber, founder of Watchdog Nation, at watchdog@star-telegram.com.

# # #

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 book named “one of top 10 consumer books of 2009”

Many thanks to Rita Robison for naming Dave Lieber’s Watchdog Nation as one of the top 10 consumer books in 2009.

Just in time for the new revised and expanded 2010 edition which goes on sale today.

Dave Lieber's book, Dave Lieber's Watchdog Nation, was named one of the top 10 consumer books of 2009

Dave Lieber's book, Dave Lieber's Watchdog Nation, was named one of the top 10 consumer books of 2009. Is this the Oscars of consumer reporting?

Here’s her list:

# # #

Did you read any helpful or inspiring consumer books during 2009?

Below are my choices for the best consumer books of the year. You can order them through my blog by clicking on the Amazon.com ad in the right column.

1. “2009 Action Plan: Keeping Your Money Safe and Sound” by Suze Orman. A plain-talking guide on how to take care of yourself during the recession and beyond.

2. “The Healing of America: A Global Quest for Better, Cheaper, and Fairer Health Care” by T.R. Reid. The Washington Post foreign correspondent traveled to Japan, Germany, France, Britain, and other countries to gather information on health care systems, using an old shoulder injury as a way to compare treatment plans.

3. “Other People’s Money: The Corporate Mugging of America” by Nomi Prins. The former investment banker describes how America got into its historic financial mess and how long it’s going to take to recover.

4. “Is America Driving You Crazy?” by Stephen Bezruchka, M.D. The University of Washington professor and emergency room physician says antidepressants are making Americans worse not better.

5. “Agenda for a New Economy: From Phantom Wealth to Real Wealth” by David Korten. Korten, cofounder of the Positive Futures Network which publishes Yes! Magazine, believes in the new economy, Wall Street will be shut down.

6. “Dancing in the Dark: A Cultural History of the Great Depression” by Morris Dickstein. A survey of the economics, politics, arts, daily life, and social legacy of the 1930s.

7. “Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong” by Dave Lieber. An award-winning guide to help you protect yourself as a consumer.

8. “Food Alert: The Ultimate Sourcebook for Food Safety” by Morton Satin. A guide to foodborne illnesses and how to prevent them.

9. “Our Daily Meds: How the Pharmaceutical Companies Transformed Themselves into Slick Marketing Machines and Hooked the Nation on Prescription Drugs” by Melody Petersen. The former New York Times reporter examines the pharmaceutical industry, and its influence on America’s medical system.

10. “Beyond Work: How Accomplished People Retire Successfully” by Bill Roiter. The psychologist and executive coach describes how people can transition from the 40-plus years as a career-focused adult and build new adult lives in which they evaluate their options and determine how they can develop personally fulfilling lives outside of work.

Add these consumer books to your library to improve help you improve your consumer choices.

Disclosure: When you order books through my blog on Amazon.com, I receive a small commission.

Copyright 2009, Rita R. Robison, Consumer Specialist

Victim or scammer? A tale of a fake check and an honored ex-offender

The man needed a job, and so he said that when the bank check for $1,950 arrived in the mail, he jumped at the accompanying offer to become a mystery shopper.

All he had to do was cash the check and send someone connected with the company part of the money as a Western Union money transfer. The rest was for him to use for mystery shopping to evaluate businesses, he was told. Afterward, he’d file reports about his experiences. Simple enough.

On Nov. 9, he went to his bank, Bank of America, but employees there told him they couldn’t cash the check. Since it appeared to be a Wells Fargo check, he was told to go there.

At a Wells Fargo branch in DeSoto, he was told to have a seat. Fifteen minutes later, a DeSoto police officer walked up to him and said, “Sir, can you stand and put your hands behind your back, please?”

“What?” the man asked.

As first reported in the Dave Lieber column in the Dec. 20, 2009 Watchdog column in the Fort Worth Star-Telegram, the man was arrested on suspicion of forgery of a financial instrument. On Nov. 30, he was indicted by a Dallas grand jury.

This is the first time I’ve seen a case where the apparent victim of a scam is arrested. But there are two important facts that must be disclosed.

Alfred Hitchcock made a 1956 movie about a man falsely accused of a crime.

Alfred Hitchcock made a 1956 movie about a man falsely accused of a crime.

First, the arrested man is Randolph Shaheed, 59, who in the late 1960s was one of Fort Worth’s most notorious gangster killers. He served 15 years in prison and is now on parole for life. (Watch a Mickey Grant documentary about him here.)

Second, he is one of the most honored ex-offenders in Texas. Two days before his arrest, the Dallas office of the state Parole Division held its annual Success Celebration, at which Shaheed was honored for helping ex-offenders succeed after they are freed.

When I asked the Texas Department of Criminal Justice to describe the award he received, the agency released a 171-word statement that describes his good deeds, calls him the ideal client and says he is “trying to promote positive change.”

How much Shaheed’s criminal record contributed to his current predicament is hard to say. He has a court date Tuesday, and the charges could be sorted out then. When I asked about his case, the DeSoto police and the Dallas County district attorney’s office mentioned his criminal background.

Shaheed said that when the mystery shopper offer arrived, he was in a confused state because his 20-year-old daughter, from whom he was estranged, had died suddenly Nov. 5.

At the time, he said he wasn’t aware that the mystery shopper ploy is a common scam. Targets of the scam are told to cash a check and send a portion of it to the purported mystery shopping company. The Federal Trade Commission says on its Web site: “The truth is that it is unnecessary to pay money to anyone to get into the mystery shopper business. ?.?.?.? Consumers who try to get a refund from promoters of mystery shopping jobs usually are out of luck. Either the business doesn’t return the phone calls, or if it does, it’s to try another pitch.”

Shaheed showed me e-mails from a Fred Mcguire of New York. (Read them here.) Shaheed said he believed that the e-mails were authentic — but they fit the classic scam. The best clue that something was wrong came in the task that Mcguire assigned him: Shaheed was supposed to visit his neighborhood Western Union office and describe all the mechanics of wire transfers from that office, including the name of money agents on duty.

When police confronted him at the bank, Shaheed said “he was a mystery shopper on the Internet,” according to a police report.

He spent four days in jail before his wife posted bail.

He is being represented by a public defender who didn’t return my calls.

Once released, Shaheed called Fred Mcguire in New York to tell him what happened.

“There’s something funny about the number,” he told me. “It just rang as if it were a phone booth or something.”

Shaheed has tried to explain that he was the intended victim of a scam.

“Doesn’t anyone want to listen to me?” he asked. “I’ve presented all the proof. I thought it was a check, brother. You know what I mean? I thought I was getting a part-time job.”

At Wells Fargo, the teller suspected that the check Shaheed presented was fraudulent, bank spokeswoman Helen Bow said. “She immediately notified the Police Department,” Bow said. She declined to answer other questions, referring The Watchdog to police investigators.

DeSoto police Capt. Ron Smith is skeptical of Shaheed’s story. “Don’t believe everything you hear,” Smith said. Although he acknowledged he had not reviewed the case file, Smith said he would be surprised if Shaheed was the victim of a scam.

In 1969, Shaheed, then known as Randolph Brown, killed a grocery store clerk in a bungled robbery attempt. Later that night, he attempted another robbery. All told, he shot at seven people, killing one and wounding two.

He was already infamous. Two years earlier, he had walked onto a Fort Worth bus holding a knife. When the driver kicked him and a friend off, he punched the driver, who started shooting. His friend was killed. He turned himself in on television at KXAS/Channel 5.

He was convicted of murder for the 1969 slaying and sent to prison, and he was paroled in 1984. After his release, he made a deal with the FBI to go undercover to break up a drug ring. Afterward, he was temporarily placed in the witness protection program. He testified against 17 defendants, the Star-Telegram has reported. All were convicted.

Then he became a minister and worked on many anti-gang programs for kids — his new life’s work. For that he was honored by the Parole Division. Excerpts from its statement released to me last week:

“With the last three years, Randolph Brown has become an advocate for other offenders. In 2005, Brown started a program now called ‘Ex-Offender’s of America Alumni Association,’ or XOAAA, where prison ministry goes beyond prayer.

“Through his program, Brown uses his voice, gifts, talents and ministry to bring forth healing for ex-offenders and those affiliated with them. The program promotes employment searches, how to get a job, finance management, spiritual counseling and more.

“The XOAAA program does not benefit just offenders but crime victims and family members as well.”

Brown also organized the Coming Up Program in Fort Worth, the statement says.

After praising his work on a radio program and cable TV, the Parole Division concluded, “Offender is more than just an ideal client. He is an advocate for ex-offenders trying to promote positive change within our community.”

Dave Lieber, The Watchdog columnist for The Fort Worth Star-Telegram, 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. Twitter @DaveLieber

The Eight Ways I Was Scammed in 2009

A pal of mine just wrote me that he hasn’t been scammed since 1975. He said he wasn’t greedy, so he didn’t look for easy money. That’s why, he said, that he isn’t victimized.

I’m happy for him.

However, I don’t consider myself greedy. And I’ve been victimized eight times this year with annoying stuff that takes time to sort out. It doesn’t have to do with me being greedy. It’s about the inefficiencies, poor customer service and culture of greed that swirls around us.

I listed all the scams that penetrated my life this year in the second edition of my book that comes out next week — Dave Lieber’s Watchdog Nation (2nd edition, Revised and Expanded.)

Below is a sneak preview from the book — a double winner with two national book awards for social change in 2009. And I just noticed that this new page appears on page 13. Fitting.


Dave's 8 Scams in 2009 2

VIDEO: 1 out of 10 of MoneyGram’s Canadian sales agents were crooks, FTC says

The $18 million settlement MoneyGram International has agreed to pay U.S. consumers who were tricked into transferring $84 million to the U.S. and Canada for fraudulent schemes is the tip of the iceberg. My video on this is here.

Worse, WatchdogNation believes, is the allegation leveled against MoneyGram by the Federal Trade Commission that 10 percent of MoneyGram’s Canadian agents (about 134 employees) were involved in the scams as willing partners.moneygram

But that’s not even the worst: MoneyGram executives were warned and did nothing. Company whistleblowers were disciplined or fired.

In damning language about the Minnesota-based company, the FTC states that MoneyGram “ignored warnings from law enforcement officials and even its own employees that widespread fraud was being conducted over its network, claiming that proposals to deal with the problem were too costly and were not the company’s responsibility.

“The company even discouraged its employees from enforcing its own fraud detection policies or taking action against suspicious or corrupt agents,” the FTC states. “Some employees who raised concerns were disciplined or fired.”ftc

During one month alone, the FTC says 8 out of 10 wire transfers through MoneyGram of $1,000 or more were fraudulent. You can read all the FTC’s legal documents here.

As first reported in the Dave Lieber column in the Nov. 6, 2009 Fort Worth Star-Telegram, the scams involved fake lotteries and sweepstakes, con jobs working as mystery shoppers, Internet  purchases, scams involving loans, e-mail, romance, employment ads and, one of the worst, the infamous grandparents scam where grandparents falsely believe they are wiring money to stranded grandchildren in Canada.

FTC spokesman Mitchell Katz says those scams are among the most evil because they prey on the elderly, many of whom already face financial troubles in tough economic times.

“They play on their emotions and financial insecurity to trick them out of their money, and that’s just not right,” Katz says. “That’s why we thought this was such a great case.”

The allegations against Minnesota-based MoneyGram go far deeper into the corporate culture than crooked agents.

FTC spokesman Katz tells The Watchdog: “Businesses have to keep in mind that you can’t just look the other way and pretend it’s not happening. You need to have a compliance program in place to make sure that the people working for you and doing your business are complying with the law.”

MoneyGram spokeswoman Lynda Michielutti released a statement:

“We don’t agree with the allegations made by the FTC. But we believed that it was in the best interest of our company and our consumers to put this matter behind us and focus our resources on delivering our valued service to consumers rather than battling it out through a long and costly trial.”

Some of the witnesses at that trial, undoubtedly would include, some of the 65 Canadian and U.S. employees of MoneyGram who already have been charged with crimes by law enforcement agencies in Canada and the U.S.

Under the settlement, MoneyGram must pay $18 million to victims and make the following changes:

– conduct background checks on all employees

– educate its employees on consumer fraud

– monitor its agents

– discipline those who break rules

– provide a clear fraud warning on its money transfer forms

– maintain a system for receiving consumer complaints that federal agents can periodically review.

WatchdogNation.com TIP

If you were scammed in a MoneyGram wire transfer, here’s how to apply for your part of the $18 million settlement:

1. File a written written complaint with MoneyGram. Contact them at 1-800-666-3947 to get started.

2. File a complaint with the Federal Trade Commission by visiting Web site ftc.gov or by calling toll-free 1-877-382-4357.

3. File a complaint with your state’s Attorney General.

Source: FTC

Don’t fall for it

Don’t wire money to:

– someone you don’t know

– someone claiming to be a relative in the midst of a crisis who wants to keep the transfer a secret

– someone who says a money transfer is the only form of payment accepted

– someone who asks you to deposit a check and send some of the money back

Source: FTC

What MoneyGram now tells customers:

On MoneyGram’s Web site, clear warnings are now issued that many of the reasons Americans were using the company’s service were fraudulent. This is worth reprinting in full from MoneyGram’s Web site:

Don’t Send Money to Strangers

MoneyGram never recommends sending money to a stranger. Any monies received by a stranger cannot be recovered and unfortunately you will not get your money refunded back to you.


Have you ever received a communication stating that you won something (money or a prize), but before you can collect you will need to send money to pay for taxes, customs, or any fees?  However, you didn’t actually buy a ticket or enter a sweepstakes. This is a SCAM.

Don’t send transfer money to the people who are stating you have “WON” something but need to send them funds before collecting your winnings. You will never have to pay money up front to receive any legitimate lottery or sweepstakes winnings

Internet Purchases

Have you found something online that interests you – a puppy, a car, an apartment for rent or any item for sale? Does the price for the item seem to be too good to be true and are you being asked to pay for the item through a MoneyGram money transfer?

Unfortunately, this is a SCAM.

Do not send money for the item to the seller. They may even send you a letter or e-mail of authentication telling you that you have purchased the item but need to wire funds first. Do not send the money. It is a SCAM. You will receive no merchandise. Once money is wired and received it cannot be recovered and unfortunately you will be at loss for any money transferred.

Loan Scams

Did you receive an e-mail or mailing about getting a loan? Were you asked to send money for loan fees, taxes, service fees, advance payments or any other reason? This is a SCAM.

Do not send money to a loan company to obtain a loan.  If the money is wired and received it can not be recovered. You will be at a loss for the money you have sent.

Checks/Money Orders in the Mail

Have you received a check or money order in the mail with instructions to first cash it at your bank and then send some of the funds to someone else through a MoneyGram money transfer? If so, the check/ money order is counterfeit and your bank will make you cover the loss.

Be aware that counterfeit checks are very hard to identify. You may have been promised a percentage of the check for employment or because of an over payment. This is a SCAM. Do not send the money and do not cash the check

E-mail Scams

Have you received a random e-mail from someone who needs help getting money back into the United States?  They may claim to be ill or inheriting a company and asking you to help them by wiring money – Do not send money to this person as this is a scam. Any money sent to the stranger will be lost and you will not get a refund.

Did you receive an e-mail from MoneyGram? The only time you will ever receive an e-mail from MoneyGram is if you sent money through www.emoneygram.com. If you receive an e-mail stating that a payment/or funds have been sent to you, and you didn’t use eMoney Transfer, the e-mail is fraudulent.

Romance Scams

Did you meet someone through a personal ad, e-mail, chat room or an instant message? Did they ask you to send them money for travel or to help them financially? Do not wire the money – This is a SCAM. Any money received by this person cannot be recovered and you will be at loss for any money sent.

Newspaper Ads

Have you found something for sale in the classifieds or any type of newspaper ad? Did they ask you to pay for the item through a MoneyGram money transfer? This is a SCAM.

Do not use a money transfer to purchase an item from a stranger. It is not safe to use a money transfer service when trying to purchase an item

Grandparent/Relative Scam

Did you receive a phone call from a grandchild or a family member? Are they in despair because they have been detained in Canada for not having a fishing license or for catching a protected species of fish? Have they been in a car accident? Are they asking for money to pay fines or for car repair? Did a relative call because they need money for a family member in medical need or for medicine? THIS IS A SCAM! Use precaution when sending money in this situation. These callers can request that you send money anywhere in the world. If you cannot verify with your family member that they are requesting the money and aren’t sure about the transaction, do not send the money. You will be at a loss for any money that is sent.

Finally, here is the latest FTC consumer alert on money transfer scams.

You can learn more about the latest scams and ways to protect yourself in the groundbreaking book by the author called Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong, winner of two national book awards in 2009 for Social Change.

Core Principles of Watchdog Nation

The idea behind the growing consumer movement is simple: With money tight and scammers everywhere, anyone who buys anything must be on guard. Consumers today are smart to rely on five core principles to keep them out of trouble.

Simple to remember but often forgotten, these principles are the backbone of Watchdog Nation, a growing group of Americans who rely on sound research, accountability and ultimately, smart strategies to fight back and win when businesses and scammers try to hurt them.

That’s the philosophy behind Watchdog Nation, according to Fort Worth Star-Telegram investigative columnist Dave Lieber, whose new book on Watchdog Nation recently won a national book award.

Dave Lieber’s Watchdog Nation: Bite Back When Businesses and Scammers Do You Wrong is the winner of the 2009 Next Generation Indie Book Award for Social Change.

“I get about 50 letters and calls a week from people with problems needing my help,” Lieber says. “As a columnist, I can only handle two. It breaks my heart that I can’t help the rest.

“With Watchdog Nation, you can see ways to solve your problems beyond complaining to a company or to a newspaper columnist. It’s easier than you think.”

Watchdog Nation’s core principles are these:

  1. Do a background check before buying. Although obvious, many consumers forget to run a simple Internet search before spending money on a product, company or service. Before buying, put the name of the company or product between quotes and add the words “rip-off” and “scam” to the search. If anything pops up, there could be a problem.
  2. Ask a bunch of questions. Don’t assume anything. Example: Starbucks offers three sizes of drinks on its public menu. Actually, there are six different cups available – including a little-known “short” size that is smaller and cheaper than the others. Two other cups are free sample cups. Dig below the surface on all purchases. Ask questions and read up on buying tips and potential problems.
  3. Hold customer service reps accountable. When seeking assistance from a company, know to whom you’re speaking. Get a name, employee ID number and location of call center. Keep a record of the day and time you call and what is said. This information gives you confidence in your dealings and sets you apart from most complaining customers. Even better, tell the company you are taping the call for “customer quality control.”
  4. Find the point of vulnerability. Businesses are like castles. They allow customers in through a front gate – a toll-free number or by e-mail – on their terms. But castles aren’t impregnable. You can still gain entry through other means. By doing Internet research, you can find other customers who experienced similar problems. Maybe there’s a class-action lawsuit or a state attorney general conducting an investigation. Once you learn the company’s vulnerability point, use it to pressure for a more favorable solution. If you need help with research or don’t have a computer, ask your local reference librarian for free assistance.
  5. Apply the pressure point. If you are victimized by a business or scammer, remember that almost everybody is regulated, licensed, audited, inspected, certified or permitted by a local, state or federal government agency. Sometimes, professional associations for various occupations take complaints, too. If a company won’t satisfy your request, complain to whomever regulates them. Ask that agency to conduct an official investigation.

“For the first time in human history, information is quickly available to help you solve your specific problem,” Lieber says. “When you know what to look for, you become a citizen of Watchdog Nation and a superhero who can solve your own problems.”