Home Repair Scam Appears to Target Military Families
By Donna Miles
American Forces Press Service
WASHINGTON, Sept. 17, 2008 ? The letter that appeared in a soldier?s
mailbox promised an offer almost too good to be true:
A home
improvement loan approved by Congress and backed up by a
government agency.
Officials at the Federal Citizen Information Center fear it?s a scam
targeting military members that uses the center?s credibility to lure
victims in.
An eagle-eyed soldier notified the Federal Citizen Information Center
after receiving the ad from the ?Home Information Center? linked to post
office boxes in Dallas and in Owasso, Okla. The letter included a
reference to FCIC?s Web site in an apparent attempt to show a federal
endorsement.
?The thing that immediately sends up a red flag is the fact that [the
advertisement] says these loans are approved by the U.S. Congress,?
said Mary Levy, director of consumer education and outreach in the
FCIC?s Office of Citizen Services.
?Congress would absolutely never
approve any particular home improvement loan.?
In addition, she said, the Federal Citizen Information Center has no
association with the Home Information Center. Levy emphasized that
home improvement services are regulated at the state and local level,
not by the federal government.
Levy expressed concern that the letter might be one of many floating
around that are targeting military homeowners who, like many of their
civilian neighbors, are struggling with financial concerns. Many are prime
candidates for scams because they?re young and relatively inexperienced
in handling money, they?re away from their extended families, and often
have no roots in their new communities, she said. ?That may make them
particularly susceptible to these kinds of scams,? Levy said.
Unscrupulous people have long focused their schemes on
servicemembers and their families. Last year, the Federal Trade
Commission and American Red Cross warned consumers about an
identity-theft scam targeting families of deployed troops.
****Check this out...This makes my blood boil****
That scam involved someone calling a military spouse, identifying herself
as a representative of the Red Cross, and notifying the woman that her
husband was hurt in Iraq and had been medically evacuated to Germany.
The caller then said doctors could not start treatment until paperwork
including the husband?s Social Security number and birth date was
completed.
Siggy's Take: This asshole should be thrown up against a wall and shot.
No trial...no nothin'.
The FTC called this scheme a variation of ?phishing? ? a technique identity
thieves use to get personal or financial information from unwary
consumers. The identity thief claims to represent a trusted source ? a
bank, a government agency, or in this case, the American Red Cross ? to
get someone to divulge personal information.
?Military families can become targets of scams, especially when the
soldier is deployed thousands of miles away and the family is here,? Levy
said. ?That?s why it?s so important that they have the information they
need to protect themselves.?
The
Federal Citizen Information Center offers consumers tips for
selecting a contractor to make home improvements and repairs:
--
Get recommendations and references. Talk to friends, family and
others who have used the contractor for similar work.
--
Get at least three written estimates. Insist the contractors come
to your home to evaluate what needs to be done. Be sure the estimates
are based on the same work so that you can make meaningful
comparisons.
--
Check contractor complaint records. Your state or local
consumer protection agency or
Better Business Bureau can
provide this information.
--
Make sure the contractor meets licensing and registration
requirements. Your state or local consumer protection agency can
help you find out what these requirements are.
-- Get the names of suppliers and ask if the contractor makes timely
payments.
--
Contact your local building inspection department to check for permit
and inspection requirements. Be wary if the contractor asks you to get
the permit; it could mean the firm is not licensed.
Siggy's Take: In my state, we have a Department of Professional
and Occupational Regulation, or DPOR. You can go to a website and look
contractors up by name and see if there are any judgements, liens or
charges leveled against them. Very good information!
--
Be sure your contractor is insured. They should have personal
liability, property damage and worker?s compensation insurance for
workers and subcontractors. Also check with your insurance company to
find out if you are covered for any injury or damage that might occur.
--
Insist on a written contract that states exactly what work will be
done, the quality of materials that will be used, warranties, timetables,
the names of any subcontractors, the total price of the job and the
schedule of payments.
--
Try to limit your down payment. Some states have laws limiting
the amount of down payment required.
Siggy's Take: You should not pay any more than 50% up front
under any circumstances. That will motivate the contractor to work hard
for the rest, and will also help ease the blow if the contractor
bails on you.
--
Understand your payment options. Compare the cost of getting
your own loan vs. contractor financing.
--
Don?t make a final payment or sign a final release until you are
satisfied with the work and know that subcontractors and suppliers have
been paid.
***Note: Some state laws allow unpaid subcontractors and suppliers to
put a lien on your home for bills the contractor failed to pay!***
--
Pay by credit card when you can. That way, you may have the
right to withhold payment to the credit card company until problems are
corrected. (It takes longer to stop payment if paying by check and you
have to contact the bank.)
The FCIC warns consumers of red flags that could indicate a fraudulent
operator, including soliciting door-to-door, offering a quote out of line
with other estimates, using pressure tactics or asking for the entire
payment up front.
The Consumer Action Handbook, published annually by the FCIC, offers
additional consumer information covering a wide range of topics. The
FCIC Web site provides ordering information.
One last word from Siggy: Beware of this scam, and NOT just
servicemembers! My good friend, a civilian, was targeted by the exact
same method. He was visited at his home by a "contractor"
offering "government-assisted" roofing for low-income families.
He took the bait and, three months later, got hammered for three
thousand dollars.
Remember - THERE AIN'T NO FREE LUNCH!
