Is "free cruise" promotion real or a scam?

October 9, 2014 15:42 by Consumer Ed

Dear Consumer Ed:

I am receiving notices in the mail from cruise lines telling me I’ve won a free cruise.  The same company is calling me on the phone and leaving messages.  I’d love to go on a cruise, but I don’t know how to tell whether these deals are legit.

Consumer Ed says: 

You’re right to be suspicious about the free cruise offers.  Almost certainly, the caller wants to sell you something in connection with that purportedly “complimentary” vacation.  There’s a reason someone coined the old adage, “there’s no such thing as a free lunch.”  It may even be that the caller isn’t actually from the cruise line itself, but simply wants to give the impression that s/he is.  You also need to be careful that you’re not setting yourself up to be on the receiving end of high-pressure sales tactics, or worse, falling prey to a scam, such as the following:

  • Your actual cruise may be free, but you might have to go to some lengths to get it.  Usually, such companies require recipients of these “gifts” to attend an extensive sales presentation of some sort before they’ll actually give it to them.  One of the most popular such pitches is for timeshare sales.
  • It’s not clear what part of the trip package is actually “free”:  Your “free” cruise may well not include transportation, lodging, meals, taxes, surcharges, or other items.  Further, if you’re required to pay a deposit up front and you change your plans, it’s unlikely you’ll be able to get a refund of the deposit.
  • If you accept such an offer from a company via the phone, they usually will want to send you confirmation about the cruise/vacation package in the mail.  Meanwhile, they ask you to provide your credit card number so that they can assess a “small service charge” at the time you accept the vacation.  Your account is charged right away, and your cancellation period will already have expired by the time you receive your confirmation packet, if you’re even sent one. Meanwhile, hundreds of dollars of “service fees” will show up on your account before you can cancel your card.


The three examples above are certainly not all-inclusive.  In 2011, the Better Business Bureau received over 1,300 complaints regarding cruise lines and free-cruise scams. So, how do you protect yourself from vacation scams? First of all, the Georgia Fair Business Practices Act (“FBPA”) has specific provisions related to promotional activities in relation to “free” gifts, prizes, or vacations.  The FBPA’s promotions statutes require companies to give advance notice to consumers if they’re required to attend any kind of sales presentation to claim a free vacation/prize. Even if the notice does not fall into the promotion category, other provisions specifically apply to vacation “awards”:

  • The vacation must include all transportation, meals, and lodging, unless the offer or notice clearly and conspicuously discloses that some or all of these items are not included.
  • If a deposit is required to secure a reservation, the offer or notice must clearly and conspicuously disclose that information.
  • You cannot be required to pay any money other than a refundable reservation deposit (i.e., no service, mailing, or handling fees) in order to receive a prize.
  • The offer may not claim that you are a “winner,” have been selected or approved, are part of any special prize group, or are entering an event from which a winner will be selected, if in fact the intent is simply to reach prospective customers, or if the majority of entrants will receive the same prize or opportunity.

In addition, it’s always a good idea to do some research before you give any personal information or credit card number to a company offering free trips/gifts.  Here are some steps you can take:

  • Research the name of the travel agency and any other company listed on the free cruise offer on the internet.  Go to the Better Business Bureau’s website at www.bbb.org to see if there are complaints against that company.
  • Don’t make hasty decisions.  The sales representative on the phone may use high pressure sales tactics and tell you that you have only a short time to accept the free offer or you will lose the opportunity.  S/he may refuse to answer questions about specific dates and any fees, and only give generic, scripted information.  If this happens, you should end the call immediately.
  • Avoid giving out your credit card (or, especially, bank account) information.  If it is truly a free cruise, you shouldn’t have to pay.  If you have to pay, it isn’t free.
  • Read the written notice carefully, including the fine print.  You may miss important information otherwise. Are transportation, meals, and lodging all included? What other additional fees or charges are there? Do you need pay a deposit to make a reservation? If so, is it refundable?  What are the refund and cancellation policies? Are you required to attend a sales presentation of any kind?
  • If you feel you’ve encountered or been a victim of a scam, you can file a complaint with the Governor’s Office of Consumer Protection.  You can also report your concerns to the Federal Trade Commission for their data collection purposes.  Additionally, if you believe you’ve received a fraudulent vacation offer in the mail, you should contact the Postal Inspection Service online, by calling 877-876-2455, or at this address:


Postal Inspection Service
P.O. Box 16489
Atlanta, Georgia 30321-0489


Finally, you mentioned that the company is calling you on the phone and leaving you messages.  If you no longer wish to receive telephone calls from the company, you can put your number on the National Do Not Call Registry. Visit www.donotcall.gov or call 888-382-1222.

 

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Legitimate resources for those facing foreclosure

August 27, 2014 18:39 by Consumer Ed

Dear Consumer Ed:

I lost my job last year when my company down-sized.  I have gone through all my savings and even borrowed money from relatives, but I just can’t keep up with my mortgage payments.  I’m afraid that the bank will foreclose on my house.  Is there any help available to me?

Consumer Ed says: 

Unfortunately, you’re not alone in this situation.  Fortunately, there are several state and federal programs that can help some people having difficulties making their mortgage payments.

Your first step should be to contact your mortgage company directly.  Many are willing to discuss your current situation and to try to come up with a solution, including a loan modification, deferment, or
repayment plan.  Look at your mortgage bill to find the name and contact information for your particular mortgage provider.

For consumers who began experiencing difficult times within the last 36 months, Georgia offers several programs.  Go to www.homesafegeorgia.com to find a summary of the programs available, requirements for eligibility, and how to start the application process.  These programs are provided in the form of a loan at 0% interest, and the loan is forgiven after five years if you stay in your home.  The Georgia mortgage assistance programs are:

  • Mortgage Payment Assistance – Provides monthly mortgage payments directly to lenders for up to 24 months to assist unemployed and underemployed homeowners.
  • Reinstatement Assistance – Assists homeowners experiencing a hardship by offering a one-time payment to catch up on missed mortgage payments.
  • Mortgage Payment Reduction (Recast and Modification Assistance) – Assists homeowners experiencing a permanent reduction in income by paying the lender a one-time $30,000 payment to lower the monthly mortgage payment.


The federal government also has several loan modification programs available to struggling homeowners.  Unlike Georgia’s programs, the federal programs aren’t loans, but ways to change the actual terms of your mortgage to make the payments more manageable.  You can find out more about these programs at www.makinghomeaffordable.gov.  The federal programs include:

  • Home Affordable Modification Program (HAMP) – Modifies the terms of the mortgage to lower the monthly payments.
  • Principal Reduction Alternative (PRA) – Assists homeowners who owe more than their home is worth by reducing the total amount owed.
  • Home Affordable Unemployment Program (UP) – Assists unemployed homeowners by temporarily reducing or suspending mortgage payments.


BEWARE!  Unfortunately, foreclosure prevention scams have increased because of recent tough economic times.  Before consulting a provider who claims it can prevent your foreclosure, there are a few things you should do to avoid getting ripped off.  For example:

  • Avoid individuals/companies promising they can halt your foreclosure – These companies cannot guarantee a particular outcome, so their promises are unrealistic (and, most likely, a lie).
  • Always send your mortgage payment to your lender or the mortgage servicer – Even if someone is assisting you in the process, make sure to send your payments directly to your mortgage company or someone approved by your mortgage company, not to any other intermediary.  
  • Avoid providers who charge up-front fees – Federal law makes it illegal for mortgage assistance relief services to collect fees before you enter into any negotiated agreement about your mortgage with your lender.
  • Never sign over your deed to anyone without consulting an independent lawyer whom you select - Some companies will attempt to have you sign over your deed, often claiming that you’ll remain in the home under a lease while they negotiate on your behalf.  This situation almost never ends well, because you no longer have ultimate control over the ownership (or occupancy) of your home.  You should never sign over your deed without first consulting an attorney that hasn’t been chosen by the provider.
  • Always read what you are signing- Some individuals may attempt to trick you into signing over the deed to your property by burying it in other paperwork.  If you don’t understand every item and every page of all documents you’re being asked to sign, DO NOT sign any of them until you have received a complete explanation from someone whom you trust, and who does understand.
  • If the provider makes any promises, get all of them in writing.
  • Don’t do business with any provider that tells you not to contact your mortgage company - Any legitimate service provider should, and will, encourage open communications between you and your lender.


Before making any decisions, contact a counselor or organization to assist you in making the right choices regarding your mortgage.  The following are great resources to learn more about the available programs and the steps required for each:

  • HUD sponsored counseling agencies may be able to provide free advice to help you avoid foreclosure.  Locate an approved counselor near you by going to www.hud.gov.
  • The Home Ownership Preservation Foundation is a non-profit organization providing free counseling to help you learn about the programs available to you.  Call them toll free at 1-888-995-HOPE (4673).


Working with mortgage companies to avoid a possible foreclosure can be overwhelming, but with proper support, you can make the best decision for your family and your home.  Be proactive and seek out the programs and counselors that will work in your best interest. And, don’t wait until the last minute to do so – give yourself as much time as possible to seek a solution that fits your situation.

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Emergency Medical Alert Scam

August 15, 2013 18:36 by Consumer Ed

Dear Consumer Ed:

I have been receiving automated phone calls saying that I qualify for a free emergency medical alert system. To accept, I'm instructed to press 1; to decline, press 2. When I hit "1" to accept I was asked to provide my bank account information. I was afraid it might be a scam so I hung up. But now I keep getting these calls, even though I have declined the offer numerous times and even asked to be removed from the contact list. What can I do?

Consumer Ed Says:

You did the right thing in refusing to provide your bank account information. A scam like the one you describe has been reported to be occurring around the country. Callers impersonate a company offering a free emergency medical alert system, but they're really just scammers trying to get you to provide your credit card or bank account information so they can take your money.

You should report such calls to the Federal Trade Commission ("FTC") by visiting ftc.gov or calling 1-877-FTC-HELP (1-877-382-4357). You should also contact your phone company to request that calls from that number be blocked.

To avoid unwanted telemarketing calls, a lot of people choose to register their phone numbers with the National "Do Not Call" Registry (www.donotcall.gov). While this is a good idea, it will only keep your number out of the hands of legitimate telemarketers. Scammers tend not to honor that registry. However, being on the Do Not Call list can make it easier for you to spot a scam since you will know that any solicitation from a company that you do not have an existing business relationship with, and that is not a charitable or political organization, is not a reputable business.

Remember - free means you don't have to pay anything. So if someone calls and offers you something for free in exchange for your banking information, hang up the phone. 

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