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Annual Fraud.org report shows link between COVID-19, recession, and scammers preying on Americans

Watchdog group’s annual report tracking trends out today 

For immediate release: February 1, 2021

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC—An analysis of the scams most frequently reported by consumers in 2020 tells the story of economic downturn, social isolation, pandemic fears, and opportunistic criminals, according to a new report released today by the National Consumers League’s (NCL) Fraud.org campaign. Through the Fraud.org website, NCL collects complaints from consumers about suspected and confirmed fraud incidents, tracks trends, and shares the data with law enforcement. 

The report’s findings note the pandemic’s impact on fraud trends, including increases in “get rich quick” schemes and predatory scams of the heart. The number of complaints received at Fraud.org regarding bogus prizes, sweepstakes, and free gifts nearly doubled year-over-year. Another pandemic scam trend: a notable increase (30 percent) in romance scams, which experts at Fraud.org are linking to the social isolation brought on by the COVID pandemic and Americans turning to online communication for companionship. 

“The COVID recession has fueled a rise in get-rich-quick schemes and romance scams,” said John Breyault, NCL Vice President of Public Policy, Telecommunications, and Fraud and the new report’s author. “The pandemic created a perfect storm for criminals: millions out of work and struggling with new financial hardship; people forced to isolate and seek companionship online; and incredible uncertainty about the future. Last year was a good year to be a con artist.” 

With many of the conditions from 2020 still in place, the consumer watchdog is cautioning consumers against the most common scams that plagued Americans last year.  

“While the exact pitch differs from scam to scam, there are red flags that consumers should consider,” said Breyault. “A request to send money to someone you’ve never met in person is almost always a scam. Another tried-and-true tactice scammers use is to create a false sense of urgency to get victims to send money before they stop and think. The best advice we can give to consumers is to stop, think, and talk to a friend or loved one before you send money.” 

In 2020, consumers submitted more than 5,700 complaints to Fraud.org. Forty-three percent of complaints reported a monetary loss, with the median loss of $1,628.  

Top Ten Scams of 2020 

  1. Internet: Gen Merchandise 
  2. Phishing/Spoofing 
  3. Fake Check Scams 
  4. Friendship & Sweetheart Swindles 
  5. Prizes/Sweepstakes/Free Gifts 
  6. Advance Fee Loans, Credit Arrangers 
  7. Computers: Equipment/Software 
  8. Internet: Auctions 
  9. Investments: Other (note in comments) 
  10. Internet: Extortion 

Other topline findings from the report include:  

New fraud entered top ten: extortion scams. 

 “As the pandemic and the recession continue to grind on in 2021, we are paying special attention to so-called ‘Internet extortion’ scams, which entered the top ten scams for the first time last year,” said Breyault. Such scams fall in to two broad sub-categories. The first category are “sextortion” scams, where consumers receive a message where the scammer threatens to release embarrassing photos, videos, or other personal information to the victims’ friends and family. The second sub-category involves “psychic” services, where the scammer claims to had discovered that a “curse” or other tragic event is about to befall the victim. Only by paying a significant fee can the victim have the “curse” lifted.  

Younger consumers and seniors are being targeted more frequently.  

The percentage of complaints received from consumers aged 26-65 decreased by an average of 8.76% in 2020.  By comparison, complaints from consumers aged 25 and below and those 65 and older increased by an average of 30.60% and 15.82%, respectively versus 2019. For consumers aged 25 and under, the top three most reported fraud categories were Internet merchandise scams, fake check scams, and romance scams. For those 65 and older, the top complaint categories were prize/sweepstakes scams, phishing/spoofing, and Internet merchandise scams.  

The Web and the telephone remain scammers’ preferred contact methods. 

With email spam filters growing increasingly successful at blocking out scam emails, fraudsters continued to turn to the Web and the telephone to find victims. Those two contact methods were mentioned in more than 81% of the complaints. “This highlights the need for consumers to be wary when responding to messages from unknown senders, particularly those encountered on social media,” said Breyault. “Consumers should also continue to be on guard for unknown callers seeking to offer them prizes or other inducements to send money.”  

Read the full 2020 Top Scams report from NCL.

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About the National Consumers League

The National Consumers League, founded in 1899, is America’s pioneering consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

National Consumers League welcomes appointment of Commissioner Jessica Rosenworcel as Acting Chairwoman of the Federal Communications Commission

For immediate release: January 29, 2021

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org(412) 945-3242 or Taun Sterling, tauns@nclnet.org(202) 207-2832

Washington, DC—The National Consumers League (NCL), America’s pioneering consumer and worker advocacy organization, welcomes the appointment of Commissioner Jessica Rosenworcel to serve as acting chairwoman of the Federal Communications Commission (FCC). Rosenworcel is the second woman to lead the agency in its 86-year history.

The following statement is attributable to NCL Executive Director Sally Greenberg:

We welcome Commissioner Jessica Rosenworcel’s appointment as Acting Chairwoman of the FCC. Her years of service at the Commission and on Capitol Hill make her an ideal choice for this position. She brings an in-depth understanding of the Commission, its committed and talented staff, and the agency’s relationship with Congress.

Acting Chairwoman Rosenworcel is a strong proponent of consumer protections, net neutrality, and universal access to high speed broadband. Her appointment couldn’t  come at a better time; the COVID-19 pandemic has exposed the chasm of access to high quality broadband in so many communities across America. Most critically, millions of students without affordable broadband access have suffered as schools have moved online during the past year. NCL is committed to working with Acting Chairwoman Rosenworcel and her team to address this critical problem.

We are honored that Acting Chairwoman Rosenworcel accepted NCL’s Trumpeter Award for consumer leadership in 2020. We welcome this strong consumer advocate who has always kept an open door for consumers from all backgrounds to discuss their concerns with the commission. We look forward to continuing to work with her and the talented FCC staff.

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About the National Consumers League (NCL)
The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

The National Consumers League welcomes the appointment of consumer advocate and FTC Commissioner Rohit Chopra to head the Consumer Financial Protection Bureau

For immediate release: January 29, 2021

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org(412) 945-3242 or Taun Sterling, tauns@nclnet.org(202) 207-2832

Washington, DC—The National Consumers League welcomes President Biden’s nomination of Rohit Chopra, a current commissioner of the Federal Trade Commission (FTC), to chair the  Consumer Financial Protection Bureau (CFPB).

This following statement is attributable to Executive Director Sally Greenberg:

We are very pleased by President Biden’s nomination of Rohit Chopra to serve as director of the CFPB. At the FTC, Commissioner Chopra has proven to be a fair, thoughtful, and even-handed regulator with a strong record of defending the interests of consumers and pressing the agency to uphold its mandate by doing more to fight fraud and combat unfair and deceptive practices.

Chopra was on the ground floor as the CFPB was built. He was one of the first hires by Sen. Elizabeth Warren (D-MA) when she took on the role as director of the—then—brand new agency. He brings a wealth of experience in the work of federal agencies, having also acted as special advisor at the U.S. Department of Education.

Despite his busy schedule, Commissioner Chopra always had an open door to hear from advocates and everyday consumers. When it comes to fighting abusive debt collection practices, crushing student loan debt, predatory payday loan companies, and auto lenders that discriminate against black, brown, and immigrant communities, consumers will have no greater champion than Rohit Chopra.

We urge the Senate to promptly confirm Commissioner Chopra so that he and his team can get started on the critically important mission of protecting the interests of the nation’s consumers.”

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About the National Consumers League (NCL)
The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

Welcoming FDA’s call for better science, more research on CBD

In 2019, in response to the growing retail market of untested, unapproved cannabidiol (CBD) products, NCL identified the need for greater consumer education and increased regulation at the federal level. NCL and its partners — Consumer Federation of America and the Community Anti-Drug Coalitions of America — created Consumers for Safe CBD to help raise awareness of the unregulated CBD marketplace, champion the rights of consumers, and call on government and industry to do more to protect consumers. This year, we will continue to work with key stakeholders to encourage safe CBD food and beverage products and promote a pathway for new therapeutic products through clinically-tested scientific research.

We’ve come a long way since our launch, and FDA is making progress. Newly former FDA Commissioner Stephen Hahn and Principal Deputy Commissioner Amy Abernethy recently called for better science, more data, and increased testing to determine the risks and benefits associated with CBD. We are encouraged by the commitments outlined in the FDA statement and look forward to continued collaboration with the Biden Administration and the new leadership at the agency to make the CBD marketplace fair, safe, and healthy for consumers.

Read more about the FDA’s comments on the Consumers for Safe CBD here and sign up for CBD updates from our Consumers for Safe CBD campaign here.

MLK legacy needed in 2021 more than ever

By Sally Greenberg, NCL Executive Director

As our nation celebrates Dr. Martin Luther King Day this week, let’s not forget the beautiful legacy of Dr. King at this difficult time in America.

Dr. King was a role model for all of us in how to bring about change peacefully. “True pacifism,” or “nonviolent resistance is a courageous confrontation of evil by the power of love,” Dr. King wrote. What America needs now—perhaps more than ever before—is Dr. King’s message and his devotion to nonviolent racial equality.

Here in Washington, DC, the 704+ thousand of us who call this city home (and still have no voting rights in Congress) are surrounded by tall fences, members of the National Guard carrying AK 47s, and barbed wire. This is sadly necessary to protect the President and Vice President at their January 20 Inauguration from violence by the likes of the white supremacist mobs who were wearing Trump hats, carrying Confederate flags, and who stormed the Capitol on January 6. Many chanted “Hang Mike Pence,” Mr. Trump’s own Vice President, and searched for Speaker Nancy Pelosi in hopes of assassinating her.

How ironic that as we celebrate the life of the remarkable American icon and civil rights leader, Dr. Martin Luther King, the Memorial in his honor on the National Mall must be closed due to threats of violence.

King taught us that violence is not inevitable nor necessary to effect social change. Over the past year, 93 percent of Black Lives Matter protests were peaceful. Dr. King would have been proud of that.

So here’s to Dr. Martin Luther King, who was and remains a role model to so many Americans and an inspiration to millions more.

NCL congratulates President-elect Joe Biden and Vice President-elect Kamala Harris

For immediate release: January 7, 2020

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC–On behalf of the Board of Directors and staff of the National Consumers League, America’s pioneering consumer organization founded in 1899, we wish to extend warm congratulations to our next President of the United States, Joe Biden and incoming Vice President Kamala Harris. As consumer and worker advocates, we look forward to building a strong relationship with the Biden-Harris Administration to advance the issues of democracy, which go hand-in-hand with consumer and worker protections. Among the top priorities on NCL’s agenda: enacting a $15 federal minimum wage and comprehensive privacy and data security laws; strengthening consumer protections regulations throughout the federal agencies; fighting fraud by enhancing consumer protections in financial transactions; restoring consumer protections to the flying public and American travelers; combatting predatory financial practices; and reducing the barriers facing all consumers seeking to gain access to the civil justice system.

Congratulations once again to President-elect Biden and Vice President-elect Kamala Harris on their election to the two highest offices in the land.

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About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

National Consumers League applauds Congress for surprise billing protections for consumers

For immediate release: December 22, 2020

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC – The National Consumers League welcomes the inclusion of long-needed surprise billing protections in the COVID Relief Omnibus Spending Bill.

Surprise billing happens when a patient’s insurance doesn’t cover a procedure provided by an out-of-network physician, something patients don’t know or realize when they get a procedure. An estimated one in five emergency visits and one in six inpatient admissions will trigger a surprise bill, which can run into the thousands of dollars.

Medical debt disproportionately drives people into bankruptcy. Bill collectors and hospitals often layer on fees, interest, and penalties, driving the original costs way up. A 2019 study published in the American Journal of Public Health found that 530,000 bankruptcies filed annually are because of debt accrued as a result of treatment for medical illness.

This statement is attributable to NCL Executive Director Sally Greenberg:

“We greatly appreciate the bipartisan leadership of Senators Maggie Hassan (D-NH) and Bill Cassidy (R-LA) in getting the surprise billing language over the finish line. We also thank House Energy and Commerce Committee Chairman Frank Pallone, Jr. (D-NJ), Ranking Member Greg Walden (R-OR), Senate Health Committee Chairman Lamar Alexander (R-TN), and Ranking Member Patty Murray (D-WA) for their early leadership on this issue. This is a shining example of working across the aisle for the betterment of consumers.

Consumers can breathe a huge sigh of relief because under the bill—including the cost of an air ambulance—consumers will be ‘held harmless’ when exposed to out-of-network costs. Once this bill is law, consumers can expect that fees charged will be far more affordable and predictable at in-network rates. We are grateful to Congress for recognizing surprise billing as a predatory practice from which consumers need protection. The committee leadership not only helped to pass a bill but launched an investigation.

After two years of debate and discussion on how health care providers and health plans will negotiate these extra costs, it was agreed that patients should be taken out of the middle of dispute resolution processes. Now, we finally have a workable system for protecting consumers.”

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About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.

Jeanette Contreras portrait

2021 rings in new health care protections for consumers

By NCL Director of Health Policy Jeanette Contreras

Surprise medical bills occur when patients unknowingly receive care from a provider who is not in their health insurance plan’s network. As the first COVID-19 vaccinations are administered, Congress has passed landmark legislation to ensure consumers needn’t worry about surprise medical bills from emergency medical services.

The passage of this legislation couldn’t come soon enough, as more than 476,000 Americans hospitalized with the coronavirus have already incurred exorbitant medical debt from COVID-19 treatment. Now, thankfully, 2020 will come to a close with renewed optimism in the American health care system.

This new law will also protect consumers from surprise billing from out-of-network ambulance and air ambulance trips, which can amount to tens of thousands of dollars in medical bills. Most patients are conscientious consumers, careful to find a doctor that accepts their insurance before making an appointment. However, in the case of an emergency, a patient faces the possibility of receiving care from an out-of-network doctor in an out-of-network hospital.

As Congress debated legislative fixes to surprise billing, the Administration showed political will toward finding a solution with the issuance of Executive Order 13877, Improving Price and Quality Transparency in American Healthcare to Put Patients First, which includes principles on surprise billing. In a July 2020 report addressing surprise billing, the U.S. Department of Health and Human Services (HHS) further urged Congress to act, recognizing that 41 percent of insured adults nationwide were surprised by a medical bill in the past two years.

Following Executive Order 13877, HHS finalized a set of regulations to address price transparency for consumers. The first rule set to take effect on January 1, 2021, requires hospitals to publicly list standard charges for the items and services that they provide. The second rule, set to take effect in 2022, demands similar transparency from most health plans and issuers of health insurance coverage. These regulations offer consumers more control over their health care spending and better information as they shop and compare health coverage options for themselves and their families.

The new HHS regulations, coupled with the surprise billing legislation, amount to the greatest consumer protections in America’s health care system since the Affordable Care Act. Consumers with health insurance should not have to worry about surprise medical bills—especially during a pandemic. The health care system will be a little more consumer-friendly in 2021, which is good news for all of us.

NCL testified before CDC committee on COVID-19 vaccine recommendations

For immediate release: December 22, 2020

Media contact: National Consumers League – Carol McKay, carolm@nclnet.org, (412) 945-3242 or Taun Sterling, tauns@nclnet.org, (202) 207-2832

Washington, DC – The National Consumers League (NCL) testified before the Centers for Disease Control and Disease Prevention (CDC) Advisory Committee on Immunization Practices (ACIP) this weekend on the equitable distribution of the Moderna vaccine and recommendations for consumer education on vaccine safety. In its testimony, NCL applauds the transparency and access afforded to the public throughout the COVID-19 vaccine approval process.

Equitable distribution:

NCL is encouraged that the Food and Drug Administration (FDA) has approved the Moderna vaccine and that the U.S. government will lead distribution efforts. Due to its ease of transport and storage, the Moderna vaccine stands to readily ship to rural and hard to reach communities. NCL calls on federal health officials at the helm of distribution to facilitate access to the Moderna vaccine to medically underserved areas.

Safety and efficacy:

NCL expressed its trust in the FDA and CDC’s robust inter-agency collaboration to continue ongoing, post-market surveillance of adverse events among recipients of the COVID-19 vaccine and to inform consumers of any additional safety recommendations. NCL urged the CDC to educate consumers about potential reactions and side effects, as this transparency will further encourage the compliance necessary to achieve herd immunity. The vaccine is expected to induce flu-like symptoms after the initial dose and this may deter some patients from getting their second dose if they aren’t warned about what to anticipate.

Vaccine adherence:

NCL encouraged the CDC to conduct culturally competent and inclusive public messaging about vaccine safety to ensure that communities of color and persons with limited English proficiency are informed and feel empowered in their decisions to vaccinate. Adding to the complexity of administering the vaccine, public health officials will need to ensure the completion of two doses in a series. This stands to create additional challenges because evidence has shown that when a vaccine involves multiple doses, nearly 50 percent of patients fail to return for a second dose.

Equitable allocation:

NCL applauds ACIP’s recommendations to prioritize vaccinations for health care workers and long-term care facility residents in Phase 1a. Now that there are two approved vaccines, NCL calls on ACIP to prioritize recommendations to vaccinate the approximately 87 million non-healthcare essential workers unable to work from home—such as bus drivers and grocery workers—who are at higher risk of exposure. Racial and ethnic minorities make up more than 40 percent of the essential workforce and are the backbone of many essential industries. The pandemic has illustrated that low-income minority communities experience more severe COVID-related illness requiring hospitalization and are at higher risk for death.

Persons who recovered from COVID-19:

Lastly, over 18 million individuals in the U.S. have been infected with the coronavirus. It is expected that individuals who recover will acquire some natural immunity to COVID-19. Individuals who recover from the coronavirus want to know if they are protected from reinfection and for how long. We call on the CDC to expedite developing vaccine recommendations for persons who’ve recovered from COVID-19.

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About the National Consumers League (NCL)

The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.