Finance Globe

U.S. financial and economic topics from several finance writers.
3 minutes reading time (513 words)

Internet Scam Targets Troubled Homeowners

In these difficult times, fraudsters are working under the guise of the federal government to trick struggling homeowners.

President Obama announced the Making Home Affordable program earlier this year as part of the effort to help homeowners who are having financial difficulty in making their house payments. At makinghomeaffordable.gov, homeowners can receive free help on loan modifications or assistance in refinancing into a lower interest rate so their payments are more affordable for the long term.

Millions of homeowners are expected to benefit from the government program. And scam artists took advantage of the government website to defraud consumers. Homeowners looking online for free government assistance were diverted to a site that offered loan modification services for a fee, according to a Federal Trade Commission complaint.

“Homeowners who are down on their luck need help, not misdirection by Internet impostors,” FTC Chairman Jon Leibowitz said. “The Commission will continue to work with the Treasury Department to move quickly against scammers who prey upon financially distressed consumers.”

The FTC said that the scam artists purchased sponsored links for their advertising on yahoo.com, msn.com, altavista.com, and alltheweb.com. When consumers searched for the "making home affordable" program, they were directed to the fraudsters' sites - which appeared to be the government's web address for the program, and were required to enter in personal and financial identifying information. The scam artists either offered loan modification services for a fee or they sold the information to people who sold loan modification services.

Treasury Secretary Tim Geithner said in a statement, “On April 6th, FTC Chairman Jon Leibowitz, Attorney General Eric Holder, HUD Secretary Donovan and I announced a multi-agency effort to crack down on foreclosure rescue scams and loan modification fraud. Today’s swift enforcement action by the FTC demonstrates our strong commitment to protecting the integrity of the program by going after actors attempting to defraud or scam homeowners trying to use the site.”

Neil Barofsky, the Special Inspector General for the Troubled Asset Relief Program (TARP), which provided valuable assistance in the FTC’s investigation, said, “Frauds that target struggling homeowners will not go unanswered. Today’s action by the FTC, supported by the investigators of our office, demonstrates our joint resolve to stop in its tracks any individual or organization that attempts to fraudulently profit off of a national crisis.” Anyone who has been victimized in this matter should contact the FTC at 1-800-FTC-HELP. To report possible fraud in this or any other TARP-related program, complaints can also be filed at www.sigtarp.gov or 877-SIG-2009

The FTC 's complaint "is against one or more persons who are unknown to the agency at this time because the defendants have cloaked their practices in the anonymity of the Internet." According to the federal court order, the unknown defendants are barred from using the hyperlink to the government program and from representing that they are affiliated with the U.S. government. Also, the four search engines are required to identify who paid for the deceptive ads, and are to refuse to place ads that have the domain name ".gov".



Source:
Federal Trade Commission
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Thursday, 22 August 2019

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