For Immediate Release - March 05, 2015

AG Healey Warns Consumers to be Wary of Prepaid Card Scams

AG’s Office Participates in the 17th Annual National Consumer Protection Week

BOSTON – Following multiple complaints, Attorney General Maura Healey is alerting all consumers to be wary of money transfer scams that have increased in frequency both nationwide and in Massachusetts. An unknown person seeking payment through the use of a prepaid card should be a red flag to consumers.

“Our office has seen an increase in the use of prepaid money cards in scams,” AG Healey said. “These scammers prey on well-meaning people under various pretenses to get them to load money on to prepaid cards. While these scams may sound authentic, consumers should not be afraid to ask questions, say no, or simply hang up a call or ignore an email if they suspect they are being scammed.”

Prepaid card scams take many forms.
In some prepaid card scams, the scam artist makes a call or sends an email, claiming that a consumer owes a debt that is past due. In another scenario, the scammer calls a senior citizen and pretends to be a grandchild or other family member asking for help in an emergency situation that requires an immediate monetary payment to get them out of trouble.

To facilitate these transactions, the victim is instructed to load money onto a prepaid card. Once the card information is shared with the scammer, the scammer uses the information to access the card account and steal the money. It can be easy for a scammer to steal money through these means, leaving consumers with little or no recourse. The cards generally do not have the insurance or legal protections that come with credit cards.

Scams are perpetrated under false pretenses.
These scams are often perpetrated under the guise of a legitimate agency, business, or service to sound more authentic. The name of a legitimate entity may appear in a caller ID or an email address and scammers often pose as the IRS or local tax agents, utility companies, debt collectors, or other persons of authority in order to facilitate the scheme. They may claim that an urgent payment is required, and may threaten legal action, cutting off service, or some other penalty if the victim does not make an immediate payment with a prepaid card.

Other scammers offer lottery winnings, investment opportunities, or “secret shopper” or other employment opportunities, and direct purchase of a prepaid card to effectuate a transaction. 

Complaints regarding this issue have increased in the past year. The AG’s Office is currently prosecuting a case in which prepaid cards were allegedly used in connection with a criminal scheme. Consumers should be vigilant about potential scams. 

Here are some tips for consumers to avoid being scammed:

  • The IRS or the Department of Revenue will never ask for credit card numbers over the phone or request a pre-paid debit card or wire transfer, so do not give out that information over the phone to anyone claiming to be from those agencies;
  • Consumers should never give prepaid card information to someone they do not know-- it is like sending cash;
  • Consumers should slow down and ask questions that may be difficult for an imposter to answer for verification;
  • Consumers should not be fooled by details that a caller may have about you or a family member and check out the story as scammers often get information from the internet to sound authentic;
  • Consumers should not give out personal information like social security, credit card or bank account numbers.

The Attorney General’s Office fields thousands of inquiries pertaining to scams and can direct consumers to the appropriate agency to file a complaint. One of those is the Federal Trade Commission (FTC). 

Consumer information specific to the “emergency” scam is available on the FTC’s website, www.ftc.gov. Consumers may report IRS scams to the U.S. Treasury Inspector General for Tax Administration at (800) 366-4484, or by visiting its website, http://www.treasury.gov/tigta/contact_report.shtml.

If a wire transaction is made, consumers should also contact the wire transfer agency used. Unfortunately, there may be little recourse to get the money back.

Before sending any money overseas, consumers may contact the State Department’s Office of Overseas Citizens Services (OCS) at (888) 407-4747, to help verify whether a situation involving an urgent request for money is legitimate or a scam. Consumers may also call Attorney General Healey’s Consumer Hotline at (617)727-8400. Additional information and resources pertaining to consumer scams are available on the Attorney General’s website

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