Government Imposters Bring Bad Business to Small Businesses

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You’ve started a new business and want to ensure you’re doing everything right. So, when people claiming to be with the government call you to say you’re violating the law, you may be inclined to do whatever they say to fix it…right?

Slow down. Government imposters are counting on that reaction — because that’s their business.

Recently, the FTC asked a judge to stop D&S Marketing Solutions from allegedly tricking and intimidating small businesses into paying up to $200 for government regulation posters that are actually free from the Occupational Health and Safety Administration (OSHA). The FTC says D&S telemarketers called newly registered small businesses, claiming to be with OSHA or another government agency. Using official-sounding names like the “Occupational Compliance and Safety Administration,” D&S allegedly told businesses they were violating federal law because they hadn’t purchased posters about occupational safety, first aid, labor law, or other topics. In fact, says the FTC’s complaint, D&S threatened businesses with fines or a shut-down unless they bought posters immediately. Many unsuspecting businesses complied, paying as much as $200 for the otherwise free posters. The FTC says D&S raked in more than $1.3 million from this scheme.

A few tips for avoiding government imposter scams:
•Get it in writing. Government agencies typically contact you first via postal mail, rarely by phone or email.
•Don’t trust caller ID. Scammers can make a call seem like it’s coming from any area code and number on your caller ID.
•If someone calls asking for money or personal information, hang up. If you think the caller might be telling the truth, call back to a number you know is genuine.

Learn more about government imposters and file a complaint with the FTC if someone posing as the government tries to steal from your business.

by Lisa Lake
Consumer Education Specialist, FTC

How to Research and Reduce Healthcare Costs

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Whether you’re planning a future procedure or navigating care after a sudden illness or accident, smart consumers have a plan in place to avoid hidden costs and billing errors common to our ever-changing healthcare system. You should too.

The Affordable Care Act (http://www.hhs.gov/healthcare/) (ACA) made it possible for all Americans to get some form of healthcare coverage regardless of their medical history. That’s the good news. The bad news is that everyone’s personal health circumstances and solutions are different, and we’re still far away from the day when the coverage we buy – either individually or through our employers – can prevent us from getting unexpected bills for services and procedures our insurer didn’t cover or errors made in the billing process.

It’s also important to know that many health insurers are adjusting to the reality of universal coverage by narrowing the assortment of doctors in their networks, leaving more patients at risk of “surprise” (http://kff.org/private-insurance/issue-brief/surprise-medical-bills/) bills if they are treated by practitioners outside their insurer’s network.

There are some helpful resources – both public (https://www.medicare.gov/coverage/surgery-estimating-costs.html) and private (https://healthcarebluebook.com/) – which have emerged that price health procedures. Using those resources can help avoid some major out-of-pocket healthcare expenses. It’s also essential to determine what practitioners may be in or out of network, particularly if it’s an emergency.

So what can you do to prevent these unexpected health costs? If you are not on Medicare, (https://www.medicare.gov/what-medicare-covers/index.html) which tends to have more standardized pricing and coverage, you need to question practitioners (or their billing departments) and price-comparing procedures the way you would any major purchase. Depending on your local medical resources, you may have the option to conduct your research online. Here are some ways to begin.

Know how you’re covered for both emergencies and non-emergencies. It’s easier to plan for a hip replacement you’ll need in six months than for emergency surgery after an accident or sudden illness, but it’s important to think through how your coverage works in both situations:

  • Emergency: Emergencies are a challenge to price because it’s tough to know which practitioners and services you’ll actually need. The key is to make a plan for emergencies. Speak to your insurer now – and consult your primary care physician – to confirm that you have a good range of in-network emergency doctors at the hospital of your choice. If not, you might want to think about switching plans during your next enrollment period. Put an easy-to-find “in case of emergency” card in your wallet next to your health insurance card that makes your preferred hospital visible to first responders or other helpers. Also, list your primary care doctor’s and your health care power of attorney’s contact information. Finally, make sure the person you designate as your health care power of attorney has access to your insurance and physician network information so he or she can guide your care more affordably if you’re incapacitated.
  • Non-emergency: If your doctor is recommending a particular in-hospital or outpatient procedure in the coming weeks or months, you’ve got time to plan, so do it. Query your physician or his or her billing department about the cost of the procedure and what other practitioners (such as an anesthesiologist) might be involved. Then spend equal time speaking with your insurer about what you’ve learned and how extensively the procedure in question will be covered. Make sure you understand if your insurer covers the procedure on an inpatient (hospital) or outpatient (office) basis – some insurers are reportedly cutting back on outpatient coverage.

Know your deductible. The latest annual Kaiser Foundation employer health benefits survey indicated some whopping figures for health care deductibles – the out-of-pocket total you have to pay before the bulk of your health coverage kicks in. For example, if you have a $3,000 deductible that you haven’t touched this year, that’s the initial out-of-pocket amount you’re going to have to pay for any big procedure. Keep that figure in mind as you continue your research on medical options. That’s why it’s important to keep such amounts in an emergency fund or, if you have the option, set aside in a health savings account (https://www.irs.gov/publications/p969/ar02.html) where you can keep funds not only for the deductible, but for other potential out-of-pocket health costs.

Review bills closely. One recent study has reported significant errors in medical bills, particularly for hospital stays. Keep in mind that the price-comparison exercise doesn’t stop on the way in to a procedure. You need to keep an eye on pre- and post-procedure bills from practitioners, hospitals and your health insurer for accuracy. If you see an error, contact the appropriate party or parties immediately to correct the problem.

Bottom line: There are very few industries going through as much change as healthcare. Universal coverage is good, but it’s important to know exactly what it pays for before you need it. Set aside time to think through your health issues and do your research to help reduce healthcare costs that can impact your overall budget. Learning to save money now can preserve your budget later.

 

By Nathaniel Sillin

 

The FTC Gets Rachel the Robocaller… Again

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Have you gotten pre-recorded sales calls from Rachel from Cardholder Services? Or Bank Card Services or Credit Assistance Program? You’ve been reporting these illegal calls, and the FTC continues to take action.

Recently, the FTC and the state of Florida announced a lawsuit against Life Management Services, a company that the FTC says is behind hundreds of thousands of these calls.

According to the FTC, Life Management Services swindled people out of their money by offering two types of phony debt relief: credit card interest rate reduction services and credit card debt elimination services. The company promised lower interest rates or government funds to pay off debt, and asked people to make initial payments ranging from $500 to $20,000. But almost no one got the help that was promised.

This is one of six recent FTC cases that focus on illegal robocalls. How does the FTC build these cases? One critical tool is the FTC’s honeypot — a large bank of phone lines designed to attract robocalls. That lets FTC investigators interact with robocallers, record the calls, and make undercover purchases. The FTC uses its honeypot to identify companies placing illegal calls and collect evidence of their illegal activities. It was particularly useful in the Life Management case announced recently.

So, what do you do if you get another unwanted robocall?

  • Hang up. Don’t respond in any way. Pressing buttons to get you taken off a list could result in more unwanted calls.
  • Block the caller’s number. You have a few options for blocking unwanted calls, including call-blocking devices, mobile apps, cloud-based services, and services provided by your phone carrier.
  • Report it to the FTC at www.donotcall.gov or 1-888-382-1222.

Read on for more info and tips about robocalls.

by

Andrew Johnson
Division of Consumer and Business Education

A False Appeal to Your Sense of Charity

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If you get a call asking you to give to a charity, you might be tempted to say yes without a second thought. But as with any call you get from someone asking for money out of the blue, pause and do some research to avoid fraudsters who try to take advantage of your generosity.

Unfortunately, there are for-profit companies — like American Handicapped and Disadvantaged Workers, Inc. (AHDW) — that pretend to be charitable organizations and lie about how they use donations. The FTC sued AHDW for deceiving people — and shut them down.

Here’s the story: AHDW’s telemarketers called and asked people to donate — either by giving money or buying overpriced household products from them. These telemarketers, often falsely claiming to be disabled themselves, implied that most of the money raised would be used to pay wages to disabled employees at the company. And as a bonus, people were told they’d get a free gift in the mail for donating.

In reality, most of the telemarketers weren’t disabled, and only a small portion of the company’s earnings were paid to AHDW’s few disabled employees. And those free gifts people got in the mail? They came with invoices, followed by harassing calls demanding payment for products people never ordered.

If you get a call about buying overpriced products to support a charity:
•Do some research. Confirm an organization is really a charity before committing to spend extra money. That “charity” might be a for-profit company trying to trick you into overpaying for things you routinely buy. You can search for names on this list of tax-exempt organizations from the IRS, or check with the BBB or your state Attorney General.
•Don’t pay for unordered merchandise. You can keep any gifts you get in the mail from a charitable organization that asks for contributions. If you didn’t order it, you don’t have to pay for it — even if someone sends a bill or calls you saying otherwise.

It’s legal for charities to call and ask for donations, even if your number is on the Do Not Call Registry. But it’s against the law for telemarketers to imply they’re from a charitable organization when they’re not. For more tips on spotting a charity scam, check out the FTC’s article Before Giving to a Charity.

by Aditi Jhaveri
Consumer Education Specialist, FTC

Anyone Can Make Mistakes With Estate Matters – You Don’t Have To

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Adulthood brings certain financial responsibilities like the building of budgets, bank accounts and proper insurance. It’s surprising how few consider a proper estate plan part of that essential mix.

In fact, a recent ABCNews poll (http://abcnews.go.com/Business/story?id=86992) found that only about 50 percent of Americans have created a will and significantly fewer have created the supporting estate documents like a living will or a power of attorney.

Preparing now for the end of your life or for illness may not sound like fun, but it is necessary. Having a plan for the future can help bring you peace and even put you on the road to stronger financial security. It can also help those you care most about. We’ve all heard cautionary tales about relatives or friends who did not have a will, and family members who were left with difficult but avoidable situations.

So, how do you start an estate plan? It has a lot to do with carefully drawn documents, but it’s the planning behind them that really counts. I would encourage you to work with a qualified financial, estate and/or tax professional in your home state at the earliest opportunity to make sure your plans fit your needs and the needs of your loved ones. Here’s a bit more detail on each.

A will, also called a testament, is the starting point. Wills are generally seen as the umbrella document that drives the rest of an individual’s estate process. A will generally accomplishes the following:

  • It details how you want to leave your property to specific people or institutions after you die.
  • If you have minor children, it allows you to name a guardian to care for them after you die or become incapacitated. It also indicates who will manage your kids’ assets, including what you leave them.
  • It lets you name your executor, the trusted person who will carry out all your wishes in the will.

If you die without a valid will, your state’s court system may get involved in distributing your assets depending on intestacy laws on the books.

A living will – also known as an advance directive – allows you to define how you want to be medically treated under specific situations, including irreversible injury or terminal illness. Depending on your state laws, living wills allow you to express your exact wishes about feeding, breathing assistance and other life-sustaining procedures in addition to how you want them carried out at certain decision points in your care. A living will may also provide information on pain or infection medications you either want or don’t want administered as well as specific instructions about your remains, including release to your family or donation for medical research.

Powers of attorney are legal documents that allow you to name a specific person to take care of your money or healthcare wishes if you are incapacitated. It is particularly wise to seek professional counsel from a qualified trusts and estates attorney in writing these documents. The person you designate as healthcare power of attorney will be speaking with doctors and executing your wishes on various forms of treatment; your financial power of attorney will be in charge of paying your bills and depending on the range of responsibilities you outline for that person, handling your investment and business affairs. Both are extremely important jobs that should be carried out by people you trust, and that’s why they need to be people in the know. Make their preparation part of your estate planning so they know how to step in and carry out the assignments you’ve given them efficiently.

Bottom line: Estate planning is the final, responsible step in all good financial planning. While it may be unpleasant to do, it is essential in taking care of family, loved ones and causes you support after you’re gone.

 

By Nathaniel Sillin

 

3 Helpful Student Loan Tips for Recent Graduates

University Graduates

Graduating college is not only a huge milestone in one’s life, but a moment that is filled with eager excitement for what’s to come next. While life is full of surprises, especially after school, one thing is for certain if you’ve borrowed money for your education- your loans will become a big part of your life until they are resolved.

With tuition costs rising every year, students are often forced to adapt a “college by any means necessary” approach to their secondary education; and we aren’t even including additional expenses for books, rent, parking, and meals! This causes a mad rush to secure financial assistance, sometimes to the detriment of fully understanding the small print in loan agreements and interest rate explanations.

Experts suggest that you try to keep your post college debt under your realistic first year salary expectation. While that’s a first step, there’s much more to solving the puzzle that is student loans. Here are a few more helpful tips to assist you in obtaining post collegiate financial freedom by quickly repaying your loans.

  1. Know Your Loans and Their Grace Periods– It is pivotal to start your repayment process on the right foot with extreme organization, so be sure to keep track of the lender, balance, and progression/status for each of your student loans. Take advantage of a site like nslds.ed.gov, where you can log in to see this pertinent information for all of your federal loans; check your original agreement or most recent billing statement for this information pertaining to any private loans you may have. Since different loans have different grace periods (how long you can wait after leaving school before you have to make your first payment), you should consult these varying deadlines to come up with a proper plan of attack for your first repayments.
  2. Pay Off Your Most Expensive Loans First– If you are able to put together more money than expected and are considering paying off a loan ahead of schedule, be sure to start with the one that has the highest interest rate. Eliminating the amount of time that these loans remain outstanding will be a huge help in stopping any further debt through interest. Furthermore, if you have private loans, start repaying them before your federal government ones; private loans typically have a much higher interest rate attached to them and often don’t offer the same flexible repayment options federal ones do.
  3. Always Make Your Payments– While repaying your loans is far from an easy thing, it is unfortunately often a necessary evil of post graduate life. If you are foolish enough to try and ignore them, however, you can crush your financial future with serious consequences that can last a lifetime. If you don’t pay off your loans, your account can go into delinquency and eventually default. Delinquency looks bad enough on any credit report, but defaulting is far worse. When you default, your credit score not only plummets, your total loan balance also becomes due; the government can even garnish your wages and take your tax refunds if it was a federal loan that was defaulted on. Defaulting on a private loan, on the other hand, is not only often easier to do if you aren’t careful, but can also put anyone who co-signed for the loan in financial danger too. Don’t be a fool- if you get in financial trouble DO NOT just ignore your loans. Talk to your lending bank representative right away and explore your options before it is too late!