Companies are getting more and more clever these days. Kim Palmer, who writes a US News & World Report money/business blog called Alpha Consumer, recently received (technically her husband received it ) a letter from the National Collegiate Lending Institute in which they were told they could receive a $300 debit card at no cost to them.

It turns out—surprise, surprise—that the offer is too good to be true. I called the number listed in the letter and learned that the “free service” is student loan consolidation. The $300 would be handed over only if we consolidated our student loans through the company and then provided a testimonial about it—hardly a 10-minute decision, especially when our student loans are already consolidated at decent interest rates. …

The lesson: Mail offering free money usually belongs in the trash.

What’s especially funny is the explanation and discussion that Kim has with David Tominus, sales manager and part owner of National Collegiate Lending Institute. Kim says its misleading (it is a litte), David says people should read the fine print (people don’t), and what it comes down to is that your average recent graduate is going to see $300 debit card, look at a relatively decent offer, and pull the trigger. NCLI is banking on that (and they do bank on it, 70-80 times a week).

Your recent grad won’t compare and contrast other offers as diligently because $300 right now is a lot of money (who can give a testimonial without actually using the service?). National Collegiate Lending Institute isn’t being misleading or doing anything disingenuous, they’re simply conducting business and consumers have to be smart enough to protect themselves (though if you do a search of National Collegiate Lending Institute in Google, the first few results are all about AG Cuomo’s investigation into their practices).

I’m all about keeping consumers as accountable for their actions as businesses are but why can’t businesses do business without this sort of chicanery?

I received an email today from Comcast about how they recently changed their policy regarding accounts:

Comcast takes the security of our customers personal and account information very seriously. As part of our ongoing effort to ensure the security of our customers information, we have recently enhanced the security of the Comcast.com account management system.

As a result of these recent enhancements, if a Comcast.com account is inactive for 180 days, it is removed from our system.

In order to keep your Comcast.com account active, please log in today with your user name and password: www.comcast.com/login.

First off, anytime someone emails me to log into my account, I never click any links in the email. Never ever. I don’t care if it’s some stupid account on some random free email account that you wouldn’t care gets stolen. The fact of the matter is that thieves know that people use the same username and password on multiple accounts so a free email account could yield a free bank account as well. Lastly, I can just go to Comcast.com directly and login there to confirm whatever.

Secondly, if this is legit, Comcast is ridiculously stupid because they should check to see if the account is connected to an active customer account (it is). If it is, then ignore this stupid little rule because they’re obviously “active” because they’re paying for service! If it’s not connected, then I suppose you can request that someone log in every 180 days (though the chances of a non-Comcast subscriber caring about their Comcast account is exactly zero).

Moral of the story - Companies may be stupid and make legitimate but dumb requests, but don’t be a dummy and get phished.

FYI, the email I received, according to the headers, was legitimately sent from a comcastonline.com’s server but…

• The email was “from” a comcastsupport.com email…
• The link in the email was to to comcast.com…
• And the link itself was to gothere2.comcastonline.com…

Seriously Comcast, you gave me 2034982304938 reasons to think it was a phishing email (all they missed was the link going to thisisacomcastphishingemail.com).

The human brain is notoriously good at sniffing out fraud, but every so often something comes along that, for whatever the reason, sneaks by our fraud detector and makes us do something we will later regret. That’s why you should do what NASA scientists to… build in redundancy for your fraud detector by getting another fraud detector: your friends. If something sounds too good to be true and you haven’t smelled fraud, get your friend to take a whiff and let you know what he or she thinks. If they think it’s okay, get a third, fourth, or even fifth opinion. If you have an especially cynical friend or one who is a domain expert (or more of an expert than you), make sure you get his or her opinion as one of the first five. If everyone says thumbs up, then go for it!

Let me give you a real life example of this situation. Back in college one of my friends was dreaming up schemes to make millions of dollars and fell upon a scheme where you could buy twelve XBoxes gaming systems off a seller on eBay and then flip them on the local school message boards for a handsome profit. He had convinced two of our friends to go in on the deal and was searching for a fourth when he asked me. I listened to his plan and everything sounded fine until he told me that the source of his XBoxes gaming systems off eBay and that he was getting a great deal. Immediately my fraud detector went off. It’s not suspicious to find a great deal on eBay, it’s suspicious to find a great deal on twelve $200 gaming systems. I told him that the auction sounded fraudulent and that I didn’t want to become involved financially but I’d do what I could to give them advice on how to protect themselves in case there was a problem. Well, eventually the whole scheme broke down as the three of them came to their senses but I was the fourth opinion (counting his own as one) and the first that sounded off the fraud alarm. Had the deal gone through with only three people (say, if the auction was for six XBoxes instead of twelve), it would’ve gone through and perhaps someone would’ve been defrauded (or not, there are plenty of legitimate bulk auctions on eBay).

There’s a reason why Ponzi schemes and the Nigerian scams are still alive and well today, they work well enough that the folks running them still turn a profit. Ponzi schemes are now called HYIP or High Yield Investment Plans (oh, 23049823094% return in one day? Sure!) and Nigerians are still getting people to cash fake million dollar checks and sending back legitimate ten thousand dollar checks. So, the next time you think something is way too good to be true, request all the way to a fifth opinion. If it ends up being a scam, you can at least rest with the psychological benefit of knowing four of your friends would’ve been duped too.

(Incidentally, some folks are turning the tables on the scammers in a hilarious way)

Image by mlsnp.

I just read and blogged about how the FTC has shut down the operation of EdebitPay, a shady little operation that offers up prepaid and stored value debit cards. Lots of folks use prepaid and stored value debit cards because anyone can get them and they sometimes let you build up credit, but to get these you had to give up your bank account information, and probably all sorts of other information, as part of the application process. What happened was then EdebitPay charged people a $159.99 processing fee that they never disclosed and that’s what made the FTC come in. Of course, if they disclosed this, then the FTC would be okay with it.

Do not give you bank account information to someone you don’t know or trust. Don’t give your personal information, such as your social security number, to someone you don’t know or trust. Don’t enter it in online, don’t give it to someone who calls and claims to be your bank, don’t give it to your neighbor. Don’t give it to the random guy giving out t-shirts in return for a credit card application.

EdebitPay could’ve been an operation out of [enter non-US country here] that was just collecting information and using it to steal your identity. Then the FTC wouldn’t be able ot shut them down and you’d be screwed out of more than $160. Seriously people… don’t make it that easy for a thief to steal your money.

Laura Rowley, a Yahoo Finance columnist, exposes the “Wedding-Industrial Complex” for what it is… a bunch of nice emotional things coupled with a bunch of “traditions” created by companies to sell more stuff. She references Rebecca Mead’s One Perfect Day: The Selling of the American Wedding, which you may recognize since I linked to a Devil’s Advocate article about how you shouldn’t get married.

Scam #1: It costs $28,000
It doesn’t have to cost $28,000 but the industry keeps pounding into the minds of brides and grooms to the point where people believe that’s how much you have to spend. I think our wedding is going to cost around that much because we’ll be inviting approximately 200 people and food (including the incidentals like tables, chairs, tablecloths, servers, cooks, etc) will be nearly $20,000 alone. Is that necessary? No. Is it nice to have? Yes, but not 100% necessary which is the point.

Scam #2-#0394820934: All those institutions you thought were cultural, they’re actually commercial.

“The engagement ring was invented by [diamond producer] De Beers in the 1930s and 1940s,” she says. “The so-called traditional bridesmaid luncheon, rehearsal dinner, pre-wedding barbecue, and post-wedding brunch don’t have a basis in history. It’s easier to say no to things like that if you understand that it’s not wrong to not do them.”

Amazing huh? I think I’m going to get that book.

When I heard that Spring was canceling the accounts of folks who constantly called customer service, I thought it was just another boneheaded company doing another boneheaded thing. Well it turns out that this was because those account holders were calling up and scamming Spring for hundreds if not thousands of dollars according to an insider who spoke to the Consumerist.

Back in the day, when I was in college, I used to call up Sprint when I was bored (in the car, waiting in line) for the lucrative “dropped call credit” refund. Basically you just called in, talked to the automated CSR and said “dropped call credit.” Your account would be refunded whatever it cost for the average call, I forget the amount, but you’d be limited to X number a day or billing period or something. Yeah it was unethical and something I wouldn’t do now, but not illegal. Well, after a while that adds up, but it doesn’t come close to the numbers the insider was quoting. People had balances of thousands and hadn’t paid a bill in years? That’s pretty ridiculous.

What’s even better was that those account holders with thousands in credits were asking for a check!

Back in college I bought a bunch of DVDs from a reputable eBay seller located in Canada for what I thought was a great price. We’re talking Wal-Mart type prices for new releases and it was from a seller that had positive feedback in the high hundreds, what I would consider a relatively reputable seller. So, I win three auctions or so for about $200 or so, quite a sum for someone in college; and I foolishly sent a practically untrackable Western Union money order to a guy in Canada. So, after I discovered this guy was basically scamming me, I tried to get some recourse. Well, Western Union told me that the money order is gone when cashed and the guy had already cashed it, I was crap out of luck with Western Union. I tried to appeal to my credit card company but they said that my charge with them was for a money order, which I received; unfortunately they couldn’t help me. I eventually was told that I had to contact Canadian officials for mail or wire fraud if I wanted resolution, yeah good luck with that.

Basically, a Western Union money order is no different than any other money order, there is basically absolutely no reason why you would buy a money order from Western Union in the first place! In fact, the use of Western Union as a means of ripping people off, through no fault of Western Union themselves, has gotten so widespread that it’s practically a flashing red light that a scam is going on. In fact, here’s a page from a site that collects readers stories about being ripped off via a Western Union money order. In those situations, those were people desperate for a loan who paid a fee in advance (bad idea) and were ripped off.

Don’t ever send a money order (Western Union or otherwise) to anyone you don’t know… you’re begging to get burned.