Tag: scam

Bankruptcy Law, Student Loans, Timothy Kingcade Posts

Arrest Made in the Latest Student Loan Debt Relief Scam

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The head of a well-known alleged student loan debt relief scam is now being forced to account for his actions. Brandon Frere, the CEO of Ameritech and two other companies is accused of engaging in scams in the student debt relief business. He was arrested last week at the San Francisco International Airport.

When he was arrested, he was on his way to Cancun, Mexico, and had $3,900 cash on him, as well as five blank checks from his business, two blank checks from his personal bank account, 10 credit cards, gift cards and his Social Security card.

The claims against Frere are numerous. He is accused of withdrawing money that the company was holding in escrow for its customers, meaning the money belonged to the customers and not to the company. He is also accused of transferring millions of dollars from the company into his personal account and spending this money on cars, travel and other luxury items.

Days before Frere tried to leave the country, a judge granted a motion for preliminary injunction filed by the Federal Trade Commission (FTC). The same day that Frere booked his Cancun ticket, he withdrew $400,000 from accounts that were associated with his companies. Of that amount, $179,000 was transferred to his personal account. The remainder was transferred to family members and lawyers. Prosecutors estimate that Frere’s companies collected somewhere up to $28 million from student loan borrowers over four years.

It is estimated that student loan debt is a staggering $1.5 trillion, held by 44 million borrowers. It is also estimated that somewhere around 40 percent of all student loan borrowers will default on their obligations at some point in time.

These types of scams are not unique. In fact, many of these companies exist, taking advantage of student loan borrowers who are in an extremely difficult situation and are desperate for relief. It is extremely important that a student loan borrower does his or her research before choosing a repayment plan or relief option. Many times, borrowers make simple mistakes, like trusting a company they should not otherwise trust, that only hurts them in the end.

Once they had the borrower’s money, the company would continue to charge the borrowers monthly fees, ranging from $49 to $99. The borrowers were under the impression that the company was making their payments to their loans, but these payments were not being made, leaving these accounts unpaid and in default.

Another illegal practice that Frere and others were accused of was encouraging their company representatives to push customers to exaggerate the size of their families to receive more favorable student loan terms.

The FTC and various state attorneys general have been hard at work on cracking down on these types of scams and illegal collection practices. The FTC claimed that Ameritech would lure student loan borrowers with mailings promising the borrowers that they were prequalified for debt-relief. The company collected fees ranging between $600 to $800 to prepare and submit documents on behalf of the borrowers who were interested in government repayment and forgiveness programs. The problem with this is that there are free services provided by the U.S. Dept. of Education that offer the same.

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For borrowers who are struggling with student loan debt, relief options are available.  Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. There are ways to file for bankruptcy with student loan debt.  It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

 

Bankruptcy Law, Credit, Debt Relief, Timothy Kingcade Posts

Beware of a New Scam Involving Cash Advances

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The Better Business Bureau (BBB) recently warned consumers to beware of a new debt collection con where scammers pose as debt collectors who claim to be collecting on cash advances.

Here is how the scam works:

You receive an automated call from a company claiming to be collecting a payment for a cash advance. Next, the recording will prompt you to stay on the line and speak with an agent.

If you stay on the line, the agent will request that you pay your debt immediately using a wire transfer or a prepaid debt card. If you refuse, the agent will use threats of arrest, lawsuits or garnished wages to intimidate you.

Keep in mind that the use of threats in debt collection is in violation of your rights as a consumer under the Fair Debt Collection Practices Act.

If you receive one of these calls, the BBB suggests you do the following:

  • Just hang up. If you don’t have any outstanding loans, hang up.
  • Get an official notice. Ask the debt collector to provide an official “validation notice” of the debt. In the US and most of Canada, debt collectors are required by law to provide the information in writing. The notice must include the amount of the debt, the name of the creditor and a statement of your rights.
  • Confirm the agency is real. Ask the caller for his/her name, company, street address and telephone number.
  • Do not provide any information they do not have. Until you have verified the call, do not provide or confirm a bank account, credit card number or any other personal information.
  • Check your credit report. If you are unsure if you have outstanding debt, check your credit report with one of the three national credit reporting companies: Equifax, TransUnion or Experian.
  • Place a fraud alert on your credit report. If the scammer has personal information, alert the three credit reporting companies that you have been contacted.

 

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If you are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Credit, Timothy Kingcade Posts

8 Ways to tell if a Debt Collector is a Scammer

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If someone calls to collect payment on a debt you were unaware of, it’s important to ask the following questions to ensure you are not getting scammed.
1.) Basic Information: Whether the collection caller is attempting to collect on a real debt or if it’s a scam, the caller is going to ask you questions. Make sure and ask some of your own. A real collector is going to provide you with the company name, address and phone number. Scammers will likely refuse to give you this information.
2.) Get Confirmation: A genuine debt collector has five days from the first phone call to send you written confirmation of the debt. That confirmation letter should be more than a demand to pay. It should also spell out some of your rights and include information on the collection agency, such as the company name, mailing address and phone number.
3.) Verify that the agency exists: Input the company name and/or phone number into an Internet search engine. Have there been any complaints against them? Confirm that the company is licensed or allowed to work in your state. Some scammers will claim to be from genuine collection firms or attorney’s offices. Contact your state attorney general’s office or department of consumer affairs and verify this- and most importantly, do NOT disclose any personal information to them.
4.) Pull your credit report: Credit reports provide a quick snapshot of your current debts. If someone calls and says you owe money and it is not listed on your credit report, it’s like to be a scam. Consumers should be checking their credit reports at least one a year. You can get each of your three reports free every year at AnnualCreditReport.com or by calling 877-322-8228.
5.) Check your state’s statute of limitations: If the statute of limitations has expired, the collector cannot make you pay. In addition, seven years after you went into default, the debt has to come off your credit report — even if it’s sold to collectors. No matter who owns it or when they bought it, it cannot be listed on your history or used to compute your credit score.
6.) Send for verification of the debt: After you’ve been contacted by a debt collector, you have 30 days to demand proof that it’s a real debt and that it belongs to you. If the debt isn’t an outright con, you want verification. As a return address, consider using a post office box or office address instead of your home address to protect your home address.
7.) Make sure you get real proof: The verification you receive could take many forms. It could be a copy of your contract with the original creditor, a copy of the charge-off statement or an invoice from the original creditor. Or it could simply be information about the debt, such as the original creditor’s name, the account number, charge-off amount and current balance. The collector should also be able to furnish at least the last four digits of your Social Security number.
8.) Determine if it’s yours—and theirs: When you receive the verification information, read it carefully. Check the billing address, the styling of your name, the middle name or initial listed and even designations like “Jr.” or “Sr.” If anything is off, it could be a case of mistaken identity or a scam. You also want to make sure the debt is being handled by the agency that contacted you.
To read more on this story visit: http://money.msn.com/debt-management/is-that-debt-collector-a-scammer-bankrate.aspx.
If you are in a financial crisis and are considering filing bankruptcy, contact an experienced attorney who can advise you of all of your options. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia, P.A. website at www.miamibankruptcy.com.