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Share this PageMarch, 2006
Have you seen ads like this on the internet and wondered if they're for real?
Well, they're for real, but I don't advise signing up for this kind of deal. Here's why...
When you see any "free" offer, you should be very careful. Very few things are really free. You should ask yourself these kinds of questions:
Question:
An ipod costs $69 to $399 dollars. How are they paying for it if they're giving it to me for free?
Answer: You have to give them something of value.
Question:
What do I have that's valuable to them?
Answer: A lot.
- Your personal information - you have to give them your name, email, home address, gender, date of birth, and phone number. They use this information to send offers to your email account, to your home via direct mail, and to your phone with telemarketers.
- Your credit card - you also are required to sign up for one of the offers they present to you. All of these offers will involve giving them your credit card number. The offers are things like a Blockbuster online rental membership, DVD and music clubs, credit card offers, ringtones & horoscopes. They are paid a bounty from these companies when you sign up. Companies will pay anywhere from $10 - $70 per sign up.
- Your friends and family - in order to qualify for the free item you have to get 5 friends or family members to sign up AND request one of their offers.
See how the money is now adding up? The company will receive possibly $40 per sign up which equals $240 (6 users x $40).
Were you worried they weren't going to make any money on this deal? Don't worry, they will still make more.
In fact, Eliot Spitzer, the fireball New York Attorney General has recently filed suit against Gratis Internet, the parent company of sites Freeipods.com, FreeCDs.com, FreeDVDs.com, and FreeVideoGames.com (just an aside - "gratis" means "free" in Spanish).
The suit alleges that Gratis:
"... sold personal information obtained from millions of consumers under a strict promise of confidentiality.
From 2000 through 2004 Gratis made numerous explicit promises to the users of its web sites about protecting personal information. Among the promises the company made were:
'We will never give out, sell or lend your name or information to anyone';
'We will never lend, sell or give out for any reason your email address or personal information';
'We at [Gratis web site] respect your privacy and do not sell, rent or loan any personally identifiable information regarding our customers to any third party'; and
'Please note that we do not provide your E-mail address to our business partners.'
Even on its sign-up pages, Gratis promised consumers that it 'does not . . . sell/rent emails.'
However, the Attorney General’s investigation confirmed that Gratis’s owners, Peter Martin and Robert Jewell, repeatedly violated these promises during 2004 and 2005 by selling access to lists of millions of Gratis’s customers to three independent email marketers. The marketers then sent hundreds of millions of email solicitations to those users, on behalf of their own customers. In each of these deals, Gratis wrongfully shared between one and seven million confidential user records.
This is believed to be the largest deliberate breach of a privacy policy ever discovered by U.S. law enforcement.
Need another reason to avoid offers like these?
Here's a good one - if you jump through all their hoops and qualify for your free ipod, you'll have to send them an IRS W-9 form, since the iPod's value will have to be counted as revenue.
What information is provided on a W9? Oh, only your name, address, and Social Security Number. Is that the kind of information you want in the hands of these people? I don't think so.
Save your pennies and buy your own stinking iPod. That's what I recommend.
Fidelity Investments lost a laptop that had sensitive employee information for 196,000 current and former HP employees. The employes were told this week that they are at risk for identity theft and that they should take steps to protect themselves.
Here's part of the email that went out to HP employees:
"This is to let you know that Fidelity Investments, record-keeper for the HP retirement plans, recently had a laptop computer stolen that contained personal information about you, including your name, address, social security number and compensation."
A web site has been set up that "includes some immediate steps that you can take to protect yourself, as well as information about how to enroll for a 12-month period of credit monitoring at no cost to you and a Fidelity call center number in case you have additional questions."
This is just the latest in string of laptop losses that have affected employees at Sun, Cisco and IBM. It's unclear if the laptops are being targeted because of the information they contain, or if it's just random theft. My guess would be random theft.
When I worked in the corporate world, laptops disappeared on a regular basis. Thieves are able to dress like the typical corporate type (tan slacks, blue dress shirt, just the right amount of hair mousse) and sneak into one of our offices. From there they'd look for an unattended laptop, pick it up, and carry it out the door as if they were rushing off to attend the next staff meeting.
Anyway...
Fidelity has good news for those affected. It appears the data was encrypted and the encryption key has expired on the machine - making the data more difficult to extract.
Here's Fidelity's take on the situation:
"At this time, we are unaware of any misuse of the information contained in the software on the laptop," said Fidelity spokeswoman Anne Crowley. "The application was running on a temporary license from a third-party software vendor. The license has expired. Since the expiration of the license, the scrambled data would be difficult to interpret and generally unusable.
We have taken steps to implement extra security processes requiring additional authentication for access to those HP accounts as well as other measures to prevent unauthorized use. We have also employed additional security controls above and beyond our already significant monitoring activity to identify if there is any unusual activity in these accounts. Further, we have reviewed activity in the HP accounts and have found no indication of unusual or suspicious activity."
The bottom line is that no matter how careful you are, someone else's blunder can expose you to identity theft. The only way to avoid it is to withdraw from modern society. I'd personally rather have the 401k money.
To shred or to tear: that is the question. Robert Cockerham of cockeyed.com decided to put the matter to a test. His test subject? A newly received Chase Mastercard pre-approved application.
Step 1: Robert tears the application into small pieces.
Step: 2: Robert meticulously lines the torn pieces up and tapes them together, like so.
Step 3: Robert fills out the application, replacing the current billing address with a new one (his parent's house) and using his cell phone as the phone number on the new account.
With that, he mails it in.
Step 4: Robert excitedly receives his new credit card at his parent's house and activates it using his cell phone.
Analysis:
- Tearing up your sensitive documents is not sufficient.
- Some creditors will process applications, even if they've been torn up, taped together and have a new address.
- A criminal could easily apply for credit in your name, change the address, and activate the account via a pre-paid cell phone. You wouldn't even know what happened until creditors started calling you about your unpaid bills.
- You must destroy all sensitive documents using a cross-cut shredder
before placing them in the trash.
- Better yet, opt-out of pre-approved offers and give your shredder and the recyclers a rest.
Read the whole story on Cockeyed.com.
Think only the uneducated can be caught in a criminal's web? Hardly...
This is the sad story of "The Doctor" and "The General." The doctor, in this case, is an internationally recognized psychiatrist, 89 year-old Dr. Louis A. Gottschalk. The general is a anonymous figure Dr. Gottschalk met in Nigeria known only as "The General."
According to papers filed by his son, Dr. Gottschalk has been a ten year victim of a Nigerian Advanced Fee Scam, losing up to $3,000,000. Like the last victim we talked about, Dr. Gottschalk is also accused of destroying bank records in order to hide the crime. Understandably, his son is trying to wrest control of the family partnership before more money is lost to the criminals.
Gottschalk was first contacted in 1995 by Nigerian fraudsters. He traveled to Nigeria and Amsterdam to "show them that he was sincere so he would get the money." Early on, he admitted to his family that he had given "The General" $300,000. After being convinced he was being conned, he promised not to give any more money.
Dr. Louis Gottschalk, Nigerian Scam Victim
Unfortunately, time passed and Dr. Gottschalk continued to send money to his "partners" in Nigeria.
Why would someone do that - especially someone as educated as Dr. Gottschalk? Here's one assessment from Anthony Pratkanis, a fraud expert from UC Santa Cruz:
"There's a line that gets crossed when they send in the money and then they're caught in a rationalization trap," Pratkanis said. "One way to convince yourself the scam is for real is to send more money, ironically enough."
Makes sense to me. Evidently it made sense to Dr. Gottschalk as well. When asked by his son as late as October 2005 about the money, he replied:
"Don't worry, everything will be all right on Thursday because I will be getting $20 million."
Dreams die hard, don't they? Here's a link to the whole story from KTLA.
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