As cities work to scrape up every little bit of revenue, they're now going after library fines and overdue parking tickets.
How are they going after this money? With collection agencies.
Is it working? The Wall Street Journal says yes:
A handful of cities, including San Diego and Chicago, have worked with collection agencies since the late 1990s. But the trend is spreading rapidly around the country as strapped local governments look for creative ways to boost revenue without raising taxes and fees. Over the past few years, local governments in places including Seattle; Anchorage, Alaska; Austin, Texas; and Florida's Miami-Dade County have contracted with private agencies to collect late parking tickets and court fees. In New York City, Baltimore and Dallas, libraries use private collection firms to recover fines. New York state recently hired a collection company to pursue overdue E-ZPass toll bills.
While shaking down citizens over small debts might sound petty, hundreds of cities around the country are owed millions of dollars in unpaid fines. Since 1997, when Chicago began using a collection agency to track down unpaid parking fines, ticket revenue has more than doubled, rising from $68 million to $154 million last year. (The total number of parking tickets issued has dropped slightly over the period.) Since the Omaha, Neb., public-library system hired a private collection company in March, it has collected more than $40,000 in fines and recovered about $75,000 worth of overdue books and materials.
Yep, they're bringing in the big boys in order to collect on millions of dollars of small fines that many of you have ignored... until now. If you decide to ignore a collection agency, that $20 library fine could show up as a collection account on your credit report.
How will will single collection account for a stupid small overdue fine affect your credit score? It could lower it by as much as 100 points. Ouch! That's gonna hurt.
It appears that Equifax is the sole credit bureau that feels this may be a bit of overkill. Also from the Wall Street Journal:
Equifax Inc., the third credit bureau, makes an effort to weed out small charges like library books and parking violations from credit files. The company says it is not fair to include them in credit reports since municipal fines are reported unevenly around the country.
Well, that won't help too much because you never know which bureau a potential creditor will use to look at your credit.
So what should you do?
It's our favorite time of year here in the U.S. - TAX TIME!
Along with tax season comes the predictable onslaught of IRS scam emails. No, these don't come from the IRS. They are from the same old bad guys trying to separate you from your money.
Here's an email that just arrived today:
They're only offering a refund of $63.80??? Those crooks!
I would have thought a higher amount, like $630.80 would better peak our interest in recovering the money. Oh well, I'm sure they do extensive testing to determine the cash amount that draws the most clicks...
Once you click the link you'll see a beautiful reproduction of the IRS site along with a form asking for your:
This looks like a clear credit card fraud attempt. With this information they can purchase items over the internet or withdraw cash from your account.
What should you do if you receive an email like this?
The IRS, unfortunately, doesn't currently have an easy way to report these emails. The best you can do right now is call 800-366-4484 to report it, but the number was busy each time I tried to call. Not good.
The IRS has placed this kind of phishing scam in their "Dirty Dozen" tax scams for 2006. Here's what they had to say:
Phishing. Phishing is a technique used by identity thieves to acquire personal financial data in order to gain access to the financial accounts of unsuspecting consumers, run up charges on their credit cards or apply for new loans in their names. These Internet-based criminals pose as representatives of a financial institution and send out fictitious e-mail correspondence in an attempt to trick consumers into disclosing private information.
Sometimes scammers pose as the IRS itself. In recent months, some taxpayers have received e-mails that appear to come from the IRS. A typical e-mail notifies a taxpayer of an outstanding refund and urges the taxpayer to click on a hyperlink and visit an official-looking Web site. The Web site then solicits a social security and credit card number.
In a variation of this scheme, criminals have used e-mail to announce to unsuspecting taxpayers they are “under audit” and could make things right by divulging selected private financial information. Taxpayers should take note:
The IRS does not use e-mail to initiate contact with taxpayers about issues related to their accounts. If a taxpayer has any doubt whether a contact from the IRS is authentic, the taxpayer should call 1-800-829-1040 to confirm it."
Since the IRS is so lame in trying to shut down sites, I thought I'd do something.
It appears the servers are based in Korea and I've emailed the ISPs that manage the IP involved, but I'm not holding my breath.
The last word... enjoy tax season, just don't try to claim an early refund from scammers.
Here's a scam story with a happy ending... kind of.
Harrison Odiawa (aka Abu Belgore), pictured below, was convicted in a Lagos, Nigeria court to 376 years for advance fee fraud, obtaining by false pretence, conspiracy and forgery.
So why isn't this a happy story?
It turns out the victim, a U.S. citizen named Robert Blick, has been serving a 30 month jail sentence himself for defrauding his own business partners in order to give over $2,000,000 to the scammers.
The story begins on March 21, 2003, when Blick received an e-mail from a person in Nigeria by the name of Taye Owo, looking for a foreign contractor to transfer $20.5 million out of Nigeria.
Sound familiar?
Unfortunately, Blick hadn't heard of the scam and became excited about getting 20 million dollars for nothing. Don't we all?
After many emails, phone calls, and faxes back and forth, the scammers provided a certificate of incorporation for Blick's American company in Nigeria as well as a job completion certificate. With those, Blick believed he was ready to pick up the 20 million and decided London was the place to make it happen. Once in London, however, the deal played out just like it always does...
The scammers "... told him that he would need £10,000 for his agent to open a bank account, and another $18,750.00 as a trust processing fee when the money transaction took place.
Blick, who came to London with only £10,000, had to stop around London with his credit cards to raise another £20,000 to meet these demands. From this moment on, Blick was in the net of the fraudsters and they milked and milked him until he started selling his personal property and dipping his hand into the account of the company he co-owned with his partners in America.
First, they showed him an aluminium strong box, which he thought contained the money. They also opened it and showed him two bundles, which he confirmed were genuine. They could not, however, pay him because one document - International Clearance and Policy Certificate (ICP) number was not available. It had to come from Nigeria, so the payment was cancelled. Next, he was informed on April 7, 2003 that a sum of $ 410, 000 was required before the ICP could be issued. He paid $195,000 as his own share. Belgore was to pay the rest."
Like all "Advanced Fee [7]" schemes, the big payoff gets closer and closer, but never quite materializes.
The milking continued until Blick's American corporate partners became suspicious and called the FBI. Luckily the FBI was able to knock some sense into Blick, but not until he had given $2,092,894 million of his and his company's money to the scammers.
In January, 2004 Blick was charged with wire fraud along with conspiracy to draud the Nigerian government. After all, the scam Blick went along with supposedly involved stealing the 20 million dollars from the Nigerian government. Blick was convicted in September, 2004 and sentenced to 30 months in jail.
Enough talk about the "victim." Now back to our scammers...
Once Blick was convicted, the FBI alerted the Nigerian Economic and Financial Crimes Commission (EFCC) regarding Odiawa, alias Abu Belgore, the man behind the fraud. With evidence provided by Blick and others, Odiawa was convicted and sentenced to the 376 years.
Does this story have a happy ending? Sort of...
The victim and the scammer both received their comeuppance. Hopefully the family of the victim and his business partners get back their $2,000,000.
For all the gory details of the case, see the EFCC web site [8].
Remember that scene in National Treasure where Nicolas Cage pulls a thumb print off Diane Kruger's champagne glass and uses it to get into the super-secret room housing the Declaration of Independence? If not, rent it tonight [11] and take a look.
So, is that really possible or is it just one of those movie-inspired myths? Unfortunately for security vendors, it's pretty close to the truth.
A study at Clarkson University [12] revealed that fingerprint scanners were fooled 90% of the time by fake fingerprints created from gelatin [13], dental plaster, or even Play-Doh! Another option is for a thief to just cut one of your fingers off and use it on the scanner.
So should you care about this high-tech biometrics stuff? What does this have to do with your life? Well, the Albertsons grocery store chain has recently implemented a biometric finger scan for payment and identification in some stores and both Wal-Mart and Costco [14] are supposedly discussing doing the same thing.
Before there's wide-spread adoption, hopefully these security questions will be resolved. One company trying to do that is Luminetx. They recently patented their vein scanner (designed initially for medical purposes) for use in biometric scans. Evidently your vein layout is extremely unique and can't be faked or bypassed (so far).
Whether it's your finger, eyeball, or arm, get ready for high-tech features at your local grocery or big box store. They're coming.
Links:
[1] http://fightidentitytheft.com/blog/-2-2-2-2-2-2-2-2/an-overdue-book-can-ruin-your-credit-score-really
[2] http://fightidentitytheft.com/fact_act.html
[3] http://fightidentitytheft.com/blog/-2-2-2-2-2-2-2-2/an-overdue-book-can-ruin-your-credit-score-really#comments
[4] http://fightidentitytheft.com/blog/identity-theft/irs-phishing-scams-its-that-time-of-year
[5] http://fightidentitytheft.com/blog/identity-theft/irs-phishing-scams-its-that-time-of-year#comments
[6] http://fightidentitytheft.com/blog/-2-2/nigerian-scammer-gets-jail-sentence-of-376-years
[7] http://fightidentitytheft.com/internet_scam_nigerian.html
[8] http://www.efccnigeria.org/index.php?option=com_content&task=view&id=764&Itemid=2
[9] http://fightidentitytheft.com/blog/-2-2/nigerian-scammer-gets-jail-sentence-of-376-years#comments
[10] http://fightidentitytheft.com/blog/-2/biometric-scanner-uses-your-veins
[11] http://www.netflix.com
[12] http://www.yubanet.com/cgi-bin/artman/exec/view.cgi/8/28878
[13] http://cryptome.org/gummy.htm
[14] http://money.cnn.com/2006/01/24/magazines/fortune/pluggedin_fortune_biometrics/
[15] http://fightidentitytheft.com/blog/-2/biometric-scanner-uses-your-veins#comments