Scams often fit with the old adage: “if it sounds too good to be true, it probably is.” The Federal Trade Commission (FTC) and the FBI are warning consumers about several similar-sounding scams that involve the promise of discounted services—ranging from utilities to health insurance—that end with fraudsters stealing your money and you having nothing to show for it.
Here's how scammers are ripping people off, and how to protect yourself.
How discounted services scams work
One iteration of this scam type begins with a robocall from someone who claims to be from a utility company (like AT&T or Comcast Xfinity) that offers phone, TV, or internet services. As the FTC alert describes, the scammer promises a 40 to 50% discount on future bills, bundles, or product purchases, but only if you act fast and pay up front. They'll ask you to purchase a gift card and provide them with the number—and they may also request your utility account information.
A public service announcement from the FBI's Internet Crime Complaint Center describes a similar scam involving discount medical insurance. In this scheme, fraudsters reach out via unsolicited calls, texts, or emails and pretend to represent legitimate health insurance providers. They may pressure targets to sign up for a new plan at a discounted rate that's available only for a limited time or promise free services. Once victims purchase a plan, they are unable to cancel it, receive refunds, or use the supposed benefits upon receiving costly medical or dental bills they believed were covered.
How to protect yourself
As with many scams, there are a few telltale signs that the promise of discounted services is fake, including a stranger contacting you out of the blue trying to sell you something, the sense of urgency to act now or lose the opportunity, and the demand to pay right away (especially with a gift card).
What do you think so far?
To avoid becoming a victim, don't make any quick decisions. End the conversation, and contact the company that's supposedly offering the deal to confirm whether it's real. Only use phone numbers and websites you search for directly—do not click links or call back numbers you're sent in messages. Never pay anything up front.
If you are targeted for discounted medical insurance, research the company through your state insurance commissioner and the Better Business Bureau to check whether it's reputable and licensed in your state. Confirm that your providers accept the plan, and read any policy documents carefully before signing. If you don't receive any documents, it's almost certainly a fraud.
