August, 2007

FTC Shuts Down Online Companies Selling Prepaid Credit

The Federal Trade Commission (FTC) recently shut down, at least temporarily, some companies that were marketing prepaid credit, primarily online, from Visa and Mastercard. According to an article from the Senior Journal, the companies are accused of making deceptive claims on their websites and unauthorized withdrawals from customers’ bank accounts. Though the companies’ fates will eventually be decided in the courts, this FTC action acts as another reminder that the anonymity of the Internet harbors scam artists and thieves who can prey on unsuspecting consumers, and that offers that seem too good to be true usually are.

Older Americans remain a primary target for fraudsters online, over the phone, and even in-person.  It’s important to remember a few key precautions when you are doing business.  First, never give out personal information unless you have initiated the contact or know for certain with whom you are dealing.  Also, read the terms of any offer a couple of times to make sure you understand it fully.  Then, ask a friend or family member to look it over with you.  Take time to think an offer over and don’t be pressured into a quick decision.  Finally, refuse to pay any fees or costs for a “free” offer.

You will find more helpful information and tips at the FTC’s website.

Deceived Seniors Can Cancel Medicare Plans

There has been a great deal of bad news recently about the widespread use of deceptive tactics in the sale of private Medicare health plans.  According to a Washington Post article printed in May, insurance agents have duped senior citizens and other vulnerable groups into buying Medicare plans that do not cover their needs or that they simply cannot afford.  Apparently, in some cases, these ruthless sales agents have even been “enrolling the dead and mentally incompetent, impersonating Medicare representatives, and using personal information stolen from federal records.”  It seems that high commission rates offered to agents have fueled this recent surge in fraudulent activity.

But this month, the Senior Journal printed an article that explains what most people do not yet know: That people who were misled into signing up for Medicare health plans can actually disenroll from their programs.  This particular right has not been advertised, but it is a rule of the Centers of Medicare and Medicaid Service (CMS) that members have an “exceptional circumstance special enrollment period” or SEP, which means that they can get out of their program if they were given false information while enrolling.  To find out if you are eligible to change your coverage, call 800-MEDICARE for more information.  The CMS promises to handle these claims “with a high priority.”  The Medicare Rights Center also offers some valuable information and resources for Medicare members.