Bogus Medical Discount Plans: A Bitter
No doubt about it -
medical costs are rising. So it's no wonder that fraudulent
telemarketers have turned to promoting medical discount plans as a new
way to bilk unsuspecting consumers. The Federal Trade Commission (FTC)
wants consumers to know that promoters of bogus medical discount plans
and cards are doing just what they always do: following the headlines
to take advantage of consumer vulnerability.
In this case, the FTC says, the
fraudulent telemarketers are perpetrating an "unauthorized billing"
scam on people who are simply trying to save a buck. The FTC has filed
suit against several companies that claim to offer consumers medical
discount plans and cards and then bill their accounts for hundreds of
dollars whether or not the consumer wants the plan or card.
How the Scam Works
According to the FTC, fraudulent telemarketers are offering
consumers a healthcare discount plan that supposedly will generate
savings on prescription drugs and dental, vision, hearing,
chiropractic, and nursing services. As part of their pitch, they lead
consumers to believe that they're affiliated with the consumer's
insurance company, financial institution, or state government. The
agency says consumers often can get these benefits on their own for
free or at minimal cost.
The tip-off to the medical discount
rip-off comes when the promoter asks the consumer to "confirm" some
personal financial information, like a credit card or checking account
number. The FTC says the promoters do this in an effort to convince
the consumers that they're simply verifying information they already
have. That's not the case. Indeed, says the FTC, once the fraudulent
promoters have a consumer's account information, they use it to make
money by placing an unauthorized charge or debit on the consumer's
The FTC advises consumers not to give out personal information -
including financial information like credit card or bank account
numbers - on the phone or the Internet unless you're familiar with the
business that's asking for it. Not only can scam artists use the
information to bill your accounts without your permission, but they
also can use it to commit identity theft and other types of fraud.
If you think a telemarketer has tricked you into revealing your credit
card or bank account numbers, call your bank or credit card issuer
immediately to block any unauthorized charges.
The FTC works for the consumer to
prevent fraudulent, deceptive and unfair business practices in the
marketplace and to provide information to help consumers spot, stop and
avoid them. To file a
complaint or to get free information
on consumer issues, visit
call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The
FTC enters Internet, telemarketing, identity theft and other fraud-related
Consumer Sentinel, a
secure, online database available to hundreds of civil and criminal law
enforcement agencies in the U.S. and abroad.
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