Consumers Report $1.6 Billion in Fraud to the FTC

snow in philadelphiaIt has been the third snowiest winter in history here in Philadelphia. So we are looking forward to spring and warmer weather. Last week in the office, we joked about how governments were spending so much money on snow this winter, someone might come forward to report some of it lost due to fraud. No one has come forward yet, but I did read last night about how some contractors were fleecing consumers in Iowa due to the cold weather.

There is a program in Northeast Iowa called Operation Thaw which is offering assistance to low income homeowners who do not have the money to get their water lines unfrozen. Hundreds of homes have been without water for weeks due to the extremely cold weather in the region this winter.

Shortly after the program was announced, the administrator of Operation Thaw had to issue a follow up statement warning homeowners about fraudulent contractors claiming to be fixing pipes pursuant to the program. The contractors are apparently telling consumers they will be reimbursed for their expenses when Operation Thaw does not currently provide for reimbursement. Instead, the consumer selects a contractor from an approved list and the program handles the arrangements.

It’s despicable.

We spend a lot of time here discussing fraud against the government, because that is the ill whistleblower laws are designed to prevent. But it isn’t the only fraud in this nation. Last year, Americans reported 1.1 million incidents of fraud to the Federal Trade Commission. The fraudulent conduct cost consumers more than $1.6 billion as a result.

Where was Iowa? They had the third fewest complaints for fraud per capita. I don’t want to think about what would have happened in a state with more fraud.

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