Local experts warned area consumers not to rush decisions that could put their pockets at risk in order to fulfill New Year’s resolutions.
The result can be money lost, whether through scams or companies that don’t disclose all the details on deals targeting people looking to lose weight or improve their finances.
One of the biggest scams to beware of is free trials, said John North, president and CEO of the Miami Valley Better Business Bureau. Especially this time of year, diet supplement trials come out of the woodwork.
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Contracts might also include details that aren’t discussed up front, North said, which makes up one of the biggest complaints the Miami Valley BBB sees each year.
“The real issue with them is oftentimes they make claims that are untrue or just unsubstantiated,” North said. “Read the small print or any web page. It may say, after the free trial, your card will be charged a monthly fee of such and such. Many people either don’t read that or they are aware of it, but then they forget to cancel within the time frame.”
A lot of people let down their guard at holiday time, said Natalie Dunlevey, president of National Processing Solutions. But it’s a critical time not to do so.
“Remain vigilant,” she said. “There will be new scams on the horizon.”
Another common concern is that consumers may also get stuck in contracts that they didn’t realize they were signing up for when starting a free trial.
That can happen for gym memberships, when those hoping to workout more in the New Year sign up for a free month trial and provide a credit card number for it. If they don’t cancel the free membership by the deadline, they are locked into a contract.
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One specific detail to ask about is what happens if the gym goes out of business. If the company has another branch within a certain number of miles, members may have to drive long distances to hit the weights instead of being let out of a contract.
“Read the contract. Make sure that you ask questions; make sure that there are no blanks in the contract; make sure that there’s no verbal commitments made that are not included in the contract; make sure you monitor that free trial period and know the window of opportunity to cancel that membership,” North said.
Also beware of of free apps that promise to walk away the pounds or get diets on track, Dunlevey said. Many of the free apps that aren’t connected to major companies can include malware that’s downloaded with the app and sits on cell phones and tablets waiting for the device’s owner to enter credit card and bank information.
Other scammers will look to steal identities through robo-calls with local area codes, she said. They claim to be from an insurance company, Medicare or Medicaid looking to help give the best rates.
“They’ll get you to give your Social Security information or your Medicaid, Medicare number, which is hugely valuable to a cyber thief,” she said. “Never give it, obviously, even if somebody says they’re a reputable company … A lot of them aren’t actually coming from the appropriate person.”
Other agencies, which could be scams or operating less than legitimately, could also reach out to help consumers lessen debt in restructuring or filing for bankruptcy.
“What happens is that you end up paying this particular company funds and then they are allegedly going to present a proposal to your debtors to pay off that debt,” North said. “What happens is you think that they’re making good on that promise, making payments on that debt, when oftentimes the scammers are just collecting that money.”
Instead, consumers should contact credit card companies directly to reduce payments or use a legitimate nonprofit organization.
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Scams to watch
Emails asking for bank information
Phone calls asking for Social Security, insurance numbers
Free apps that may have malware
Free trials with hidden commitments
Gym membership trials that must be canceled
Groups offering to restructure debt