Are You Financially Aware?
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How much fraud can we expect to deter with increased financial literacy?
I am skeptical that literacy is the root problem, and so was pleased to see that Sandra F. Braunstein, Director, Division of Consumer and Community Affairs, of the Federal Reserve agrees with me.
"Financial education is not a panacea.
Providing consumer information is one of several necessary and complementary consumer protection strategies ranging from raising awareness, providing accurate information, building capacity among educators and practitioners to developing effective consumer-tested disclosures, and, when necessary, protecting consumers by regulations banning or restricting unfair and abusive products.
We believe that all of these approaches are essential for ensuring that consumers can successfully navigate an increasingly complex financial marketplace."
Well, that sound promising. Let's find the Federal Reserve Board's method for preventing foreclosure scams.
"This spring, in response to the increasing number of foreclosure rescue scams identified by our non-profit partners, the Federal Reserve Board took the unusual step of purchasing 30-second advertisements in movie theaters to raise awareness of these scams and other fraudulent consumer "help."
The advertisements, which played before movie previews in 14 cities with high foreclosure rates across the country, warn consumers about foreclosure scams and direct them to our website for tips on avoiding fraud and for information about other resources available to them through the Federal Reserve System.8
Perhaps even more effective than the advertisements themselves was the coverage that the Federal Reserve received for this effort.
Several major newspapers, wire services, and radio and television news programs reported on the movie theater outreach, further extending the reach of our message and raising public awareness of this critical issue.9"
Interesting, did it work? I am not sure. Probably a dumb idea not to have the movie embeddable!
Furhter, the foreclosure scam tips seem the sort advice that if you were able to use it, then you would have needed it in the first place.
More promising that "tips" stripped from the context which makes them persuasive, is the FTC's identification of certain pitches.
Here are the pitches that the FTC says foreclosure scammers use:
"Stop Foreclosure Now!"
"We guarantee to stop your foreclosure."
"Keep Your Home. We know your home is scheduled to be sold. No Problem!"
"We have special relationships within many banks that can speed up case approvals."
"We Can Save Your Home. Guaranteed. Free Consultation"
"We stop foreclosures everyday. Our team of professionals can stop yours this week!"
But the problem is that when I search for websites bidding on these keywords, I am not seeing sites with any traffic at all.
What does this mean? Are the con criminals not using these pitches, after all? Not on the internet? Or I have I just missed the big websites? Don't know, but I did find it amusing that none of the websites I visited, which were bidding on these keywords, mentioned the Federal Reserves's number one tip:
"If you are looking for help to prevent foreclosure, be sure the counseling agency is on the Department of Housing and Urban Development's list of approved agencies. Visit HUD's website for an easily searchable list of HUD-approved housing counseling agencies, or call 877-HUD-1515 (877-483-1515) for more information. If you are approached by foreclosure counselors--by mail, phone, or in person--make sure the counseling agency is HUD-approved before you do business with them."
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