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Sometimes I wonder whether the world is being run by smart people who are putting us on or by imbeciles who really mean it.

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If you've taken the bait and lost money to a telemarketer, expect that the same or another telemarketer will try to hook you again. Consumers who have been victimized often are placed on what is known in the trade as "sucker lists" and then victimized again. "Sucker lists" contain the names, addresses, phone numbers, and sometimes other information of people who have responded to bogus telephone solicitations. These lists, which are created, bought, and sold by some telemarketers, are invaluable because unscrupulous promoters know that consumers who have been tricked once are vulnerable to additional scams. These telemarketers hope that consumers believe that "this time" they will win the "grand prize." Most often, however, these consumers simply lose more money.

The Federal Trade Commission (FTC) is investigating complaints about some telemarketing firms that take your money, not just once, but repeatedly. Such activity is known as "reloading" or "double- scamming."

This brochure explains how reloading scams work, what precautions you can take to avoid becoming a victim, and where to go if you have a complaint about a telemarketer.

How the Scam Works

"Reloaders" or "double-scammers" use a variety of approaches to retarget consumers. For example, if you have lost money to a telemarketer you may be contacted by an individual claiming to represent a government agency, private company, or consumer organization that works, for a fee, to recover lost money or a product or prize. The problem is that the second caller may be just as bogus as the first. And, if you've paid the recovery fee -- you guessed it -- you've been double-scammed. In some instances, the second caller works for the firm that took your money in the first place.

Understand that some local government agencies and consumer organizations do provide assistance to consumers who have lost money. But they will not guarantee to get back your money and they will not charge a fee.

In another approach, a telemarketer may use prize incentives to persuade you to purchase merchandise. If you buy, you may get a call back saying that you now qualify for a more valuable prize. They lead you to believe that making an additional purchase could increase your chances of winning. If you buy a second time, the telemarketer may contact you yet a third time, repeating the same salespitch. The only change is that you are now a "grand prize" finalist and, by buying more merchandise you could win the "grand prize."

Of course the telemarketer wants payment when you agree to the purchase -- usually by a credit card phone order or the delivery of a check by courier service. However, it may be several weeks or more before you get your products and prizes. When your merchandise or prizes do arrive, you may discover that you paid too much for inferior products and that you did not win the "grand prize" after all. By that time your credit card account has been charged and your checks cashed.

How to Protect Yourself

To avoid being victimized by a reloading operation, consider the following precautions.

* Beware of individuals claiming to represent companies, consumer organizations, or government agencies that will recover your lost money for a fee. National, state, and local consumer enforcement agencies, such as your Attorney General and consumer protection offices and non-profit organizations, such as Call For Action, or the National Fraud Information Center, do not charge for their services.

* Before you make a purchase by phone from a company you do not know, ask the company to send you written materials about its operation. You may be on a "sucker list." Even if you don't get information, you can still check out the organization with your state or local consumer protection office before you send any money.

* Be skeptical of promoters who repeatedly contact you, stating that if you purchase more of their merchandise, you have a better chance of winning valuable prizes.

* Make sure you receive and inspect your original purchase or prize before making additional purchases.

If You Have a Complaint

Always try to resolve complaints with the company first, but be careful. Don't let the company representative persuade you to accept a substitute product or award if this truly isn't what you want. If you want your money back, say so and don't accept less. If that does not work and you believe you have been defrauded, contact the National Fraud Information Center at 1-800-876-7060, 9 a.m. - 5:30 p.m. EST, Monday - Friday; Call For Action (CFA) at (202) 537-0585; TDD (202) 537-1551; your state Attorney General; local consumer protection office; and Better Business Bureau, to report the company.

The National Fraud Information Center is a private, non-profit organization that operates a consumer assistance hotline to provide services and assistance in filing complaints. Call For Action (CFA) is a Washington, D.C.-based international network of radio and television consumer hotlines. The CFA Network of 800 volunteers helps consumers retrieve money or services.

In addition, you may wish to file a complaint with the FTC by writing to: Correspondence Branch, Federal Trade Commission, Washington, D.C. 20580. Although the FTC generally does not intervene in individual disputes, the information you provide may help to indicate a pattern of possible law violations requiring action by the Commission.

Facts for Consumers from the Federal Trade Commission in cooperation with Call For Action, Inc., a Washington, D.C.-based international network of radio and television consumer hotlines

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