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Call it "Dial F for Fraud." Like Alfred Hitchcock's classic thriller, "Dial M for Murder," the 1990s version of the movie would feature a telephone, a victim and a greedy bad guy.

Here's where it begins to get scary. It's your telephone. You are the victim. A phony telemarketer on the other end of the line is the bad guy.To get you, all the phony tele-marketer has to do is dial your number, spin an enticing tale about a product, contest or great investment and hope you pull out your wallet.

The telemarketer either sends someone immediately to your home to pick up your money, asks for a credit card number to secure the deal or requires you to listen to a sales presentation.

But you never get the promised prize or product, or when it arrives, it's not what you expected. Often, you end up with the booby prize: unauthorized charges to your credit card.

It's easy money for the scam artist. And, it's one of the biggest fraud problems in Utah, said Connie White, executive director of the Utah Department of Commerce.

While many legitimate, reputable companies rely on tele-mar-keting to reach consumers, others use the telephone to rip off the public.

According to the Federal Trade Commission, fraudulent tele-mar-keters steal more than $10 billion from American consumers each year.

Telemarketing swindlers use similar tactics to get that money from consumers:

- They just won't take "no" for an answer. In addition to high-pressure sales pitches, some telemarketers resort to insults, arguments and even threats. Be firm. It's OK to say no. It's also OK to hang up.

- Timing is crucial. Supplies of the alleged product or service are dwindling, an offer is about to expire or the market is changing "even as we speak." To get in on the good deal, you must make up your mind immediately. Such comments should put you on red alert.

- They offer to send someone out immediately to pick up your money rather than asking you to send in payment via the mail. Why? To avoid federal charges of fraudulent use of the U.S. Postal Service. Refuse such service.

- They pitch a risk-free investment, often saying you're lucky to get in on it because it's just about to take off. If it's a risk-free investment that's just about to take off, why is the company hunting for investors through the telephone directory?

- They often ask for your credit card number as identification or for verification for a prize or offering. Banks and consumer protection agencies give the same advice: Never give out financial information over the telephone.

Telephone scam artists often target senior citizens who have both time and money on their hands. Many of the victims are lonely and enjoy talking to someone.

In fact, people over age 65 make up only 12 percent of the population but comprise 30 percent of all fraud victims.

"If bitten once, you're likely to get bothered over and over again," White said.

The family of one elderly Utahn got the man an unlisted telephone number after he fell prey to several telemarketing scams, White said.

Shutting down fraudulent tele-marketing operations is often complicated because the business is located in one state but makes calls to consumers in other states. They change telephone numbers and locations long before the law catches up with them.

But it may not be so easy for phony telemarketing firms to stay a step ahead of the law in the future.

On Tuesday, the U.S. House of Representatives voted 411-3 to approve the Consumer Protection Telemarketing Act. The act gives the Federal Trade Commission more authority to draft rules prohibiting deceptive tele-mar-keting activities.

It also allows state attorney generals to file civil actions against fraudulent telemarketing firms on behalf of the state's residents. The bill provides a three-year window for victims who've lost at least $50,000 because of a tele-mar-keting scam to bring civil action against a firm or individual.

And, it creates a federal clearinghouse to deal with inquiries about telemarketing businesses and regulations.

The Senate Committee on Communication, Science and Transportation is reviewing the bill.

The Utah Legislature passed a bill this session to curtail the operation of fraudulent telemarketing companies in Utah.

The bill requires telemarketing companies (except nonprofit organizations) to post a $50,000 bond. It also creates criminal penalties for repeat offenses. The state may use the bond money to repay consumers if a company proves to be fraudulent.

The law also should help protect Utah consumers from telephone fraud. It requires any telemarketing company doing business in Utah, whether physically located in the state or not, to register with the Department of Commerce.


Additional information

Scammers get taste of own medicine

The scammers got scammed Thursday when FBI agents across the country clamped down on fraudulent telemarketing operations in 13 cities.

The sting, called Operation Disconnect, was the result of a two-year undercover operation. In Utah, agents arrested 56 people who worked for six local telemarketing companies.

To nail the telemarketing businesses, the agents created a company that marketed a computer they said would dial up to 1,000 long-distance phone numbers an hour without a charge and deliver a computerized sales pitch.

The agents told the businesses that to set up their computer, the company needed to know details of their operations - what they told customers, what the customers expected and what the company really offered.

The businesses fell for the lure of something for almost nothing and revealed their secrets.

Most of the companies pressured victims to buy overpriced items such as water purifiers, vitamins, skin care products or pens. The products sold at prices ranging from $300 to $1,500. None was worth more than $50.

The companies sweetened the deals by telling victims a purchase would make them eligible for a valuable bonus - gold coins, expensive jewelry, home entertainment centers, luxury cars or large sums of cash. As a rule, victims received an item, typically a ruby pendant, worth less than $40.