June 23, 2010

Consumer Advisory: Attorney General Corbett cautions PA storm victims about scams

HARRISBURG - Attorney General Tom Corbett urged consumers to be watchful for possible scams as they work to repair damage that was done by a number of fast-moving storms that have touched communities across Pennsylvania in recent days.

"Storm-damaged areas are often a magnet for scam artists and con-men, looking to take advantage of victims," Corbett said.  "Consumers should be watchful for scams and report any suspicious activity."

Corbett said that the most common topics for consumer complaints following disasters are home repair schemes, government loan or grant schemes and fraudulent disaster-related fundraising efforts.
 
"Home repair schemes can include shoddy contractors, who take money but never do any work; phony inspectors, who are actually salesmen looking to sell expensive products or services; or bogus insurance adjusters, who may try to convince you to inflate claims, direct you toward questionable contractors or convince you that they will take care of 'all the paperwork' while redirecting claims payments to themselves," Corbett said.

Contractor issues -
Corbett said all Pennsylvania homeowners considering home repair or improvement projects should understand their rights and carefully review information about the state's Home Improvement Consumer Protection Act, which went into effect in July 2009.

"The new law requires written contracts for all projects over $500, including specific information about the total price for a project, a start-date and end-date, details about the materials being used and an explanation of a consumer's three-day right to cancel a contract," Corbett said. "The law also requires contractors to register with the Attorney General's Office and carry a minimum level of insurance."

All home improvement contractors operating in Pennsylvania are required to provide consumers with their registration number, which must be included in all contracts, estimates and advertisements.  Consumers can verify a contractor's registration by using the "Home Improvement Consumer Information" button, located on the front page of the Attorney General's website, at www.attorneygeneral.gov, or by calling 1-888-520-6680.

"To date, a total of 69,756 home improvement businesses have registered with the Attorney General's Office," Corbett said. "We encourage homeowners to use this registration system as a tool to help select a contractor suited for their project."

After checking a contractor's registration, Corbett urged consumers to take additional steps to protect themselves from con artists or scams, including:

• Get multiple estimates.
• Get references for recent work, and check those references (ask other consumers if they were happy with the work that was performed, if there were any problems and if they would hire that contractor again).
• Research businesses carefully before signing any contract.
• Do not feel pressured by "special offers" or deals on "left over" materials.
• Be wary of contractors who approach you with unsolicited offers or stories of "just being in the neighborhood."

Loan or government grant schemes - 

• Be suspicious of requests for up-front payments for loan applications or to search for grants.

Relief agencies and government assistance programs do not ask for pre-payment by disaster victims.  Contact relief agencies and local governments directly to get a list of available disaster-relief programs (Check with the local chapter of the Red Cross, U.S. Small Business Administration, and local emergency management officials for more information).

Disaster relief fundraising scams -

• Be wary of high-pressure tactics and door-to-door collections.
• Ask for details about any charity before you make a donation (legitimate charities will always explain their programs and services).
• Check to see if a charity is registered in PA before making a contribution (charity registration info is available on the PA Department of State website at www.dos.state.pa.us).
• Ask for info about how funds will be spent (legitimate charities will tell you what percentage of your gift will go toward community services, operating expenses or fundraising).
• Write checks directly to the charity, rather than giving cash.

Other consumer issues -

• Disasters can wipe out financial records, including credit card and utility bills, bank statements, and other vital information - keep spare copies in a safe location.
• Call your bank, credit card, utilities and other businesses that send you bills, and notify them of the problem.
• Get a free copy of your credit report, which will list all your major accounts and creditors at www.annualcreditreport.com.
• Ask for duplicate bills or a delayed payment plan (ask for a delay before you are late on any payments).
• Discuss the situation with your insurance company as soon as possible, to identify what losses are covered.
• Contact the PA Insurance Department (www.insurance.pa.gov) or the Attorney General's Bureau of Consumer Protection if you have problems getting a response from your insurance company.
• Consider getting advice from a non-profit financial counseling service to plan your best response to added expenses and/or financial losses related to a disaster.

Consumers with questions or problems related to disaster-recovery scams can contact the Attorney General's Consumer Protection Hotline at 1-800-441-2555 or file an online complaint at www.attorneygeneral.gov.

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