Local

WA attorney general warns of more possible scams

Washington state attorney general Bob Ferguson says a range of scams, from pretending to be government entities to robocalls, are targeting people in Washington. The attorney general has already sued two companies to stop a prolific scam targeting businesses, and expects to see more scams over the next few months. The attorney general is hoping that people will fill out a complaint form that could help the agency catalog the scams as they arise.

Ferguson’s office says nearly a quarter of a million deceptive letters may have cost Washington state businesses — and said two companies targeted businesses with a scam by pretending to be a government agency. The attorney general says this was a case of a company demanding payment for posters or certificates it said were mandatory by the state. Businesses received a letter that was written like it came from a Washington government agency but it really wasn’t — the form asked businesses for money.

A King County judge has ordered two companies to pay nearly $25 million for the unlawful conduct that targeted small businesses. “CA Certificate Service” and “Labor Poster Compliance” are the companies that sent hundreds of thousands of letters to Washington business owners saying they needed certain posters or certificates by law. These posters or certificates are not mandatory and they are available from the state for a fraction of the cost the companies demanded. The attorney general found that the companies made more than $5.3 million in profit from their deceptive efforts.

At least 15,437 Washington business owners paid $82.50 to CA Certificate Service — a net total of more than $1.23 million.

More than 400 Washingtonians paid Labor Poster Compliance up to $85.25, which totaled more than $33,000.

Laura Clinton is the division chief for consumer protection in the Washington attorney general’s office and said the impostor scam is one of the most prevalent: “people pretending to be a government agency reaching out with a sense of urgency that there’s a problem with your account or we need an immediate payment to clear your tickets. … In this era, it’s hard to know if you can trust the person on the other end of the telephone and unfortunately a lot of the time you cannot.”

Back in March 2019, the Washington secretary of state issued an alert on the companies behind all this, but the companies continued to operate until Ferguson’s office sued.

According to the attorney general, the companies actually sent 232,091 deceptive letters in Washington. A King County Superior Court judge, David Whedbee, granted Ferguson’s request that the companies repay the Washington businesses in full — and even added on pre-judgment interest. That amount will be determined later. The court ruled that the two companies committed 232,091 separate violations of the Washington Consumer Protection Act. The court ordered the two companies to pay $23,518,200 in penalties.The judge also blocked the companies from mailing letters into Washington state that appear to be a bill or an invoice for payment. The court order also bars the companies from sending letters that look like they are from the Washington state government or a company working on behalf of the government.

“This scam preyed on business owners who were juggling multiple responsibilities and wanted to play by the rules,” Ferguson said. “My family ran a small business in Everett for decades. The last thing they needed was somebody trying to take advantage of their desire to play by the rules. We will continue aggressively standing up for Washington small businesses.”

Some new small business owners told the attorney general they believed the so-called “Ca Certificate Service” was working on behalf of the Washington secretary of state. The attorney general also says that the companies targeted business owners by pulling business owner information off the secretary of state website. The secretary of state does not require the purchase of a business certificate to complete the business registration process. A certificate of status, also called a certificate of existence, shows that a business is current and authorized to do business here in Washington. Washington residents can purchase the certificate directly from the secretary of state for a $20 fee.

The attorney general’s office also said it conducted a survey of consumers and found that unintentional enrollment in a subscription service was also an issue for many people. Consumers thought they were making a one-time purchase but were signed up for subscriptions anyway. The attorney general’s office released results from that survey and said 59% of Washington residents reported something along those lines happening to them — that’s roughly 3.5 million people. The attorney general’s office says the unsanctioned sign-ups happen with prechecked boxes.

Those unauthorized subscriptions have also proven difficult to cancel — which is another issue the attorney general’s office heard about from consumers.

The attorney general’s office survey found that 70% believed that prechecked boxes should be prohibited and that online retailers were the culprit behind those prechecked boxes.

Clinton said that government imposter scams come in regularly to the office but so do many other types of scams. Auto-renewals for subscription services appeared to be high on the list of things the attorney general hears about when it comes to consumer complaints. She also said robocalling continues to be an issue, along with fake websites pretending to be legitimate — but are just fronts for parties trying to get people’s personal info. In mid-October, the authorities also warned people about charity scams that appear at the end of the year during the holiday-giving season.

In the last year, the attorney general’s office says it has received 93 complaints related to fundraising for charities. The attorney general’s office brings consumer protection lawsuits to hold scam charities accountable.

Ferguson’s office listed the following tips on the attorney general’s office website on how to avoid falling victim to a charity scam:

  • Research before giving. The best way to protect yourself from scams is to take time to research the charity before giving. The Washington secretary of state’s office maintains a database of charities that provides some basic information about charities, including how much of their revenue is used for a charitable purpose.
  • Know who you are giving to. Some fundraisers, charities, and scammers use deceptive tactics to confuse you about their identity. In some instances, an organization might use a name very similar to another well-known charity so it can borrow on the reputable charity’s goodwill.
  • Don’t give in to pressure. A charity might try to influence donors by expressing an immediate need for help. Take time to verify the fundraiser’s claims.
  • Plan your giving. Decide how much you want to spend on charitable giving each year and stick to that budget. Deciding who you want to give to in advance will help you assess whether the charity fits your values.

“Scammers will try to use pressure tactics and a false sense of urgency to dupe you out of your money,” Ferguson said. “Remember — there’s never any rush to donate. Take your time and do your research before donating.”

The attorney general’s office did say that it is noticing a few COVID-19 related scams but merchant scams are making a comeback. Clinton said election-related scams also can crop up with parties pretending to be political entities or political action committees but really aren’t linked to the election or candidates.

Rate