What is Telemarketing Fraud?

Scams and sales that take place over the phone are telemarketing fraud. A telemarketer will call a victim and misrepresent causes in an attempt to coerce money out of that person. Telemarketing fraud is a broad category that covers foreign lottery scams, attempts to acquire credit card or personal information, and any other methods to cheat people out of money. When telemarketers call you, do not give out any personal or financial information.

State and Federal Telemarketing Laws

In the United States, there are regulations that classify telemarketing fraud as a crime, which the state or federal court can prosecute, depending on the individual circumstances. Estimates indicate that Americans lose about $40 billion each year to telemarketing fraudsters. All consumers with a phone are potential victims, but scammers often concentrate their efforts on the elderly population. The most common scam types reported by the Federal Trade Commission include scams that:

  • Promise free gifts or money
  • Claim the victim has won a sweepstakes
  • Pushing low-risk investments with high returns
  • Force victims to make immediate decisions
  • Are calling with unsolicited offers

Minnesota Minnesota Statutes §325E.28 states that telemarketers are forbidden from using automatic dialing-announcing devices unless the consumer has subscribed or given consent to the calls, or if the message is preceded by a live operator. Any victim of telemarketing fraud has the right to bring civil action against the telemarketer to recover damages.

Telemarketing Fraud Cases

Victims of telemarketing fraud have options to recover lost assets and receive compensation. State and federal courts try numerous cases every year to help victims. In a 2017 case, Shashana Stacyann Smith was sentenced to 24 months in prison for her telemarketing lottery scheme. In her particular scam, Smith called victims, claiming they had won large lottery prizes and needed to pay thousands of dollars to receive their winnings. Of course, victims did not receive any monetary prizes and Smith kept the money, sharing it with other individuals located in Jamaica. The court found Smith guilty and ordered her to pay $167,532.95 in restitution.

How to Avoid Telemarketing Fraud

If a telemarketer calls you, it is always best to say, “No thank you,” and hang up. All home and mobile phone owners should register with the National Do Not Call Registry. Many honest telemarketers will follow the law and terminate contact with phone numbers on this list. If a consumer is still receiving calls, the caller is very likely a scammer ignoring the law. Hang up and report the number at the registry’s website.

To protect yourself from telemarketing fraud, never release personal or financial information over the phone. Do not buy anything from marketers calling your phone number or agree to accept prize earnings. Legitimate companies will not conduct business in this matter. Per Minnesota state law, companies must provide written contracts, cancellation policies, and contact information for the company he or she represents.

What to Do if You Are a Victim of Telemarketing Fraud

It is very difficult to receive money back if you have been a victim of telemarketing fraud on your own. If you are a victim, contact our experienced fraud lawyers immediately. We will gather specific information about the situation to determine steps to take to recover lost money. You should always report telemarketing fraud to the National Fraud Information Center, Federal Trade Commission, FBI, or Minnesota State Attorney General’s office.

Contact our firm as soon as possible for the best chance at recovering money lost. Waiting too long to find help can make pinning down the telemarketing company more difficult but will also allow the company to continue scamming other consumers.