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Birmingham-area scam uses telephone relay service for deaf | al.com
Birmingham-area merchants are being targeted by scam artists using a new Internet-age twist on an old scheme, according to merchants and a credit card processing company.
Scam artists are trying to place large orders using what appear to be stolen or fraudulent credit cards, merchants said. The scammers ask the merchants to charge the cards for some amount beyond the cost of the purchase and wire the balance to an associate.
The callers identify themselves as being deaf, and are using Web-based transcription services called relays. Relay services allow the hearing impaired to have telephone conversations by providing operators to transcribe spoken comments from the hearing party, and read aloud the written comments from the hearing-impaired party.
The relay services, which the Americans with Disabilities Act requires phone companies to provide free, have been used as cover in telephone scams for several years because they help scam artists hide their location. Operators are barred from interjecting themselves into the conversation, even if they suspect they are witnessing a fraud.
Kathy Levine, owner of Uncle Monk's Cafe in Chelsea, said she was victimized several weeks ago when a man called using a relay service and ordered 150 chicken Caesar salads for a birthday party for his mother the following Sunday, paying with a Discover card.
The man added about $1,200 to the $1,700 bill and asked that $1,200 be wired to an associate in Arkansas.
Levine said she was excited about the big order, but became suspicious when the man became upset after she told him she couldn't do anything until the funds charged to his card arrived in her account.
She contacted the company that manages credit card processing for the restaurant and Discover and learned it was a scam.
"The naive person that I am, it sounded like it was on the up-and-up," she said. "I'm not naive anymore."
Uncle Monk's was out only processing fees associated with the credit card transaction, and those were refunded, she said.
Attempts to reach the person who placed the order, and with whom Levine also exchanged e-mails, were not successful.
Karen Edgeworth, who owns McIntosh Flower Shop in Northport, had a similar experience on Tuesday.
She spent an hour on the phone with a man using a relay service as the man placed an order for six large floral arrangements for his brother's wedding, also using a Discover card after other cards were declined.
He asked her to add an extra $1,150 to the credit card charges, then wire $950 to an associate and keep $100 for her trouble, she said. She refused to process the order and contacted Discover and her credit card processing company.
Efforts to reach officials at Discover, who told Edgeworth another flower shop reported an identical call the same day, were not successful.
Terry Hirsberg, national sales manager for Total Merchant Services in Birmingham, said loss-prevention officials at the Colorado-based card processing company have been getting reports of 10 to 15 such incidents a week nationwide.
The use of the hearing-impaired relay service doesn't just hide the location of the scam artists, it's a distraction to the merchant and raises a level of sympathy that might result in their overlooking the subterfuge, he said.
"They're preying on mom-and-pop businesses still recovering from the (recession)," he said. "And using the hearing impaired relay -- a lot of small businesses aren't used to it. Your defenses go down a little bit."
An Internet message board for relay operators is filled with discussions about how to handle calls that are apparent scams, and stories about having to silently stand by as people were deceived. One operator posting on the site recalled placing 50 consecutive calls from an apparent scam artist in Nigeria, home base to many such schemes.
Some of the operators said they risk being fired by disconnecting such calls, in violation of their employers' policies.
Birmingham-area merchants are being targeted by scam artists using a new Internet-age twist on an old scheme, according to merchants and a credit card processing company.
Scam artists are trying to place large orders using what appear to be stolen or fraudulent credit cards, merchants said. The scammers ask the merchants to charge the cards for some amount beyond the cost of the purchase and wire the balance to an associate.
The callers identify themselves as being deaf, and are using Web-based transcription services called relays. Relay services allow the hearing impaired to have telephone conversations by providing operators to transcribe spoken comments from the hearing party, and read aloud the written comments from the hearing-impaired party.
The relay services, which the Americans with Disabilities Act requires phone companies to provide free, have been used as cover in telephone scams for several years because they help scam artists hide their location. Operators are barred from interjecting themselves into the conversation, even if they suspect they are witnessing a fraud.
Kathy Levine, owner of Uncle Monk's Cafe in Chelsea, said she was victimized several weeks ago when a man called using a relay service and ordered 150 chicken Caesar salads for a birthday party for his mother the following Sunday, paying with a Discover card.
The man added about $1,200 to the $1,700 bill and asked that $1,200 be wired to an associate in Arkansas.
Levine said she was excited about the big order, but became suspicious when the man became upset after she told him she couldn't do anything until the funds charged to his card arrived in her account.
She contacted the company that manages credit card processing for the restaurant and Discover and learned it was a scam.
"The naive person that I am, it sounded like it was on the up-and-up," she said. "I'm not naive anymore."
Uncle Monk's was out only processing fees associated with the credit card transaction, and those were refunded, she said.
Attempts to reach the person who placed the order, and with whom Levine also exchanged e-mails, were not successful.
Karen Edgeworth, who owns McIntosh Flower Shop in Northport, had a similar experience on Tuesday.
She spent an hour on the phone with a man using a relay service as the man placed an order for six large floral arrangements for his brother's wedding, also using a Discover card after other cards were declined.
He asked her to add an extra $1,150 to the credit card charges, then wire $950 to an associate and keep $100 for her trouble, she said. She refused to process the order and contacted Discover and her credit card processing company.
Efforts to reach officials at Discover, who told Edgeworth another flower shop reported an identical call the same day, were not successful.
Terry Hirsberg, national sales manager for Total Merchant Services in Birmingham, said loss-prevention officials at the Colorado-based card processing company have been getting reports of 10 to 15 such incidents a week nationwide.
The use of the hearing-impaired relay service doesn't just hide the location of the scam artists, it's a distraction to the merchant and raises a level of sympathy that might result in their overlooking the subterfuge, he said.
"They're preying on mom-and-pop businesses still recovering from the (recession)," he said. "And using the hearing impaired relay -- a lot of small businesses aren't used to it. Your defenses go down a little bit."
An Internet message board for relay operators is filled with discussions about how to handle calls that are apparent scams, and stories about having to silently stand by as people were deceived. One operator posting on the site recalled placing 50 consecutive calls from an apparent scam artist in Nigeria, home base to many such schemes.
Some of the operators said they risk being fired by disconnecting such calls, in violation of their employers' policies.