If you were new to the world of personal computers, you might be unaware that prices for PCs have been tumbling, and that complete systems start around $500. If you had poor or no credit, you might be sucked into a scheme to sell you a computer for more than $2,000 – and not send it to you until you had made several months worth of payments. Or maybe, not ever send it to you at all! Welcome to the world of Blue Hippo, Financing Alternatives and their imitators.
BlueHippo, part of Edison Worldwide, is a Baltimore-based company that sells computers and TVs to consumers who have poor or no credit. Its customers are mostly individuals who have trouble managing money, do not have enough cash to pay the purchase price and don't qualify for credit from more traditional retailers.
The company's advertising has been spattered across American TVs since the BlueHippo's birth in April 2003. Since then, the ceaseless waves of complaints have flooded almost every ear that will listen. As late as last month, complaints were still rolling in at ConsumerAffairs.com.
“In August 2007 I started the layaway process with the infamous Blue Hippo company,” Roberto, of San Leandro, told ConsumerAffairs.com. “When I spoke with the sales rep I was quoted a computer at $1,700. This included shipping and all accessories and taxes. When I received the paper work the actual price was a staggering $2,178.”
Roberto said he was told he would receive his computer in eight weeks, but when the paperwork arrived, eight weeks had turned into 13. In mid October, still without his computer, he said he tried to cancel the deal, but a month later Blue Hippo was still sucking $79.98 from his bank account every two weeks.
Meanwhile, the state of Virginia has shut down a Blue Hippo wannabe, Financing Alternatives, Inc., after consumers complained the company took their money – allegedly for grossly overpriced computers – but provided nothing in return.
“I didn`t have the heart to tell my son it was a scam, that the money was just stolen,” Carla, of Galesburg, Illinois, told ConsumerAffairs.com. “He looked at me and said ‘no Mom, somebody wouldn`t do that.’ I said well this company did and it wasn`t just us, but many others.”
Many, many others. Virginia Attorney General Bob McDonnell says Financing Alternatives owes computers to 1,765 customers who paid in full - plus hundreds more who've made partial payments. McDonnell says Financing Alternatives and its owner George Christian owes consumers $3.3 million.
6. We’ll Buy Your Home Scams
With 2007’s subprime mortgage mess and escalating foreclosures, there’s a lot of desperation out there among some homeowners. There’s also no shortage of shady characters hoping to get rich off this misery – from mortgage rescue operations to teaser rate mortgage hustlers.
Also hoping to take advantage of the fear gripping the housing market are scammers who promise to pay cash for your house – often without even seeing it. In North Carolina, state officials say one such company making that promise to homeowners was nothing more than a scam.
Attorney General Roy Cooper said the company, Charlotte Home Solutions, promised to buy homes from people who needed to sell quickly but instead left them vulnerable to foreclosure. As alleged in Cooper’s complaint, the company convinced homeowners to sign title to their homes to a trust controlled by the partners. Because Charlotte Home Solutions didn’t assume the mortgage on the property, the original homeowner unknowingly remained responsible for mortgage payments on the house.
“This scam hurt both homeowners and people who hoped to become homeowners,” Cooper said.
7. IRS Phishing Scams
For the last few years, identity thieves have used spam “phishing” emails to trick people into revealing social security numbers and other sensitive information. While more people have become savvy to these ubiquitous emails, allegedly from banks and credit card companies, in 2007 scammers found a sure fire way to get their emails noticed. Hardly anyone, they discovered, disregards a notice from the feared Internal Revenue Service.
In May, the IRS warned consumers about an e-mail scam intended to fool people into believing they are under investigation by the agency’s Criminal Investigation division. The e-mail purporting to be from IRS Criminal Investigation falsely states that the person is under a criminal probe for submitting a false tax return to the California Franchise Tax Board.
The IRS does not send out unsolicited e-mails or ask for detailed personal and financial information. It dealt with new variations of the same email scam for much of the year.
“Everyone should beware of these scam artists,” said Kevin M. Brown, Acting IRS Commissioner. “Always exercise caution when you receive unsolicited e-mails or e-mails from senders you don’t know.”
