If getting your finances in order tops your list of New Year’s resolutions, you are in good company. Taking steps to better manage your money is a perennially popular resolution. Financial scammers know this and often ramp up their efforts to target new victims this time of year.
Each year, Hanson & Payne’s team of experienced Milwaukee area bankruptcy attorneys sees an uptick in the number of potential clients taken advantage of by scammers promising to help them get out of debt. Sometimes the scammers will take your money and run. Other times, they will fool you into thinking they are working hard on your behalf so you keep paying them. Meanwhile, they are pocketing your cash while you fall further and further into debt.
These are some of the red flags to look for so you don’t get scammed:
- A debt relief company that demands upfront payment before it will do any work on your behalf. Many times these advisers will take your money and run.
- Companies or advisors that want your credit card or bank account information before they will explain what sort of work they can do on your behalf.
- Companies or advisors that ask you to fill out a third-party authorization form or power of attorney document.
- A debt relief company that guarantees it can eliminate or reduce your debt in a very specific period of time. There is no set timetable for this sort of work. It is often very time-consuming, and never guaranteed to be successful.
- Advisers that tell you to cut off communication with your creditors. This should only be done after you have started to work with a bankruptcy attorney, who will talk to your creditors on your behalf.
- Using high-pressure sales tactics to make it seem like you will miss out on an opportunity if you don’t agree to work with them right away.
- Companies with pompous-sounding names that send you letters with fancy seals and logos.
- Websites, letters, emails, or texts with spelling or grammatical errors throughout them can indicate the person who wrote them is a scammer.
If someone uses one of the tactics above on you, you should consider reporting them to the Federal Trade Commission at ReportFraud.ftc.gov.
In addition to watching out for these red flags, the best way to avoid getting scammed when looking for financial advice is to work with a certified financial planner or seek credit counseling from one of the credit counselors approved by the bankruptcy court to serve debtors in the Eastern District of Wisconsin. Working with one of these approved credit counselors has the added benefit of giving you a bit of a head start on the bankruptcy process if it turns out that bankruptcy is your best path forward. All filers are required to go through court-approved counseling before the bankruptcy court will hear their case.
If it seems like bankruptcy may be the best option for you, or you have questions about bankruptcy, the Hanson & Payne team is here for you. We help Milwaukee area residents, businesses, and creditors navigate the bankruptcy system. Please contact us today to schedule an initial consultation.