Filed under: Cards, Ripoffs and Scams, Fraud

Last week, police busted a woman working at a Wendy’s restaurant for credit card fraud.

They say that when customers in the drive through used a credit card to pay for their food, she would swipe their cards through a credit card reader that captures all the card’s information. She would take the tiny reader home and download all the data to a laptop computer for her own use. Police say she was making fake credit cards with customers’ real data and going shopping with those cards, victimizing between 40 and 50 Wendy’s customers.

This is a risk any time we hand our credit cards to someone and can’t see what’s happening to it. The credit card readers (often called skimmers) are inexpensive, sometimes as cheap as $100. They can fit nicely into someone’s pocket, so whenever a server at a restaurant walks away with your card, you might be at risk.

Since it’s not always possible to keep an eye on your credit card, what can you do? The best advice is to routinely check your credit card balances online. I check mine once per day to make sure that there aren’t any unusual charges. That way, if someone has stolen my credit card information, I’ll be able to halt their theft early.

Consumers usually aren’t liable for fraudulent charges on their credit cards, but it still pays to cease these crimes swiftly. It will be much easier to clean up the mess if it’s smaller. And by stopping the thief, you save all consumers money…. their theft is paid for by all of us via higher fees and rates.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Bookkeeping, and is the author of Essentials of Corporate Fraud.

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Filed under: Ripoffs and Scams

To many “Prosperity Theology” or “Prosperity Gospel” represents nothing more than praying to God for money. The prosperity doctrine is gaining in popularity thanks to engaging televangelists like Joel Osteen and books and movies like “The Secret.”

Believers in this doctrine often preach that those whose finances are bad just haven’t had enough faith in God. Those who can’t seem to lose weight just aren’t praying hard enough and thinking thin thoughts. You can have anything you want if you pray hard enough and believe that you can have it.

But that amounts to blasphemy for many devout followers of God and the Bible. People don’t become sick because they lack faith in God. Hard times don’t come upon us because we don’t believe in God enough or want prosperity enough.

Add to this the fact that the high-profile evangelists are often seen raking in millions of dollars, and you’ve got a huge problem on your hands. Aren’t those evangelists proof that God blesses the faithful with money? Those on the other side state the evangelists are exploiting the weak and vulnerable with this “you can have it all” gospel. People want to believe that their lives can improve, and exploiting religion in this regard is one of the oldest tricks in the book.

Beware: These sketchy teachings go by many different names, including health and wealth theology, prosperity gospel, word of faith, name it and claim it, and many others. Yes, God will bless those who live right and believe, but prosperity theology takes the Bible out of context and misleads believers.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Record-keeping, and is the author of Essentials of Corporate Fraud.

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Filed under: Cards, Ripoffs and Scams, Fraud

Last week, police busted a woman working at a Wendy’s restaurant for credit card fraud.

They state that when customers in the drive through used a credit card to pay for their food, she would swipe their cards through a credit card reader that captures all the card’s information. She would take the little reader home and download all the data to a laptop personal for her own use. Police say she was making fake credit cards with customers’ real data and going shopping with those cards, victimizing between 40 and 50 Wendy’s customers.

This is a risk any time we hand our credit cards to someone and can’t see what’s happening to it. The credit card readers (often called skimmers) are inexpensive, sometimes as cheap as $100. They can fit nicely into someone’s pocket, so whenever a server at a restaurant walks away with your card, you may be at risk.

Since it’s not always possible to keep an eye on your credit card, what can you do? The ideal advice is to routinely check your credit card balances on the web. I check mine once per day to make sure that there aren’t any unusual charges. That way, if someone has stolen my credit card information, I’ll be able to cease their theft early.

Consumers usually aren’t liable for fraudulent charges on their credit cards, but it still pays to stop these crimes quickly. It will be much easier to clean up the mess if it’s smaller. And by stopping the thief, you save all consumers money…. their theft is paid for by all of us via higher fees and rates.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.

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Filed under: Ripoffs and Scams

To many “Prosperity Theology” or “Prosperity Gospel” represents nothing more than praying to God for money. The prosperity doctrine is gaining in popularity thanks to engaging televangelists like Joel Osteen and books and movies like “The Secret.”

Believers in this doctrine often preach that those whose finances are bad just haven’t had enough faith in God. Those who can’t seem to lose weight just aren’t praying hard enough and thinking thin thoughts. You can have anything you want if you pray hard enough and believe that you can have it.

But that amounts to blasphemy for many devout followers of God and the Bible. People don’t become sick because they lack faith in God. Hard times don’t come upon us because we don’t believe in God enough or want prosperity enough.

Add to this the fact that the high-profile evangelists are often seen raking in millions of dollars, and you’ve got a large problem on your hands. Aren’t those evangelists proof that God blesses the faithful with money? Those on the other side say the evangelists are exploiting the weak and vulnerable with this “you can have it all” gospel. People want to believe that their lives can improve, and exploiting religion in this regard is one of the oldest tricks in the book.

Beware: These sketchy teachings go by many different names, including health and wealth theology, prosperity gospel, word of faith, name it and claim it, and many others. Yes, God will bless those who live right and believe, but prosperity theology takes the Bible out of context and misleads believers.

Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Bookkeeping, and is the author of Essentials of Corporate Fraud.

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Filed under: Banks, Borrowing, Debt, Real Estate, Ripoffs and Scams

While I can’t guarantee that there won’t be any exotic mortgages lurking out there in 2008, they’ll be rare and hard to find. You also will need to have stellar credit ratings to qualify for exotic mortgages, because investors have pretty much dried up. The risks of loss are just too high for most mortgage investors.

When exotic mortgages were at the top of their game in 2005, lenders made about $625 billion in subprime loans, and most of these fit into the category of exotic mortgages. Essentially any mortgage that can’t be sold to Fannie Mae and Freddie Mac because it doesn’t meet their prime lending terms gets categorized as subprime, even if the borrower is also a candidate for a prime loan. In 2005, about $625 billion of subprime loans were funded. In 2007, that number will drop to about $50 billion, or just about 2% of the mortgage market.

Don’t anticipate to find option ARMs, 0% down mortgage loans (especially if it’s an investment property and not your primary home), and ridiculously low teaser rates that jump dramatically in two to three years. Also, many of the balloon loans will be shut out except for those with strong credit histories.

The folks who likely will be hardest hit with this change in market conditions are people who are self-employed and have a difficult time proving income. No doc loans will be hard to find, and probably the rules for getting approval will be very stiff.

Many exotic loans helped to introduce the term upside-down mortgage, which used to be solely for vehicles when the car was worth less than the loan amount due. With people putting 0% down, and in some cases not even paying all the interest due, mortgages quickly became upside-down as the real estate market weakened.

Good riddance to exotic mortgages, and I hope for the sake of American consumers they never come back.

This post was written as part of a series on on 2007 departures. Read about more products, companies and people you won’t see in 2008.

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