QC residents get lessons on avoiding scams

A Quad Cities crowd on Monday night, March 4, heard heart-breaking stories of Iowans being conned out of money from scammers. Some of those stories included: Martha Jo Ennis, a retired teacher from Marion, was conned out of more than $1 million in a Ponzi investment scheme. Another Iowa woman was convinced to withdraw $40,000 […]

A Quad Cities crowd on Monday night, March 4, heard heart-breaking stories of Iowans being conned out of money from scammers. Some of those stories included:

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• Martha Jo Ennis, a retired teacher from Marion, was conned out of more than $1 million in a Ponzi investment scheme.
• Another Iowa woman was convinced to withdraw $40,000 from her bank account. (The criminals also told her not to tell bank officials why she needed the money and lied to her that they were investigating the bank.)
• A teacher from Boone, was told she had to pay $12,000 because police were investigating her as part of a child porn ring.
• A DeWitt man was convinced he had to pay federal officials money or he would be arrested. A caller informed him that he was the subject of a  Drug Enforcement Administration (DEA) investigation and convinced him to take money to a Davenport location and convert $42,000 into Bitcoin. The man had second thoughts and hung up on the caller. A few seconds later, he received another call. This time, the caller ID came up as the Davenport Police Department and the caller said he was a Davenport officer and told the man if he didn’t make the financial transition he would be arrested. The man sent the money.

Their stories were all part of an educational seminar called “Stop the Scammers Roadshow” held Monday night at the RiverCenter in Davenport. The event is part of an 18-stop, fraud prevention and educational tour. It is a new collaboration between the Iowa Department of Insurance and Financial Services, the Iowa Attorney General’s office, and AARP Iowa. The campaign aims to educate Iowans about the types of scams that flow through communities every day and how they can protect themselves.  “I’ve seen so many very large losses. … These scams can be devastating to the entire family,” said Doug Ommen, Iowa Insurance commissioner, and one of the event’s presenters.  He added that one of the tour’s top goals is to educate people and “help prevent scams instead of picking up the pieces” after people have been conned out of their money. During the presentation, Mr. Ommen and Al Perales, an investigator with the Iowa Attorney General’s Office, told a crowd of more than 100 people about the latest trends in scams, and shared many examples of Iowans losing money to the scams and the steps people should take to avoid falling victim to scams. “These scams are evil and ruin lives…. These are not the Andy Griffith days,” Mr. Perales said.  He also told the crowd of a scam that targeted one of his neighbors in Tipton, Iowa. The incident began when the man paid $500 to have his computer fixed. Months after that, he received a call and was told he actually owed $5,000 for the computer services. If he didn’t immediately pay, he would be taken to court. Mr. Perales told his neighbor that it was a scam and not to pay. He didn’t pay, but it was also apparent the scam incident took a heavy emotional toll on his neighbor, the investigator told the crowd. One of the most common scams that targets the emotions of older Iowans is the “Grandparent scam.” This is used to coerce money from older people when con artists pretend to be a grandchild calling from a foreign country and in desperate need of money to get out of jail or for some other urgent need. This scam is getting even more convincing because criminals are using AI technology to mimic a grandchild’s voice over the phone, said Mr. Ommen. “AI can be a wonderful tool. But, it’s also another opportunity used by scammers,” he told the QCBJ before Monday’s presentation. When asked who in the audience has been targeted by the “Grandparent scam,” at least 10 people raised their hands. The two presenters said that criminals are putting together better scams because they now have much more information about potential victims. Much of that information comes from social media and other sources that are just a click away on the computer.  “There’s no such thing as ‘cold calls’ anymore. … Scammers have so much information,” Mr. Ommen said. He added that he hopes the people in the audience take away these messages from Monday’s presentation:

• Always double check. If a person calls and wants money, hang up the phone and call a trusted advisor. He added that Iowans’ reputation for being nice people – called “Iowa nice” – is one of the reasons scammers target people in the state. Mr. Ommen said it's OK to say no and hang up the phone.
• Report scams. People can report scams by sending emails to [email protected] or by calling (515) 281-5926 or (888) 777-4590.
• Never judge a person’s integrity by the sound of his or her voice on the phone. Scammers know how to sound friendly in order to gain your trust.
• Take your time. Take the time to research, get advice, and learn more about investing. 
• Watch out for “reload” scams. If you lost money once, don’t let scammers trick you into trying to recoup the money.
• The presenters on Monday also recommended that participants contact the three major credit bureaus – Equifax, Experian and TransUnion –  and put a freeze on their credit. This will keep criminals from approving any new credit account in your name.

One of the people who reported being scammed is Ms. Ennis, the retired teacher from Marion, who lost more than $1 million in an investment fraud case. Mr. Ommen told the crowd on Monday that she has allowed her name to be used at educational events in hopes that other people will not fall victims to scams. The retired teacher lost almost everything – her retirement money and money from the sale of her family farm – to a Ponzi scheme.  The scheme was orchestrated by Noah Aulwes, former owner of Covenant Advisors of Cedar Rapids. Mr. Aulwes pleaded guilty to theft in the first degree, securities fraud and money laundering and received a prison sentence of up to 10 years and ordered to pay restitution. Victim impact statements read during court hearings stated Mr. Aulwes preyed on retirees, using charm and Christianity to get a foot in the door and gain victims’ trust. “She had doubts about (the investment), but still trusted the guy,” said Mr. Ommen. He added that Ms. Ennis could have avoided being conned by contacting the Iowa Department of Insurance and Financial Services and asking one question: Do you have any complaints against this investment company? In the fight against investment scams and other con games targeting Iowans, there have been successes. In fact, Mr. Ommen pointed out that the meal being served to the audience on Monday did not come from Iowa taxpayers; the meal was paid for through fines and penalties from convicted scam artists. However, there are relatively few success stories when it comes to convicting scammers. Mr. Perales said there is a “very, very low” success rate in getting many scammers. Mr. Ommen said that “success is higher” when it comes to convicting investment scammers, but added: “For some of these frauds, there is really never justice.”