CUNA Presses Feds For Help On Phony CU Scam
Spurred by the growing number of fake credit unions being advertised in newspapers by scam artists, CUNA is urging the Attorney General of the United States and the Federal Trade Commission to lead a crackdown.
The scammer or scammers, who have yet to be identified, have placed newspaper ads in at least a dozen states-Wisconsin, Utah, Pennsylvania, North Carolina, Michigan, Missouri, Washington, Indiana, Ohio, California, Colorado and Alaska-offering "hassle-free loans" to borrowers. Those who call the phone numbers in the ads hear an electronic menu of options, and are asked to wire an advance payment on the loan to an address in Canada through Western Union. The ads include the logos of CUNA's "America's Credit Unions" campaign and that of NCUA. The name used most frequently in the ads is "Century Credit Union," but the names of other credit unions have also been used both in print and online. Scammers have used addresses similar to that of existing credit unions to give the appearance of legitimacy.
As reported in The Credit Union Journal August 11, one of the first issues credit unions confront when they discover their own identities have been hijacked is whom to contact for help.
Now CUNA is turning to federal authorities for help. "In our opinion, inducing innocent victims to send funds in interstate or international commerce to a nonexistent financial institution, and then stealing those funds, violates a number of federal criminal and civil statutes and is appropriate for attention by your Department," CUNA President and CEO Dan Mica wrote in the letter to U.S. Attorney General John Ashcroft.
Mica requested that the Department of Justice, including the FBI, "bring their resources to bear upon this problem, to identify and prosecute the parties creating this fraud."