Telemarketing Scam Poses Under Healthcare Guise in La.

September 17, 2003

Insurance Commissioner Robert Wooley says at least two Louisiana victims have been claimed by a quasi-health insurance telemarketing scam that has been spreading across the United States and Canada. Confirmation of two victims in central Louisiana prompted the Fraud Units of the Department of Insurance and the State Police to investigate the matter, Wooley said.

Wooley explains that the product being pitched is a policy or discount card that supposedly will save the victim, often an elderly person, a lot of money on health care costs. What makes the success of this scam so alarming is that it follows that same old pattern that we have repeatedly been warned against. “The scary part is that people who have grave concerns about an issue that impacts their personal lives continue to fall for these age-old schemes,” Wooley says. “This one works because people have concerns about being able to continue to cover the rising costs of health care. We need to keep reminding people that they should never give out sensitive information, such as bank account numbers, to anyone they do not know, especially over the telephone.”

The scam starts with a contact, most often a phone call, from a telemarketer who is with an outfit that usually has Global in the title, such as Global DHB. The exact nature of the product being sold varies, but often takes the form of a medical discount card. The caller convinces the victim that a small amount of money drawn from the potential victim’s checking account monthly will pay for this cost-saving product. Even better, there is a full money back guarantee if the individual is not completely satisfied. All he or she has to do, the telemarketer explains, is to provide a checking account number. The $349 cost for the product will then be deducted from the victim’s bank account in small monthly installments, the caller explains. One central Louisiana victim was alerted to the scam because the first bank draft drawn on the account was for the full $349. The alarmed victim tried to cancel the agreement, as directed, but was unsuccessful. Needless to say, the discount card was also bogus.

“We’ve been watching this scam as it has operated in seven or more states and Canada,” Wooley said. “Now that we have known victims here, we must assume that the perpetrators are actively seeking other victims in the state. I urge anyone who has been contacted about a health insurance savings scheme such as the one described here to contact the Louisiana Department of Insurance, toll-free, at 1-800-259-5300, or in Baton Rouge, at 225-342-5900, and ask to speak with someone in the Fraud Unit,” he said.

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