The cataclysmic turn of events in Haiti has sent shockwaves throughout the world. There is no dearth of individuals looking to financially support the monumental relief effort currently underway in the island nation. Everyone can be rest assured that there is no dearth of those gloating over Haiti's misery, either. Gangs of cyber scavengers have hit top gear and are pulling out all the stops to hoodwink unsuspecting, well-intentioned donors. Their methods may be old but still tend to yield rich dividends.

Since the vast majority of online charlatans use fake internet addresses, unsolicited emails and social networking sites to reach their prey, it is very easy to deny them by just ignoring the links and  attachments contained in them, howsoever affecting the cry for help. Some useful advice on identifying and reporting scams is available on the FBI's site. There Better Business Bureau also offers some valuable information on the subject, including a list of charitable organizations with proper accreditation, on its web site. Here is a typical scam doing the rounds in the UK.

Image Credit: Msf.org.uk

Have you been holding off on buying that new console for fear of the setup process? Does the thought of wasting a whole ten minutes of you time plugging everything in and turning it on make you physically ill? Well then, Target will totally have you covered later this month. Yes, for a mere $99 Target will come to your house and set up your console.

If you are rich enough to go for this, Target will plug in the console to your TV, configure it, put it on your network, and setup online accounts. Technically, it’s a third party, Zip Installation, that’s doing the work, but Target is putting their name on it.

At a hundred bucks, I imagine it will be a tough sell. Would you, or anyone you know pay for this service?

It’s shameful, really. And it’s a glaringly obvious reason why computer retail is dying. (R.I.P Future Shop, CompUSA, and Circuit City.) And it’s a sure sign that some of the remaining retailers could give a rat’s patootie about their customers. It’s really not a big surprise that Best Buy’s “optimization” isn’t worth the $39.99 they charge for it. Rather it’s Best Buy’s attitude about you, the computer buying public--you’re nothing but a flock of sheep to be fleeced, so let the shearing begin.

Meg Marco at The Consumerist walks us through the whole scam. Best Buy sells optimization for its computers. Optimization, it turns out, is little more than Best Buy opening the box, removing some desktop shortcuts, tweaking bits of the browser interface, and downloading/installing OS updates (which the OS is normally takes care of by itself). All-in-all, nothing your average user can’t do on their own. And, after testing unoptimized and optimized systems--surprise, surprise--optimization doesn’t do a thing to speed the computer up. (In one instance, on a Asus laptop, optimization actually slowed the system down 32 percent.)

Great, fine, it’s like extended warranties--so much money thrown down the drain--just skip it. But, in many cases you can’t. It seems that Best Buy ties attractive sales prices to pre-optimized machines. And, magically, no unoptimized machines are available. You want the sale price, then pony up the optimization fee. (Getting it waived, from buyer experiences related by Marco, is next to impossible.) Not only do you have to pay more than the advertised price if you want the advertised price, some unknown “geek” at Best Buy has opened your box and fiddled around with your computer. (Experience here suggest checking the box’s contents before leaving the store.)

This is not just hard sell. With hard sell you have a choice. But Best Buy has stacked the deck against you. And do they feel bad about promising the moon with optimization (some sales reps claiming up to 200% speed improvements), without delivering anything of tangible value? Nope, instead Best Buy blames you, the consumer. “This is about the choice," a Best Buy spokesman said. "If you don't want it, you don't have to get it." See, it’s you that’s to blame, not Best Buy and its deceptive pushing of a worthless service.

Savvy computer users/buyers don’t fall for this, of course. (Savvy computer users/buyers also don’t shop at Best Buy.) Which means Best Buy is preying upon the novice, the uninitiated. Scare tactics or trumped up, empty promises work best with this crowd. Which makes the practice all the more loathsome. Even worse, it makes no sense for Best Buy to engage in this. Best Buy purportedly wants to make more money off its service business. To make this work you have to not only treat customers right at point-of-sale, but give them a reason to come back again and again. Once people realize they were scammed, you’ve lost them (and then some). Hard to see how you build a repeat-business with this approach.

Image Credit: Ian Muttoo/Flickr

More and more it seems that e-commerce differs little from a shell game. Both have the expressed purpose of taking away my money without giving me something tangible in return. It’s almost as if my having a dollar or two in my pocket, my bank account, or on my credit limit, is too much for someone to bear--they have to find a way to separate it from me. While a traditional shell game requires my explicit participation, e-commerce doesn’t, making the task all too easy.

The tale of the scam perpetuated by affinity program hawkers Webloyalty, Vertrue, and Affinion is well known. They used a simple ploy of offering a coupon in exchange for an email address, while they were actually signing up the unsuspecting person to a web loyalty program, along with a monthly fee as high as $20. The scam was pulled off with the expressed involvement of seemingly honest web retailers, such as Orbitz, Buy.com, Travelocity, Barnes & Noble, Pizza Hut, and Priceline--who got kickbacks on each transaction. (Thanks guys, for respecting us as customers.) As many as 30 million people may have been affected.

The Senate Committee on Commerce, Science, and Transportation has been conducting an investigation into the matter, and has turned its attention to the big credit card companies: American Express, MasterCard, and Visa. Why? Because of all the parties involved they were best positioned to detect the scam and, acting on their customers best interests, put an end to it.

Credit card companies are at the forefront of the complaint process. When something that shouldn’t appears on a bill, it’s the credit card company that gets the complaint. But, the credit card company also gets to ‘wet its beak’ on all of the action--so it charges both the consumer (fees and interest), and the merchant (a percentage) for each transaction processed. The $1.4 billion Webloyalty, Vertrue, and Affinion accumulated through their bogus practice may have been just enough for the big three to turn a blind eye, despite thousands of consumer complaints. This is what the Senate Committee wants to find out.

While this particular little racket may come to an end, its unlikely those involved will get more than a slap on the wrist. And, the big players will still be there, just as unconcerned about your welfare as before. The lesson here: always carefully check your monthly statement.

Image Credit: matiasjajaja/Flickr

Apple's App Store sits about 1,000 applications lighter today, which represents about 1 percent of all apps. The reason? Apple discovered that a large iPhone developer was participating in a ratings scam, and so Apple removed the company's catalog of over 1,000 apps.

The company in question is Moliker Inc., who developed more than 1,000 titles, most of which were based on travel (such as Mobile Travel Guide). The company is accused of giving its own apps 5-star ratings to try to raise the average ratings and boost sales.

But the scam came crumbling down when one attentive user noticed a pattern in most of the reviews. Most of the apps had about 50 five-star rankings with poorly written reviews, which served as a tell-tale sign that the developer was probably using his allotment of 50 promocodes to create fake accounts and review his own apps. The user fired off an email to Apple Senior Vice President of Worldwide Product Marketing Phil Schiller, or promplty pulled all 1,011 apps from the App Store.

"Yes, this developer's apps have been removed from the App Store and their ratings no longer appear either," Schiller said.

Image Credit: ZDNet

Stuff like this is why we’re told to always be wary. Not just of strangers, it appears, but of friends as well. The Senate Committee on Commerce, Science and Transportation held a hearing on Tuesday, where it laid out the ‘questionable’ marketing practices of Vertrue, Webloyalty, and Affinion, web merchants that sign up users to “web loyalty programs,” to the tune of $9 to $12 a month, without the user being aware. How? By riding on the coattails of respected e-retailers such as Orbitz, Buy.com, Fandango, and Continental Airlines.

How’s the alleged scam work? At the end of a transaction at a legitimate web site a pop-up appears asking the user to enter an email address if they are interested in receiving cash back or a coupon. Simple enough, except buried in the fine print is enrollment in the web loyalty program, along with permission to charge the user’s credit card a monthly fee. Where’s the credit card information come from? The legitimate web site sells that information to the loyalty program. The user never knows about the transaction until a charge appears on their credit card statement. The user gets double-pwn3d: by the unscrupulous web loyalty program, and by a trusted merchant.

Overall, the Senate Committee estimates the three loyalty programs generated more than $1.4 billion from the scheme, with $792 million kicked back to the web retailers who provided the user’s credit card information. (Classmates.com, for example, raked in $70 million.)

It would be easy to lay the blame at the users feet: you really should read the fine print. (Although the vast majority of us never do.) But the Senate Committee reported that managers at Affinion, Vertrue and Webloyalty knew full well that people were completely unaware of what they were signing up for, and that their programs were specifically designed to mislead people. The ‘legitimate’ retailers who enabled this were also aware of what was going on, but turned a blind-eye because of the revenue it generated.

Webloyalty and Vertrue stated during the hearing they’ve changed their business practice, and now require additional information for enrollment. Others aren’t convinced, arguing that the only way to curb the practice is to make it illegal for retailers to sell customer’s personal information.

Image Credit: trochim/Flickr

Facebook is the king of social networking with more users than any other web 2.0 site. With all those users, it’s also an attractive place for scammers that want access to lots of eyeballs. After a few embarrassments, Facebook is promising to take a stronger stance against deceptive advertising.
 
Facebook has gotten a bit of a black eye in the press lately after some companies using the platform were accused of scamming users. These scams often come in the form of special offers and surveys within games. Facebook’s Nick Giano wrote in a blog post that the site was aware of the problem and was actively working on it.

Users of the site also encountered a rise in stimulus scam ads earlier in the year; Facebook notes that they were quickly removed from the site. Hopefully this new wave of scams can be dealt with in the same manner. Facebook claims that over 100 developer applications have already been removed or “brought into compliance" so far. Have you noticed any fishy behavior on Facebook?

As another remind that crime doesn't pay, 23-year-old Nicholas Woodhams, also known as the "iPod Mechanic," faces 13 months in prison after pleading guilty to mail fraud and money laundering charges. Woodhams was also ordered to pay $648,568 in restitution to Apple and $8,066.85 to the U.S. Postal Service, Arstechnica reports.

According to the lawsuit, Woodhams ran a scam of exploiting Apple's advance replacement system for the iPod shuffle and reselling them through his own website. He also allegedly exploited Apple's iPod Warranty Service Program to get Apple to repair out-of-warranty iPods.

Woodhams' scam proved rather lucrative, but it's all going back. In addition to the above jail time and fines, Woodhams must forfeit about $750,000 worth of criminally acquired assets, including his house in Michigan, an Audi S4, an Ariel Atom 2, a Honda motocyle, and over $500,000 in cash. Ouch.