Two tech support companies have agreed to pay $26 million to settle Federal Trade Commission (FTC) charges that they duped poeple, particularly older adults, into spending tens of millions of dollars for computer repair services under false pretense.
Cyprus-based Restoro Cyprus Limited and Reimage Cyprus Limited allegedly tricked people into signing up for the services after falsely claiming that the user's computers had viruses or other serious problems.
“These companies used scare tactics and lies about threats to consumers’ personal computers to bilk consumers, particularly older consumers, out of tens of millions of dollars,” Samuel Levine, FTC Bureau of Consumer Protection director, said in a statement. “We have taken decisive action to halt this scheme and return money to consumers.”
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
If you believe you were affected by this particular scam, hold tight. The proposed order must be approved by a federal court before it becomes effective. The FTC said it intends to use the $26 million fine to help compensate those affected by the scheme.
Fake pop-up warnings
According to the FTC, the companies "lured or alarmed" consumers by using fake Microsoft Window pop-up warnings indicating that their computers or systems were infected with viruses and urging them to scan their computers to avoid damage. Following the scans, the companies urged people to buy their software, which ranged in price from $27 to $58, to "fix" the issue, the FTC said.
"Regardless of the actual health of the consumers’ computers, the companies’ scans typically identified purported serious issues that needed immediate attention," the agency said.
After purchasing the software, people were then told to call a software activation number, in which sales agents urged people to buy more services for hundreds of dollars for the fix.
How to avoid getting scammed
According to a recent FTC scams report, people lost more than $10 billion through scams in 2023, a 14% increase from the year prior. Another 2021 FTC report found that older adults are targeted, accounting for 40% of all fraud reports in 2020.
The FTC’s scams website provides guidance on how to avoid a scam. Scammers use tactics such as claiming that there is a problem when there isn’t one, and pressuring users to act swiftly to avoid further damage.
If you believe you were scammed, the FTC recommends following a cautious set of protocols and reporting those organizations through this platform.
RELATED CONTENT
-
It's Not Too Late for Wealth Advisers to Participate in the Silver TsunamiWith so many business-owning Baby Boomers set to retire, wealth advisers need a plan to ensure their business-owning clients and prospects become and remain their best clients.
-
Are AI Search Results Ghosting Your LinkedIn Posts? This Could Be WhyPosts generated by AI don't hold enough authority with AI search engines to significantly boost your visibility (yes, that's ironic!). Here's what you can do instead.
-
The $2.5 Billion Amazon Settlement: Key Dates, Claim Eligibility and MoreAmazon agrees to a historic $2.5 billion settlement over its Amazon Prime memberships. Here's what you need to know about the case and filing a claim.
-
Passive Income: How the Ultra-Wealthy Build Wealth While They SleepHow the wealthy create passive income streams that keep paying long after the hard work is done.
-
The Tax Trap Snares Many Business Owners: A Financial Pro's Guide to 11 Strategies You May Be MissingPoor tax planning means many business owners are leaving money on the table for the IRS. This detailed guide from a financial adviser highlights strategies you may not be aware of.
-
Want to Shave 10 Hours Off Your Workweek? A Startup Expert Shows How AI Can HelpArtificial intelligence is overhauling how companies operate, freeing up entrepreneurs and their workers to skip the menial stuff and get down to business.
-
How Five Retirees Turned Their Passion into a BusinessFor these entrepreneurs, later life has little to do with winding down. Find out how they turned hobbies and passions into businesses — and how you can, too.
-
Five Key Wake-Up Calls for Ambitious Business Owners, From a Biz SpecialistYour personal financial plan needs to include a formal exit strategy for your business, or you could be in trouble.
