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.”
Sign up for Kiplinger’s Free E-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
-
Stocks Can't Hold Meta, Microsoft Gains: Stock Market TodayThe main indexes all opened higher Thursday on impressive Big Tech earnings, but momentum faded into the close.
-
Retirement Health Care Costs Are On the Rise: What You Need to KnowA 65-year-old retiree will face significantly higher lifetime health care costs than they would have a year ago, even with Medicare. Here are the surprising totals.
-
Selling Your Business? This Powerful Insurance Option Unlocks Multigenerational WealthPrivate placement life insurance (PPLI) offers almost unbelievable investment flexibility, estate planning and tax advantages. And it's completely legit.
-
Ready to Retire? Your Five-Year Business Exit StrategyIf you're a business owner looking to sell and retire, it can take years to complete the process. Use this five-year timeline to prepare and stay on track.
-
Take It From a Tax Attorney: This Is a Magic Multimillion-Dollar Tax-Saving StrategyThe qualified small business 1202 stock exemption is a $10 million exclusion that seems too good to be true and is often overlooked.
-
Integrity, Generosity and Wealth: A Faith-Based Approach to BusinessEntrepreneurs who align their business and financial decisions with the biblical principles of integrity, generosity and helping others can realize impactful and fulfilling success.
-
Three Estate Planning Documents a Business Owner Can't Afford to SkipA business owner's estate plan should protect the company and its employees as well as the entrepreneur's heirs. These three documents are critical.
-
Sam's Club Takes On Amazon Prime With Big Summer Savings — But Is It Worth Joining?With longer sales and seasonal deals, Sam's Club is making a strong case for summer value. Here's how to save.
-
Can You Be a Good Parent to an Only Child When You're Also a Business Owner?Author and social psychologist Susan Newman offers advice to business-owner parents on how to raise a well-adjusted single child by avoiding overcompensation and encouraging chores.
-
Just Sold Your Business? Avoid These Five Hasty MovesIf you've exited your business, financial advice is likely to be flooding in from all quarters. But wait until the dust settles before making any big moves.
