If having the latest cell phone, laptop or tablet computer is your goal, you may have listened with interest to some stores’ advertised promises to buy back your gadget so you can upgrade quickly.

Better Business Bureau of Southern Arizona advises consumers to investigate the offers carefully before signing up or paying a fee. The plans are basically a form of insurance that allows you to trade in a gadget in good condition toward another product. However, the value may be less than you expected or it may be hard to qualify for the buyback if you don’t follow specific directions as required in the plan.

“Consumers who have to have the most sophisticated gadgets as part of their job or their lifestyle may find value in these offers,” said Kim States, BBB President. “But you have to balance the cost of the plans against what you may actually get back if your item isn’t in tip-top condition when you trade it in.”

The New York Times recently reported that many of these plans come with high price tags, and their value drops sharply if you don’t trade in the old item within a short period of time – often less than a year. It could take longer than that for the new version to arrive on store shelves.

BBB offers the following tips for consumers who may be considering a buyback plan:

• Consider the buyback plan as a form of insurance. The plans basically guarantee a resale value, but that value can drop off sharply over time. The true value may be nominal and may be hard to define, so make sure you read the fine print.
• The plans have the retailer’s interest at heart. When you bring back your item, you usually will be issued a gift card good only at that retailer, essentially locking you in to that store for the next technology purchase. In some states, consumers also have found that they have to pay sales tax as many as three times – for the original purchase, when they return the item and again when they use the gift card.
• Buyback plans don’t work if you’re forgetful or disorganized. Many plans require you to return the original purchase receipt, power cords and manuals. If you don’t have them, you may not be able to get as much trade-in value for your gadget.
• Mobile phone contracts are excluded. You may be able to upgrade your cell phone with a buyback program, but you will still have a contract with the cell phone service provider who may bill you for the life of the contract. Find out whether the service contract can be transferred to a new phone.
• Erase any personal data before returning your gadget. To avoid identity theft, make sure that the memory of the gadget is wiped clean before you turn it in. Otherwise, computers and even cell phones can contain sensitive information that could be used to commit identity theft.
• Consider reselling gadgets elsewhere. Some consumers have found that they can get more out of their gadgets by reselling them than by trading them in. Online auction or classified ad sites may be a better way to get some value out of your gadgets.

For more consumer tips or to check a company’s BBB Business Review, go to www.tucson.bbb.org or call (520)888-5353.  

Consumers across the nation have filed complaints with Better Business Bureau about a group of Connecticut-based companies involved in advance fee loan scams – loans that require upfront payment of fees in order to secure credit.

According to complaints filed with Better Business Bureau this spring, victims across the country lost an estimated quarter of a million dollars to phony lenders who took their money and ran, leaving the applicants in an even worse financial situation than they began with.

That is what happened to an East Haven, Connecticut man who wired more than $1,200 as a security deposit to a company calling itself Mont Samson Financial, for a $20,000 loan.

Despite recent improvements in the economy, lending standards remain stringent, leading cash-strapped consumers to turn to fraudulent lenders who promise loans regardless of the applicants’ credit history.

Complaints received by BBB are likely to be only the tip of the iceberg, according to Connecticut Better Business Bureau President, Paulette Scarpetti.

“We know from experience that the victims who file complaints with BBB represent a vocal minority, and that many other consumers across the nation may be falling prey to these schemes,” she said. “The worst part is that people being targeted are already suffering tremendous financial hardship.”

BBB recently received complaints about advance fee loan scammers that create, steal or modify more than 75 different company names for their operations, including Acclaim Equity Group, American Linx Financial, Capital Alliance Financial Group, Hartford Financial Services, Hazelton Financial, Howard and Clark Financial, Mont Samson Financial, Transgroup Services and Trillium Investment Lending, among others.

Advance fee loan scammers are known to illegally use names or slightly altered versions of names of legitimate companies to lend credibility to their sales pitches.

Most victims stumble upon advance fee lenders online in classified ads on sites such as craigslist.com, or in local Thrifty Nickel publications.  Advance fee loan operators try to stay a step ahead of legal action by putting up Web sites for limited periods, taking them down within a few weeks and replacing them with a new site under a new name and fake business address.

The Web sites look professional and often require the victim to fill out an application form that asks for bank account and Social Security numbers. The applicant eventually is told the loan is approved and required to pay thousands of dollars in upfront fees, supposedly to cover the cost of loan insurance and as collateral.  The victim never receives a loan and may even be tricked into paying the scammers even more money.

BBB advises cash-strapped individuals and small business owners to recognize the red flags of an advance fee loan scam

• The lender has a bad reputation—or none at all.  Research the lender thoroughly online and with your BBB. Most trustworthy lenders have an established track record; be wary if you can’t find much information about the lender online.
• The lender is not registered to do business in the state. Check with state financial or banking regulators.
• The lender asks you to wire money or send a money order before you can receive the loan. If you are instructed to wire money to another country consider this yet another red flag.

If you’ve become a victim of an advance fee loan scam, contact BBB by calling (520)888-5353 or visit, www.tucson.bbb.org, and report the incident to your police department. If you were asked to wire money to Canada, file a complaint with Canadian law enforcement by calling toll free: 1-888-495-8501 or e-mail: info@phonebusters.com.

A company that markets itself as a leader in the timeshare resale business and boasts relationships with some of the world’s most prestigious corporations, also claims a strange address in downtown St. Louis – the long-vacant and padlocked LaSalle Building at 509 Olive Street.

The company, Property Experts Marketing, appears to be among a group of bogus businesses that promise to sell vacation timeshares in return for advance fees, but then do nothing.

Better Business Bureau warns that Property Experts Marketing and similar enterprises are set up solely to steal money from unsuspecting consumers. Many use fabricated, or “ghost” addresses to make them appear more legitimate.

A Texas truck driver told BBB recently that he paid Property Experts Marketing $6,300 to market and sell a portion of his timeshare.  Despite repeated promises, the company has yet to sell the timeshare.
Kim States, BBB President, said unscrupulous businesses can take thousands of dollars from timeshare owners before they realize they have been duped.

“These are slick, sophisticated operators who go to great lengths to make themselves look legitimate to potential timeshare sellers,” States said.  “In this case, they went as far as faking an address in the heart of downtown St. Louis.  The only problem is that they chose a deserted office building with no electricity and no running water.”

Even after a BBB investigator told a representative of Property Experts Marketing that he had visited the locked and deserted office building earlier that day, the representative insisted that the company had a suite on the seventh floor of the building.  The man said he was speaking from a phone inside the Olive Street office.  Asked if he would be willing to meet a BBB representative at the building, the man replied, “well, actually I am leaving right now.”

The timeshare owner from Converse, Texas, said he was solicited by phone several weeks ago by a man representing himself as an agent with Property Experts Marketing.  The agent told him that he could sell a portion of his timeshare for $27,000.  All the company asked, the agent said, was that the owner pay (more…)