Senator Jeff Klein warned New Yorkers to be on high alert for financial schemes during these challenging fiscal times. Joined by a Bronx couple who almost fell prey to a Canadian lottery scam, the Capizuttos, Klein exposed the fraud which is currently being investigated by Canadian Authorities.
“The bottom line is that people throughout this state are struggling financially and promises of monetary rewards are appealing. But please be aware – that if it sounds too good to be true it likely is,” said Klein.
Last month, James Capizutto received a letter from “Summit Financial Investments” along with a check for $4,700. The letter said that he had won $250,000 in the Canadian Lottery and stated that in order to claim his reward he had to first – deposit the check in his name and second – send a “money gram” for around $3,000 back to Summit Financial Investments in Ontario Canada to cover the tax due on the winnings. Mr. Capizutto smelled something fishy and contacted Senator Klein immediately.
Klein’s office promptly investigated the issue and found that the Federal Trade Commission had launched a large scale investigation of this particular scam back in 2007 that targeted two businesses based in British Columbia. Those defendants were charged and the FTC asked the Canadian court to order them to provide restitution to their victims. That case was based out of the West Coast.
Klein’s staff conducted a “sting” and reached out to Summit Financial Investments twice last month. When the staff stated where they were calling from – the person on the other end of the phone abruptly hung up. After staff made a third attempt to contact the organization – this time posing as a constituent and providing the claim number from the mailing, they were walked through the process of depositing the check and assured that they would receive the $250,000.
This is how the scam works: by the time the bank realizes the check is faulty – you’ve already likely sent the money gram to Canada. So the bank would not only charge your balance for the bad check but additional penalties and fees – leaving you out of thousands of dollars.
Klein urged New Yorkers to report similar scams to his office.