HE-552, Reprinted April 1998. By Fred Waddell, Extension Family Resource Management Specialist, Associate Professor, Human Development and Family Studies, Auburn University. Originally prepared by Josephine Turner, Extension Program Specialist, Professor, Human Development and Family Studies, Auburn University.

Help Stamp Out Consumer Fraud

The most effective weapon against fraud is an alert and informed consumer. To be alert and informed, you must continually remember and practice the following twelve guides:

1. Know The Seller.

Beware of the fly-by-night operator or the company without a permanent address. Be skeptical of companies whose only address is a post office box. It is usually safer to deal with a local merchant. Then, get to know your local merchant. Tell him or her of your special needs.

2. Ask Questions.

Know exactly what you are buying and what the product or service will cost. Find out about any installation charges or monthly service charges. Look for hidden interest charges in contract agreements.

3. Look For Information Or Research.

Read labels, tags, and product handbooks. Read about product performance in such publications as Consumer Reports and Consumer Research before deciding on a large purchase. You can find these in your local library. Ask people you know and trust about the product.

4. Get It In Writing.

Be sure all promises are in the written contract. Don't accept verbal agreements unless they are written specifically in the contract.

5. Investigate "Free" Or "Bargain" Offers.

No one can stay in business if he or she gives services and products away. Be sure there are no hidden tricks or conditions attached to any offer which may mean you must pay more money.

6. Read Before You Sign.

Ask for a copy of the contract to study before you sign. Don't sign a "one day only" or a "one chance only" deal. Never sign a contract that you have not read. If you are pressured into signing, this ought to be a warning signal. Stop! Think about it again. Never sign a contract with blank spaces. Always get a copy of the contract at the time it is signed.

7. Always Sleep On A Major Decision.

Making a major decision to buy because the item might not be there tomorrow is rarely a good one.

8. Beware Of Door-to-Door Salespersons.

They often use high pressure selling techniques. Remember, those who come uninvited are required to furnish you a Notice of Cancellation with your sales receipt. This notice gives you 3 days to cancel the contract, but it does not guarantee a full reimbursement.

9. Watch Out For Bait-and-Switch Sales Tactics.

This is an advertisement scheme where a product is advertised at a low price. After the customer is in the store to buy the advertised item, the salesperson tries to switch the customer to a higher priced product. This practice is illegal. You should report the salesperson and company to:

The Federal Trade Commission
1718 Peachtree Street, N.E.
Room 1000
Atlanta, GA 30308

10. Don't Fall For Referral Selling Tactics.

This scheme offers you a product for only a fraction of the cost if you will provide a list of names of friends. For each friend who buys the product, you receive a reduction in the cost of the item you bought. If the friends fail to buy the product, you are stuck with paying the full price.

11. Shop Around.

If you have questions about a business, check with the local Better Business Bureau or contact the Alabama Attorney General's Office of Consumer Protection in Montgomery. The toll free number is 1-800-392-5658 and the Montgomery number is 834-5150.

12. Complain.

If you are a victim of a fraudulent scheme, report it to the Alabama Attorney General's Office of Consumer Protection, 560 S. McDonough, Montgomery, AL 36104, or to the appropriate federal agency such as the FTC.