Rodriguez Law, P.C. is proud to announce that starting next month, on the first Wednesday of every month from 9AM-1PM, we will hold a free legal clinic specifically on fraud affecting the Latino community where victims of fraud can obtain free consultations and case evaluations in English or Spanish. Dates: June 5, July 3, August 7, September 4, October 2, November 6, December 4.
Although the types of fraudulent schemes targeting the Latino community are limitless, our experience shows the following to be some of the most common scams:
- Investment Fraud
Many of our largest cases have involved investment fraud. Although there is no limit to the nature of these schemes, the most common scams involve Ponzi schemes, promissory note fraud, stockbroker/investment advisor fraud, and non-existent business or real estate ventures.
- Wage Theft & Labor Violations
Wage theft is the illegal withholding of wages or the denial of benefits that are rightfully owed to an employee and is common in such industries as construction, restaurants, etc. Wage theft can be conducted through various means involving overtime, minimum wage violations, employee misclassification, illegal deductions in pay, working off the clock, to not being paid at all.
- Predatory Lending & Loan Sharks
Those with lower income or limited credit histories often have the most difficulty obtaining access to credit and loans. Seeing an opportunity for exploitation, companies and individuals have made an entire industry out of taking advantage of those who do not know their rights or speak English.
“Prestamistas” or loan sharks often provide loans to Latino small businesses at usurious rates, as high as 100% per annum.
- Immigration & Notario Fraud
Perpetrated by so-called “immigration consultants,” such schemes tend to increase when immigration legislation is being proposed or considered (i.e. now). The “consultants” take advantage of general awareness of possible new programs and their victims’ lack of sophistication about the legislative process.
In most Latin American countries, the term “notario” implies that the person described is a licensed attorney. A common scam involves individuals who represent themselves as “notarios” and offer help with the immigration process; in fact, these individuals are not attorneys, take your money, and falsely claim that your case is being processed.
- Employment Agency Fraud
This fraud preys upon undocumented immigrants looking for work and tends to increase when the economy is in a downturn.
In a recent report, the Federal Trade Commission has identified the following additional areas of fraud targeting the Hispanic community:
- Used Cars
Some sellers fail to comply with applicable state and federal laws, such as the FTC’s Used Car Rule (if a transaction is conducted in Spanish, the mandated “Buyers Guide,” disclosing whether the vehicle comes with a warranty or “as is,” must be provided in Spanish).
- Health Insurance fraud.
Because minimum wage earners often do not obtain health insurance from their employers, they are attracted to offers for low-cost health insurance, which may not provide the advertised benefits, if any.
- Buying Clubs (offering discounts on products and services).
For Hispanics who seek discounts and best prices, offers for buying clubs are extremely attractive. Panelists at an FTC Hispanic/Latino Outreach Forum described a Hispanic cultural affinity for “free” or discounted goods and services, and an economic need for them driven by lower income levels as a group. Buying clubs often are offered for free for thirty days, requiring the consumer to cancel before the end of thirty days to avoid being charged for the club.
- Work-at-Home Schemes.
The panelists considered this a growing problem area that particularly takes advantage of undocumented immigrants seeking an income without having a traditional employer. Tackling this fraud also poses challenges because these schemes are advertised not just in classified ads and other media, but often by signs tacked onto telephone poles.
The panelists noted that many Hispanics wire money to relatives in their home countries and that there are many problems with undisclosed fees or fees that vary from what was disclosed.
- Prepaid Phone Cards.
Problems with undisclosed fees are commonplace with these cards.