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OFIR Scam Alert: Fake Insurance Company Checks Are a Scam


Consumers should contact OFIR if they receive what appears to be a $4,900 check from Allstate Insurance


FOR IMMEDIATE RELEASE
April 21, 2010
OFIR Contact: Jason Moon 517-335-1700;
http://twitter.com/midifs

Allstate Contact: Karen Spica 248-994-9390

LANSING – The Office of Financial and Insurance Regulation (OFIR) and Allstate Insurance Company announced today that they are working together to warn consumers of an international mail fraud scheme. An OFIR employee received a counterfeit check that appeared to originate from Allstate. The fraudulent check was issued for $4,970.20 and came with a letter informing the recipient that they won a $250,000 “Consumer’s Promotion Draw” for consumers who shop at a number of the nation’s major stores. The letter also explains the $4,970.20 check was issued to cover the “Non-Canadian Residential Tax” the consumer will have to pay to a tax agent. The consumer is also expected to pay $200 in insurance and delivery charges. The individuals sending these letters and counterfeit checks have no affiliation with Allstate and are illegally using the company’s name.

Recipients are told that to receive the $250,000 prize, they must cash the check and then send $4,770.20 by Moneygram or Western Union to an address located in Tacoma, WA. If a consumer were to cash the phony check, they could find themselves owing their bank more than $4,900.

“This is a classic advance fee scam where consumers are enticed into paying upfront fees for a prize they never get in return. The twist here is the scammers are trying to fool consumers by using the good name of an insurance company,” OFIR Commissioner Ken Ross said. “If an offer sounds too good to be true, it probably is.”

OFIR provided the following tips to consumers to help them avoid falling victim to this type of scheme.

  • Be leery of checks received from companies you do not do business with. The check is most likely fraudulent.
  • If an offer sounds too good to be true, it probably is.
  • Be skeptical of any correspondence offering you the opportunity to win a large sum of money in exchange for specific information.
  • If the name of a well known company is noted on the correspondence received, contact the company to verify the legitimacy of the letter.

To view the fraudulent letter and check, visit: http://www.michigan.gov/documents/dleg/scam_letter_318549_7.pdf

Allstate had the following message for Michigan consumers:

Consumers need to be careful as these scams often fraudulently use well-known brands to lend credibility to their schemes. Allstate is one of many corporations that are unwillingly pulled into these scams and whose good names are used to deceive consumers. Besides sharing information about this and other scams with its agents and employees, Allstate also has a special consumer protection section on their Web site - http://www.allstate.com/consumer-fraud-protection/main.aspx - where consumers can check on current scams and review tips on how to avoid being a victim. This particular scam is posted and our priority is making sure consumers are protected and aware that this mailing is not legitimate and is not authorized by Allstate.

Customers should always feel free to contact their agent or 1-800-Allstate if they have questions about a mailing they receive bearing the Allstate name. We also encourage consumers to report this to their local law enforcement. Allstate is looking into the matter further to see what we can do to help bring this to the attention of the proper authorities. 

Michigan consumers who receive or have received what appears to be a $4,900 check from Allstate should immediately contact OFIR toll-free at 877-999-6442 and the agency can direct their call to the proper authorities.

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