Scammers targeting victims in and out of disaster zones after recent hurricanes, earthquakes

Be on the lookout for scammers who want to take advantage of you when donating to disaster relief charities

Hurricanes in Texas and Florida. Earthquakes in Mexico. Wildfires in the western states. Devastating natural disasters have been making major headlines in recent weeks. While the human and financial toll these disasters take is bad enough, there’s a category of scam artist that aims to add insult to injury when events like these occur: disaster scammers.

At Fraud.org, we have heard a growing number of complaints regarding three scams in particular that affect consumers both in and outside of disaster zones.

The fraudulent contractor scam

In the aftermath of a major weather event like tornadoes and hurricanes, victims understandably want to fix their homes as quickly as possible. Taking advantage of this, scammers have been known to show up on a would-be victim's doorstep and offer to start work right away. Here are some red flags to distinguish between a legitimate contractor and a scam artist looking to cause trouble:

  • A “contractor” who asks to be paid in cash. Always pay with a credit card or check. If a contractor asks to be paid in cash, it is most likely a scam.

  • A “contractor” who requests a large upfront payment. Many scammers will request to be paid upfront, and then disappear, never to be heard from again. To minimize your risk, you should try to keep your down payment to around 10 percent of the total cost.

  • A “contractor” that asks you to sign an AOB (Assignment of Benefits). By signing this document, you are giving your contractor control over your insurance policy. This allows the contractor to inflate the cost of your repairs, and could cause a drawn-out legal dispute between you, the contractor, and your insurance company.

If you find yourself in a situation where you need a home repair, follow these tips to protect yourself:

  • Verify that your contractor is properly licenced and insured to complete the work you are hiring them to do.

  • Ask the contractor for references and check consumer review websites. Former client recommendations can offer peace of mind.

  • Write down their driver’s license number and vehicle information (make, model, and license plate number) so that you are able to report them to the authorities if something goes wrong.

  • Get a written estimate and sign a contract before work begins.

  • If you are planning to have your insurance company cover the repairs, be sure to call your insurance agent and confirm that they will cover it. 

The charity scam

In the aftermath of natural disasters, many “charities” run by scam artists pop up to take advantage of Americans’ willingness to help others. Follow these steps to steer clear of crooks looking to make a quick dollar off of your generosity:

  • Avoid charities that seem to have sprung up overnight in response to a disaster. Instead, give to charities with a proven track record of helping natural disaster victims.

  • Make sure the charity you are donating to is legitimate. You can do this by checking out websites like Charity Navigator,Charity Watch, orGuideStar. There you can find information like tax records that explain what the charity does, how long they’ve been doing it, and who their head employees are.

  • Pay by credit or debit card. That way, if the charity turns out to be a scam, you can dispute the charge.

  • If you receive a solicitation from a group fundraising on behalf of another organization, be sure to ask what percentage of a donation is kept by the fundraising organization. If the caller is unable or unwilling to provide that information, or if the fee seems unusually high, it could be a scam. 

The storm-damaged used car scam

Vehicles damaged by floods and hurricanes are often cleaned up and shipped across the country to be re-sold by unscrupulous car salesmen. While these cars may look and run fine at first, flood damaged vehicles often have malfunctioning airbags or hidden rust and mold problems, and may not run properly in the long term. To protect you and your family from this scam, follow these steps:

  • Check the vehicle history report through a trusted source like the National Insurance Crime Bureau’s free database.

  • Look for signs of flooding like water stains in the glovebox or fogging inside headlights and tail lights.

  • Consider the smell of the vehicle. While a mildew smell is a definite red flag, a heavy disinfectant smell should also set off your alarm bells, as these heavy-aroma cleaners can be a sign that someone is trying to hide mold.

Natural disaster scams come in many forms and can be difficult to spot. If you think you may have come across a scam intended to take advantage of a natural disaster victim, let us know! Please file a report at Fraud.org via our secure online complaint form. We’ll share your complaint with our network of law enforcement and consumer protection agency partners who can investigate and help put fraudsters behind bars.