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May 11, 2005

'Deaf' Phone Calls Bilk Businesses Out Of Money

From: WBAL - Baltimore,MD,USA - May 11, 2005

BALTIMORE -- Innovative scam artists have a new way of shopping for victims by pretending to be deaf to dupe Maryland businesses out of tens of thousands of dollars.

WBAL-TV 11 News I-Team reporter Barry Simms said women's clothing store M. Randall and Company has been in business in Easton for 12 years and it isn't unusual for customers to place orders by phone. But last November, Marc Del Pino wasn't sure if a large phone order was a blessing or a joke.

"I laughed at him at first until I got it approved," Del Pino said.

Simms said it was a $3,400 credit card transaction, and once it was approved, all seemed good.

"I didn't get a feel for it," Del Pino said. "I didn't feel I was being ripped off."

In fact, Del Pino received three more orders by phone totaling more than $12,000 and shipped the merchandise to Nigeria before he discovered the caller had used stolen credit cards.

Simms reported that what was so unusual about the story is the way the orders came in. Del Pino never spoke directly with the purchaser; instead, he spoke to an operator used by deaf consumers to help them shop.

The service is called Internet Protocol Relay. Federal investigators now know that criminals are finding IP Relay an easy way to shop for new victims.

In Maryland, IP Relay is supposed to work like this: the deaf customer types a message to the relay operator. The operator calls the business and reads the message. The business responds. The relay operator then types a response back to the deaf customer. But by law, the operators aren't allowed to reveal information that would disconnect the sale -- even if they feel there's a scam going on.

"In many cases, the subjects are trying multiple credit cards to see if they will work, so the operator will be putting credit card number after credit card number to see if it hits and quickly recognize it's a scam," said FBI Internet Crimes Agent Dan Larkin.

Merchants like Del Pino don't find out it's a fraudulent sale until weeks later.

Simms reported this scam has affected small businesses here on the eastern shore, in Baltimore and across the country and those business owners who have been targeted find they have no recourse. He said they have to recover the costs.

Del Pino thought he had fraud protection from the credit card company, but it was voided because there was no customer signature and no way to prove he talked to the real card holder.

"I think I'm abused by both sides of the fence," Del Pino said. "I'm the one who ends up with nothing."

Except, Simms reported, the $16,000 he now owes the credit card company.

Over the past year, federal agents have seized more than $1 million worth of merchandise and made 17 arrests in Nigeria and Ghana.

The I-Team contacted AT&T about the scam. The company said the IP Relay service is for use only within the United States and it's trying to keep some calls from reaching operators by blocking IP addresses from foreign countries.

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