Oct 23

New Law: Increased Fraud Protections

by Dillon Kato

A new Montana law that went into effect on Oct. 1 puts stricter penalties in place for people convicted of fraud and scam crimes that target the elderly or mentally ill.

The law, which started as HB 287 during the 2013 session of the Montana Legislature, allows a judge to impose up to an additional $10,000 in fines on a person convicted of violations of Montana’s Consumer Protection Act, if the victim of their crime is older than 60 or is a person with developmental disabilities.

This penalty would be on top of the $10,000 in potential fines those crimes already carry. The new law means that Montana joins 17 other states that currently have similar enhanced penalties for fraud-related crimes.

Daniel Salomon, the Republican legislator from House District 12 who introduced the bill in the 2013 legislative session, said it was the end result of a team effort spearheaded by Attorney General Tim Fox’s office.

Salomon said he felt the law was very important to help deter people who might target these groups.

“These are people that might be more trusting and maybe not quite as diligent. That can make them easier to prey on,” Salomon said. “The new law does not create any new crimes, but simply amps up the punishments for existing fraud crimes against these groups.”

Salomon said the attorney general’s office worked to draft a proposal, and when he was approached to carry it, he was happy to do so. Fox’s office then worked to make sure that lawmakers questions or concerns were answered or addressed as the bill went through the legislature with strong bipartisan support.

“Nobody was really against it. At most, therewere just questions about is this constitutional, do we have the authority to do this, as there is with every bill,” Salomon said.

Statistics from the attorney general’s office show that of the 1,423 complaints its Office of Consumer Protection received last year, 1,204 people gave demographic information. Of those, 429, or 35 percent, were above the age of 60.

Matthew Dale, the director of Montana’s Office of Consumer Protection, said the types of fraud schemes his office saw ran the gamut from door-to-door and mail to telemarketing and email-based scams. His office worked closely with the attorney general to draft HB 287.

One of the office’s compliance specialists, Ryan Sullivan, said one type of fraud he’s seen recently is what he called the “grandparent scam.”

“People will call up pretending to be a grandchild. They might say that they are very sick, or maybe in jail in another country. They need their ‘grandparent’ to wire them money immediately to pay for medical bills or legal fees,” Sullivan said. “They are trying to instill that instant feeling of fear or panic that might make them do something impulsively.”

Dale said the real impact of the new law will be felt when scammers who are caught experience the new teeth added to their penalties. While he said he thinks the new law will deter would-be criminals, he also warned people to always be careful and vigilant, especially with financial or private information.

“Use your gut instinct. If you are questioning yourself about if this is a good idea, it’s probably a scam,” he said. One of the easiest tipoffs, he said, is anytime you are asked to wire money, especially out of the country.

Anyone with questions about something they have received can call the Office of Consumer Protection, who can help them to verify. It also has a warning service on its website called Scam Alerts, where a person can sign up to be notified with details of new frauds that have been detected in Montana.

Deputy Attorney General Jon Bennion said when Attorney General Fox’s office began to see that a greater proportion of consumer protection complaints were coming from older people, they felt that there was a growing need for a tough deterrent. He also serves as Fox’s legislative liaison when the Legislature is in session.

“Once it passed the Legislature, it went to the governor’s desk, who was the attorney general only months before, so he clearly saw the importance of this type of legislation and signed it,” Bennion said.

From talking with other states which have enacted similar laws, Bennion said they have seen criminalstake notice. “People have taken all of that state’s area code phone numbers out of their telephone scam database. Pretty soon, they might be doing the same with 406,” he said.

Dillon Kato is a Missoula freelance writer and regular contributor to Montana 55.

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