A Reality TV Star’s Telemarketing Scheme

(MUSIC INTRO)

[00:00:01] Bob: This week on The Perfect Scam.

[00:00:03] (show clips montage) Why are the police here? We're looking for Jen Shah. Oh my gosh. What? Real Housewives star charges in massive fraud money laundering scheme. 

[00:00:12] Penny Pucket: Before I knew it, I had spent over $30,000 between websites and all of this other stuff that, that went along with it.  

[00:00:21] Bob: Are, are you selling many blankets?  

[00:00:23] Penny Pucket: No, I didn't sell not one thing.  

[00:00:27] Bob: Oh! $30,000 and you didn't sell one blanket.  

[00:00:29] Penny Pucket: Right.  

 

(MUSIC SEGUE)

[00:00:33] Bob: Welcome back to The Perfect Scam. I'm your host, Bob Sullivan. And before we get to this week's episode, just a quick exciting announcement. The Perfect Scam now has its own email address –theperfectscampodcast@aarp.org and we want to hear from you. If you've been the victim of a scam, or you know someone who has, and you'd like us to tell the story, write to us! Or, just send us some feedback. That email address again is theperfectscampodcast@aarp.org

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[00:01:08] Bob: Penny Pucket has a beautiful hobby. She makes baby blankets. These aren't just any baby blankets; however, they are specially designed to be used in car seats where often parents struggle to keep anything warm and safe on their kids. But when the family farm in Kansas started to struggle a few years ago, Penny thought that maybe, just maybe, her hobby could help save the farm. So she went online looking for help starting a new business, instead she got years of heartache. She ended up losing the farm and she found herself on television right next to Jen Shah from the Real Housewives of Utah. Let's meet Penny.

[00:01:53] Bob: I love the name Penny Pucket. I'm sure you get this all the time, but it sounds to me like you're a character from a children's novel or something.

[00:01:59] Penny Pucket: I have been told that a lot.

[00:02:02] Bob: That's maybe more than a coincidence. Penny spends a lot of her time working for children.

[00:02:10] Bob: So, Penny Pucket, tell me about this hobby that you have.

[00:02:14] Penny Pucket: My mother had designed a set of, I guess you'd call it, fitted blankets that you could put in like a car seat or a stroller. And it would keep the blanket on the baby.

[00:02:28] Bob: What a beautiful thing to make blankets for babies and toddlers.

[00:02:31] Penny Pucket: Yeah, yeah. Mom was a pretty special. She's now passed, but she gave me the design.

[00:02:37] Bob: Now when you say design, I mean I know there's special problems with having blankets that stay on babies in car seats, right, so can you explain to me what the design is?

[00:02:44] Penny Pucket: they have feet kind of like a bunting, and then instead of like zippers or whatever else, it's got Velcro and it's kind of got wings that you can harness the baby in, and then these wings come around and Velcro across their arms in the, the car seat. So they'll stay kind of warm.

[00:03:05] Bob: Yeah, sure. I can't imagine what a relief it would be to get a gift of one of these things that is so much easier to put on.

[00:03:12] Penny Pucket: (laughs) Yeah, they're kinda cool, they work, they work pretty good.

[00:03:16] Bob: How long does it, does it take you to make one of these blankets?

[00:03:17] Penny Pucket: From start to finish, it takes about three hours.

[00:03:21] Bob: And you do, you do all these yourself, right?

[00:03:23] Penny Pucket: Yes.

[00:03:25] Bob: Oh my God. (laughs) So it's uh wow, this is a, this is a, this is a labor of love is the only way I can describe it. They're beautiful.

[00:03:33] Penny Pucket: Thank you.

[00:03:34] Bob: I'm, yeah, I'm looking at your site right now and, and like elephants, baby shark... I like the one with the cars myself, of course. (chuckles) Noah's Ark, I mean they're adorable. And you do, you do all of these with your own hands.

[00:03:49] Penny Pucket: Yes, yes, yep. I enjoy making them. It's one of my outlets.

[00:03:55] Bob: I can, I can tell, but three hours is a big investment in time.

[00:03:59] Penny Pucket: Yeah, but I don't know, I guess maybe it's part of my creativity. It's, it's kinda neat to take a flat piece of fabric and put it together with another piece of fabric and the end result is, you know, kinda neat to see what, what it looks like when you, when you get it done.

[00:04:20] Bob: Why did Penny's mom get involved in blanket making in the first place? Well, it was kind of out of necessity.

[00:04:28] Penny Pucket: My mother, she had 14 grandkids. I had a sister that mom ended up pretty much raising her kids, and so she was trying to figure out a way. My sister had four kids that were a year apart, and she had a set of twins. And so Mom designed those for, for those kids and, and then she started getting requests for them, so she started making some.

(MUSIC SEGUE)

[00:04:54] Bob: The whole big, blended family lived in Southwest Kansas where Penny and her husband were busy managing the family farm.

[00:05:02] Penny Pucket: I was in a small community in Ulysses.

[00:05:05] Bob: And you were all somewhere near the big family farm.

[00:05:08] Penny Pucket: Yep, yep, we all were raised there so.

[00:05:11] Bob: What did you grow?

[00:05:13] Penny Pucket: Uh we had wheat, corn, grew a little bit of soybeans, sunflowers, and then we had a, a few head of cattle.

[00:05:21] Bob: Just like every other farmer in Southwest Kansas, I'm guessing, right?

[00:05:24] Penny Pucket: Yep.

[00:05:26] Bob: When her mom passed away during COVID making those blankets, preserving her mom's design became even more important to Penny.

[00:05:35] Bob: So I'm sure every time you make one of these you think of her.

[00:05:38] Penny Pucket: Yes, I do.

[00:05:40] Bob: How long ago did she pass?

[00:05:42] Penny Pucket: Um, two years ago. Um, she got ALS and was unable to do this anymore.

[00:05:50] Bob: Oh God.

[00:05:50] Penny Pucket: Um, she couldn't even talk for the last year.

[00:05:56] Bob: So the blankets mean a lot to Penny and to the parents who use them. But at one point a few years ago, they represented something else to Penny and her family. Hope. Penny hoped her hobby could help save the family farm.

[00:06:12] Penny Pucket: We were farmers back in Southwest Kansas, and we were kind of struggling a little bit, but I was trying to figure out a way of making some extra money so that I could stay home and be available to run errands you know like parts and, and whatever else I needed to do for my husband on the farm.

[00:06:31] Bob: The farm was struggling for all the reasons family farms struggle nowadays. So Penny settled on an idea. She'd sell her blankets. She'd been taking occasional special orders from neighbors for those blankets for years. What if she set up an online marketplace so she could sell them to anyone anywhere, but she didn't know anything about setting up an internet store.

[00:06:56] Penny Pucket: So I went online, and I did a search and found a, a 90, I think it was $97 course that instructed you on how to market your products through social media.

[00:07:11] Bob: Ninety-seven dollars? That isn't much. So after thinking about it for a bit, Penny decides to take the plunge, and what does she get for that $97? Just some very basic instructions about how to set up a Twitter account and so on, but there is something else she gets for her trouble.

[00:07:31] Penny Pucket: After I got signed up, then I started getting all of these phone calls from people wanting to help me get websites set up and all of that.

[00:07:40] Bob: So these people call up and they say, "Hey, I've heard, I’ve heard about your product. I can help you do this." That happens right away?

[00:07:46] Penny Pucket: Yeah, yeah.

[00:07:48] Bob: Like are we talking about 5? Are we talking about 100?

[00:07:51] Penny Pucket: I would have at least 1 to 2 phone calls a day.

[00:07:54] Bob: Oh my God. You're kidding!

[00:07:55] Penny Pucket: Not kidding.

[00:07:56] Bob: Wow.

[00:07:57] Bob: The calls are annoying, but Penny knows she needs a website.

[00:08:03] Penny Pucket: And being a business owner, I knew that at times you had to invest a little in order to get something going. So I didn't think a whole lot about putting out money for a website because you got sometimes to invest some money in order to get, get a, a return.

[00:08:22] Bob: Oh, of course.

[00:08:22] Penny Pucket: And I was told within a few months I would have my full investment returned to me, and then I would be making a profit. A lot of them would tell me you've got to, like I could make a thousand dollars a week, and then they want, they wanted me to add stuff to the website, not just do blankets to kind of boost the revenues, you know, the sales.

[00:08:43] Bob: So after listening to all these pitches about websites, about e-commerce tools, about taking credit cards, about ranking high in Google, Penny decides to plunge deeper into the business. Remember she's trying to save the family farm.

[00:08:59] Penny Pucket: I got involved with multiple of these phone calls, 'cause one, they set you up with Google, so that you, when they did a, a web search, you were at the top of the, the rankings, so they would see your, your website first. Then there was someone contact me, then they said, well you, "There's going to be another company contact you that's going to help you set up your LLC that you probably need to be protected in that way," which, you know, like I said, I understood that there was some things that you needed to have in place. So it all made sense.

[00:09:35] Bob: It made sense and it cost a lot of dollars.

[00:09:41] Penny Pucket: The website itself to get it set up was $8000, and then it was like $120 a month to keep the website up and functioning. And they would help manage it.

[00:09:54] Bob: Sure, sure. But how, how much are the blankets?

[00:09:57] Penny Pucket: Right now they're going for about $80, depending on what size.

[00:10:00] Bob: But so you're selling something for a little less than $100 and they asked you for $8000 just for the website. That sounds like a lot.

[00:10:08] Penny Pucket: Yeah, yeah. They were going to design me a website, and they were, they assured me that I would be making money within the first week.

[00:10:16] Bob: Wow. I mean did you have, was $8000 a lot of money to you at the time?

[00:10:20] Penny Pucket: Yeah, but credit cards were readily available.

[00:10:21] Bob: Uh-huh, yeah sure. I mean you were doing all this because you, you, you realized you need a little extra money to help with the farm, right?

[00:10:30] Penny Pucket: Yes, yes, yes, that was the whole purpose, and not to get upside-down because of it.

[00:10:35] Bob: Yeah.

[00:10:36] Bob: And $8000 is just the beginning.

[00:10:41] Penny Pucket: But then, you know they charged I think it was like $1000 for the LLC, and then for Google it was like $250 a month to keep on top of the search engine. And before I knew it, I had spent over $30,000 between websites and all of this other stuff that, that went along with it.

[00:11:05] Bob: $30,000. Wow.

[00:11:07] Penny Pucket: Yeah, over $30,000.

[00:11:09] Bob: And, and that would have been over the course of what, six months or something?

[00:11:13] Penny Pucket: It was over the course of three months. And they said, "Well, you know, if you started blogging that, that would also boost your people looking at your site." So I took a course on blogging. And that was when I realized that something was wrong.

[00:11:32] Bob: Something is very wrong. Money is going out fast. But nothing is coming in.

[00:11:39] Bob: Are, are you selling many blankets?

[00:11:41] Penny Pucket: No, I didn't sell not one thing.

[00:11:44] Bob: Oh! $30,000 and you didn't sell one blanket.

[00:11:48] Penny Pucket: Right.

[00:11:49] Bob: Penny confronts the company she's working with, and they blame her for the lack of sales.

[00:11:56] Penny Pucket: I would do the homework. I mean they, they assigned, you had a coach and everything. And once a week you'd get on the phone and call and, and they would give you an assignment. And I did it all. I did it all. But they told that I didn't do my homework, or I would be seeing some results.

[00:12:12] Bob: So when you complained to them that you spent $30,000, you'd taken this blog course, and you're not getting anything out of it, what's their response?

[00:12:19] Penny Pucket: They, they told me that I wasn't doing my, doing what I was supposed to. And I said, "Well I was." And...

[00:12:28] Bob: But they blamed you.

[00:12:29] Penny Pucket: They blamed me for, for all of the deal.

[00:12:32] Bob: But the problem isn't Penny's lack of blog posts. Something much more fundamental is wrong.

[00:12:38] Penny Pucket: I actually went on the website and tried to buy my own product and it wasn't, it didn't work.

[00:12:45] Bob: (gasp)... oh my God!

[00:12:47] Penny Pucket: It didn't work though, the website that was set up didn't work. You couldn't buy anything on them.

[00:12:53] Bob: Oh my God. Like you couldn't add a product to cart or enter a credit card or any of that stuff?

[00:12:57] Penny Pucket: Nope. None of that stuff.

[00:12:59] Bob: Oh my God.

[00:13:00] Penny Pucket: And see, I was paying for a merchant's account and all of that. And you couldn't buy anything.

[00:13:07] Bob: Complaining to her business consultants gets her nowhere.

[00:13:12] Penny Pucket: They just, they said, no, you didn't do what you were, you were told to do, and once company even got pretty, pretty angry with me. And I said, "You know it doesn't work. I went to the website. It doesn't work." And they said, "Well yes it does." And I said, "You go and buy something on it then."

[00:13:31] Bob: (chuckles)

[00:13:33] Penny Pucket: And they said, "No, it's, it's a working website." And I said, "No, you, you can only view it. You can't buy anything on it."

[00:13:40] Bob: Oh my God. Well I mean what, my heart would fall to the ground. How, how did you react?

[00:13:49] Penny Pucket: I was upset and I, I decided I was going to try and see if I couldn't get some of my money back.

[00:13:57] Bob: So at that point, Penny immediately switches to recovery mode.

[00:14:03] Penny Pucket: So I started filing disputes with my credit card. The one website company was pretty smooth. They had convinced me instead of just charging my credit card, to do a wire transfer onto my credit card, or yeah. And I found out that when I tried to get that money back through the credit cards, that you know filing a dispute through the credit cards on that wire transfer, the wire transfers you can't dispute. It's just a done deal.

[00:14:37] Bob: The money's just gone. Yeah.

[00:14:38] Penny Pucket: The money's just gone. And so then I started going and filing complaints to the Attorney General. So, in my case, there was Salt Lake City, so I had to file to Utah. I had one company that was in Washington State, another one that was in New York, and so I had to file complaints to the Attorney General in all of those states.

[00:15:01] Bob: But at the same time Penny is trying to get her money back, she's also paying her bills by literally mortgaging the farm she is trying to save.

[00:15:11] Bob: You put $30,000 on credit card?

[00:15:15] Penny Pucket: Yes.

[00:15:16] Bob: And then were you able to pay, pay that off?

[00:15:19] Penny Pucket: Um, it was starting to become a real struggle to make all of the different payments. So we ended up remortgaging our house and adding the credit cards onto our house mortgage. We had enough investment, yeah, that we could cover the house and all of that, and you know, just put it all in one, one big deal, but...

[00:15:43] Bob: So, so these companies are stealing your money, not doing what they said, and you were paying them back by mortgaging your house.

[00:15:50] Penny Pucket: Right. Right.

[00:15:51] Bob: Oh, God. You were doing the right thing, obviously they're doing the wrong thing.

[00:15:55] Penny Pucket: Yeah, yeah that's how it works.

[00:15:58] Bob: And in the end, the debt burden is just too much.

[00:16:04] Bob: I'm thinking if you're already struggling and then you've got this $30,000 in debt, that might have been, that might have actually been the death nail for the farm.

[00:16:11] Penny Pucket: Um, yes and no. At that time my husband and I both, he wasn't working on the farm anymore, he was doing the afterhours and weekends deal with the farm to try to keep it going.

[00:16:24] Bob: Right.

[00:16:25] Penny Pucket: And in order to pay our bills and make a living, then he was working outside, and then I took a part-time job too. The family farm, we ended up having to sell it because it wasn't providing a, a living for us. And so we sold the farm and moved, but we lived in Southwest Kansas for 62 years.

[00:16:43] Bob: Oh that must have, that must have been really hard to sell the farm.

[00:16:46] Penny Pucket: Yes, it was, it was extremely hard.

[00:16:49] Bob: So Penny gives up the blanket business, gives up the farm, gives up small town life, and moves to Independence, part of the Kansas City area near where her grandkids now live. And she tries to move on. Several years pass, and then one day a suspicious phone call arrives which reignites the entire affair.

[00:17:11] Penny Puckett: I got a phone call from ABC and at first, like I said, I didn't trust anybody. So I thought it was a scam. So I didn't answer the phone, I didn't reply to any of the emails or anything that they had sent for probably a good month. And then they just kept calling and I thought, okay. So I googled the, the name and sure enough, it was ABC and I'm going, oh my goodness.

[00:17:41] Bob: What does ABC News want with Penny Pucket? They want to talk to her about her baby blanket business. Well, really about all the people who called and offered to help her with the baby blanket business.

[00:17:55] Bob: So I mean you had moved; you had put all this behind you. You probably hadn't even thought about it much.

[00:18:00] Penny Pucket: No, I hadn’t, I hadn't. I still had the blankets in rubber tubs. I, I hauled them up here thinking that I would give them away as baby gifts, you know.

[00:18:13] Bob: Why would a national TV news network working on a documentary care about baby blankets? Because one of the people behind all those phone calls and all those helpful consultants that Penny paid is a national TV star.

[00:18:28] Penny Pucket: Then they started telling me what they were doing. And told me that Jen Shah was actually part of it. And I hadn't heard Jen Shah before, because she wasn't one that I had dealt with. It was one of the people underneath her who I had had dealings with. And then they started telling me that he was the one that was cooperating with, with the government.

[00:18:47] Bob: Had you heard the name Jen Shah before?

[00:18:50] Penny Pucket: Um, no, I hadn't. I don’t watch the Salt Lake City people or the other ones either.

[00:18:58] (show clip) Salt Lake City, Utah, is known for its magnificent mountains.

[00:19:03] Bob: Jen Shah, in case you aren't a fan of reality TV shows, was one of the flamboyant stars of the show Real Housewives of Salt Lake City.

[00:19:12] (show clip) She can't (inaudible)

[00:19:14] Bob: What was that like?

[00:19:15] Penny Pucket: It was kind of like I can't imagine, you know. You think of movie stars that they get all of this money, and they don't need to scam people to get their money, you know to get their wealth. You don't put that together. And it was, it was like, I can't believe that if she's a movie star, how, how she could do that to people? You know, she ought to be getting plenty of money from her own movies and stuff that she's done. Or you'd think, right?

[00:19:47] Bob: Yeah, yeah, yeah, why, why would she need to do this? She's famous.

[00:19:52] Penny Pucket: Yeah, yeah.

[00:19:53] Bob: Yeah.

[00:19:54] Bob: Investigators are asking questions about the various companies that ended up calling Penny Pucket and thousands of other victims like her. They believe Jen Shah is the very public face behind a network of people who have sold worthless services to thousands of victims, many older Americans. Most of them are working off lead generation lists generated by ads selling services like that $97 social media training course. And as law enforcement closes in on Shah, the investigation becomes a plotline on the show.

[00:20:29] (show clip) Can we talk about the hundreds of lives you've ruined? The US Attorney's office is no joke. Do we need to add Kim Kardashian to our legal team?

[00:20:40] Bob: At first Shah doesn't seem to take the charges all that seriously, at least not in public, not on the show.

[00:20:48] (show clip) The only thing I'm guilty of is being Sha-mazing!

[00:20:54] Bob: Um, but you know when some of this was happening, right...

[00:20:57] Penny Pucket: Yes.

[00:20:58] Bob: ...so she not only denied that she did it, but she said, you know, "The only I'm guilty of is being Shah-mazing." I mean how do you, how do you react to that?

[00:21:08] Penny Pucket: (laughs) Well, it's going to fall; she's going to fall.

[00:21:13] Bob: On the show Shah is known for living a rather extravagant life. Here she is talking about moving from one mansion to an even bigger mansion.

[00:21:25] (show clip) Sure, I love the Shah Chalet, but like all good things, everything comes to an end just like our lease did. So we found the next best thing; Shah Chalet 2.0. This was supposed to be the exercise room and I turned it into a closet. We had movers and I'm telling you what, when they showed up, they have never, ever seen so many clothes, shoes, or purses in their entire life.

[00:21:53] Bob: It's just the contrast is just so remarkable. I mean she's, you know, you're mortgage your home, other people are losing their homes and, and she's living literally, bragging on TV about this fabulous lifestyle she has. The dichotomy there is just hard to swallow.

[00:22:08] Penny Pucket: Yep, she's living high on the hog on everybody else's money.

[00:22:13] Bob: Finally, during that second season of Real Housewives of Salt Lake in September of 2021, Jen Shah is indicted, arrested during filming of the show.

[00:22:25] (show clip) What is going on? Why are the police here? We're looking for Jen Shah. (bleep) is going on? She just left. Wait, Jen? They were asking about Jen. You guys, what if she's on the run? How did they know she was here. Somebody had to have told them she was here. What are you guys doing in there? Search warrant. Oh my gosh. What? Real Housewives star charges in massive fraud money laundering scheme. No! I have (bleep) chills. No. No. Her and (inaudible) were charged for stealing people's money. Fraud.

[00:23:02] Bob: Manhattan US Attorney Audrey Strauss makes her case to the public after the arrest. "Jennifer Shah who portrays herself as a wealthy and successful businessperson on reality television allegedly generated and sold lead lists of innocent individuals for other members of their scheme to repeatedly scam in actual reality and alleged, the so-called business opportunities pushed on the victims by Shah were just fraudulent schemes motivated by greed to steal victims' money." But at the TV season plays out and the prosecution plays out, Jen Shah repeatedly maintains her innocence.

[00:23:42] (show clip) (inaudible) you're innocent. I am innocent, okay? No, no...

[00:23:47] Bob: She even starts selling Shah Squad t-shirts with "not guilty" on the back and the hashtag, #freeJenShah. Then the ABC documentary story airs in November 2021. It's called, "The Housewife & the Shah Shocker," and it shows a very different side of Jen Shah.

[00:24:06] Bob: Now how did you react to it when you watched it?

[00:24:09] Penny Pucket: I thought they put it together very well. I was a little surprised that some of the information that they provided me though because I had no idea that Jen Shah was involved and that there was like 14 other people that were brought up on, on charges as well with her. I had learned that, that first $97 charge that I did, apparently they had a way of checking to see what kind of credit you had, because I learned later that there was also several other people that their fees were larger than mine just because they knew what credit they had available to them.

[00:24:48] Bob: So as you watched this program and you learned it's other people and it's bigger than you realized, but then she's denying the whole thing, that, that must have made you furious.

[00:24:55] Penny Pucket: Yeah, I don't know how she thought she was going to get by with it. You know and she had all of these, these other people underneath her that was saying that she was the head person; how could she continue to deny that she was ever involved?

[00:25:11] Bob: But just days before her high profile trial is set to start in July 2022, Shah pleads guilty.

[00:25:18] Bob: In January of this year, she is sentenced to 78 months in federal prison. She also agrees to pay $9.5 million in restitution to victims.

[00:25:29] Bob: Wow, how do you feel about that? Is, is that a relief?

[00:25:34] Penny Pucket: Um, yes and no. I don't think that the sentence that they gave her was enough. And according to what I've learned, she's supposed to pay all of us back after she gets out. For 6½ years she's not going to be living in that house. For 6½ years she's not going to be driving all those cars. So why do the rest of us have to wait 6½ years to get restitution? And I guess that's, that's what makes me the angriest, because there's people that lost their homes. We were one of the fortunate ones that, that we didn't, but it could have very well happened that way.

[00:26:30] Bob: And nothing's happening to help you in your situation for the next 6½ years, right?

[00:26:35] Penny Pucket: Right. Right.

[00:26:36] Bob: Yeah.

[00:26:37] Penny Pucket: Or any of those other people. I feel sorry for those people that really, that you know that actually were homeless because of her and her organization.

[00:26:49] Bob: So when she pled guilty, I'm going to read this to you, um, she issued a statement that says, "I want to apologize to all the victims and families, and I take full responsibility for the harm I caused and will pay full restitution to all the victims. I recognize that some of you lost hundreds and others lost thousands, and I promise to repay." Do you want to respond to that apology?

[00:27:15] Penny Pucket: I'll have to see it to believe it. Um, she didn't have remorse before until she got caught, so I, I'll just have to see it to believe it.

[00:27:27] Bob: Meanwhile, Penny is trying to move on with, well with everything.

[00:27:32] Penny Pucket: Yeah, well I don't, I, to this day I still don't trust anybody. They have to prove that they're trustworthy before I can do business with them. So it has left an impact and for the longest time I didn't even talk about what happened. My kids didn't even know. And when they found out, they were furious, because I have one son that is actually in IT. He, he develops websites for large companies. Um...

[00:28:02] Bob: Oh God, and he was like you spent $8000 for the website. Oh no, right?

[00:28:07] Penny Pucket: Yeah, but he was 7 hours away. At that time he was living up here in Independence, and I was in Southwest Kansas, which is clear across the state, catty-corner.

[00:28:17] Bob: Yeah, yeah.

[00:28:18] Penny Pucket: They just had started a family, so they had babies. They didn't need me as a burden, you know. So I was trying to do it myself. And I, and then I had a son-in-law that, that also did that. So they were both really mad that I had done that, 'cause they would have helped, they said, but, they were busy with their own families.

[00:28:41] Bob: And you were going to do it yourself, yeah, I get it. Right, I get it. So is the dream of selling these baby blankets is, is it basically dead at this point?

[00:28:51] Penny Pucket: I sell a few off and on, but yeah, pretty much.

[00:28:57] Bob: Now I'm just, I'm just thinking about how, because I know at some point when you decide, every, every investor, everyone with an idea has to do this, you know, I'm going to go for it. I know this is a lot of money but you've to, to spend money to make money. I'm going to take, I'm going to take a risk, and that exhilarating, right, and like lots of people. But the only way you succeed in life, and then to get to the point where, where you were. It's, it's hard for you to talk about this, right?

[00:29:23] Penny Pucket: Yeah, yeah, it's embarrassing because you kind of think, you know, people may think that you're stupid. You know how did she manage to allow them to take all of that money from her, you know. So in, in a lot of ways it's, you know it's, it's embarrassing to talk about because you don't know what other people are going to think. And you know, it, I guess maybe it's a pride thing. You don't want to admit that you were vulnerable or weak or ignorant. Maybe that's a better word for it. So yeah, it, it's been really hard to talk about.

[00:30:03] Bob: Is it getting any easier?

[00:30:05] Penny Pucket: Actually, it, it's kind of freeing to be able to talk about it, get things out in the open.

[00:30:14] Bob: And how is everything else going? Is life in Independence is, is it better? Is it easier? Is it harder?

[00:30:20] Penny Pucket: We had quite an adjustment. Of course we went from a population of about 10,000 in the whole county to I don't even know what Kansas City is. But we weren't, aren't crazy about the traffic.

[00:30:33] Bob: Yeah, yeah. So your husband, did he find work nearby? Again, it's a big change, he's not working nights and weekends on the farm.

[00:30:41] Penny Pucket: Yeah, well he's got, he works for a trucking company that he might as well be on the farm, because he's putting in the same hours or more.

[00:30:49] Bob: Hmm.

[00:30:51] Penny Pucket: But we're making it. We're making it do. And, of course, we lived down on the farm, so we're living in town which is a totally different animal in and of itself with all the close neighbors and all of that, but we do have a good neighborhood that, that's pretty quiet. So... so we can't complain about the neighbors.

[00:31:12] Bob: And you're near the grandkids.

[00:31:14] Penny Pucket: Yes. And we've got five grandkids that, that we get to spend a lot of time with.

[00:31:20] Bob: Well that, that's a pretty good trade there I would say. Your whole life is centered around children.

[00:31:25] Penny Pucket: Children are special. They're the future. So you've got to invest in them.

[00:31:32] Bob: After their ordeal, Penny has some advice for Perfect Scam listeners. Victims of crimes really need to report what happened.

[00:31:41] Penny Pucket: I would encourage anybody to do whatever it takes. I know it takes time, but a lot of the attorney generals, they have now electronic stuff that you can send information in. It's a quick little form. It takes maybe 5, 10 minutes, and send it in. Do it because the more people that turn it in, then they, it, it starts red-flagging those companies. And then there's an investigation that starts.

[00:32:08] Bob: Sometimes it, it can feel like you're not doing anything 'cause you don't hear back right away, but I, I have talked to folks at attorney general's office who tell me that as few as five complaints can actually get a lawyer to look at a company. And so your, your individual complaint might be the one that pushes it onto someone's desk.

[00:32:25] Penny Pucket: Exactly. Exactly.

[00:32:29] Bob: There is a little bit of good news for Penny as a postscript. She did ultimately get some of her money back.

[00:32:36] Penny Pucket: I filed all these complaints. The credit card, some of the disputes they went ahead and gave me my money back because they did, they acknowledged that it was a scam. And I ended up getting almost half of the money back by doing all of those complaints and filing the disputes with the credit cards.

[00:32:58] Bob: And then more recently, she was surprised to get a check from one of the federal agencies where she filled out a complaint.

[00:33:05] Bob: Is there anything else about this story or what, what happened to you that you really want people to know?

[00:33:10] Penny Pucket: Don't give up. 'Cause like I said, if, if you do all of the right stuff, file the paperwork, you may not see anything for years down the road, 'cause it was several years and I received $1200 in the mail from the FTC because of a complaint that I filed. So you never know when you're going to get a magic gift in the mail.

[00:33:32] Bob: So fill out the paperwork even though...

[00:33:34] Penny Pucket: Fill out the paperwork. Yep, 'cause they found me. 'Cause they, you know I had lived in Southwest Kansas when all this happened on a farm back in Ulysses, Kansas, and they found me in Independence, Missouri.

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[00:33:50] Bob: Penny's problems really began when she started getting all those phone calls with business propositions. And we wanted to learn more about the rules governing these kinds of calls, so we enlisted the help of a real expert, Cindy Liebes, who spent decades prosecuting criminals who did their work on the other end of a phone line.

[00:34:09] Cindy Liebes: I was at the FTC for over 34 years. I started out as a, an attorney, a staff attorney, doing telemarketing fraud cases all over the country. But ultimately I retired as the Regional Director for the Southeast Region of the FTC. I prosecuted and oversaw the prosecution, the civil prosecution of telemarketers, internet scam artists, and those who violated Section 5 of the Federal Trade Commission Act which basically prohibits unfair and deceptive practices by individuals and companies.

[00:34:49] Bob: With all that time spent chasing internet and telephone criminals, I asked Cindy what she learned about people who do this to victims.

[00:34:58] Cindy Liebes: They're professionals. This is their job, and they're good at it. And so the thing I learned is that you know consumers, people are not at fault for falling prey to these professionals. They're very good at what they do, and oftentimes they share with one another ways to rip people off. And so I've learned that really the best defense as they say is a good offense; being prepared and knowing when it's a scam and understanding how these scam artists are targeting and victimizing people.

[00:35:40] Bob: The criminals will do and say anything just to keep people on the phone a little longer. And one of the tools in their toolbox is to invoke the name of famous people or famous companies.

[00:35:52] Cindy Liebes: I know part of what we're talking about is the, the indictment of Jen Shah who was on the Real Housewives program. And oftentimes these scam artists pretend to be someone that you know, or from an organization that a consumer is very comfortable with. And that makes them comfortable to either give information or give their money to these fraudulent operations.

[00:36:22] Bob: Now I think that that's interesting and really important. If, if someone calls with, with a name that's familiar, uh like they're, they're from the Microsoft Technical Support Department or Amazon or something, that gives the criminals an edge, right?

[00:36:33] Cindy Liebes: It, it really does. When I was at the Federal Trade Commission right before I retired, I led an initiative that was dealing exactly with that, those what they call Tech Support Scams, where people thought that they had some sort of virus on their computer and in fact, their computer would tell them that there was a virus. And it was often, it looked like or appeared to come from Microsoft or Facebook, and that's not true. Facebook or Microsoft does not know and will not let you know that you have a virus on your computer. And these people either sold you products and services that were worthless, or they were able to remote into your computer and to get all sorts of information off of your computer, including financial information.

[00:37:27] Bob: But what they were trading on the familiarity of the brand name, right?

[00:37:30] Cindy Liebes: Exactly.

[00:37:32] Bob: Hmm, and that's part of this Jen Shah story, I'm sure people recognized the show or had some, had some comfort with that person, that brand, and that made it easier for a criminal to lure in someone who was listening. Is that how that worked?

[00:37:46] Cindy Liebes: E--, exactly. So they make it much easier, much more familiar, but, but oftentimes in that case, for example, she was involved with selling leads, or selling people's names to other scam artists who were involved in business coaching scams.

[00:38:05] Bob: Many of Cindy's cases involved something called the Telemarketing Sales Rule, the TSR which governs what businesses can and can't do when they call consumers. The TSR is a result of the Telephone Consumer Protection Act, the TCPA, signed by the first President George Bush about 20 years ago. That law also gave us the Do Not Call List. I couldn't resist asking Cindy about that.

[00:38:32] Bob: The basic question everyone asks is, well I'm on the Do Not Call List, why do I still get calls? And, and how do you answer that?

[00:38:39] Cindy Liebes: Again, I think many times it can be because these are scam artists, and they really do not care to follow uh the Do Not Call Registry or the laws that are state laws that stop them from calling people. Sometimes, also, it is because you've done business with a company in the past, and the Do Not Call Registry allows for those with whom you have a previous business relationship to continue or to call you, and those affiliated with them may call you.

[00:39:15] Bob: The Telemarketing Sales Rule has a bunch of provisions which make certain kinds of phone calls illegal. Calls late at night for example, or automated robo calls. Those are usually illegal. And you might be surprised at something else that's illegal under the TSR...

[00:39:31] Bob: It's illegal for someone to ask you for a cash transfer on the phone like one of those Cash App things or a wire transfer, and so immediately if someone asks you for that sort of payment online, you should just hang up because they're breaking the law, right?

[00:39:46] Cindy Liebes: Yeah, if they do it over the phone. You know that's a, a great thing that you brought up. Do not, if someone asks you to pay with a, a card, a reloadable card, you know what, chances are that's a scam. If someone asks you to pay by cryptocurrency, chances are that's a scam. Or a money transfer.

[00:40:07] Bob: Also, Cindy says, beware of people selling business advice, especially get rich quick ideas.

[00:40:13] Cindy Liebes: Quite often with business opportunities or business coaching, what the way that the people that are selling these things make their money is by selling these things. Not by the information that they're providing to you. It often doesn't work, and people can shell out thousands, or even tens of thousands of dollars and get nothing in return.

[00:40:37] Bob: One of Cindy's most important pieces of advice, never take any step without talking to someone else, without using someone you trust as a sounding board. Take the time to talk.

[00:40:51] Cindy Liebes: Resist the pressure to act immediately. Instead, talk to friends, talk to family about what you're being told or what you're being sold. Oftentimes once you say it out loud or you tell a family member or a friend about what someone is trying to sell you, it will make you realize, wait a minute, that doesn't make sense. Or if your friend or family may tell you, please don't do that. You know what, let me help you here.

[00:41:24] Bob: I think that's such a clever and important piece of advice. Once you say things out loud, so often you just hear them differently than when they're in your own head, right?

[00:41:33] Cindy Liebes: Oh yes, that's very true. And, and it's really proven true when I've worked with consumers. It's really proven very true that once you say it out loud, once you talk to others, once you even look online for information about these types of sales pitches, you realize, wait a minute, I have to slow down. If I'm going to enter into a business coaching operation or organization, if I'm going to give them my money, wait a minute, I need to slow down. Is there a better way to do it. And with the business coaching, what we advise you, go to a government organization. The Small Business Administration, for example, provides free information for people who want to start their own business.

[00:42:26] Bob: And as for any unexpected phone calls, your best bet is just to hang up right away, or not to answer the phone in the first place.

[00:42:36] Cindy Liebes: I mean unfortunately I and many of the folks I know, no longer answer calls from numbers that I do not know, that are not in my contact list. I wait for them to leave me a voicemail, and then, and only then do I call them back.

[00:42:54] Bob: So I am not bashful about that. I think that should be universal advice. I, I never answer from an unknown person, and I'm a journalist which makes my life much harder. But you know listening, making them leave a message, first of all, many of them don't bother, but sec--, second of all that provides that little time gap that we've talked about.

[00:43:13] Bob: And if you've already been a victim of a scam phone call...

[00:43:16] Bob: So I know some people feel like oh, this, you know, I've been a victim, there's nothing I can do. No one's going to listen, so why bother? What's your response to that?

[00:43:26] Cindy Liebes: Well they do listen. I mean in the years that I worked at the Federal Trade Commission, we brought hundreds, if not thousands, of cases against these types of companies, and our main goal was to stop these companies and to get consumers their money back. Similarly we work very, very closely with criminal agencies, and one of the best ways to stop these folks is to let us know what they're doing and how they're doing it, and hopefully, not only take away their money but work with the criminal agencies to put them in jail.

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[00:44:11] Bob: If you have been targeted by a scam or fraud, you are not alone. Call the AARP Fraud Watch Network Helpline at 877-908-3360. Their trained fraud specialists can provide you with free support and guidance on what to do next. Our email address at The Perfect Scam is ­– theperfectscampodcast@aarp.org.  And we want to hear from you. If you have been the victim of a scam, or you know someone who has, and you'd like us to tell their story, write to us! Or, just send us some feedback. That address again is theperfectscampodcast@aarp.org. Thank you to our team of scambusters; Associate Producer, Annalea Embree; Researcher, Sarah Binney; Executive Producer, Julie Getz; and our Audio Engineer and Sound Designer, Julio Gonzalez. Be sure to find us on Apple Podcasts, Spotify, or wherever you listen to podcasts. For AARP's The Perfect Scam, I'm Bob Sullivan.

(MUSIC OUTRO)

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