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    Final Thought
    After the Money’s Gone – It’s Too Late

    The most effective consumer protection consists of preventing people from being fleeced in the first place.

    Francis X. Sullivan

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    A few years ago, I received a letter from an elderly couple who owned a timeshare in a Mexican resort. They didn’t travel anymore, but they were having trouble selling the timeshare because there is virtually no secondary market for timeshares. A broker with a Wisconsin address had arranged a sale. He told them they just needed to put $30,000 into an escrow account for one week to cover taxes under Mexican law.

    Francis X. Sullivan, U.W. 2000, is chief director of the Consumer Protection and Antitrust Unit of the Wisconsin Department of Justice, Madison. The views expressed in this column are his alone.

    So they did. And when the broker told them the law had changed and they needed to put $9,000 more into the account “for 48 hours,” they borrowed the money and did that, too. They hadn’t heard from the broker in a few weeks. They wondered – could they get their money back?

    The broker’s phone number could not be traced. The address was a drop box. The couple’s money was gone.

    Consumer protection is frustrating. Scammers use sophisticated technology to conceal their identities. They operate on a volume basis, contacting thousands of people every day to find potential victims. It’s impossible to stay ahead.

    How do you get money back from a scammer? Unless you’re very lucky, you don’t. You might get a refund from a legitimate business that made a mistake or a judgment against a shady business that has resources. But you won’t get money from somebody you can’t find.

    As soon as the elderly timeshare owners sent $30,000 to a stranger, they were doomed.

    Lawyers can advise clients not to participate in shady deals. We can research, advise, cajole, nag. But, “Should I wire $8,000 to a stranger in Kenya?” is not a question we hear. If we hear about it at all, it’s in the past tense – “Should I have wired $8,000…?” By then, it’s too late.

    Consumer protection starts with listening to the people we meet every day and talking with them honestly and frankly about the pressures they face and the financial choices they make.

    So how can lawyers protect consumers? They can join existing educational efforts. The Federal Trade Commission has wonderful (and free) consumer education materials. Closer to home, the Wisconsin Department of Agriculture, Trade and Consumer Protection and the Department of Financial Institutions provide Wisconsin-specific material. My son goes to Stoughton High School, where the curriculum includes a personal finance class aimed at protecting him and classmates from consumer scams and frauds.

    And lawyers can do much more if we think of ourselves as responsible for protecting our communities. How many charitable solicitations do your parents get, and what do they do with them? Do you know about the plumber who just stopped by to sell them an extra water heater he “happened to have on the truck?” Do you know your neighbor is pouring his money and energy into a multilevel marketing scam? Do you know your daughter’s friend is paying thousands to a shady student-loan broker?

    Yes, we’re lawyers. But we’re people first. Consumer protection starts with listening to the people we meet every day and talking with them honestly and frankly about the pressures they face and the financial choices they make. You can’t give good advice until you know what’s happening. And you probably can’t help if you only find out about a problem after the money is gone.