1. Chapter Section Deception & Fraud   Pages   ~People sometimes buy products that don’t meet their needs.   ~Products that the quality is not good.   ~Advertising is deceptive if it is misleading.   ~Most advertising provides accurate information.   ~Salespeople usually try to help you find a product that meets your needs.   ~Exaggerated claims and misleading prices are deceptive practices.        

2. TRADING UP You’ve seen a product advertised.
~You go to the store and the salesperson tells
you the product isn’t good….that you
REALLY WANT to buy the more
expensive product….this is TRADING UP.
~It is not illegal.
~Salespeople make more money if you purchase
this “better” product.

3. SALES PRICE ~a sale is a sale ONLY if the price is below the
usual price.
~Sometimes sales prices are deceptive.

4. SUGGESTED RETAIL PRICE
~Prices can be deceptive. ~Manufacturer’s suggested retail price is sometimes HIGHER than any retailer EXPECTS to actually get for the product. ~Beware of claims of lowest prices in town

5. LOSS LEADER
~Sometimes stores GET YOU TO COME TO THEIR STORE by attracting you with a product priced below cost. ~Store will lose money on this product WITH HOPES you buy OTHER PRODUCTS. ~Items prices below cost to attract you to the store are called a LOSS LEADER. ~This is legal…BUT…beware that the OTHER PRODUCTS aren’t priced HIGHER then usual.

6. FRAUD
~Deliberate deception ~Designed for unfair or unlawful gain. ~Cheating the consumer ~A statement is fraud when it meets 2 conditions: ~person making the statement knows the statement is false. ~purpose of statement must be to cause others to give up property that has value (usually money). ~proving fraud can be difficult ~without written evidence or witnesses, fraud is hard to prove. ~Best protection against fraud is to AVOID IT. ~Need to learn the difference between honest and dishonest offers. ~When an offer seems to good to be true…it may be fraud.

7. BAIT AND SWITCH
~If you arrive at a store to buy an ADVERTISED product and it is OUT OF STOCK or SOLD OUT…the salesperson tries to get you to buy a “better” “more expensive” AVAILABLE product. ~Baiting consumers with an advertised BUT non-existent bargain and then switching them to purchase a more expensive product (similar to the advertised product but with more features “to meet their needs”) ~Don’t just buy the more costly item because you came to the store ready to buy

8. PYRAMID SCHEME
~Example Chain letter that asked you to mail $1 to the person on the top of the letter and sent copies to 10 friends…telling you that you will receive LOTS OF MONEY ~Pyramid scheme is a type of FINANCIAL FRAUD in which people PAY to join an organization or participate in a financial “sure thing” money maker. ~People are PROMISED lots of money. ~In the end, the only people who make money are the people on the TOP

9. TELEPHONE FRAUD ~You can’t see them
~They can tell you they are calling from
a legitimate business…but are they!?
~Can’t see their body language to judge
if they are telling you the truth.

10. Telephone Fraud Clues To Look For
~Offer a deal too good to be true.
~Ask for your credit card or Social Security Number to VERIFY your identity.
~You must BUY SOMETHING to get something of a greater value.
~They refuse to send you a written copy of a sales agreement…or what they are offering BEFORE you buy.
~They demand you ACT NOW or the offer will expire.
~They refuse to provide a TELEPHONE
NUMBER of ADDRESS of their
organization.
~Telephone fraud tries to PLAY ON YOUR
EMOTIONS.
~They have SCRIPTS to tell them what to
do to respond to ANY SITUATIONS
they may encounter when talking to
potential customers.

11. How To Protect Yourself From Deception and Fraud
~How to Protect Yourself From Deception & Fraud:
~Recognize it when you see it.
~Check out unfamiliar companies BEFORE purchasing anything.
~Ask questions about offers that seem too good to be true.
~Know the product or service you are buying.
~Make decisions with your head, not your emotions.
~Use your decision-making process to evaluate your options.