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 The rest of the top ten were all some form of imposter scam: debt
collection scam, sweepstakes scam, tech support scam, government
grant scam, etc. About 85% of those reporting scams to BBB
recognized them as frauds before any money was stolen, but the Top
Ten Scams still account for more than $1 million dollars lost from
those who filed with BBB. [see
table below] “Scammers are all basically imposters,”
notes Mary E. Power, president and CEO of the Council of Better
Business Bureaus, the umbrella organization for 113 local,
independent BBBs across the United States, Canada and Mexico. “Three
of the top four scams reported to us are those that scare people
with threats of arrest, law suits or other frightening actions.
Scammers are pretending to be government agents, lawyers, debt
collectors, police officers. They engage directly with you, so your
best bet to avoid being scammed is to stop engaging. Hang up the
phone, delete the email, shut the door.”
How the Scams Work:
Tax Scam: You receive a phone call from someone who claims to
be with the IRS (U.S.) or CRA (Canada). They claim you owe money in
back taxes and will be arrested or face legal consequences if you do
not pay (usually by wire or prepaid debit card). The caller ID is
spoofed to appear to be a government agency or the police.
Debt Collection Scam: You receive a phone call from someone
claiming that you have an unpaid debt. You are threatened with
garnishments, lawsuits, even jail time if you don’t pay right now.
The scammer will often use caller ID spoofing and pretend to be a
government agency or law enforcement in order to further invoke
fear.
Sweepstakes/Prizes/Gifts Scam: You receive a call, letter, or
email claiming you’ve won a prize in a sweepstakes. In order to
receive the prize, you are instructed to send a fee to cover
expenses associated with delivery, processing, or insurance. The
prize is not real; you should never have to pay money to claim a
prize you have won.
Tech Support Scam: You are contacted by “technicians”
claiming to have detected a virus or security threat on your
computer and, for a fee, can log-in and correct the problem
remotely. These callers are actually hackers trying to steal money
or sensitive computer passwords and/or damage computers with
malicious software.
Government Grant Scam: You receive a phone call, email, or
letter informing you that you’ve qualified for a government grant.
In order to receive the grant, however, you are instructed to send
money as a processing or delivery fee, usually by wire transfer or
prepaid debit card.
Advance Fee Loan Scam: While searching for loan information,
you see an enticing ad and click through to the website. You fill
out an application and soon receive an email or phone call advising
that you are approved for the loan, but you must first send a
processing fee, security deposit or insurance. You pay the “fee,”
but never see the loan. Credit Card Scam: The scammer
pretends to be from your bank or credit card issuer, and they claim
that you are now eligible for a lower interest rate, or that they
need to verify a recent transaction. The consumer provides the
scammer with their credit card number and security code to “verify”
their identity.
Work from Home Scam: While looking for a job online, you
answer an ad for making big bucks while working from home. The job
may be stuffing envelopes, posting advertisements, or shipping
packages. You could have your identity stolen when you fill out the
employment forms, or even end up handling stolen merchandise.
[to top of second column] |
Fake Check/Money Order Scam: This can happen any time someone is paying
you for goods or services (even when you are selling something online). You
receive a check in the mail that is larger than the amount owed, and you are
asked to deposit the check and wire the difference. The check is a fake and when
it bounces, you’re out the money.
Lottery scam: You receive a call, letter, or email advising that you have
won a large amount of money in a foreign lottery, but you have to pay upfront
for taxes and fees. Such lotteries are illegal. Sometimes you may be sent a
check as partial payment, but the check will be counterfeit.
Why Scams Work:
There is a science to scams, and it may surprise you to know that scammers use
many of the same techniques as legitimate sales professionals. The difference,
of course, is that their “product” is illegal and could cost you a fortune. Here
are the major techniques they use to draw you in:
Establishing a connection: The scammer builds rapport and a relationship
with you. This is usually used face-to-face, as in home improvement scams and
many investment scams, but also online romance scams.
Source credibility: Scammer use techniques to make themselves look
legitimate, such as fake websites, social media posts, or hacked emails that
come from a friend’s account. Most email phishing scams spoof real companies,
and many scammers pretend to be a trusted business or government agency in order
to add credibility.
Playing on emotions: Scammers rely on emotion to get you to make a quick
decision before you have time to think about it. An emergency situation or a
limited time offer is usually their methodology. They count on emotional rather
than rational decision-making.
What You Can Do:
Don’t be pressured into making fast decisions.
Take time to research the organization. Check them out on bbb.org, search
online, etc.
Never provide your personal information (address, date-of-birth, banking
information, ID numbers) to people you do not know.
Don’t click on links from unsolicited email or text messages.
If you are unsure about a call or email that claims to be from your bank,
utility company, etc., call the business directly using the number on your bill
or credit card.
Never send money by wire transfer or prepaid debit card to someone you don’t
know or haven’t met in person.
Never send money for an emergency situation unless you can verify the emergency.
[Alyssa Hoerr, Director of
Investigations & Information, Better Business Bureau Serving Central
Illinois] |
