Online Money ScamsScams A Scam is a confidence trick - a crime - is an attempt to defraud a person or group after first gaining their trust through deception. Scams or confidence tricks exploit victims using their credulity, naïveté, compassion, vanity, irresponsibility, or greed and exploiting that. Researchers have defined confidence tricks as "a distinctive species of fraudulent conduct ... intending to further voluntary exchanges that are not mutually beneficial", as they "benefit con operators ('con men' - criminals) at the expense of their victims (the 'marks')". A scam is a crime even if no money was lost. – ScamScam A Scam is a confidence trick - a crime - is an attempt to defraud a person or group after first gaining their trust through deception. Scams or confidence tricks exploit victims using their credulity, naïveté, compassion, vanity, irresponsibility, or greed and exploiting that. Researchers have defined confidence tricks as "a distinctive species of fraudulent conduct ... intending to further voluntary exchanges that are not mutually beneficial", as they "benefit con operators ('con men' - criminals) at the expense of their victims (the 'marks')". A scam is a crime even if no money was lost. Basics
Money Scams Come In A Variety Of Types
Here are some of the basic types
Fraudsters Gain Your Trust – Then Steal Your Money
Portions Reprinted from Western Union
They use any means to contact victims—telephone, snail mail, email, and the Internet!
They gain your trust and when they have you hooked, they ask you for money; then they take it and run.
The scenarios they use to lure you in change, constantly, but you can protect yourself and your friends and family by arming yourself with knowledge of the most common types of fraudFraud In law, fraud is intentional deception to secure unfair or unlawful gain (money or other assets), or to deprive a victim of a legal right. Fraud can violate civil law (e.g., a fraud victim may sue the fraud perpetrator to avoid the fraud or recover monetary compensation) or criminal law (e.g., a fraud perpetrator may be prosecuted and imprisoned by governmental authorities), or it may cause no loss of money, property, or legal right but still be an element of another civil or criminal wrong. The purpose of fraud may be monetary gain or other benefits, for example by obtaining a passport, travel document, or driver's license, or mortgage fraud, where the perpetrator may attempt to qualify for a mortgage by way of false statements. A fraud can also be a hoax, which is a distinct concept that involves deliberate deception without the intention of gain or of materially damaging or depriving a victim..
Types of Scams
- Advanced Fees / Prepayment / 419419 An advance fee scam or fraud (419 scam) is a form of fraud and is one of the most common types of online confidence tricks. The scam typically involves promising the victim a significant share of a large sum of money, in return for a small up-front payment, which the fraudster claims will be used to obtain the large sum. If a victim makes the payment, the fraudster either invents a series of further fees for the victim or simply disappears. The 419 comes from the Nigerian law against this type of scam. Money Scam
- Mystery Shopping Scam
- Overpayment Scam
- Employment ScamEmployment Scam Bogus job postings, recruitment emails and online ads - often illegally using legitimate company names – are all tools scammers use to defraud people seeking employment. Always be suspicious of quick offers with high salaries or pre-payment requests for coaching, training or certifications, and never share personal information until you're certain a job posting is legitimate. Many employment scams also offer advanced payment for supplies. These checks will often bounce, costing you money.
- Lottery / Prize ScamPrize Scam These scams involve someone claiming you won a prize. However, they say you must pay a fee or provide sensitive banking information in order to get it. They keep the money, and you get nothing for it.
- Rental Property Scam
- Emergency / Grandparent ScamGrandparent Scam Grandparent/Family Emergency Scam - Scammers sometimes prey on grandparents by claiming their family members are in jail or in trouble and need money quickly. They use stolen personal information such as family member names and hometowns to seem more convincing.
- Internet Purchase Scam
- Relationship ScamRelationship Scam A Relationship Scam is a one-to-one criminal act that involves a trust relationship and uses deception & manipulation to get a victim to give to the criminal something of value, such as money! Click here to learn more: What Is A Relationship Scam? / Romance Scam / Dating ScamDating scam Dating scammers or love scammers create fake identities on dating apps and social media to coax you into fake online relationships. They often quickly move to personal channels such as phone or email, using your trust to acquire money or personal info, or help you hide their criminal activities. You'll probably never meet them in person. This is a relationship scam.
- Fake Check ScamFake Check Scam In this con, the victim deposits a phony check and then returns a portion by wire transfer to the scammer. The stories vary, but the victim is often told they are refunding an “accidental” overpayment. Scammers count on the fact that banks make funds available within days of a deposit but can take weeks to detect a fake check.
- Anti-VirusVirus A computer program that can replicate itself and spread from computer to computer or file to file. It comes to life only when you take a specific action, such as running a particular program. / Extortionware / Encryption Scam / RansomwareRansomware Ransomware is a type of malware from cryptovirology that threatens to publish the victim's personal data or perpetually block access to it unless a ransom is paid. While some simple ransomware may lock the system so that it is not difficult for a knowledgeable person to reverse, more advanced malware uses a technique called cryptoviral extortion. It encrypts the victim's files, making them inaccessible, and demands a ransom payment to decrypt them. In a properly implemented cryptoviral extortion attack, recovering the files without the decryption key is an intractable problem – and difficult to trace digital currencies such as paysafecard or Bitcoin and other cryptocurrencies that are used for the ransoms, making tracing and prosecuting the perpetrators difficult. Ransomware attacks are typically carried out using a Trojan virus disguised as a legitimate file that the user is tricked into downloading or opening when it arrives as an email attachment. However, one high-profile example, the WannaCry worm, traveled automatically between computers without user interaction.
Advanced Fees / Prepayment / 419 Money Scam
Scammers pose as representatives from phony loan companies and use authentic-looking documents, emails, and websites to appear legitimate. They charge “fees” in advance of making loans. Consumers pay, but the loans never come through. Scammers are long gone and they sometimes regularly change the name of their “businesses” to avoid law enforcement.
This is one variation of a scam called the “advance fee” or “prepayment” scam. Scammers can also lure victims in with promises of investments or inheritance gifts in exchange for a fee. But it all comes down to the same theme: Victims pay money to someone in anticipation of receiving something of greater value and then receive little or nothing in return.
See also: Fake Check Scam
Mystery Shopping Scam
Mystery shopping scams are popular with criminals who target employment websites. The ploy’s simple: Scammers send victims a check and tell them to use the funds to “evaluate” Western Union’s money transfer service. Victims wire the money only to find out later that the checks bounce and they’re responsible for paying the bank back.
See also: Fake Check Scam and Employment Scam
With overpayment scams, fraudsters play the role of buyer and target consumers selling a service or product. The “buyer” sends the seller a legitimate-looking check, usually drawn on a well-known bank, for an amount higher than the agreed-upon price. They contact an explanation for this overpayment and instruct the seller to deposit the check and wire back the excess funds. Weeks later, the victim learns the check is fake but is still on the hook to pay the bank back for any money withdrawn.
See also: Internet Purchase Scam and Fake Check Scam
Employment scams generally start with a too-good-to-be-true offer—work from home and earn thousands of dollars a month, no experience needed—and end with consumers out of a ‘job’ and out of money. They generally follow one of three patterns:
- Scammers pose as a new ‘employer’ and send victims a check to cover up-front expenses, like supplies. Victims deposit the check, buy the necessary supplies, and wire any remaining funds back to the scammerScammer A Scammer or Fraudster is someone that engages in deception to obtain money or achieve another objective. They are criminals that attempt to deceive a victim into sending more or performing some other activity that benefits the scammer.. Weeks later, they find out the checks are fake and they’re on the hook for the entire amount.
- Scammers pose as ‘recruiters’ pitching offers of guaranteed employment or as ‘employers’ extending job offers on the condition that victims pay upfront for things like credit checks or application or recruitment fees. Victims pay, but job offers never materialize.
- Scammers pose as ‘company’ representatives and seek sensitive personal and/or financial information from victims under the guise of doing credit or background checks. They then target victims later on for identity theftIdentity Theft Identity theft is when someone uses another person's personal identifying information, without their permission, to commit fraud or other crimes. In both the U.K. and the United States it is the theft of personally identifiable information. Identity theft deliberately uses someone else's identity as a method to gain financial advantages or obtain credit and other benefits, and perhaps to cause other person's loss. The person whose identity has been stolen may suffer adverse consequences, especially if they are falsely held responsible for the perpetrator's actions. Personally identifiable information generally includes a person's name, date of birth, social security number, driver's license number, bank account or credit card numbers, PINs, electronic signatures, fingerprints, passwords, or any other information that can be used to access a person's financial resources..
See also: Mystery Shopping Scam and Fake Check Scam
Lottery / Prize Scam
Lottery or prize scamsPrize Scams These scams involve someone claiming you won a prize. However, they say you must pay a fee or provide sensitive banking information in order to get it. They keep the money, and you get nothing for it. follow two similar patterns:
- A victim gets an unsolicited phone call, email, letter or fax from someone claiming to work for a government agency or representing a well-known organization or celebrity, notifying them that they’ve won a lot of money or a prize. The scammer gains their trust and explains that, in order to collect the winnings, they first have to send a small sum of money to pay for processing fees or taxes. Following these instructions, victims immediately wire the money, but never get their “winnings.” And they’re out the money they paid for “fees and taxes.”
- Victims get an unsolicited check or money order and directions to deposit the money, and immediately wire a portion of it back to cover processing fees or taxes. Weeks later, victims learn that the checks are counterfeit, but have already wired the money to cover the “taxes” and can’t get it back. And they’re on the hook to pay their banks back for any money they withdrew.
See also: Advance Fee/Prepayment Scam and Fake Check Scam
Rental Property Scam
Sophisticated scammers use the Internet, and particularly free classified websites, to prey on unsuspecting real estate victims. Rental property scams generally happen in one of two ways:
- Renters are looking for a house or an apartment to lease and get scammed by an “owner.” Victims come across a place in a great area, at a great price. The advertisement looks legitimate so they start communicating with the “owner,” generally by email. The owner says the place is theirs if they wire money to cover an application fee, security deposit, etc. They wire the money, and then never hear from the “owner” again.
- Owners are renting out their house or apartment and get scammed by a “renter.” “Renters” contact victims, generally by email, and express interest in renting the house or apartment. Scammers send a check for the deposit but then cancel the deal. Victims wire the money back only to find out the check was a fake.
See also: Internet Purchase Scam and Fake Check Scam
Emergency / Grandparent Scam
Emergency scams play off of peoples’ emotions and strong desire to help others in need. Scammers impersonate their victims and make up an urgent situation—I’ve been arrested, I’ve been mugged, I’m in the hospital—and target friends and family with urgent pleas for help, and money.
Emergency scams also come in all shapes and sizes. There’s the Grandparent Scam where con artists contact the elderly claiming to be their grandchild, urgently asking for money. And the Social Networking Scam where con artists hack into social networking accounts and then target friends with frantic requests for money, claiming injury, arrest, etc.; they do the same by hacking email accounts. They use the information in these accounts to supply enough personal detail to make their requests appear legitimate.
Also see: Relationship / Romance & Dating Scams
Internet Purchase Scam
In the internet purchase scam, criminals prey on victims who bid on items using an online auction website or service. It generally plays out in one of two ways:
- Victims win the bid, which is likely a sham or set up, and are told the seller only accepts money transfers for payment. The seller tells the buyer to put the transaction in a fictitious name, or the name of a loved one. Scammers convince victims this protects their money until the goods or services are received. The seller then creates a false ID in the fictitious name and retrieves the funds. The merchandise never arrives.
- The other variation is when the original auction is legitimate but the victims don’t win the bid. They’re contacted later on by another party offering to sell them the same item under similar terms and instructed to wire the money as payment. The money is sent but the buyer never receives the goods.
See also: Overpayment Scam, Rental Property Scam and Fake Check Scam
Relationship Scam / Romance Scam / Dating Scam
The relationship scam starts simply: A man and woman meet on the Internet. The relationship progresses: They email, talk on the phone, and trade pictures. And, finally, they make plans to meet, and even to get married. As the relationship gets stronger, things start to change. The man asks the woman to wire him money; he needs bus fare to visit a sick uncle. The first wire transfer is small but the requests keep coming and growing—his daughter needs emergency surgery, he needs airfare to come for a visit, etc. The payback promises are empty; the money’s gone, and so is he.
Also see: Emergency / Grandparent Scam
Fake Check Scam
Fake checks play a starring role in lots of different scams: advance fee or prepayment scams; mystery shopping scams; lottery prize scams, and more. Victims get an unsolicited check or money order and directions to deposit the money and immediately wire a portion of it back to cover various expenses, like processing fees or taxes. Weeks later, victims learn that the checks are counterfeit, but they’ve already wired the money and can’t get it back. And they’re on the hook to pay their banks back for any money they withdrew.
Also see Advance Fee/Prepayment Scam, Mystery Shopping Scam, Employment Scam, Overpayment Scam, Internet Purchase Scam, Lottery/Prize Scam and Rental Property Scam.
Anti-Virus / Extortionware / Encryption Scam / Ransomware
A fraudsterFraudster A Scammer or Fraudster is someone that engages in deception to obtain money or achieve another objective. They are criminals that attempt to deceive a victim into sending more or performing some other activity that benefits the scammer. contacts the victim claiming that they are from a well-known computer or software company and have detected a virus on the victim’s PC. The fraudster advises that the virus can be removed for a small fee with a payment by either credit card or an online money transfer. The fraudster then requests remote access to the victim’s computer to install anti-virus software to remove the virus. Unfortunately, the fraudster uses this access to take control of the victim’s computer to install software and malwareMalware Short for "malicious software," this term means computer viruses and other types of programs that cybercriminals use to disrupt or access your computer, typically with the aim of gathering sensitive files and accounts.. The fraudster may also steal credit card information that is on the computer and use it to complete online money transfer transactions.
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By the SCARS™ Editorial Team
Society of Citizens Against Relationship ScamsSCARS SCARS - Society of Citizens Against Relationship Scams Inc.
A government registered crime victims' assistance & crime prevention nonprofit organization based in Miami, Florida, U.S.A. SCARS supports the victims of scams worldwide and through its partners in more than 60 countries around the world. Incorporated in 2015, its team has 30 years of continuous experience educating and supporting scam victims.
Visit www.AgainstScams.org to learn more about SCARS. Inc.
A Worldwide Crime Victims Assistance & Crime Prevention Nonprofit Organization Headquartered In Miami Florida USA & Monterrey NL Mexico, with Partners In More Than 60 Countries
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