Category Archives: General Scams

Don’t try to get something for nothing

Sometimes you walk a fine line when you’re writing about how-to-not-get-swindled. On one hand, a victim is a victim, and it’s not nice to place blame on them. On the other, there are scams that prey upon some all-too-human tendencies  (which we all have within us, make no mistake about it) to be a little avaricious.

When it comes to this category of scams, here’s the rule: don’t try to get something for nothing.

Think about all the fake iPad scams you’ve heard about. A guy approaches you at a gas station and offers to sell you a brand new iPad for a super-low price. You find out later that the box contains a mirror or some other non-iPad object.

It’s no fun to get conned, but ask yourself: is there anything about a guy selling iPads at a gas station that doesn’t scream “This is not legit!” when you really think about it? Apple doesn’t sell its products from cars at filling stations.This is either a scam or an attempt to unload stolen goods. You’re almost better off with the mirror.

What about the Pigeon Drop scheme? Forget the whole “Let’s have this person hold your good-faith money while we do this-or-that to divvy up this satchel of cash we found” angle…how many movies do you have to watch to know that “satchel full of money” equals “drug dealers/hit men/bank heists/things you don’t want to get within ten miles of”? Honest people who find big stashes of currency contact law enforcement, because there’s no way that cash is not evidence of some major crime. It couldn’t be more obvious if it was in a big white sack with a huge dollar sign printed on it.

The rule applies to all manner of scams and rip-offs. $437 sounds a bit steep for an hour of work, doesn’t it? Then don’t fall for the secret shopper scams. Brand-name prescription drugs for a tenth of the cost? Sounds too good to be true! That’s because it is.

We’re all looking out for ourselves on some level. If I see a ten-dollar bill bouncing merrily down the sidewalk on a windy day, I’ll pick it up. But I’ll also check around me to make sure nobody was chasing it, or standing there with that distraught look that can only mean one thing: their tenner just blew away. (For the record: this never happens to me…I’m much more likely to be the one with the distraught face.)

However, moving forward, remember this: if someone approaches you offering something for nothing (or next to it), take warning. You’re either about to be scammed or become an accomplice.

The irony of online banner advertisements

Earlier this year, an article about the Iraqi Dinar Scam appeared on Forbes.com. Here’s a screenshot:

2012-11-09a2

First, let me go on record here: I disagree with the author’s use of the word “stupid” in the title of this article. It’s arrogant. Falling for a scam doesn’t make you stupid; it is my deeply-held belief that everyone is vulnerable to scams. Every single one of us has some magic combination of situation, emotion and opportunity capable of leading us straight into Scamsville. My goal with this site has always been to eliminate as many of those possibilities as possible; to make your own scam-combination-lock as difficult to decipher as possible. But we’ve all got a tell. Somewhere. I can’t emphasize this enough.

But this particular scam isn’t really my focus here. Yes, the Iraqi Dinar Investment Thing is very much a scam. The fact that entities selling it have to classify their businesses as a service for collectors of exotic currency (and not as a foreign exchange investment) to get around regulations should tell you something. Now you know. Go forth and tell others.

No, my focus today is to point out one of the absurd ironies of online publishing and the keyword-based online advertisements that accompany it. Because, on the very same page as the article shown above, this advertisement appeared, plain as day:

 

2012-11-09b

Yep. An advertisement for a business involved in the very scam the article spends several hundred words discussing.

No, I didn’t click on it. I don’t trust these businesses enough to even expose my computer to their websites. So I can’t give you any further details on this particular “offer,” but I can assure you: it involves you paying a few thousand dollars for a mound of paper that’s going to be worth the same nothing ten years from now that it’s worth today.

So here’s your takeaway for this Friday: for the most part, just don’t click on advertisements that appear on websites, even when those websites are reputable (I mean, Forbes wasn’t exactly founded a week ago, you know?). Even if the ads seem relevant to what you’re reading.

In fact, lots of web browsers now have plugins available that will block banner ads from view altogether. Adblock for Google Chrome is popular. I used it in the past, but since I have to occasionally write articles on this stuff, I felt it was better for me to be able to see the ads. There was even a variant called “Catblock” at one point, which replaced ads with pictures of totally adorable cats. Which is just awesome.

“Does this fit with the way the world works?”

I saw a video the other day that featured Michael Shermer, editor-in-chief of  Skeptic magazine, talking about questions you can use to evaluate claims when it comes to science vs. pseudo-science. With a nod to physicist Carl Sagan, he referred to the method as a “Baloney Detection Kit.”

The fourth question in the Kit was:

Does this fit with the way the world works?

In other words, does the claim being made jibe with how reality tends to operate across a variety of situations?

What an excellent question to keep in mind when it comes to avoiding scams.

As I perused my Google Alerts for the latest news items about different types of fraud, I found that a lot of them could be avoided by simply asking that very question before acting. Here are some examples:

From Connecticut: Scam Targets Payday Loan Borrowers

In this scheme, a caller claims to be collecting on a delinquent loan, and tells the victim they will be arrested unless they make a payment over the phone right away. Is this how the world works?

Not even close. First, lenders don’t have the authority to decide if you’ll be arrested or not. The police in the U.S. are not employed by private financial institutions. Sure, if you commit loan fraud, they can contact authorities, but being delinquent doesn’t usually fall under that umbrella. Debtors prisons went out quite a while ago in this country. Second, whatever the circumstance, they don’t call you and tell you about an impending arrest in advance. You generally only get to know about it two seconds before it happens.

From Arizona: New Scam Claims that President Obama will pay Consumers Utility Bills

So the President’s gonna pay your light bill for you, huh?

Just like Reagan and Nixon and Kennedy all did, huh?

And he’ll be over tonight at six for dinner, with a marble rye and Trivial Pursuit, right?

Folks, this is not how the world operates. Presidents don’t pay your utility bills. In most cases, that one’s all on you. Don’t fall for it. They want you to surrender information so they can commit identity theft.

From Everywhere: The Exiled Nigerian Prince Scam

I won’t go into details about these scams, since most of you probably already know about them (here’s an old article if you don’t), but suffice it to say they fail the “is this how the world operates?” question with flying colors. Rich people don’t just give massive amounts of money away to random strangers. It would be nice if they did, but wishing something were true doesn’t usually do much to change the facts.

From Everywhere Again: Secret Shopper Scams

Offers for jobs that pay lots of money for minute amounts of unskilled work don’t appear out of nowhere in your email inbox. People who make $150 for an hour’s worth of work have advanced knowledge, skills or education to make their time that valuable. Cashing a check then wiring the money to someone doesn’t meet those requirements. Also, finding a job usually requires you to take the initiative first.

From South Carolina: Charleston police warn elderly against ‘found money’ scam

I suppose it’s possible that someone could find a wallet or briefcase that contained a large sum of cash. It still seems more like something that would happen in a movie than real life, but wallets exist, cash exists, and people who lose things exist. There’s no physical barrier to someone finding a vessel of some sort, bursting at the seams with cabbage.

However, upon finding such an object, there is generally a binary, either-or course of action that will follow, depending on the person who found it:

Honest Person: they’ll call the police and turn it in.
Dishonest Person: they’ll keep it all and run away.

There’s really not a whole lot of variation here. That’s just how the world works.

What won’t happen is that an honest person will find the cash, then offer to split it with a random stranger. Their concern will be for the owner of the money, or for helping solve a crime (because, let’s face it, big wads of discarded money have a distinctly criminal aroma about them).

What also won’t happen is that a dishonest person will find cash, then offer to split it with a random stranger. Their concern will be for their own gains and their own gains only.

Neither of those fit with how the world works, so if anyone in a parking lot ever tells you they found a big stash of money, don’t believe a word they say. That cash is a decoy, and they’re trying to get you to part with a chunk of “good faith money.” Politely decline, get a description, go somewhere safe, and rat ’em out. You just might save someone else from becoming a victim.

Scams Hit Northwest Indiana

Scam artists and less-than-honest businesses seem to be running wild in Northwest Indiana lately. Within one week, three different articles appeared in the NWI Times:

  1. AG Zoeller files lawsuits against local businesses
  2. National rental scam reaches NWI
  3. C.P. police warn of telephone scam; two residents victims

We’ve got a full line of scams and rip-offs here: car dealerships rolling back odometers, shady mortgage schemes, the grandchild-in-trouble telephone scam and a few Craigslist rental property scams.

The articles above do a fine job of presenting the details of each situation; no need to rehash here. The real lesson is this: always be aware of potential scams, watch out for anyone promising to lower your mortgage payment, never take an online classified ad at face value, never wire money to anyone who contacted you first, and always get a Carfax report before you buy a used auto.

The bad guys are out there, and they have a variety of methods at their disposal. All the rest of us can do is be informed, ask questions and stay vigilant. But those simple tools go a long way towards keeping yourself away from scams and fraud.

How to Weed Out Scams

When you read about as many examples of scams and identity theft as I do, you start to notice patterns. Even though the details may change, most scams are based on one of a few tried-and-true structures.

This actually makes it easier for you to avoid them, however. Instead of learning the minutiae of every new con job that comes down the pike, you can apply a few basic principles to steer clear.

One of those principles is similar to “Who Initiated Contact,” which I wrote about several months ago. This time the question is, “Did you take action that would lead to this transaction?” Here are a few examples.

Lottery Scams

Lottery scams always seem to come up, but people still fall for them, so a little refresher never hurts.

With a normal, legitimate lottery, you begin the transaction by purchasing a lottery ticket. You then wait for the numbers to be called. If you win one of the big prizes, you take action again by contacting the lottery office, presenting the ticket, filling out paperwork. If you don’t take this action, they might know when and where a winning ticket was sold, but they won’t contact you.

Lottery scams don’t start with action on your part. Out of nowhere, someone emails you and informs you of a lottery you’ve won. It’s the exact opposite of how a genuine lottery works. The rest of the scam runs in similar bizarro-fashion, with the victim sending money, but if you stop to think, “Did I take action that would logically lead to this?” first, you won’t even bother to get that far.

Employment Scams

Employment scams come in all shapes and sizes, and their objectives range from taking your money outright to leaving you as the only traceable, domestic link in a money laundering scheme.

However, most of the time, when you find a new job it’s because you took some action first. You filled out an application, sent a resume, networked with people in the industry. You probably didn’t just wait for a job to fall on your head.

Employment scams often don’t wait for you to take action. You’ll get an email that claims you’ll make hundreds of dollars per day. You’ll be “hired” without an interview or application. Pay is often wildly out of proportion for the work you’ll supposedly be performing ($10 to stuff an envelope, for example), which is another way to apply the question of whether you took action; would any employer in their right mind pay you over a hundred dollars for less than an hour’s worth of mindless work?

There is a caveat here, though: not all employment scams can be weeded out this way. If you’re actively looking for a job and posting resumes on job websites, you’re taking action that could lead to employment opportunities (post a resume on Monster.com and see how many work-at-home “payment processor” jobs (i.e. money laundering) you’ll be offered via email, sometimes within an hour). To further complicate matters, fraudulent companies often post fake listings on job sites, so you might be tricked into sending your resume to them first. Always research any company before you apply, but also remember that high-paying job offers don’t just fall out of the sky.

Mortgage Settlement Scams

A scam recently surfaced in Virginia that targets homeowners who are underwater or in foreclosure. It starts with a phone call that tells victims they are owed money from a federal mortgage settlement and ends with the victims revealing bank account numbers in hopes of receiving a check, only to be remotely cleaned out by crooks.

The scam is based somewhat on fact—there was a settlement with mortgage lenders meant to make good on bad foreclosure practices—but those eligible still have to take action first. Applications and other paperwork have to be filed, and the homeowners have to be the ones who start the process.

Asking “Did I take action that would lead to this?” isn’t the only method to spot a scam, and as noted above, it’s not always the best test, but it’s a good weapon to keep in your arsenal for the next time a possible scam shows up on your radar.

BBB launches Scam Source website

The U.S. Better Business Bureau has launched a new website called Scam Source.

The new site features a channel for consumers to report scams they’ve encountered, a “Scam Aggregator” with links to articles around the web, and email alerts.

I encourage you to poke around the site and sign up for the alerts. It’s still new, so it will be interesting to see what scams they uncover.

Text message scam: there needs to be a word for this

We need to come up with a word for “scams that arrive via text message, but are not phishing attacks, which already has a word (SMiShing).”

Crooxting? Because they’re crooks, and they’re texting you. Something tells me this is going to be an uphill endeavor. Sort of like trying to make ‘fetch’ happen.

Anyway, this showed up on my phone the other day, in two parts:

FRM:ci2 h5j8
MSG:Bestbuys giving away
Leftover Cyber-Monday
$1000 giftcards at:
goo.gl/6u2nQ?QQHEJ go
claim yours

ci2 is texting
you for free using Textie
app. You can reply or text
‘stop’ to block, Get Textie
free in the iPhone App
Store.

I’ll give you a shiny new penny* if you can find five things that DON’T scream “absolute scam” about this, because I sure couldn’t.

I also won’t be texting ‘stop’ to anyone, either; I don’t want to confirm that mine was a genuine phone number.

If you get one of these, just delete it.

*Disclaimer: Not a genuine offer. I don’t have a shiny new penny. Which is making this Penny Racer totally unfun to play with, by the way. No wheelie action at all.

One for the kids and one for the seniors

Here’s a new scam that targets kids:

Among fans of Justin Bieber, getting the popstar to follow you on Twitter is apparently a badge of extreme OMG-ness, which means it was inevitable that a scam would surface exploiting the fact.

If you even mention the star on Twitter, there is a good chance someone will direct message you with a URL that supposedly reveals a surefire way to get the star to follow you back. It then leads you to a site that requires a cell phone number and for the victim to take yet another bogus IQ test.

What happens next: the victim’s phone is charged $10-$20 per month for some lame premium service, and Justin doesn’t follow them at all.

As of the latest reports, the original scam site had been shut down, but it won’t be long before it resurfaces. Warn the kids: anyone on Twitter that tells you they have a way to get a star to follow them back is leading them into a scam. Also, in a year when there’s some new pop culture obsession, just take out the words “Justin Bieber” and fill it in with the Current Big Thing, and repeat the warning.

Here’s one that targets seniors:

A guy in coveralls will hang around a parking lot and wait for an elderly person to go into the store. He’ll then dump some oil or brake fluid near the  car. When the potential victim returns, he’ll tell them he’s a mechanic and that he can fix the car. One he “fixes” the non-existent leak, he informs them he has to charge for the “service.” I would assume they get a bit aggressive if the victim refuses.

If someone in a parking lot offers you auto repairs out of the blue, politely refuse. Take your car home and park it. If there’s a (new) pool of fluid a few hours later, your car really does have a problem. Take it to a real mechanic you trust.

But there probably won’t be, because in all likelihood you were approached by a con artist.

Locksmith Scams

If it hasn’t already happened to you, it will: you’re going to lock your keys in the car, lock yourself out of the house or find out that a lock rusted shut over the winter.

You’re going to need a locksmith.

It happens to everyone, and yet it’s a need now complicated by con artists; it seems locksmith scams are on the rise.

Typically, victims start by searching online for a locksmith. They call a random listing and get a reasonable-sounding estimate over the phone. When the “locksmith” actually shows up, however, they start adding charges until the price is completely out of line. Since most people in need of a locksmith are in a tight spot, they often end up paying. Sometimes, as a bonus, the phony locksmith will damage your property.

How do you avoid this scam? Choose a locksmith now, before you need one. Either get one you’ve used before and already know to be trustworthy, or check out the Better Business Bureau and online reviews. Make sure you’re dealing with an actual local business instead of having your call routed to a national number, and refuse to use any locksmith that only accepts cash payment.

Once you’ve got your locksmith, save the number in your mobile phone and keep it handy at home.

When you’re away from home, it’s a little trickier to choose one on the fly, but you can still watch out for warning signs like rapidly-escalating costs and cash-only operations.

How NOT to rent a home

Let’s say you’ve just got an excess of money in your life, and you’re tired of it. To remedy the situation, you decide to lose eleven or twelve hundred dollars to a con artist.

Now, how should you go about it? Eureka! To Craigslist!

Start looking up rental properties on Craigslist and find a few you like. Start contacting property owners until one instructs you to drive by the house and check it out. The owner himself can’t be there to show you around the place because he’s on vacation overseas. However, if you like the look of the place, you can just send a check for the first month’s rent to his vacation address (or wire the money).

Follow his instructions to the letter, and hey presto! you’ve just lost several hundred bucks! The person on the phone never did own the house, and in fact has just lifted photos from a legitimate rental advertisement.

Naturally, nobody actually wants to lose money to a scam, so what I’m really saying here is don’t do any of the above.

Okay, fine, you can look for apartments or houses to rent on Craigslist. That, in and of itself, isn’t a mistake. However, if you find one you’re interested in, absolutely refuse to hand over money unless the property owner agrees to meet you there in person, has a key that opens the door, shows you the inside, and can prove that the property belongs to him or her. (You still might want to bring a friend with you, because there are other, non-financial risks associated with meeting a stranger.)

Also, never hand over money until contracts have been signed and everything is official and legal.

With the kind of scam described above, you have to consider three questions: first, why would you agree to rent a house or apartment, mostly sight-unseen (except for the outside)? What if you find out there’s no kitchen and the only toilet is right in the middle of the bedroom?

Second, why would they agree to rent a house to you, sight-unseen? There are people in the world who just wreck stuff. Any owner renting out a property is going to want to feel you out in person and make sure you at least don’t seem like the type that’s going to cut a hole in the living room wall with a chainsaw three days after you move in.

Third, if the house is locked up and the owner is supposedly on vacation overseas, how’s he s’posed to give you the key?