Scams and Complicated Explanations

Have you ever watched a movie or read a book where the villain’s ultimate downfall is that he just talks too much?

The hero lies broken and bruised atop some building at the triumphant bad guy’s feet, while burning bits of debris rain down all around them and helicopters whir away in the distance, their spotlights scanning the ruined streets below. The villain lets out a guttural, joyless laugh and aims some twisted destructive device squarely at our hero’s face…and then pauses. He begins to taunt, and then to talk. Then he launches into a monologue that becomes a sermon, going into great detail of how he masterminded the whole thing, and why.

Several minutes of explanation later, the villain is the one either defeated or put to the run by the good guy, or some quipping accomplice whose fate was left unknown a few scenes earlier appearing from behind an air conditioning unit. If the bad guy had just shut up and acted dastardly, he would have succeeded, and gotten away with it. The entire Harry Potter series would have been a novella about a kid who doesn’t survive his first year of wizarding school if Voldemort would have flapped his gums less.

The “talkative villain” trope holds true in a lot of scams, as bad actors attempt to distract potential victims from how fishy the situation really is.

Pet scams start with an online listing for purebred dogs or cats, often at unusually low prices. The seller may initially agree to an in-person transaction, but will soon come up with complicated reasons why the buyer can’t see the animal or pay in person. They’re out of town on business, or they’re overseas, or somebody is in the hospital. Eventually they ask for payment through a peer-to-peer mobile app, offering to ship the dog or cat on an airplane, tack on a few hundred dollars for shipping, then disappear with the money.

Car sales scams operate in a similar fashion, with some well-regarded used vehicle for sale (at thousands below blue book value) and an offer to ship the vehicle. Why is the price so low, you might ask? Oh, they’re just moving out of the country and have to get rid of everything fast, or it belonged to an ex and they can’t stand the sight of it, or they’re in the military and can’t take it with them. They might ask that you pay through an escrow service that turns out to be fake, or request payment by wire transfer or mobile app. Some might even generously offer to only take half payment now, and you can pay the rest when the car arrives on the trailer (that they’ll ask you to cover the rental for).

Romance scammers will use their alleged military service or job in an oil field to justify why they can’t meet their victim in person, or even video chat (“the internet out here is really bad…”), which also ends up being the reason why the target has to wire money, or to receive electronic deposits and disburse it to multiple bank accounts (i.e. helping the scammer launder money).

Apartment scammers who claim to own a property they have no legal ties to will also give complex reasons (travelling for their career, etc.) why they can’t meet a renter in person and must collect the deposit by some non-reversible, non-traceable means. Other scammers will comb online classified ads and, instead of making an offer and paying like a normal buyer, start asking the seller to add gift cards, or send a check for thousands more than the item is worth (“that’s okay, just wire the difference back”). They might also come up with strange reasons they would pay to have an oak chest of drawers shipped to Oregon from Maine, instead of buying local.

There are things you need to know when it comes to transactions: what is it, how much is it, how the buyer is going to get it. When a buyer or seller starts telling you their life story and using it as a reason to dictate the terms of the transaction, it’s safest to assume you’re dealing with a villain.

Be Careful Using PayPal Friends and Family Payments

PayPal offers two options for sending money to someone: “Goods or Services” and “Friends and Family.”

“Goods and Services” is how you pay for, well, goods and services. For example, say you’re like me and you have a vinyl record habit; you would use PayPal Goods or Services to buy yet another grip of semi-collectible audible oddities through a website like eBay. If the seller doesn’t ship anything, or sends a damaged item and won’t issue a refund, you can submit a claim through PayPal and get reimbursed if the seller refuses to make it right. It protects you from scammers and bad merchants.

On the other hand, if you just need to send money to a family member, you can use the Friends and Family option. This allows the person sending the money to pay the fee for using the service, rather than the recipient (as with Goods or Services payments).

There is only one case in which you should use Friends and Family: when you’re sending money to an actual friend or family member. Why? Because this payment option doesn’t have the same protections. Once you send money, it’s gone. There are no claims or disputes. It’s like wiring money or using peer-to-peer money transfer apps like Venmo or CashApp.

This lack of recourse for the sender has led scammers to place ads for everything from electronics to rental properties, then attempt to convince interested parties into sending payment through PayPal Friends and Family. This allows them to steal money without the victim being able to claw any of it back through a claims process.

The second an online seller requests that you pay with Friends and Family, cut off all contact and report the merchant to whichever website they’re selling on.

Watch Out for This Venmo Scam

You’ve been using the peer-to-peer payment app Venmo to transfer money between your friends and family for a while without incident, when suddenly a payment for $1,000 from a complete stranger appears in your account, along with a message: “omg I sent that to the wrong person can you please please please return it to me?”

What do you do?

Thinking about how sick you would feel if you had accidentally sent such a large amount to the wrong person, someone you didn’t know, you might be inclined to send the money back. However, it is very likely that you are about to be the victim of a scam that will leave you a thousand dollars in the hole.

Here’s how it works: the stranger will use stolen credit card data to load a Venmo account, then send money to an intended victim at random, along with the message pleading for the funds to be returned. In the meantime, the stolen credit card is removed from the scammers Venmo account, which is then linked to a bank account controlled by the scammer.

If the victim returns the funds, they are immediately deposited into the bank account and withdrawn. Meanwhile, the credit card data theft is discovered and the destination of those stolen funds—the victim’s Venmo account—is charged back for the amount originally sent by the scammer.

You might even notice that this is just a high-tech version of the old counterfeit check scheme: “take this money, then send it back to me.”

So…what should you do if a large deposit from a total stranger shows up?

First, ignore the messages. Use Venmo itself to rectify the problem by creating a new support ticket. Indicate that you did not request these funds, and that you are concerned about fraud. From there, let Venmo handle it.

Whatever you do, don’t try to take the money. The theft will be discovered at some point, and you will be on the hook for those funds. Remember: they didn’t come from the scammer. They came from a victim who had their credit card information stolen. You could just ignore the funds and leave them in your Venmo wallet, but it’s best to be proactive and contact the company with your concerns.

You Don’t Get Something for Nothing

Sometimes we get specific around here, with lurid details of a single type of fraud and all its permutations and variations, and how to avoid it.

Other times, however, it is helpful to zoom out and talk big picture, core principles that can help you avoid getting swindled by a con artist.

Here is one such principle to keep in mind: nobody ever really gives anybody something for nothing.

Have you ever had a job where your function was literally to be on the payroll, but provide absolutely nothing of value to the employer? Of course not. You may have had jobs that were easy, but whenever you’re getting paid, it usually means you’re giving back something of value in return in the form of mental or physical energy. (Whether you’re getting paid enough is outside the scope of this article, of course.)

But of course, when you say something like that, people start coming up with exceptions. Sure, a friend might just give you something they’re not using anymore, or a parent might hand you a sawbuck for no reason in particular when you’re a kid. So let’s refine it a bit: strangers aren’t giving free money to people on the internet. Here are a few forms these scams can take:

  • A fake Instagram profile claiming to be a recent Powerball winner, giving away free gift cards to anyone who asks. Every photo of the (actual) winner was a screenshot taken from the same television news report. $700 million and he doesn’t even have his own camera.
  • A fake “money flipping” investment where you use a peer-to-peer app (Zelle, CashApp, etc.) to send a stranger money, then they magically multiply it by 10 and send it back. Naturally, only the first half of this transaction ever actually takes place.
  • Every single “Bill Gates/Jeff Bezos/Mark Zuckerberg/Warren Buffett/Elon Musk/etc. had an email lottery and you won” (or “…is giving $500 to everyone who shares this “) social post, forwarded email or text message ever created.
  • “$295 per assignment!” for 10 minutes of mystery shopper work. Sure, at first glance, this may not appear to be a “something for nothing” type of offer, but $295 for 10 minutes is $1,770 per hour, which is $3.7 million per year, and that seems a bit steep.

Every one of these schemes has a different goal. Some are just trying to get a social media profile thousands of likes or follows, then sell the profile to someone else. Others are just quick-hit, “take the money and run” arrangements, and of course the old counterfeit check scheme never really goes away. The key is to never fall into the trap of thinking that the internet is full of benevolent strangers simply aching to give money away to random people. It is not, and it never has been.

Mystery Shopper Scams Never Die

One of the first fraud prevention topics I ever wrote about (all the way back in 2009) was the Mystery Shopper Scam.

The scheme was almost always the same: victims would receive a cashier’s check in the mail with instructions to cash the instrument at their bank, then wire most of the money (a couple thousand dollars) back to the sender, allegedly to report on the “customer service” at Western Union. Later, the check would turn out to be counterfeit, leaving the victim on the hook for the money they already wired.

Of course, eventually people started catching on. Banks and credit unions began to verify cashier’s checks and ask questions before handing over large sums (bringing an end to the days of a cashier’s check being “as good as cash”), and tellers were trained on how to spot a fishy monetary instrument. Western Union got hit with a $586 million fine for “aiding and abetting wire fraud” and became more vigilant about how its services were being used. Consumers began to be wary of strangers mailing cashier’s checks.

However, I received this text message recently:

Become a Mystery Shopper with us. You will be requested to shop at various locations: Walgreens, CVS Pharmacy, Family Dollar, 7-Eleven, and Walmart. You will conduct “American Express Gift Cards” and Groceries purchases. Verifying stores ID Requirement process are being met. Pay Rate: $295. Apply today online [URL redacted]. HR Byrnes

From this, I gather that the scam has evolved to circumvent the changing landscape. The “Groceries purchases” are irrelevant; the real action is the American Express Gift Cards. If I had to guess, I would say that at some point they ask victims to buy these cards preloaded with some specific amount, then relay the card numbers back to them. Maybe there is a fake check involved (some of the above stores do offer check cashing services), but if they can convince the victim to load up a gift card and tell them the numbers, why go through the trouble?

Notice what they’ve done here: by switching from wire transfers to gift cards, the only other person the victim needs to have contact with is the cashier selling the cards, and with nothing inherently suspicious about loading a gift card, what is the likelihood that cashier is going to ask any questions? After that, the victim is alone, with nobody between them and their phone to say, “Hey, maybe don’t give those numbers to a stranger.”

One more point to make: real mystery shopper gigs do exist. They pay about $10 per assignment, less than 3.5% of the rate being offered in this text message. Nobody is getting paid $295 for 15 minutes of work, at least not as a mystery shopper.

Don’t Fall for the White Van Speaker Scam

You’re at a gas station or passing through a parking lot when a guy calls to you from a van filled with stereo equipment. He says he works for a company that deals in high-end home theater systems for wealthy clients, and they just got done with an installation for which too many components were ordered. He shows you brand new speakers, amplifiers or digital projectors, still in their boxes, and says they’re selling them at a loss because they can’t be returned. He produces a brochure showing speakers priced at $849, the same ones he’s willing to sell you for a mere $50.

How would you respond to this situation?

If you said, “walk away and don’t buy anything,” your instincts are correct.

The White Van Speaker Scam has been around for decades, at least since the 1980s and possibly earlier. It doesn’t have to be a van, which doesn’t have to be white, and they don’t have to be selling speakers, but the basics remain the same: convincing a buyer that they are getting a big discount on high quality goods that turn out to be junk. It can happen in-person like the example above, or online through sites like Craigslist and Facebook Marketplace.

The items being sold always turn out to be garbage, no matter what jargon the seller throws at you. Speakers are almost never actually capable of handling the claimed wattage, cheap paper cones are concealed with fake ones, and the enclosures are often weighted with bricks or concrete to give them more heft (to make them “feel expensive”). Stereo components and projectors are similarly cheaply made, off-brand and occasionally non-functioning. There are cases where the box doesn’t contain anything but rocks or bricks.

No professional home theater installer is ever going to “accidentally” order too many speakers or any other equipment. What company would have an order for a single 5.1 surround system and buy six more systems by mistake (and drive all six to the job site)? And even if they did, wouldn’t they just warehouse the extras for the next orders? There’s no rule that says, “we didn’t use these supposedly-high-end electronic components today, therefore we either have to sell them at a loss or toss them in a dumpster.”

However, you don’t really need to think about it that much. You only have to remember two things: first, if a deal seems too good to be true, it is too good to be true. Second, don’t buy electronics from dudes in vans.

Don’t Get Scammed a Second Time

It’s bad enough falling for one scam and losing money. What’s worse is losing even more money to a Recovery Scam.

Recovery scams target victims who have already fallen for a different scam. Con artists keep lists of victims and their contact information, what they fell for and how much money was lost, and sell these lists to other scammers. Some of these will use this information to conduct recovery scams, which are just another form of advance fee fraud.

It starts with a phone call or an email, or even a letter. The person contacting you will claim to represent a private company or federal agency and offer to help you get back the money you lost in a previous scam. They may even claim to be the (nonexistent) company that stole your money in the first place, offering a refund.

What happens next is not hard to predict: in order to get your money back, or file the paperwork to do so, or whatever else they’ve cooked up to sound believable, the recovery scammer will ask you pay an upfront fee, which might involve the usual sketchy payment methods like gift cards, wire transfer or cryptocurrency. They may ask for banking or credit card account details. Or they may send you a check for much more than the amount you originally lost; you will then be instructed to cash the check and wire the overage back to the sender. Later, the check turns out to have been counterfeit and you are once again left holding the bag.

If you have fallen victim to a scam, and especially if you sent money by some irreversible, untraceable means, you must admit to yourself that those funds are gone for good (as painful as that admission can be). Also, be aware that there is now a decent chance someone will attempt to victimize you a second time with a recovery scam. But anyone who contacts you out of the blue, regardless of the stated reason, to ask for money or financial information is almost never someone you should trust.

Scams That Target Young People

Endless articles are written about scams that focus on the elderly, which can give the impression that only seniors are targeted by (and fall for) scams. However, young people fall victim to a host of schemes every day. Many of these are just the same old tried-and-true scams we’ve seen a million times, with their approaches tailored to their intended group.

What makes young people susceptible to these scams? Trust in the digital world is a major factor—a world in which nearly everything can be done online is the only world many have ever known, and they inherently trust it. Additionally, humans of any age are easy to trick with images, and young people are no different, so their taking of social media images at face value is understandable. And of course, lack of life experience plays a role.

Money Flipping: these scams often originate on Instagram, with profiles appearing to depict fabulous material wealth. The scammer will offer the victim an investment that seems too easy to pass up: “Send me a few hundred dollars with CashApp or Venmo, and I will turn it into thousands and send it back.” Only the first part of the transaction ever actually occurs. Sometimes they dress it up as a cryptocurrency investment, or complicate the pitch in different ways, but it always comes down to some “secret” method of magically multiplying money.

Sugar Daddy/Sugar Momma: an (alleged) older person will contact a young victim, offering a generous “allowance” in return for online companionship. From there, the scheme proceeds into well-worn scam territory, usually either a fake check scam or advance fee fraud. In the former, the victim will be sent a check and instructed to purchase gift cards or Bitcoin, or make a wire transfer. In the latter, the scammer will request an upfront payment from the victim, to “prove” his or her loyalty. In other cases, the scammer will offer to pay loans or bills, then ask for financial account information. You can guess what happens next.

Blackmail Scams: the scammer, posing as an attractive stranger, will goad the victim into sending compromising photos, or convince them to meet in a video chat app (to capture video of the same), then threaten to distribute these images to the victim’s friends, family or workplace if payment is not made. Since the initial approach is made via social network, the scammer will have easy access to the names of people the victim knows, which adds urgency to the threat.

Drop-Shipping Scams: counterfeit fashion is rampant online, with websites offering deep discounts on designer goods. What actually arrives, several months later, is incredibly cheap, unwearable knockoff clothing or accessories, or cosmetics containing unknown ingredients.

Influencer Scams: a related offshoot of the drop-shipping scheme is an apparent offer from a designer to be “sponsored” by their brand (in other words, the start of the elusive, sought-after career as an INFLUENCER), which is then followed with an offer to purchase their items for 50% off. Here’s the thing: if they’re not giving it to you for free, you’re not an influencer, you’re a customer. And you’re going to get the same drop-shipped knockoff junk they sell to everyone.

Online Auto Sales Scams

An online listing for a used car from a private seller can be tempting, especially when the price is right, but too many people fall victim to scams involving these transactions. There are a variety of warning signs.

First, look at the price of the car. Compare the asking price to a trusted source for used car values. If there’s a huge difference, stay away. $1,000 for a car that retails for $4,000 is a bad sign.

Next, a seller’s refusal to let you see or test-drive the car in person is a huge red flag. Of course, there is still the matter of a pandemic to think about, and a lot of scammers have used this very reason for not allowing potential victims to see the vehicle, but a list of excuses as to why you must purchase the car sight-unseen should send up some signals.

On a similar note, beware of ANY convoluted story from a seller, or urgency. “I need to sell this car right away because my (whomever) did this or that and I have to go to (someplace) to work on (something) or my (whatever) is going to (whatever).” You don’t NEED all that information, and no legitimate seller should be constructing a narrative around the car other than, “How much are you willing to pay for it, do I agree to that price, and when are you going to pay for it?” If the seller claims to be overseas, in the military, or working in an oil field, stop all communication. These are some of the most common scam setups (also popular in online romance schemes).

Speaking of payments, if you’re looking at a car on an online service such as eBay Motors, do not allow a seller to communicate or do any business outside of that system (such as by email or text message). Scammers will do this to make the transaction untraceable. Some will go as far as setting up a fake website that mimics eBay in order to gain your trust, then attempt to convince you to pay with gift cards or by wire transfer. As with every other case, payment by these non-traceable, non-reversible methods is a sure sign of trouble.

5 Tips for Avoiding Repair Scams

Spring means a lot of things: longer days, warmer temperatures, trees and flowers (and allergies) in bloom, migratory birds returning from their winter homes.

It also means fixing up all the stuff on your house that broke, fell, cracked, blew away or started leaking over the winter. This also means home repair scammers coming out of the woodwork.

Many homeowners can do some repairs on their own, but most of us need help with bigger issues. Additionally, age plays a role in our ability and confidence to perform certain tasks. At 40 you might be willing and able to climb a ladder onto the roof; at 80 it may not seem like such a great idea. Home repair scammers often target older homeowners for this very reason.

Here are five things to watch out for.

  1. Someone knocking on your door: this is the number one way non-trustworthy contractors will approach you—out of the blue, at your doorstep, allegedly just having noticed some major problem with your house while in the neighborhood. No legitimate contractor works this way.
  2. Claiming to have extra materials left over from another job: any contractor worth your business isn’t going to “accidentally” order too much of anything.
  3. Refusing to put anything in writing: a verbal agreement without a written contract detailing the job and final cost is an invitation for the price to suddenly double or triple when the (likely shoddy) work is done. Get multiple bids, in writing, before beginning any major repair.
  4. Wanting full payment in cash up front: this is a setup for a classic take-the-money-and-run scheme.
  5. High-pressure sales tactics: don’t trust anyone trying to make you reach an immediate decision. A good contractor knows most homeowners are not going to go with the first bid, and that price isn’t necessarily the only deciding factor when choosing.

Be extra cautious after any kind of major storm event that caused flooding or other damage. Scammers will hit the streets in droves after a big storm, offering to fix rooves and gutters and siding. But the same rules still apply. You don’t want to end up losing money on some contractor who did lousy (or no) work.