Tag Archives: Fraud

$500/week to wrap your car in ads? Better think again.

I still haven’t encountered anything that contradicts this fraud prevention axiom:

“Cash this check then wire the money back to me” is a sure sign of a scam.

It’s a fairly easy pattern to spot when it comes to things like lottery scams, because the scammers almost literally use that exact wording. But there are other times where the “wire the money back to me” stage is a little more obscure.

One such case is the Car Wrap Advertising Scam. Below is a scan of an actual letter used to initiate this scheme after the would-be victim responded to a random email or text message offer. This letter came with a cashier’s check for $2,390.00 (click to enlarge):

In this case, they’re not directly saying “wire the money back to me,” but they are telling you to give it to someone else, in the form of setting up a payment to a “Decal Specialist.”

What happens when you contact this person? You’re instructed to wire the money from the check, which will eventually be returned as fraudulent, putting you on the hook for the cash you gave away. It’s the same pattern as a lottery scam, only with an additional step in between.

One reason this scam continues to work is that there are actual wrapped cars out there. We’ve all seen them. However, even in cases where these aren’t company-owned vehicles, legitimate car wrap advertisers share certain features:

  • They don’t randomly contact you out of the blue via text message or email
  • They don’t take everyone who applies; they’ll want to know how far you drive each day, where you drive, what kind of car you have, and your driving record
  • They’re not going to pay you $500 per week. About $1,000 per month seems to be the ceiling, and that’s for absolute ideal (for the advertiser) circumstances (i.e. you drive hundreds of miles per day in an area extremely densely-populated with people within the ad’s target demographic; I’m guessing your car has to meet certain visibility criteria as well, because I’ve mostly seen these ad wraps on lifted, customized 4×4 pickups)
  • You don’t pay them at any point, and you’re not responsible for passing along money to whomever applies the decals (“Hey stranger we’ve never met in person, here’s a few thousand dollars to give to someone else for us. We’ll just trust you to not keep it.”)

If you’re truly interested in turning your vehicle into a billboard, there are a few links to apparently legitimate agencies in this Penny Hoarder article. But before you act on anything online, be sure to do a lot of research first, and always get in writing what you are agreeing to do and how you will be compensated. If it’s too easy to get the gig, it’s probably a fraudulent offer.

What is a ‘Money Mule’ scam?

Cybercriminals rake in a lot of cash from their activities (such as mystery shopper scams, lottery and romance scams, and identity theft), which creates a problem: for the most part, they can’t simply start using the funds for personal gain because financial institutions generally ask questions when dealing with amounts in the hundreds of thousands or millions. They need to launder the money to give the appearance of legitimate origins.

Enter the “money mule.”

Criminal organizations set up fraudulent businesses and recruit people with online work-at-home advertisements. These victims are hired under titles like “Transfer Agent” to act as intermediaries between non-existent business entities, supposedly to legally circumvent bureaucratic requirements, fees or taxes.

Anyone who responds to one of these offers will be instructed to open a new account, usually at a specific large bank. The victim receives incoming wire transfers in the $10,000 range, keeps a certain percentage, and then wires the rest (in chunks of around $3,000) to various (fraudulent) companies around the world. Repeat this for a few cycles between a few hundred victims, and the original source of the money becomes obscured.

Unlike the majority of scams, you may notice a difference here: in this case, the mule actually can make a profit. So why not look for a “Transfer Agent” job online and become a “victim,” make a quick couple hundred bucks and then get out?

Because, also unlike other scams, there can be legal consequences for the victim. In an effort to crack down on this type of activity, financial institutions are getting good at noticing suspicious wire transfer activity, and you could end up getting arrested when (not if) you get caught. Not worth it.

The key is to be very suspicious of any job opportunity that seems like it pays too much for the work required, shows up out of the blue (even if you’ve posted a resume on a job website), and steer clear of anything that involves receiving funds via wire, then disbursing those funds to others.

Fraudulent Customer Service Phone Numbers

By now you’ve probably heard about Tech Support Scams, where someone calls you out of the blue and tries to convince you that your computer is infected with a virus, that they have somehow detected it remotely, and that the only way to fix the problem is to hand over money, control of your computer, or both.

It’s one of those scams that can easily be avoided with the question, “Who initiated contact?” If they called you, it’s fraudulent.

But what about when you’re the one initiating contact?

When you need customer service from a large company like Amazon, Facebook or Netflix, it’s important to make sure you’re getting their contact information from a trustworthy source. Internet searches might lead you to a correct number, but the internet is also brimming with hundreds of examples of fraudulent customer service numbers, posted by criminals in hopes that you will call them instead of the legitimate phone number.

What happens if you call a fraudulent number? They may try to get your password information to take over your account and lock you out, they may ask you to reveal credit card or other financial account information, or they may take over your computer (with your help) and install malicious software or commit other crimes.

If you need to contact customer service, make sure you’re getting your information from a reliable source. Don’t trust phone numbers that appear in online forums. If you notice zeros replaced with the letter “O” (1-8OO instead of 1-800, for example), that’s a sure sign of a fraudulent phone number.

With some companies, Facebook being the most prominent example, there simply is no phone number you can call. Any problems have to be resolved using online tools. Every single phone number you see listed on the internet as a Facebook customer service line is false information.

The best way to find customer service contact information is to go directly to the company’s website and look for links like “Help” or “Contact Us.” Sometimes there will be options for help via email or chat and no option for telephone contact, other times the phone number will be front and center. It depends on the company you’re dealing with. In any case, to avoid a massive headache and potential losses to fraud, always make sure you’re getting the number from the official source before you even pick up the phone.

One Easy Rule for Avoiding Investment Fraud

I read about a phony investment scam recently. This one didn’t even have the sophistication of a pyramid or Ponzi scheme. The pitch basically consisted of this: “Give us $800 now, and later you’ll get up to $3,000 for being an early investor.”

I’m not even sure how much detail it went into beyond that.

And sure, it’s easy to spot such an obvious scam…from the outside. But real people fell for it. There was something about the approach that sounded appealing and legitimate. I say it all the time: nobody is 100% immune to fraud.

Still, I wasn’t going to write a whole article about this particular scheme because there really wasn’t anything to write about, but it did make me think, “Is there some kind of basic rule that people can use to filter out schemes like this?” The victims were approached with an (alleged) investment opportunity that sounded good, sent their money, and never got a dime back.

And there it was: they were approached.

They weren’t looking for something to invest in. Somebody approached the victims, out of the blue, with the promise of large, guaranteed returns.

Large, guaranteed returns are suspicious enough, but think about how investing really works in the real world: unless you’re a venture capitalist, nobody is ever going to simply approach you out of nowhere with something to invest in. If you want to invest for profit, you’ve got to find your own opportunities. You can hire a firm to help, or strike out on your own, but there’s never really been a case where, “Hey stranger, give me money and I guarantee you’ll get all of it back, many times over, in return” has turned out to be a legitimate offer. People don’t just share money with strangers. They don’t even share it with friends most of the time.

So here’s your one easy rule:

Be very suspicious of any investment opportunity where you did not initiate contact.

This touches on affinity fraud, too, where someone will use shared membership in a group to build trust in order to sell fraudulent investments. This often happens in churches, where a member of a congregation will present materials relating to an investment that later turns out to be nothing more than a scam.

You can ask other questions, too. Is the person selling this investment licensed to do so? Does the offer make sense vis-à-vis how the world actually functions? Why are you, of all people, being given this opportunity? Are the promises being made just a little too amazing? Is the seller hitting the “I’m just like you” note a little too hard? Is there a shadowy, mysterious “they” that supposedly doesn’t want you to know about the investment? Are they talking about “guaranteed” returns?

All of these questions can help you filter out an investment scam, but if you stop at the point a stranger is making a too-good-to-be-true offer, you can avoid fraud from the outset. It doesn’t apply to every case (because nothing applies to every case), but it’s a pretty good start. If someone is presenting an out-of-the blue investment opportunity, that’s your first red flag.

Avoiding Fraudulent Debt Collectors

Debt collection generally works like this: a creditor who can’t devote the necessary time and resources needed to recover funds from old delinquent loans sells those debts to a collection agency, often for pennies on the dollar, to cut their losses a little. That agency, which now owns the debt, contacts consumers and tries to negotiate at least partial repayment.

Naturally, there are also con artists posing as debt collectors, attempting to obtain money, personal information, or both from victims. There are also collection agencies who stray from established, legal methods in order to collect legitimate debts. Here are six warning signs to watch for.

They’re trying to collect on a debt you don’t owe

Unscrupulous collectors will sometimes contact people with the same name as the actual debtor, or even settle for someone with a similar name. An outright scam artist might simply invent a debt out of thin air, or threaten random people in hopes that someone will pay out of sheer terror. In any case, never agree to pay a debt you don’t owe. Ask for a written validation notice. If they refuse, that’s a sign of trouble. Get as much information as you can about the agency, and report them to the FTC.

Important Note: collection calls for debts you didn’t incur can also be a signal that you have been a victim of identity theft. If you’ve received such a call, it may be time to check your credit report if you have not done so recently, to look for anything that shouldn’t be there.

They’re threatening you with arrest, lawsuits, or violence

For the most part, debt collectors are allowed to inform you that you owe a debt, provide proof that you owe it, state to whom the debt is owed, and present options for payment. They are not allowed to threaten you with arrest or legal action, and they’re especially not allowed to threaten physical harm to you or those around you.

They’re demanding personal information

Even if you actually owe money, there is no reason for them to ask for personal identifying information or account numbers over the phone. It’s one of the core rules of fraud and identity theft prevention: never reveal personal information to a stranger who contacted you out of the blue.

They won’t give you any information

If the caller won’t tell you the name of the agency, to whom the debt is owed, or anything else about whom he or she represents, be very suspicious. A legitimate collector will be transparent about these things, presumably because they want to actually collect on delinquent debts and stay in business, instead of being shut down by the FTC.

They’re calling in the middle of the night

This applies to a lot of other types of calls, but if they’re calling you before 8:00 a.m. or after 9:00 p.m., you have every reason to suspect either a scam or a rogue debt collector. There are rules about when they can contact you by phone. It’s kind of like putting yourself on the Do Not Call registry; if they’re already violating one rule, what else are they up to?

They keep calling after you’ve told them not to

Even if you’ve got a legitimate debt, you can still tell a collector to stop contacting you about it. Usually you will have to provide this request in writing, but once you do, they’re supposed to knock it off. Of course, if they won’t even provide an address to send said request to in the first place, you already know something is fishy.

Resources

Learn more about debt collection scams:

Report a debt collector to the FTC:

File a complaint with the Indiana Attorney General’s Office:

What If I Don’t Have Caller ID?

I’m guilty of assuming everyone has caller ID these days. While the feature may be baked right into mobile phones, caller ID service for landline phones is still a feature you usually have to pay extra for. And some people don’t want to.

So how should these holdouts handle telephone scams?

My advice is: get on the list and be quick on the draw. First, add your number to the National Do-Not-Call Registry. Once it takes effect, it will weed out all the legitimate, non-scam phone calls. Anyone who calls with an offer or sales pitch after that is obviously ignoring federal regulations and can be assumed to be attempting to commit fraud. If you’ve answered the phone, hang up as soon as you realize what’s happening.

Second, the vast majority of scammers use automated robocalls, where they ring multiple phones at once and then connect with whomever answers first. That setup takes a moment to function, and causes recognizable audio artifacts. If you’ve answered the phone and don’t get a response within a second or so, you can assume it is a robocall and hang up. If you answer and the first thing you hear is electronic noises (little clicks, bloops, beeps, etc.) or silence, it’s safe to assume you’re dealing with a robocall and hang up.

If you’ve hung up on a legitimate caller, they’ll call back.

Failing the quick-draw hang-up technique, if you find yourself talking to an unexpected caller, the old rules still apply: if they’re trying to make you afraid, it’s probably a scam; if the offer sounds too good to be true, it’s probably a scam; never wire money to a stranger; the IRS doesn’t call to demand payment over the phone; you didn’t win the lottery; your grandchild isn’t in jail or a hospital overseas; your computer doesn’t have a virus; never press “1” for any reason.

You’re under no obligation to be polite to someone who is trying to trick you out of your money over the phone. You’re allowed to just hang up without explanation.

Online Dating Scams Can Be So Much Worse Than You Thought (OR: Incredibly Bad Romance)

The classic Online Dating Scam involves a con artist meeting a victim online, pretending to initiate a long-distance relationship, and then asking the victim to wire money.

It’s a widespread form of fraud, and despite increased awareness, it continues to thrive because we’re all convinced it only happens to other people. We’re too smart, right?

Right. There’s a reason you never hear anybody say, “Yeah, you know, I’m just really naïve and easy to manipulate.” Here’s a little trade secret known to scammers around the world: literally everyone has some area in which he or she is vulnerable. There is no such thing as a 100% scam-proof human.

But there may be an even more compelling reason to avoid the romance scam: the possibility of criminal prosecution. In this case reported by BBC News, a woman was not only tricked into wiring her own money to her online “partner” over the course of several years, but also convinced to move money between different bank accounts on behalf of the con artist, making her an accessory to money laundering.

For which she was prosecuted and convicted.

Yeah, let that one sink in for a second. The irony is, she was probably helping him launder money he was getting from other romance scam victims.

Now, I’m no legal expert, and this case did occur in the U.K., not the U.S. I’m not sure how different the laws are here, but I’m betting that there is a point at which they also no longer care that you were a victim because it should have dawned on you that you were laundering money.

So if you’re out there on the internet looking for companionship, or if you know someone who is, be aware of the risks. When someone you’ve never met is asking you to send money, or to transfer funds between different financial institutions, do not do it. Under any circumstances, okay?

How to Report a Dinar Scam to the FBI

If you or someone you know has fallen victim to an Iraqi dinar (or Vietnamese dong, Indonesian rupiah, or any other foreign currency) “revaluation” investment scam, the FBI has set up a website to report the seller of these worthless currencies.

Currency revaluation schemes have been around for a long time, and have never once paid off for anyone except the people charging a commission for the sale. Iraqi dinar scams have been going strong since 2003, and the currency has yet to do anything except lose value.

There’s an article at Forbes.com that goes into further detail on this type of scam.

The IRS Is Using Private Debt Collectors Who Will Make Calls, but This Actually Changes Nothing

Sometimes fraud prevention can be boiled down to nice, simple rules that don’t leave much room for subtlety. Never wire money to a stranger. Just keeping that one rule in mind will keep you out of a lot of trouble, even if you forget the details of the scams that utilize the technique.

The IRS will never call you was another one of those hard rules, but as of 2017, it’s become a little more complicated. However, for the most part, nothing has really changed when it comes to fraud prevention.

Basically, the IRS will be contracting with four collection agencies, who will only be contacting certain taxpayers who have been delinquent for a significant period of time, whom the IRS has been unable to locate, and who meet certain other criteria. Furthermore, the collectors will not be demanding payments. Instead, they will be directing taxpayers toward electronic options for paying the IRS directly.

This means that some people will be getting calls from collection agencies on behalf of the IRS. The rest of the fraud prevention rules still apply: if they threaten you with incarceration or demand immediate payment, it’s a scam. If they’re talking about wiring money or loading up gift cards, it’s a scam.

Since con artists are nothing if not adaptable, I’ll add this point: if they do anything other than tell you about how you can pay the IRS directly on your own, it’s a scam. I’m sure someone is already gearing up to make calls claiming to be a collection agency, then telling victims they can pay over the phone with a credit card, with a wire transfer or with prepaid gift cards, or by visiting a fraudulent website. The collection agencies the IRS is using will not be asking for nor accepting payments from delinquent taxpayers. At all.

The actual website where you can pay your taxes, overdue or otherwise, is IRS.gov/Pay. And that’s pretty much the only thing the collection agencies contracted by the IRS are going to be allowed to tell you. Any mention of a different website to pay your taxes? Scam.

I recommend reading the full article below for more detailed information.

Counterfeit Check Scam Targets College Students (or: Stop Me If You Think You’ve Heard This One Before)

College students have been targeted by an employment scam that’s going to start sounding familiar as soon as I begin to describe it.

Ads are placed on job websites for administrative positions, or emails are sent directly to students “recruiting” them for the jobs. You know…college…recruiters…there companies who need your talents so badly, they’re hiring these people called recruiters to find you before you find them. That’s the dream, right?

Anyway, students who respond to the ads are sent a cashier’s check…can you guess what’s coming yet? The victim is instructed to cash the check, then wire the funds to someone, presumably to pay for equipment or software.

Now let’s see if you can guess what happens next:

  1. The student receives equipment and software and begins a rewarding career that pays well;
  2. The student gets struck by lightning three times in one week;
  3. The student finds out the check was counterfeit, and since he already wired the money to someone else, is now out several thousand dollars.

The answer is C, but B is actually more likely than A.

Scams usually involve tricking a victim into willingly handing something over, be it money or personal information. Scammers try to invoke emotional responses in order to make potential victims bypass their logic. This is why scammers try to create urgency or incite fear, prey on those who are desperate, or (in this case) prey on a group of people, college students, who know they’re in a competitive scene where the supply is greater than the demand.

Scams like this are easy to avoid, simply by applying a single principle: never cash a check and then wire the funds to someone else. It’s one of those rules that works in dozens of scenarios.

Source: https://www.ic3.gov/media/2017/170118.aspx