Most popular scam schemes

22 December 2021

Grandparent Scams

With grandparent scams, a fraudster poses as a panicked grandchild who needs cash right away for some emergency—to get out of jail, to leave a foreign country, or to pay a hospital bill. The COVID-19 pandemic has made it even easier to sell compelling lies: "I'm in the hospital with COVID. Please send money right away." AARP says that grandparent scams are on the rise, with nearly $41 million in reported losses during 2018, up from $26 million the year before.

According to the FTC, you can avoid grandparent scams (and other family emergency scams) if you:

  • Resist the urge to act immediately. Scammers pull at your heartstrings and rely on you to respond quickly—before you've had a chance to think things through.
  • Verify the caller's identity. Ask questions that a stranger wouldn't be able to answer. Confirm the story with other family members or friends, even if (or especially if) the caller says to keep it a secret.  
  • Never send cash, gift cards, or money transfers. 

419 Fraud—Advance Fee Scam

Also known as the Nigerian letter scam, 419 fraud is one of the most common scams on the internet—and one you've likely seen in your own inbox. The advance fee scheme takes its name after the section of the Nigerian criminal code that outlaws fraud. According to the FBI, more than 14,600 people reported falling victim to advance fee scams in 2019. Collectively, they lost $100.6 million, or roughly $6,800 each.

The scammer usually claims to be a member of a wealthy Nigerian or another West African family, reaching out to you personally after the death of a loved one. They seek to relocate a large fortune out of the country for safekeeping purposes and into your bank account. The catch? You must submit small payments for fees in return for a large chunk of their cash cache.

You should never respond to these requests or volunteer your bank details. Any correspondence should be sent to the FBI, the U.S. Postal Inspection Service, the U.S. Secret Service, or the Federal Trade Commission.

Pre-Approved Notice

You receive a letter or an email declaring that you have been pre-approved for either a credit card or a bank loan. Those experiencing financial strain may fall victim to this scam, which promises instant approval and appealing credit limits. The catch? You must pay an upfront fee when you sign up. While credit card companies do charge annual fees, they will never ask you to pay them when you apply.

In general, be wary of any offer that has a "100% guarantee," requires any upfront fees, or that requests payments in cash, money transfers, or gift cards. 

Debt-Relief and Credit-Repair Scams

Individuals who are down on their luck can easily fall for an email claiming to relieve their debt or repair bad credit. This scam makes the false promise to negotiate with creditors to either consolidate or settle debts or to remove negative information from your credit report.

According to the Federal Trade Commission (FTC), "These operations often charge cash-strapped consumers a large up-front fee, but then fail to help them settle or lower their debts—if they provide any service at all."

Steer clear of any debt-relief company that asks for fees in advance, before it settles any debt. Likewise, avoid any company that guarantees it can eliminate or reduce your debt by X amount by X date. Research any debt-relief or credit-repair service you are considering. It's a good idea to check with your state's attorney general and consumer protection agency to learn about the company's reputation.

Lottery Scam

Congratulations! You’ve won the lottery or some other large amount of money! Except you haven’t. This bogus email comes to you out-of-the-blueusually claiming to be a part of international sweepstakesstressing that you’ve won big and that you just need to send over a processing fee or to get in touch with someone who can process your winnings.

Unless you have entered some legitimate lottery, chances are you haven’t won the jackpot. When you win the lottery, you contact the appropriate retailernot the other way around.

Fake Check or Money Transfer

You list something on an auction-based website, and the winning bidder offers to pay you more than the offered purchase price via cashier’s, corporate or personal check. Upon receiving the scammer’s counterfeit check, you are conned into sending the difference back through bank wire. Then you have to pay the bank back in full once the fake check bounces.

Never accept payment for more than your selling price. Additionally, you should opt for a secure form of e-payment, such as PayPal or Google Wallet, to ward off scammers.

The Bottom Line

It’s safe to assume that if anyone is asking for your bank or personal information, you’re being scammed. You should never give out personal information to anyone on the internet who contacts you directly. If you have to make a financial transaction online, make sure you’re doing so on a secure server and through a reputable site.

If you believe you’ve been scammed, immediately change all of your passwords and delete any malicious software you may have downloaded, and call your credit card company, if necessary. Contact your local law enforcement authorities to report the scam and get help with the next steps. You can also report the scam to the FBI, the Federal Trade Commission, the U.S. Postal Inspection Service, and your state attorney general's office.


Latest Articles

Vardy v Rooney

The background The ongoing proceedings relating to Defendant’s publication of a post on Instagra...

Internet Defamation and the Banking Industry

With an industry-wide focus on enterprise risk management, and with the particular vulnerability ...

Corporate Defamation: A Perspective on Analyst Reports

In 2008, Bank Atlantic, a Florida based bank, sued a prominent Wall Street analyst over a report ...

Never Fraud

We all are here to talk about last news for fraud and scam situations in the world.