Contributions by consumer advocates, legal professionals, and industry insiders
The Twelve Best Tips for Avoiding Scams and Scammers
You’re too smart to get scammed, right?
Wrong. Absolutely wrong. Smart people are even better targets for scammers because
they usually have more money. And a good con man knows how to part you from your
money…no matter how smart you are.
"We found that one very high net worth individual had been conned by the ‘your nephew’s
in jail in Mexico’ scam,” says Bill Kowalski, principal and director of operations
at Rehmann’s Corporate Investigative Services. “Anyone’s vulnerable to the right
As we increasingly turn to the web for—well, everything—here are a few tips for
avoiding the online bad boys.
1. Do a reverse image search on that impressive website.
The company’s office building is imposing, the silver-haired CEO looks wise. But
a ‘reverse image’ search via a site like TinEye might reveal that both pictures
are actually stock images from a company such as Shutterstock. PeopleClaim.com’s
researcher found that one MegaScam company had even photo-shopped their own logo
right onto a picture of Microsoft’s headquarters.
Stock photos of customer service reps are one thing—you’d have to be pretty naïve
to think that you’ll be talking to that gorgeous model when you call to complain
about your broken mop—but fake HQs, phony CEOs, and ‘customers’ that testify all
over the web are a sure sign of a scam.
2. What’s their address…really?
If you want to make a run-of-the-mill scammer or ‘Rachel from Card Services’ hang
up fast, just ask for their address. Savvier scammers will provide a fake one. But
in these days of Google Street View, it’s inexcusable to end up mailing desperate
demand letters to a parking lot.
Search the address without the company name. Does a likely building show up? And
is the address associated with any other company? (One jokester had provided a PeopleClaim.com
claimant with the FBI’s address.)
If there’s a suite or PMB number, try the address without it. If your search comes
up with a UPS store or other private mailbox provider, be wary. There are very legitimate
reasons, such as security and convenience, for using Post Office boxes. But while
a freelance graphic designer working from home might make use of the local UPS store
or a virtual office, a genuine ‘big investment company’ won’t.
3. How sturdy is their website?
“Make sure the URL of the website has https:// in front of it,” says David Bakke
of Money Crashers—the ‘s’ is a level of security that quick cons don’t bother with.
“Check the website at Who.is. …type in the name of the website you're checking,
and look for information about the registrant – it should match the owner information
on the Company History or About Us page,” he adds. “Also, look at the date of registration.
If it occurred in the recent past, that's another possible sign the website is fraudulent.”
Links within a site can be fraudulent too. You might think you’re going to PayPal,
but instead you’re entering your credit card number into a scammer’s vault. Bill
Kowalski tells his clients to always hover their computer mouse over any link before
clicking. “The true destination of that link,” he says, “will pop right up.”
4. Are their license numbers and memberships real?
PeopleClaim.com received several complaints against a moving company that had failed
to deliver vehicles purchased via Craigslist. It had a great website that ticked
all the right boxes, right down to the DOT and MC numbers. But when we cross-checked
the numbers on FCMSA, they belonged to a company by another name.
“Call the FBI,” advised the real company. “We had to redo our site because it was
cloned so much.” The claimants had lost big bucks to a scammer’s third party auto
Steven J.J. Weisman, author of "The Truth About Avoiding Scams," has another tip.
“Check for BBB accreditation from the Better Business Bureau itself. Don't trust
the seal merely because it appears on the website. It may be counterfeit,” he says.
Indeed, the only mention of some companies online is a free press release announcing
BBB accreditation—that the BBB has no record of.
Some websites sport an assortment of seals and accreditations. Check ‘em out. Does
‘Proud Member of the Gold Brokers Fraternity’ actually mean anything?
5. Watch out for those freebie sites and security questions
You set Facebook to the most private settings, you never click links if you haven’t
checked the sender, you don’t give out private info over the phone…right?
But, warns Robert Siciliano of as BestIDTheftCompanys.com, you’re still making yourself
vulnerable if you use the same password frequently and answer security questions
“Don’t answer ones that a hacker can easily get the answer to, such as ‘City you
were born.’ Choose the most obscure questions from the list (or) give answers that
make no sense, such as “Planet Neptune” for the city you were born in.”
A multitude of innocent-looking sites that let you play games, answer quizzes, or
sign up for freebies—that may never arrive—also might be fishing for the information,
including your favorite password, that will allow a hacker to cut through your account
security like a knife through butter.
6. Why is Wells Fargo offering you a Caribbean vacation?
Cybersquatters just love your typos. Bill Kowalski spent 25 years with the FBI, and he’s all too familiar with the way scammers take advantage of common misspellings. You type in WellFargo, or Citbank, whatever, and boom, they’re there with an offer for a gift card.
You think you’re on your bank’s website so you happily use your credit card number for the shipping and handling. Ouch. So if a familiar website is uncharacteristically keen to offer you a gift card, check your spelling.
7. Don’t just search the company
Common reputation management techniques enable a dodgy company to flood several pages of search results with positive links. So search XYZ Company multiple ways— + complaints, + scam, + PeopleClaim.com, + BBB, + Attorney General, + fraud, etc.
And remember, some of the seedier companies have also set up fake ‘neutral’ review sites that will pop up if you search XYZ + scam. “Is XYZ Company a Scam? We tried it and the profits were incredible…” Fake review sites should make you run faster.
8. What does that A rating mean?
Not much—it’s just a small part of the picture. Longevity means more. While legitimate companies work hard to retain good online ratings, an unknown company might have a sterling grade only because it’s brand new and no-one’s complained yet. Also, many victims really have no idea where to even start complaining.
Bear in mind, too, that it’s possible for a patient scammer to sign up with online business review sites, make a complaint or two about themselves, and quickly resolve everything. Within a few months, they’re ready to start hauling in the big fish. Take ratings with a grain of salt—no matter how venerable the site that gives them.
9. Is that a persuasion strategy I hear?
Michaela Beals of Stanford’s Financial Fraud Research Center suggests you be very attuned to persuasion strategies. “The faster potential victims can spot these persuasion tactics, or red flags, the less likely they are to become so overcome with emotion that they don’t stop and think before making a decision,” she says, citing the most common strategies:
- Phantom riches – dangling the prospect of wealth in front of you
- Source credibility – trying to build credibility by claiming to be with a reputable firm or to have a special credential or experience
- Social consensus – leading you to believe that other savvy investors have already invested
- Reciprocity – doing a small favor in return for a big favor
- Scarcity – creating a false sense of urgency by claiming limited supply
And if they tell you “oh, that’s just fine print. Don’t worry about it!” run like hell.
10. Understand that money sent by wire or reloadable card is cash
If a company or ‘agent’ wants payment by wire, Western Union, or a reloadable card (such as Green Dot MoneyPak or ReLoadit) you’re probably dealing with a scammer. There is no way to get that money back once it’s gone.
Reloadable cards are particular favorites for “advance fee” scams, whereby you’re eligible for a payday loan, a government grant, a scholarship, mortgage refinancing, credit card rate reductions, etc.—but only after you’ve paid the taxes, application fees, or some other bogus fee. Remember, the IRS doesn’t take Green Dot cards.
11. Free trial? Yikes—beware Negative Option billing and Add-On Services
Wow—you can get a FREE sample of that great skincare cream, weight-loss supplement (yes, we’re talking about you, Garcinia Cambogia and Forskolin) or, um, male performance booster? And all you have to do is provide your credit card number for that low $2.95 shipping and handling fee?
Congratulations. You’ve likely just signed up for Negative Option Billing. Your credit card will be automatically charged for a full-price shipment every month unless you specifically opt out. If you don’t actually read the Terms and Conditions, though, you won’t know this until it’s too late. And in some cases, even when you try to cancel, you can’t get through to the company. Sometimes you’ve “agreed” to return the sample to a foreign country or within a timeframe you can’t possibly meet.
An add-on service might be a credit monitoring, health insurance, or discount savings plan that you inadvertently click on—or agree to try—and then pay for each month as part of another bill. Such charges can, and do, go unnoticed for years.
ALWAYS read the Terms and Conditions and ALWAYS check your credit card and bank statements religiously.
12. If it’s too good to be true, it probably is.
Seriously. It’s amazing how many smart people are ‘too smart’ to understand this most basic advice.
While care and judgment have gone into the preparation of this article, neither PeopleClaim nor the author can make representations as to its accuracy or completeness. Opinions expressed are those of the author and are offered as opinion, not fact. Readers assume full responsibility in taking action based on information, opinion, or advice offered. PeopleClaim does not independently verify or specifically endorse the article's content, and is not responsible for errors, omissions, or the consequences of advice taken.
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