Better Business Bureau investigates thousands of scams every year, from the latest gimmicks to schemes as old as the hills. Our new Scam Source (www.bbb.org/scam) is a comprehensive resource on scam investigations from BBBs around the country, with tips from BBB, law enforcement and others. You can sign up to receive our Scam Alerts by email, and you can also report scams you’ve discovered. Following are 10 types of scams that were often reported this year.
1. Job Hunter Scams
BBB sees lots of secret shopper schemes, work-from-home scams, and other phony job offers, but the worst job-related scams steal your identity. Emails, websites and online applications can look very professional, and the candidate can be interviewed for the job (usually over the phone) and then presented with an offer. In order to start the job, however, the candidate has to fill out a “credit report” or provide bank information for direct deposit of their “paychecks.” The online forms are nothing more than a way to capture sensitive personal data – Social Security number, bank accounts, etc. – that can easily be used for identity theft. And, of course, there is no job, either.
2. Sweepstakes and Lottery Scams
Sweepstakes and lottery scams come in all shapes and sizes, but the bottom line is almost always this: You’ve won a whole lot of money, and in order to claim it you have to send us a smaller amount of money. Oh, and keep this confidential until we’re ready to announce your big winnings. These kinds of scams often use celebrities or other famous names to make their offer seem more genuine. Don’t click on the link and instead go directly to the homepage of the company mentioned. Sweepstakes can be legitimate but be cautious, do your research, and talk to the company directly.
3. Social Media/Online Dating Scams
There are many ways to use social media for scams that sound like it’s coming from a friend. Viral videos claiming to show everything from a coupon for the latest electronic gadget, to grisly footage of Osama bin Laden’s death, or the latest celebrity hijinks, have shown up on social media sites, often looking as if they have been shared by a friend. When you click on the link, you are prompted to do something like “upgrade your Flash player,” but the file you end up downloading contains a worm that logs into your social media account, sends similar messages to your friends, and searches for your personal data. The next time you see a sensational headline for the latest viral video, resist the urge to peek.
4. Home Improvement Scams
Always near the top of BBB complaint data are home improvement scams. They usually knock on your door with a story or a deal – the roofer who can spot some missing shingles on your roof, the paver with some leftover asphalt who can give you a great deal on driveway resealing. These scammers move around, keeping a step ahead of the law…and angry consumers. Adding insult to injury, are those who move in after a natural disaster, taking advantage of desperate homeowners who need immediate help and may not be as suspicious as they would be under normal circumstances. The elderly and disabled are targeted but no one is immune. A large percentage of BBB’s Accredited Businesses are home contractors who want to make sure you know they are legitimate, trustworthy and dependable. Find one at www.bbb.org/search.
5. Check Cashing Scams
Legitimate company names are used for an inordinate amount of scamming, especially check cashing scams. Here’s how it works: Someone contacts you via a legitimate company, i.e. Craig’s List, maybe for a legitimate reason like buying your old couch or perhaps through claiming to hire you as a secret shopper. Either way, they send you a check for more than the amount they owe you, and they ask you to deposit it into your bank account and then send them the difference via a wire service. A deposited check takes a couple of days to clear, whereas wired money is gone instantly. When the original check bounces, you are out whatever money you wired…and you still have not sold your merchandise.
6. Phishing Scams
“Phishing” is when you receive a suspicious phone call or email asking for personal information that puts a virus on your computer to hunt for your data. It’s almost impossible to avoid them if you have a telephone or an email account but there are ways to protect yourself and your computer. As an example, a phishing scam this year disguised itself as official communication from NACHA – the National Automated Clearing House Association – which facilitates the secure transfer of billions of electronic transactions every year was used. The email claims one of your transactions did not go through, and it hopes you react quickly and click on the link before thinking it through. It may take you to a fake banking site “verify” you account information, or it may download malware to infiltrate your computer.
7. Identity Theft Scams
There are a numerous ways to steal someone’s identity either through email, regular mail, fax, phone or even someone’s trash. Once the scammers have personal information such as your name, Social Security number, or other identifying information, they can use this data to apply for credit cards, loans, or even commit crimes. Some common ways that scammers may obtain personal data is from “shoulder surfing” in public places or “dumpster diving” through your home or office trash bin to obtain copies of your checks, credit card statements, or other records.
8. Financial/Loan Modification Scams
In challenging economic times, many people are looking for help getting out of debt or hanging on to their home, and almost as many scammers appear to take advantage of desperate situations. Because the federal government announced or expanded several mortgage relief programs this year, all kinds of sound-alike websites have popped up to try to fool consumers into parting with their money. Some sound like a government agency, or even part of BBB or other nonprofit consumer organization. Most ask for an upfront fee to help you deal with your mortgage company or the government (services you could easily do yourself for free), and almost all leave you in more debt than when you started.
9. Sales Scams
The Internet has introduced a whole new way to victimize people. Penny auctions are very popular because it seems like you can get something useful - cameras, computers, etc. – for way below retail. But you pay a small fee for each bid (usually 50₵ to $1.00) and if you aren’t the winner, you lose that bid money. Winners often are not even the top bidder, just the last bidder when time runs out. Although not all penny auction sites are scams, some are being investigated as online gambling. BBB recommends that before you engage in this you do your research; know exactly how the bidding works, set a limit for yourself, and be prepared to walk away before you go over that limit.
10. Imposter Scams/Grandparent Scams
Whether it’s malware that is introduced to your computer when clicking on a coupon on a social networking site thinking it’s from a friend, a call or text claiming to be coming from a grandchild or family member, or an email that looks like it’s coming from a well-known organization, these scammers try to pose as trustworthy sources to gain personal information or money.
Not even the BBB is immune from being targeted – Hundreds of thousands of people have gotten emails that very much look like an official notice from BBB – but it’s not! The subject line says something like “Complaint Against Your Business,” and the instructions tell the recipient to either click on a link or open an attachment to get the details. If the recipient does either, a malicious virus is launched on their computer…a virus that can steal banking information, passwords and other critical pieces of information needed for cyber-theft. BBB is working with security consultants and federal law enforcement to track down the source of these emails, and has already shut down dozens of hijacked websites. Anyone who has opened an attachment or clicked on a link should run a complete system scan using reputable anti-virus software. If your computer is networked with others, all machines on the network should be scanned, as well.
Imposters can also target friends and relatives, leading them to believe that a loved one is in trouble and needs help in another country. So far, the scam has specifically targeted grandparents in more than a dozen states asking them to wire money. Typically, the grandparent receives a frantic phone call from whom they are led to believe is their grandchild. The ”grandchild” pleads to the grandparents to not tell his or her parents and asks them to wire thousands of dollars. The key to a successful imposter scam is getting you to send money before you find out and realize the person on the other end is not who you think they are. BBB advises to confirm the status of the individual by calling them back directly or verifying the story with other family members before taking any further action. Do not act hastily or wire money.
For more information on these and other scams, go to BBB Scam Source (www.bbb.org/scam). Sign up for our Scam Alerts and learn about new scams as soon as we do.
Visit our website at www.newyork.bbb.org or call 212-533-6200.
