It’s difficult to imagine how people in simpler times could be so naive to fall for such obvious scams and cons of the era.
Fraudsters feigning injury, religious affiliation or magical powers to swindle sympathy donations commonly preyed against unsuspecting folks. Hucksters, grifters and shysters would pick your pocket, pull a sting, and sell you the Brooklyn Bridge, all in one step.
We might know better these days than to get suckered into some old timey hoodwink, but we’re no less vulnerable to scams today. Modern-day thieves are tech savvy and sophisticated; with email and the internet at their disposal, today’s scammers rely on cybercrime, identity theft and other advanced methods to make you part ways with one thing: your hard-earned cash.
Don’t fall hook, line and sinker for any of these common money scams:
Phishing and pharming scams
Your computer, browser and cell phone make you particularly open to scams and frauds. The classic phishing email involves a scammer "fishing" for sensitive information by posing as a legitimate person, entity or agency -- like your bank, credit card company or even the authorities. They’ll try to obtain your Social Security number, or credit card/bank account by getting you to click on a fake link in the email. What may look like a genuine login is actually handing over your info to thieves.
Victims of pharming scams may inadvertently download virulent software, malware or code while browsing the web, directing unsuspecting internet users to submit their passwords or account info on a fake website or app that appears bona fide. If you come across an email or website that looks suspicious, don’t click on it; delete it, or, if it appears to be from your bank, contact your institution’s fraud hotline. If you’re going online in public, always log into a secure WiFi network, or use a VPN.
Vishing and smishing scams
Vishing and smishing go hand in hand; these phony, phone-based telemarketing scams are utilized by fraudsters who’ll call (vish) or text (smish) consumers impersonating anyone from a bank representative, to mock charitable organizations, to the government.
Gaining your trust, they’ll alert you that your account has been compromised, and they’ll need to "verify" your account information before proceeding. Or, in many cases, the scammers will resort to threats. It’s the court, claiming that you missed jury duty, and now you need to pay up. Or, a local nonprofit may convince you to make a phony contribution.
And in a sneaky example of tax fraud, the "Internal Revenue Service" will call up, claiming that you owe unpaid taxes. The IRS has many ways of contacting taxpayers, but it will never call customers; only trust official tax-related communication through snail mail.
You’re browsing the web, clicking away, when you surprisingly stumble across a website emblazoned with an official-seeming (seeming the operative word) FBI logo, accompanied by the message that your computer has been frozen and is under investigation. It may elaborate that you’ve been caught in the act of downloading illegal materials (even if you haven’t), your IP address is being tracked, and that your computer will be locked until you pony up some cash.
It’s called ransomware, and it’s an insidious form of scam bullying derived from spyware and malware meant to intimidate people to believe they’ve committed a crime.
But crime doesn’t pay, and neither should you. If you’re on the receiving end of a ransomware scam, and your computer is indeed frozen, contact local authorities or your internet provider to report the incident. Worst case scenario, you may need to have your computer diagnosed, fixed and unstuck, but your best course of prevention is to always keep your antivirus software updated and active.
(Personal story time: I’ve had this happen to me a few times, and the solution was to force a shutdown of my laptop and restart it. Once I reopened my browser, I deleted the offending scam URL from my browsing history. Problem solved.)
ATM and debit card scams
Staying vigilant of your surroundings at the ATM is one way to prevent being mugged, but you might miss the card skimmer many thieves carefully place inside the machine slot to capture your debit/credit card numbers as you swipe. Some scammers are also astute enough to install small pinhole cameras to record your PIN numbers as you type.
With card providers replacing their swipe cards with chip/EMV technology, you’re still at risk of being scammed, so be careful. As fewer cards are being swiped, scammers need some way to obtain your info, so they’ll go the impersonation route and call/email. Remember, your bank will never ask you to reveal your PIN number.
Credit repair/debt counseling scams
Credit card debt can impose strain on your finances, but also on your well-being; desperate for a quick solution, many unwitting consumers may fall for scams promising to repair or erase your debt. Said credit "repair" companies will all but guarantee that they can fix your credit or raise your score for a fee; they’ll do all the "work" for you, including liasoning with the credit bureaus and settling with your creditors.
The unfortunate part about these companies is that they’re fake, and their services, false. You can’t pay to boost your credit score, remove details from your credit report, or eliminate your debt; that’s up to you paying your bills on time, reducing your debt, and giving your credit history a chance to change and time to heal.
Another potential scam to avoid are student loan counseling scams for those struggling with student debt. Beware organizations soliciting high fees or sensitive personal or financial information; chances are, they’re out to pocket your cash or raid your bank account. If they advertise heavily on social media or claim to be affiliated with a federal or governmental agency, avoid them. Like credit card debt, there are only a few ways to pay down your debt: refinance, consolidate, and chop away at the balance yourself.
Rental and apartment scams
Never rent an apartment sight unseen, even if the pics online attract you, and the scammer, er, landlord, offers you the unit without meeting you in person. It’s not because the apartment might be a dump -- it’s that the apartment and the rental is a downright scam.
Rental scammers seek out enthusiastic victims by advertising an apartment in a great location, with great amenities and a low monthly rent. All the communication will be through email, where the scammer, acting as the property owner, will offer the victim the lease, asking them to wire funds to cover your security deposit, associated fees, and more.
After forking over the cash, the prospective renter never hears from the scammer again, and now, they’re out a great deal of money as well as a home. Your recourse? Never trust an ad that’s too good to be true. Work with an authentic rental or property management agency, and treat CraigsList or online ads with discretion and caution.
Protecting yourself from money scammers
Stay on the alert and protect yourself against money scams by following some of these tips:
Don’t verify your personal info. Never divulge your name, address, email, phone number, bank account or Social Security numbers, to anyone you’re unfamiliar with. If someone claiming to be from an official source solicits your information, verify their identity first before they can steal yours.
Safeguard your passwords. At the ATM or gas station, carefully check if the card swipe mechanism seems secure. Only withdraw cash from well-lit locations, preferably during daylight. Always shield the keypad as you type your PIN, even if nobody else is around. And when choosing a PIN or password, don’t select anything derived from your birthdate or phone number, since they can be easily deciphered.
Spot the fake ones. Carefully check if correspondence seems genuine. Is that URL in the email from "IRSgov" missing a key piece of punctuation? Does the message appear suspiciously generic, or lacking in grammar? Does that email seem phishy? Trust your instincts. If that email from your bank appears phony, it probably is. If that bill you received in the mail looks foreign, don’t pay it -- rather, report it. Better to stay safe than sorry.
Keep your computer secure. Never browse the web without a quality antivirus program or firewall installed on your computer, laptop or mobile device. Consider using a password manager to encrypt your login info, and always use a secure WiFi.
Contact the credit bureaus. Check your credit report for errors or inconsistencies that could compromise your creditworthiness; someone may have stolen your identity and is ruining your credit score on your behalf. Contacting each of the three credit bureaus to investigate and resolve the problem is a step in the right direction.
Shred your documents. Before discarding of receipts or other sensitive documents with personal or financial info, shred them. Dumpster divers do exist and can retrieve your information easily from papers that are thrown out intact.
Get identity theft insurance. Trying to recover from a stolen identity can be expensive. Identity theft insurance protects you from having to foot every bill alone.
Image: Yuri Samoilov