Different Types of Fraud

Learn about the different types of fraud online!

1. Phony Checks

  • Someone pays you with a check when there’s actually little or no money in the account.
  • To protect yourself, never take a check that doesn't include an address and confirm both the name and address against the buyer’s driver’s license.

2. Phony Internet Sellers

  • While surfing the web, you’re liable to run across items (often name brand watches, jewelry or electronics) being offered at ridiculously low prices.
  • Many of these sellers are phony; they’ll take your money, but never deliver the item.
  • Always check user reviews and ratings before buying online.

3. Online Misrepresentation

  • This is a form of fraud in which the seller offers a high-value item at a discounted price. Often, such items aren't worth nearly what the seller says they are.
  • Before buying, do a comparison by checking what other sellers are listing the same item for on the Internet. If you can’t find the item anywhere else, chances are it’s a scam.

4. Website Misdirection

  • Even buying from a top retailer like Amazon.com or Overstock.com can be dangerous. Those companies aren't crooked, but sophisticated hackers have found ways to mimic these companies’ checkout pages so when you go to pay for your purchase, you’re actually giving your credit card information to someone else.
  • Whenever you reach a checkout page, check the website address at the top of your web browser. Make sure it matches that of the original site.

5. Identity Theft

  • Families or individuals information is used without their permission. It occurs when the fraudster uses your credit card or bank account information to buy items and then charge them to you.
  • The simplest way to protect yourself is to shred receipts, bank card statements, credit card bills, etc., before throwing them in the trash.

6. Charities Fraud

  • Americans enjoy giving to worthy causes, which is something con artists are eager to take advantage of. Especially around the holidays, you’re expected to get emails or phone solicitations asking you to donate to any number of charities.
  • If you want to give to a charity, never respond to a solicitation. Choose the charity for yourself and donate directly.

7. Debt Elimination

  • Many Americans are in debt. If you’re in such a situation, you may be tempted by ads by companies that promise to negotiate with banks and credit card companies on your behalf so you can zero your debt. Many of these scams ask for partial payment up front – often $1,500 to $2,000 – as well as all your credit card information.
  • They’re bogus. And, in the end, you’re not only out $1,500 to $2,000, but you've also given away all your credit card information, which the scammers are now free to use.

8. Pyramid Schemes

  • Frequently disguised as “multilevel marketing programs,” these schemes promise you high returns on your investment if you can recruit other people to work as your marketing network. Of course, the only way they can make money is if they recruit other people to become part of their marketing networks, etc. The way such programs evade the law is by making it possible to make money by selling actual products or services, but their real focus is the financial pyramid, which only serves the people at the very top.
  • The best and only way to protect yourself is just to avoid them.

9. Work-at-Home Scams

  • Millions of Americans now telecommute, so the idea of working from home sounds viable. But most of the ads that say you can “Make $25 to $200 working at home!” are frauds, especially if the company behind them asks you to pay to join their program. At best, you’ll be hired to get other people involved in the scam.
  • The best way to avoid these scams are to delete them from your emails and never respond to them.

10. Jury Duty Scams

  • Scammers will email individuals saying that you missed your Jury Duty assignment and you must pay $100 or else you will be taken to jail. Don't let these emails fool. The hackers are just tying to scare you into thinking that you'll actually go to jail if you do not pay the $100.
  • The best way to protect yourself from this type of fraud is to delete the email and never respond to them or else they'll keep popping up on your email list.