Keeping Your Money
What are Scams
A scam is a dishonest attempt to trap you into parting with your money. A corrupt scheme performed by a dishonest individual, group, or company in an attempt obtain money or something else of value.
Scams traditionally come from confidence tricks, where an individual would misrepresent themselves as someone with skill or authority, i.e. a doctor, lawyer, investor. After the internet became widely used and new forms of scams emerged such as lottery scams, scam baiting, email spoofing (spams with junk mail), phishing (when you try to con people into giving you their personal details) and also apparently winning valuable prizes. These are all considered to be email fraud.
How to identify a scam
Tips on How to Identify a Scam or Fraud
If the email, phone call, pops up tab, prize or lottery notification has any of the following elements, it is strongly suggested it is probably a fraud and you should not respond to it. Below are some general tips to recognize scams:
- The organization has no official website and cannot be located in Google.
- If the email or requestor asks for bank account information, credit card numbers, driver's license numbers, passport numbers, your mother's maiden name or other personal information.
- The email or caller advises that you have won a prize - but you did not enter any competition run by the prize promoters.
- The email claims you won a lottery (even though NO legal lottery that notifies winners by email)
- The mail may be personally addressed to you but it has been posted using bulk mail - thousands of others around the world may have received the exact same notification. Especially true if you find an exact or similar email posted on a website.
- The return address is a Yahoo, Outlook, Gmail or other free email accounts. Legitimate companies can afford the roughly $100 per year that it costs to acquire and maintain a domain and related company email account.
- The text contains a lot of propaganda and exaggerations, but few specific details about costs, your obligations, how it works and etc.
- The prize promoters ask for a fee (for administration, "processing", taxes, etc.) to be paid in advance. A legitimate lottery simply deducts that from the winnings.
- To get your prize might require travel overseas at your own cost (and personal risk) to receive it.
What is Social Engineering
Cybercriminals also use social engineering to convince you to install malicious software or hand over your personal information by coning you as the people by doing something and not knowing what your actions are doing. They might email you, call you on the phone, or convince you to download something off of a website.
Warnings on how to see a scam
1) The first point highlighted is the invalid email address. This means that the account that has sent you this email is not valid and is not the same one that the original website would use to send emails
2) A company will only stick to one email account and will never use an outside account. This is could make a website look in efficient and shady and we suggest that it is a scam and or a fake website or email.
3) If an email or a website asks for any personal details you should instantly be suspicious as to why. Never give any personal details to any website, email or message that you wouldn't give to a complete stranger.
4) DO YOUR HOMEWORK! Before you even respond to an email do your homework. Research the company and see if they send emails with the account that you have been provided with. Also check who the email has sent from and what their position is in the company or the business. Then we suggest that you research that person's background and if no information comes up or is found on the internet, then you should not trust this company.
You should not have any contact with the scam organisation but instead report them.
Do's and Don'ts of What to Do When Approached By a Scam
-Give any personal or any financial details away
-Open any attachment or download any files from emails you receive, regardless of who sent them
- Reply to email or pop-up messages that ask for personal or financial information, and don't click on links in the message or paste a link from the message into your Web Browser.
-Use anti-virus and anti-spyware software, as well as a firewall, and update them all regularly.
-Be very suspicious of emails from people you don't know, particularly if they promise you money, good health or a solution to all your problems. The same applies for websites. Remember, anything that looks too good to be true usually is.
Different types of Scams
1) Computer Virus Scams
Computer virus scams are usually run from overseas call centres. You may be called at home by somebody claiming to be from a technical support company. Windows Technical Services, PC Windows Support and Microsoft are a few of the company names used that they may use.
The caller will tell you that your computer has a virus. They'll ask you to log on to your computer and to download a piece of software. This gives them remote access to your PC.
Then they might tell you that your download is an anti-virus software and you need to pay for that. After they will ask for your account details and not charge you but instead will have full access to your bank account.
2) Banking and phishing scams
Scammers use phishing scams to trick you into handing over personal information. Information like your personal banking details, your IRD number and social media passwords can be very valuable to fraudsters. It gives them free reign on both your finances and your personal identity.
Phishing attempts are usually made by email. But they can also be over the phone, or by text message.
3) Computer Hacking
Computer Hacking is very common today in the 21st century. Computer Hacking is when you receive an email, inviting and encouraging you to click a link. It may look harmless and intriguing to you so you generally want to find out more. You then might decide to go and see what it’s about by clicking the link. But little did you know that you have just given a scammer access to your computer. They then will steal all of your personal details, or use your computer to run some other scams.
4) Online Dating Scams
Someone starts connecting with you through a dating service. You like chatting with them and become interested. You may start to get to know the person, perhaps over weeks or months. You start to feel a really strong bond. All of a sudden they need some money – a personal crisis just a short-term loan.
You trust them so you want to help. They’ll probably have a convincing story. You send them money. Before long they ask for more – then more, and more, and more.
Soon you've handed over all of your savings. Or worse still, you borrow money to bail them out. Once they've taken all they can, your new love will disappear and your money will be gone.
No one wants to think that they could be taken advantage by an internet dating scam, and yet hundreds of people are every single year.
5) Investment Scams
With Investment scams you may be offered a guaranteed system for making money. The secrets of the system are yours but at a price. However there is no system an no hope of you ever getting your money back.
How investment scams work…
1. Somebody contacts you with, what seems like, a great opportunity to make money.
2. It could be an investment opportunity or a share market tip based on 'secret' information.
3. It could be expert advice on how to unlock superannuation funds early.
4. It could even be special gambling software that promises to pick winners every time.
It may sound tempting, but think twice – you could end up losing a lot of money.
What is Budgeting
The best way to take control of your finances is to do a budget. This is a simple tool that doesn't cost a thing and helps you understand the money going in and out of your household.
A budget can show you if you’re spending more or less than you can afford. A budget enables you to direct your money to where it matters most. This is so you can stay on top of bills and start putting money towards your future goals and wants.
Budgeting is the process of creating a plan to spend your money wisely on the things that you need and then the things that you want. Creating this spending plan allows you to determine in advance whether you will have enough money to do the things you need to do or would like to do.
If you don't have enough money to do everything you would like to do, then you can use this planning process to prioritize your spending and focus your money on the things that are most important to you.
Why Budgeting is so Important
Since budgeting allows you to create a spending plan for your money, it ensures that you will always have enough money for the things you need and the things that are important to you or you want. Following a budget or spending plan will also keep you out of debt or help you work your way out of debt if you are currently in debt.
What is Debt
Debt is an amount of money borrowed by one party or person from another. Many corporation and individuals use debt as a method for making large purchases that they could not afford under normal circumstances. A debt arrangement gives the borrowing party permission to borrow money under the condition that it is to be paid back at a later date, usually with interest.
Tips That Will Help You Stay Out of Debt
4) Learn How to Do it Yourself
Spend time learning how to do tasks that you would normally pay a contractor or professional to do. Any time you get a chance to save money by doing something yourself take that opportunity.
For example if you go out to a company party at a facility where there is valet parking, then look to see if you can park your vehicle yourself to save the valet charges. Wash your vehicle each week in your driveway with your own water and supplies to avoid paying for a car wash.
Do not take the "do it yourself" approach to dangerous levels. Like if a family member needs medical attention, then you need to go to a doctor. But if you find practical ways to save money by doing something on your own, then you should take the chance to save money and avoid putting yourself into debt.
Special Thanks to the following...
Kennedy.G W (CPA and Financial Auditor)