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Spotting a Consumer Scam

Identity Theft

A consumer scam is a purposeful deception in the advertising, marketing, sale, or provision of goods or services in order to secure unfair or unlawful gain. With the vast telecommunications system that is operating today across the globe, this can be anything from a lender scam to a sweepstakes con enacted online, over the phone, and even through regular mail from virtually anywhere in the world. It’s important that consumers be aware of the most recent schemes being run in order to avoid becoming a victim. Fortunately, common fraud scenarios are regularly posted and updated on such government websites as the FBI and FTC, making self-education a much easier process. Here are some of the most common consumer scams out there so consumers can know what to look for.

  • Telemarketing frauds: These types of scams typically hinge on a telemarketer pressuring the consumer to make quick decisions while on the phone in order to avoid “missing out.” Often, the telemarketer will tell a victim that they must “act immediately,” that they "can’t afford to miss this offer," or something along those lines. The best way to avoid this consumer scam is to avoid buying anything from or giving any information to an unfamiliar company. Consumers should only pay after services have been delivered, and they need to do their research on the company before agreeing to anything.
  • Advance fee schemes: These schemes hinge on the promise of opportunity, that by paying a fee up front, the victim can receive products, services, investment opportunities, “found money,” and so on. Typically, this fee is designated as a finder’s fee, and the victim is later informed that they are ineligible for the opportunity but that they must forgo the fee nevertheless. These schemes can be avoided by using cautious business practices and by being wary of anything that seems to good to be true.
  • Phishing: This is a particularly tricky consumer scam, as in this case the criminal pretends to be a representative of the victim's bank, credit card, or other lender, and contacts them via email to supposedly resolve a problem with their account. Through the course of the “resolution” process, they ask for account information and other personal data such as a Social Security number. In this way, the criminal is able access the victim's account or otherwise steal their identity. The best way to avoid this type of fraud is for consumers to always contact the institution themselves and confirm the legitimacy of the inquiry before giving out any sensitive information.
  • Lottery cons: This particular consumer scam has been around for a long time. Essentially, the victim is contacted by mail, email, or over the phone and informed that they have just won a lottery or sweepstakes. The catch is that in order to collect their prize, they’re required to pay an upfront fee. Once the payment is made, however,there’s no prize to be collected. The trick here is that any contest requiring an upfront fee should always be viewed as suspect, as it’s usually a scam.

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