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How to Detect a Scam


How to Detect a Scam

In 2006, the Federal Trade Commission (FTC) complaint database received more than 670,000 consumer fraud and identity theft complaints, and consumers reported losses from fraud of more than $1.1 billion. The two best weapons you can use to protect yourself against scam artists are awareness of current fraud schemes and some common sense.

Scams Now Making the Rounds

  • Sweepstakes prizes and lottery
    Sweepstakes prizes and lottery scams inform the victims that even though they never entered the contest, they've won a prize; first, however, the "winners" must pay registration, lawyer or courier fees. People who pay the fees end up losing their money, and never see a prize.
     
  • Advance fee fraud,
    Advance fee fraus is also known as a "419" or "Nigerian" scam because of the section of Nigerian criminal law that makes it illegal.  It is a scam in which the victim is asked to pay fees in advance in exchange for huge sums of money. For example, the victim might be told that he or she will receive an unclaimed bank account if lawyer or court fees are paid.
     
  • Work-at-home scams
    Work-at-home scams prey heavily on senior citizens, stay-at-home moms and the disabled, with promises of easy money and no experience required. Unfortunately, the victims often shell out money for instructions or materials, only to find that they are left with merchandise that is impossible to sell.
     
  • Charity fraud
    Charity fraud occurs when a phony group uses a name resembling that of a legitimate charitable organization, or high-pressure or highly emotional appeals to raise money from unsuspecting victims.

How to Protect Your Finances

When fighting fraud, a little common sense goes a long way. Remember:

  • If it sounds too good to be true, it probably is.
  • Never give out your personal information, including account or Social Security numbers, in response to a call or e-mail that you did not initiate. And never send sensitive information by e-mail.
  • Claims of urgency should raise alarms of suspicion.
  • If you suspect fraud, contact Community Bank the National Consumers League's Fraud Center at www.fraud.org or 1-800-876-7060 .