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Tips for Detecting and Avoiding Fraud and Scams

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Each year, more and more people fall victim to scams, putting their money and information at risk. With the assistance of AI programs and advanced technology the number of scams currently active is always increasing. While the targeting and presentation methods of theses scams can vary, the tips for avoiding them are easily applied to all types of scams.

Scammers will target people through phone calls, emails, text messages, pieces of postal mail, social media, fraudulent websites, or applications/programs. The following tips can help you detect scams and fraudulent attempts to gain access to your information or finances regardless of the type of scam.

1. Be aware of who you are dealing with.
Scams often are going to involve imposter websites, copy-cat email addresses, fake 800 phone numbers, and official looking text messages. They will appear to be legitimate, but there are ways to ensure you are interacting with the correct person or business. Before you return a call, click a link, or make a purchase verify the company or person’s address with an internet search. Using the company name and “review” or “scam” in your search terms will bring up results where those terms were used together. Consider the risk. If you have done your research and still believe you should deal with this company or person, weigh the risk and determine if the end result will be worth it in the end. Consider who is going to be receiving your name, address, phone number, and payment details.

Here are some additional ways you can research an offer, claim, or company:

  1. Locate the physical address of the company and use Google Street View to see what is at that address. If you are not seeing a business or it does not appear to be something that could operate as a business, use caution when proceeding with any future interactions.
  2. Use the Better Business Bureau's Scam Tracker and search the phone number, company name, email address, or what they are asking you to do. This database is populated by other submissions of consumers and you can easily see who has had poor results.
  3. If the scammer is claiming to be from a company that you recognize or do business with, go directly to that company's website to verify the offer or any contact information. Never click links within the suspected scam message. Always do a new web search or use a bookmarked web address. If you are still unsure, contact the company via their official contact methods to confirm any details.
  4. If you decide to make a purchase, try to use a protected payment method. Be aware of how long you have after a purchase to file a claim or dispute a charge and what the process is should you need to do that.

(bonus tip - if a Facebook post shows that it has a lot of comments, but you can only see a handful and they are all positive - that company is deleting or hiding comments.)

2. Wiring Money or Using Gift Cards is the same as using cash.
Anytime someone is requesting you make a payment through a wire transfer or by purchasing gift cards, it is most likely a scam. These transactions are almost impossible to reverse and even more difficult to trace, making them a perfect method for scammers to get your money. Never send gift card codes or wire money to strangers, someone who is insisting on these methods for payment, or to anyone claiming to be someone you know who is in an urgent situation.

These scammers might use tactics to make you feel comfortable talking to them. They may also become agitated and demanding, if you do not do what they are asking you to do. No reputable business will use tactics like this and if any request makes you uncomfortable, immediately stop communication with that party - regardless of any threats of punishment or fines. Once you have ended the call, find a direct contact number through a trusted source - never from the suspicious call or request.

3. Review your recent transactions, monthly statements, and credit report.
Scammers who steal account information will use this information to make fraudulent charges, open new accounts, commit tax fraud, identity theft, or other harmful actions. By reviewing your statements or logging into your account to review recent transactions you can detect unfamiliar activity before it's too late. Look for unknown charges and notify your card issuer or financial institution immediately by using the number on the back of your card or your statement. Some websites and apps also allow you to lock or unlock your card to protect you from future fraudulent charges.

Learn about your options and how to enact them if needed. You are also allowed free copies of your credit report through the major reporting agencies or can sign up for a free account with them to review your credit report to look for unauthorized account creation.

4. Only donate to established charities.
During times of crisis or holidays that evoke emotional responses, scammers will take advantage of the generosity of others. They will build fraudulent websites or social media accounts in an attempt to collect your donations for their own gain.

Review charitable organizations before donating by using Charity Navigator to ensure your donation will be utilized in the proper way.

Find additional tips to donate safely at https://www.ftc.gov/charityfraud

5. Never take risks when it comes to your health.
Health related scams can promise amazing results or heavily discounted prices. Ensure anything you are taking has been reviewed by your doctor. Discussing claims of treatment, side-effects, or risks is an essential part of any decision regarding your health.

Also, always ensure you are purchasing prescriptions from licensed US pharmacies. Purchases from discounted providers online or out of the country could result in you receiving fake, expired, mislabeled, or inaccurate dosages - which all can be dangerous to your health.

Research your insurance company and options before you sign up or pay for any premiums. The health insurance industry can be overwhelming and scammers take advantage of these frustrations and can provide minimal care or not even be a valid company capable of processing claims.

Learn more about health-related scams at https://www.ftc.gov/healthscams

6. A "Sure Thing" doesn't exist when investing in potential.
Being pitched a low-risk, high-return investment opportunity by someone you’re not familiar with is an immediate warning sign. These offers will insist on you acting now, will promise big profits, assure you that you will have little or no financial risk, or demand you send cash immediately. Social media can be especially tempting when you are being presented with an offer from someone you think you know while scrolling your feed. If you are contacted for one of these investment opportunities - immediately report them at https://reportfraud.ftc.gov

7. Be cautious when asked to pay a fee for something before the service is provided.
You should never pay fees first in order to be hired by an employer, receive a loan, receive inheritance, or win a prize. Fraudulent companies will make large promises in exchange for a nominal fee. Once they have that fee your chances of receiving what they promise is minimal. If you are searching for an easy way to complete a difficult task, and someone is promising quick results for a minimal fee, consider the value exchange. If you do not believe the task could be completed at that cost, the odds are it will never be completed and you will lose your money.

8. Know where checks come from before depositing them.
Scams can make requests for you to deposit a check and only send back a portion of the funding either via wire transfer or by purchasing gift cards. These scams can be framed as mystery shopping, testing a service, winning a prize, or refunding overpayment. By law, financial institutions make funds available from deposited checks within a few days, but determining if a check is fraudulent may take weeks. If a check turns out to be fake your financial institution may remove the deposited amount from your account - regardless of the funding being available or not. Anytime you are being asked to use your own financial accounts to resolve an issue with overpayment or to complete a service, use caution. If you are provided with a check that you are suspicious of and want to verify its validity – check with your financial institution before attempting to deposit it.

9. Never provide personal or financial information for unknown requests.
These requests can come via an email, text message, website link, advertisement, pop-up window, or phone call. You should treat your personal and financial information as if it was cash. Don’t blindly give it to strangers and once you give it away, you can never take it back.

They might request you to confirm account numbers, login details, PIN numbers, text message confirmation codes, or any personal data - and it may seem like it is coming from a legitimate source. If you ever receive an attempt like this in any format and are unsure if it is valid or fraudulent - use the number on the back of your credit card, statement, or visit your financial institution in person to check on your account status.

10. Protect your information while on your computer.
Often times, scams will involve a request for you to access your accounts or information while a 3rd party is able to view your screen remotely. These scams are targeted to appear as if you are receiving a refund, have a virus, need a product update and any attempt for someone over the phone to connect to your computer from a remote location should be evaluated to see if it is from a legitimate source. You should never enter any information, passwords, or payment information into a form or website while a 3rd party is able to watch. These attempts for this level of access are almost certainly a scam.

11. Paying for Prizes isn't Winning.
Receiving messages that claim you've already won a large amount of money or an impressive prize can appear fantastic. However, the providers of this "prize" will request that you to pay fees, taxes, or custom duties - which might sound like a legitimate need when it's paired with such a tempting prize. If you need to pay for a prize, you haven't won anything. Once any fees or taxes are paid, the scammer already has your money and you will not receive anything and it is will be impossible to get your money back - regardless of how convincing the offer was. If the "prize" is being presented from a different country, keep in mind that Foreign Lotteries are illegal and that is exactly what these "prizes" are considered.

Here are additional resources for detecting or reporting fraud and scams:

Report Fraud and Scams to the FTC - https://reportfraud.ftc.gov/
Better Business Bureau Scam Tracker - https://www.bbb.org/scamtracker/lookupscam
IL State Attorney General's Identity Theft - https://www.illinoisattorneygeneral.gov/consumer-protection/identity-theft/
IL State Attorney General's Identity Theft Hotline - 1-866-999-5630
FTC's Tips on how to Recognize and Report Fraud Text Messages - https://consumer.ftc.gov/articles/how-recognize-and-report-spam-text-messages

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