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Identity Theft and a List of other Common Scams

20th September 2009, 2:59am

How these frauds work

Inheritance scheme: Targets are told a wealthy stranger died and are asked to help with banking. The come-on arrives in a lengthy letter asking for help in transferring large amounts of money. Recipients are assured large sums of money for little effort in return for their bank account data. Funds are then stolen from the victim's bank account.

Identity theft: Names, SIN or credit card numbers are hijacked. Signs of such theft are letters or phone calls stating approval or denial by a creditor when no application was made. Collection agencies contact victims demanding money; credit card statements arrive for purchases never made. Credit card statements no longer arrive.

Cheque overpayment: A phoney cashier's or personal cheque is received by the seller of a good or service for more than the amount owed.

They're asked to deposit the cheque and wire the excess funds back to the purchaser. The deposited cashier's cheque is then returned as counterfeit and charged back to the seller.

Advance fee: The Nigerian letter scam, the pitch begins as a request for an urgent business transaction which can arrive through paper mail, e-mail or fax.

      What scams are presented as a money-making investment or involves payment of up-front fees...

The 1-900 ploy: Usually through the regular mail, the victim is urged to phone a 1-900 number to discover how much money they've won. The offer often states the call costs around $4.99 a minute.

The prizes end up being minimal while $35 is lost with every call.

Vehicle warranty package: Mail or phone calls deliver an unsolicited buyer beware type-pitch. They offer vehicle warranty that might already be owned by the victim.

Emergency or grandparent scam: A grandparent is contacted by phone caller claiming to be a grandchild who says they're in some sort of trouble requiring a financial bailout. The money is sent by a company like Western Union or Money Gram before the grandparent can verify the story.

Pyramid or Ponzi schemes: These depend on luring an ever-growing number of investors who pay off those who came before them. Finding newcomers is more vital than selling any product that might be at the core of the pitch.

Puppy scam: Classified ad racket promises a puppy after all fees are paid. Fees -- which include shipping and customs charges -- are sought in advance and paid through a money transfer company. Photos of the pets are used but the animals never actually exist.

Lottery fraud: Tricks victims into thinking they've won a jackpot. Fees are asked to be paid up-front before the prize can be claimed. The winning claims are made by free e-mail accounts like Yahoo and Hotmail, which legitimate lotteries don't use.

Bogus charities: Caution should be taken when an unfamiliar charity comes calling.

Phishing: A ploy that elicits financial data and passwords from Internet users. This con uses replicas of real businesses to trick users into supplying credit card and social insurance numbers and bank account data. The information can be used to commit identity fraud.

Vacation schemes: Unsolicited vacation offers; sometimes, these come-ons involve a prize that has to be paid for.

 Be very aware of keeping your personal information safe.

More Information:   Identity theft risks,   Articles,   Fix Credit Rating

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