Top Internet Fraud Scams

According to the FBI, the first question people have when contacting them to report an Internet scam is, "How did they get my name, e-mail and/or credit card number?"

The Internet has revolutionized the way we gather information, shop, do business and, even socialize with one another.

But...being aware of, at least, the top internet fraud scams could prove fruitful in the avoidance of "being had."

Number One: The Internet Crime Complaint Center or (IC3) , partnership of the FBI and the National White Collar Crime Center lists "Internet Auction" as number one comprising 44.9% of referred complaints.

There are two most common auction fraudulent scams. First, a person "wins" the bid, sends in their $$ and receives no merchandise.

Second, the seller sets up a bogus online escrow service, takes the money from the winning bidder but never sends the money to the seller.

For the regular Joe, it is difficult if not impossible to check out an auction service.

We always seem to go with the 'brand name' and hope for the best. But, fraud still occurs...at too high of a rate.

NOTE: Never give out your social security number or drivers license number to an auction seller...even if they ask!

Number Two: Coming in at 33% of all consumer fraud complaints is "Identity Theft," most of which come from online use.

In the U.S., identity theft costs consumers $50 billion annually according to the FTC.

With the technology available to spammers, even the conscience person is not totally safe.

The best precaution to use on line is to only give your credit card number when the seller of merchandise has a secure transaction exchange like "PayPal."

Number Three: Yes, it's "Credit Card" fraud. We are a CC society and growing more so.

Federal law limits your loss on a stolen CC or CC number to $50.00 no matter how much is charged against the card without you knowledge.

To reduce the chance of fraudulent use, police and CC companies tell us to never let our card out of sight. My reaction? This is not possible.

Number Four: Using a bogus money order or cashiers check to buy a product or service or using them in a "may I have my money back" scheme. Here is how this top Internet fraud scam works.

You sell something yourself, like your used car, for example. The buyer gives you a money order or cashiers check that is a close match to a real one, but you couldn't know the difference.

After that person drives off in your former car, using the example, he calls you to say he made the money order out for $8,000 instead of $800. He wants to know if he could stop back and pick up your check for the difference of $7,200.

Because you believe the money order is "like cash," you give him your refund check. He immediately cashes your check but his money order is returned 9 or 10 days later from your bank, with a notation that its was fraudulent.

Now, you're out $7,200 plus your car, which he probably sold to a chop shop for cash.

A fictitious lawyer contacts you to say that Mrs. XXXXX, one of your long lost relatives, died overseas. The deceased relative has left a large amount of savings in a bank account. As the next-of-kin, this money is yours.

The catch. You, the would be victim, to obtain this money, must wire transfer a tax fee of, say $875 plus the lawyer's fee of $1,200. Upon receipt by the lawyer, the $186,000 will be wired directly to your checking account. Oh, and by the way, please give me you account number.

This scheme works well with senior citizens. They think they may remember Mrs.XXXXX, but for sure, they could use the money.

Number Six: A close second, as the most interesting of the top internet fraud scams is the, "I'm in trouble, send money" scheme.

Your "girl friend" needs money for a visa and to come visit you in the States from a country overseas.

This relationship has been carefully cultivated by the spammer over the past two or three months in order to set the hook.

Now, you're out several thousands of dollars. Your chance of getting these dollars back is...nil!

Number Seven: Here is a real winner and comes in first of my personal top internet fraud scams.

You receive an e-mail or you click on this site. For a fee of only $19.95, you send for and receive a CD that guarantees you that your "making easy money from home" days are here.

However, you have no knowledge of what is about to happen. The CD has a unique ID # for you to use in the CD program you sent for.

After sending them you PayPal account # (because they are going to need to deposit your big bucks in it), you are ordered to run your computer program 24/7 to capture all the loot.

What happens though, is that the spammers, through your computer, open every ad window they can find. The result? They receive per-click $$$ per each click.

Number Eight: The last of the top Internet fraud scams is the old, " you've won the lottery" scam.

You receive an e-mail, with a follow-up snail-mail letter congratulating you on winning the lottery. Of course a fake check is enclosed to make it seem real.

A phone number was in the e-mail asking you to call to confirm your acceptance of the winnings.

You're then told to deposit the check and send a wire transfer of $15,187 "by Friday" because taxes and fees had to be paid on the winnings.

The fake check that you deposit is usual in excess of $250,000, but, of course, 3 to 5 days later your bank tells you the bad news.

Multi-Level Marketing programs (MLM) are cause for concern. The Federal Trade Commission (FTC) defines them legal structures, but with guidelines.

They advise that MLM organizations offering greater financial incentives for recruitment than product sales are to be viewed cautiously.

High joining fees or the requirement to purchase a minimum inventory of fairly expensive product can usually identify fraudulent MLM schemes.

These organizations sell product through "distributors," or independent contractors, who receive commissions on sales.

Many times these distributors recruit others to also be distributors. The original distributor, now a manager, may collect a percentage of the sales, which their recruited distributors make.

In a legitimate MLM company, commissions are earned only from the sale of a product or service.

If distributors are paid mostly by dollars received from recruiting new distributors, then the MLM company is an illegal pyramid or Ponzi scheme.

How Pyramid Schemes Work

Pyramid schemes definitely fit into the top Internet fraud scams.

They are considered to be unfair trade practices because they ultimately are unfair to most participants. In reality, only those at the top three levels of the pyramid benefit from those below them.

If most of the money one earns comes from recruiting new people who, in turn, must recruit other new people to produce financial rewards, and not from selling a product or service, then the company promoting this venture, is almost certainly running a pyramid (ponzi) scheme.

The top Internet fraud scams always include Ponzi schemes. Ever hear of the adage, “Stealing from Peter to pay Paul?” Well, that’s a Ponzi scheme in a nut shell.

Here, the promoter of the scheme pays no commission to people who recruit an ever-increasing stream of new people.

Because the promoter promises a high financial rate of return to everyone. Don’t you want to tell your friends about the “good deal” you’ve found?

Simply, the promoter just uses money received from new recruits to pay obligations owed to longer-standing members of the program.

Hopefully by exposing the top Internet fraud scams out there in the marketplace, you’ve have had a chance to “see” some of the pitfalls waiting for all of us.

So, please “do” not get involved with top Internet fraud scams, or any other such scams.

Prior to continuing, would you like to help yourself or others?

YOU'RE INVITED:

If you want help in determining if a website is legitimate or not, please ask the world for help now.

Or, maybe you have experiences you can share with others around the world to help them avoid websites which are not truthful or on the up-and-up according to your experience.

We all benefit from Paying It Forward. Thanks for sharing.

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