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Blog Fraud/Identity Theft

5 summer scams to avoid all year long

Fraud/Identity Theft
5 summer scams to avoid all year long

This summer’s most prevalent financial scams are catching consumers by surprise.

1. Gift cards, secret shoppers and the allure of fake offers

This summer scam works as follows: consumers are drawn in by a phony email or social media post to become a “secret shopper” in exchange for some form of financial gain.

When a consumer agrees to participate, the fraudster seals the deal by delivering a very large counterfeit check. The criminal then asks the consumer to deposit the check and purchase gift cards with the funds — keeping a small portion of the proceeds as compensation for being the “secret shopper.”

The consumer is asked to email photographs of the gift cards, front and back, so the criminal can use them immediately — before the counterfeit check has a chance to bounce.

Takeaway: The bounced check and all associated damages are the responsibility of the consumer because the criminal and his or her email address are long gone by the time the check bounces.

2. “You can never be too rich or too thin” — and other email scams

Some consumers are attracted to “get rich” and “get thin” offers, and unfortunately an age-old diet scam has surfaced again, targeting consumers with spam emails. When an unwitting consumer signs up for the “self-improvement” deal, that individual agrees to recurring billing for the proposed service.

Takeaway: This ongoing billing arrangement is difficult to stop. And, in some cases, the stolen payment card information is used for other fraudulent purposes.

3. “MSN” help desk fraud

This form of fraud is usually directed at the elderly. A criminal calls an unsuspecting consumer and warns that his or her PC, however seldom used, is riddled with viruses.

The fake technician offers to assist, and then dispatches the victim to a local big box store to buy prepaid gift cards which are given as payment for the tech support services.

Takeaway: Losses to elderly victims of this summer scam can soar well into the thousands, and the criminals are willing to take every nickel without remorse.

Some big box stores have started to try and identify consumers who may be embroiled in these summer scams, but they can run into roadblocks when victims are either mentally incapacitated or reluctant to admit they have fallen for a scam.

4. Card cracking

This rip-off scheme typically victimizes our youth. A fraudster reaches out to a young person via social media and convinces the potential victim that they can both benefit by helping each other out, with the young account holder receiving a small sum — $100 or so — as compensation for cooperating with the fraudster.

The victim then gives the criminal access to his or her online banking credentials, so the criminal can deposit counterfeit checks into the account.

The fraudster also typically requires the usage of the account holder’s debit card and, in some cases, accompanies the co-conspirator to an ATM to perform withdrawals against the counterfeit checks that have been deposited. This is especially troubling if the account holder is a minor in the company of an adult criminal.

Bottom Line: All financial damages, including non-sufficient-funds checks, fall back onto the young consumer. And that easy $100 profit? It was fake as well.

5. Direct-mail scams

Bogus, but official-looking, letters are delivered every day to random consumers with stern requests for Social Security numbers and other personally identifiable information.

Some of these letters are printed on what looks like big bank letterhead and, in all cases, there is at least one “official looking” hard-copy form that the consumer is asked to fill out and return.

Takeaway: The addresses on these letters and the return envelopes provided are criminal addresses. They are not P.O. boxes belonging to actual businesses.

The main objective here is identity theft. This summer scam can be very convincing to consumers because the U.S. Postal Service has not been a criminal mainstay since the proliferation of email in the mid-1990s.

Read about other ways to protect yourself from fraud and identity theft on our blog. 

(Article provided by CO-OP Financial Services)