A scam is broadly defined as a clever attempt to defraud someone. While scams have been around as long as people have had things worth scamming, the rise of email and the Internet has given scammers more tools and methods of committing fraud than ever before.
If you suspect you have been a victim of online scams or fraud, you can report your experience at USA.gov (or see below for a list of places to report fraudulent activity). Other countries have similar ways to report scam attempts and fraudulent activity.
Protecting Yourself from Scams and Fraud
Here are the top three things you can do to protect yourself from scams and fraud:
Know Who You’re Dealing With: Make sure emails, links and websites are legitimate before conducting clicking on them, and especially before conducting any sensitive business. If you are unsure, delete the email and avoid using the link or website. When it comes to phone calls, only answer the phone when you recognize the number, and never give important details to someone who calls you.
Monitor Your Accounts: Keep an eye on account balances, transactions, and credit reports to make sure there is no potentially fraudulent activity. Do this as part of your weekly or monthly routine to help maintain financial health.
Report Suspicious Activity: Many people assume that others have reported a fraud attempt already, or that scams are just a part of life. The truth is, the more people who report, the more likely the scammers are to get caught.
Tips about dealing with specific types of scams are listed below.
Phone Scam Tips
- Add your cellphones and landlines to the National Do Not Call Registry.
- Do not answer calls from unfamiliar phone numbers.
- Never give private information to someone who calls and says they are from your bank. Instead, hang up and call the bank using the customer service number on your statement or the bank’s website.
Email Fraud Tips
- Remove yourself from unwanted/unused email lists to minimize the clutter and make unsolicited messages easier to find.
- Use your email provider’s spam or junk filter to weed out potential scam emails.
- Use whitelist filters to label, star or organize important messages.
- Scan all incoming email with virus scanning software to prevent viruses.
- Delete suspicious emails immediately, without opening them or clicking on any links they contain.
- Never agree to send money to someone you don’t know.
Internet Safety Tips
- Log out when you are done with a website, especially if using a public or shared computer.
- Keep your web browser (Chrome, Firefox, Safari, Internet Explorer, etc.) and other software up to date with the newest version to ensure you have the latest bug fixes and security features.
- Make it a habit to check for secure connections, identified by a small green padlock symbol in your browser’s address/location bar and the use of https (not just http) in the URL.
- Double-check URLs to make sure you are on the right website – many scammers use website names that look very similar and have similar-sounding names.
- Enable popup blockers so that you are not automatically redirected to scam site.
- Use strong passwords to protect your online accounts – a password manager like LastPass or Dashlane will help you remember them all.
- Avoid using unsecured wifi connections whenever possible, since they can give hackers easy access to your system.
Always Double Check Before Giving Out This Information
- Date of birth / age
- Social Security number
- Bank account numbers
- Routing numbers
- Credit card numbers
- Security codes (also called CVV or CVV2)
- ATM PINs (or other codes)
- Mother’s maiden name
- Personal history details
Most Common Scams
There are far too many types of scams and fraud to list on a single page. Here are some of the most common scams that occur every year, with a brief description of what they are and the best ways to avoid them.
Advance Fee Scams
This ubiquitous scam tries to get the target to send a relatively small amount of money to the scammer in order to unlock a much larger amount. A typical form of this scam involves the scammer claiming to have an inheritance or some other large amount of money that is coming to them, but they first need to pay legal or processing fees in order to access it.
It goes by many names including Nigerian scam, 419 scams, and the Spanish Prisoner scam. Today, the scam is mostly run by email, but in the past people have used many forms of communication, including regular mail, faxes, and telephone.
How to Protect Yourself:
- Do not communicate with anyone asking for money by email.
- Delete emails from suspicious or unrecognized addresses.
- Never send money to someone you met via email.
“Phishing” (pronounced “fishing”) is a type of scam that uses email to trick victims into revealing personal or sensitive information for use in accessing financial accounts, tax information, or engage in other forms of identity theft. Phishers – scammers who engage in phishing – often use emails and websites that look like legitimate bank or government websites, but which actually belong to the scam artists.
In recent years, many phishing scams have involved emails and websites that look like they are originating from the U.S. Internal Revenue Service (IRS). The scammers will use the IRS logo and use official-sounding words and phrases to trick people into providing personally identifying information (SSN, bank account, routing number, etc.) or to make payments with the threat of severe penalties or jail if the person does not pay.
How to Protect Yourself:
- Avoid using links in emails – use bookmarks or navigate directly to the bank or government website you want to visit by entering the URL in your web browser.
- Know that the IRS does not initiate communication via email, text, or social media.
- Understand your rights as a taxpayer and your rights as a consumer.
- Forward potential IRS phising scams to [email protected].
There are many different types of phone scams, but most of them involve trying to obtain personally identifying information about yourself, your finances, and your habits. The scammers will then use this information to access financial accounts or personal records, constituting identity theft.
Elderly individuals are the group most often targeted by phone scammers, because they can easily become confused and are most likely to provide information over the phone to someone they believe is from their bank. If you live or care for an elderly individual, talk with them about the importance of not giving out personal information over the phone.
How to Protect Yourself:
- Do not answer calls from unrecognized phone numbers.
- Only give out personal information if you made the call and know who you are talking to.
There are a lot of products out there that make bold claims – often around health, nutrition, or medical conditions. People in the U.S. spend billions of dollars a year on unnecessary dietary supplements, pain relief devices, and other consumer products that do not actually have any proven health benefits.
Before buying any such supplements, medical devices, or other products, it is important to do your investigative work. Don’t just simply read the label on the product itself – they are often inaccurate and misleading! Even if a product claims to be safe and approved by the U.S. Food & Drug Administration, that does not mean it is effective to treat the particular condition claimed on the label. Save your hard-earned money only for things that actually work.
How to Protect Yourself:
- Research medical and health claims on trustworthy government and educational websites.
- Read reviews from third-party websites and blogs (not the manufacturer’s site) to see what problems others may have experienced after using the product.
- Talk to your doctor about whether a supplement, medical device, or other product will work for you.
Shipping scams (sometimes called re-shipping scams) involve the receipt of packages ordered by someone else that you then ship to another location. The scammers will promise to pay you the shipping cost plus a fee for your service, but of course that amount is never paid.
In reality, what happens is that the item you shipped (or re-shipped) was most likely bought with a stolen credit card. The scammer needs a physical address for the item to be delivered, and when you forward the item along, it will most likely be to an untraceable P.O. box. The clincher is that the cops will come knocking on your door, since the item was shipped to your address – and the scammers will have whatever personal information you gave them, which could lead to your credit card being the next one used to scam someone else.
This type of scam often rears its ugly head around the holidays, because of the large number of packages that get shipped to loved ones around the world. However, it can happen any time of the year.
How to Protect Yourself:
- Never agree to ship (or re-ship) a package for someone you do not know.
- Do not give out your address or other personal information to individuals in promise of future payment.
Recovering from a Scam
If you have been the victim of a scam or other type of fraud, the consequences can vary broadly. Some of the consequences include:
- Lost money
- Stolen identity
- Debt issued in your name
- Credit problems (e.g., denied for new credit)
- Civil liability
- Criminal charges
Recovering from these consequences can be a long, time-consuming, and expensive process. Scammers are good at hiding, and even when they are caught, the money they scammed from others is likely already spent, making it impossible to repay victims.
Still, there are some things you can do to minimize and possibly reverse some of the effects of the scam on your life and finances:
Call your bank IMMEDIATELY – Depending on the type of scam, you may be able to stop any transactions from going through if you report the activity right away. Even if the transaction is not stopped, you may be eligible for a refund if you report fraudulent activity on your credit card or bank account within 30 days.
Place a fraud alert – You can file a fraud alert on your credit report with all three major credit bureaus. Unfortunately, you will have to do this individually with each of the credit bureaus, as there is no single way to contact all three.
- Equifax: 1-800-525-6285
- Experian: 1-888-397-3742
- TransUnion: 1-800-680-7289
In addition, you may wish to contact some of the smaller credit reporting agencies. These agencies typically maintain reports on consumers with a specific focus (such as employment, insurance, utilities, tenant history, etc.):
- Innovis: 1-800-540-2505
- LexisNexis: 1-888-497-0011
- National Consumer Telecom & Utilities Exchange: 1-866-349-5185
- Talx: 314-214-7000
- ISO (Verisk): 1-800-888-4476
- ChexSystems: 1-800-428-9623
- Check Information Systems (CheckFraud): (843) 571-2143
- FirstData: 1-800-710-9898
- CoreLogic: 1-888-333-2413
- TenantData: 1-800-228-1837
- Medical Information Bureau: written requests only
- Milliman IntelliScript: 1-877-211-4816
- The Retail Equation: PO Box 51373, Irvine, CA 92619-1373
(The above list is incomplete. If you have a suggestion for an addition, please let us know!)
Report to federal authorities – The U.S. Federal Trade Commission is the primary place to report scams, but you may want to report scams to other government agencies – such as the FBI, which investigates Internet crimes – as well:
|Type of Scam / Fraud||Reporting Agency / Link|
|General consumer and financial scams and fraud, including identity theft||Federal Trade Commission Complaint Assistant|
|E-commerce fraud (national and international)||eConsumer.gov Complaint Form|
|Internet crimes (including scams and fraud)||Federal Bureau of Investigation Internet Crime Complaint Center|
|Telephone fraud (including cell phone fraud and scams)||Federal Communications Commission Consumer Complaint Center|
|Mail fraud or scams sent through the U.S. Postal Service||U.S. Postal Inspection Service Complaint Form|
|Medicare and Medicaid service fraud||Centers for Medicare & Medicaid|
1-800-447-8477 (Medicare Fraud Hotline)
|IRS imposters and related fraud/scams||Treasury Inspector General for Tax Administration Scam Report|
|Census agent imposters and related fraud/scams||U.S. Census Bureau|
Report to state agencies – In addition to reporting scams to federal agencies, you may want to notify your state agencies, so that others in your state will be aware of potential fraud and scam attempts. In most states, you can report fraud to the state’s Office of the Attorney General:
- District of Columbia
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- West Virginia
Notify the Better Business Bureau – If the scam involved a business (or someone posing as a business), you should also notify the Better Business Bureau, which can warn other consumers about potential fraud.
Get credit/debt counseling – If your credit was damaged due to a scam, you may want to consult with a credit counseling service. Be sure to choose a legitimate credit counselor, such as one certified by the nonprofit National Foundation for Credit Counseling (NFCC). Do not use a for-profit debt consolidation or repayment service, as they often wind up having harsh terms and high fees.
Consider legal counsel – While most money lost in scams goes unrecovered, you may still want to pursue legal action, especially if you know the identity of the individual or company who perpetrated the scam. Even if you don’t file a lawsuit, your attorney may be able to help you dissolve debts incurred by the scammer, so that you do not have to pay them yourself. When seeking an attorney, only go with reputable lawyers who will provide an initial consultation for free, and make sure you understand the terms of any fees upon recovery before signing any documents.