Common phone & promotional scams

When you send money to people you do not know personally or give personal or financial information to unknown callers, you increase your chances of becoming a victim of telemarketing fraud.  To protect yourself from the damage of identity theft and fraud, exercise caution using the tips below.

• The IRS - Tax scams persist year-round, threatening people with jail time or prosecution if they don’t pay debts to the Internal Revenue Service.  Given that fake IRS phone calls continue to plague consumers, the IRS itself has repeatedly published a list of things you will not experience with a legitimate IRS representative, including phone calls demanding payment, threatening arrest, and asking for specific payment methods like a prepaid debit card. Learn more

• Lottery scan or advance fee fraud “419” frauds. Named after the relevant section of the Nigerian Criminal Code, this fraud is a popular crime with West African organized criminal networks. There are a myriad of schemes and scams – mail, email, fax, and telephone promises are designed to entice victims to send money, ostensibly to bribe government officials involved in the illegal conveyance of millions outside the country. Victims are to receive a percentage for their assistance.
  
  There are many variations of phishing and 419 schemes, but they all have the same goal: to steal the victims’ money or personal and account information. Click here for a list of the most common variations of the 419 scam.
  
  
• Investment Scams - A salesperson convinces a senior that an unusual asset, like a horse farm, is worth a significant investment. Learn more
• Charitable donations - Unscrupulous charities take advantage of generosity and memory loss to request donations repeatedly. Learn more
• Grant fraud scam - Perpetrator poses as a representative of a government agency or some other organization with an official sounding name. He or she contacts older adult notifying him or her that they’ve been selected to receive a grant and requests the older adult’s checking account number in order to deposit grant the funds into the account.
• Sweepstakes - ‘Contest’ claims a senior won a prize and needs to send in money to collect winnings.

• Money transfer scams - Often part of an Advance Fraud Scheme, a perpetrator convinces an older adult to send funds via Western Union or other money transfer services, using a number of elaborate schemes.
• Mystery shopper - The perpetrator enlists an older adult to become a “mystery shopper” for them and sends the older adult a counterfeit cashier’s check. They are instructed to cash the check, wire a portion back to the perpetrator and keep the remaining amount (appeals to those on a fixed or limited income).
• Misappropriation of income or assets – A perpetrator obtains access to a vulnerable adult’s Social Security checks, pension payments, checking or savings account, credit or ATM cards, and withholds portions of checks cashed for themselves.
• Charity scams – The victim is persuaded to buy a valueless or nonexistent product, donate to a bogus charity, or invest in a fictitious enterprise. Seniors are particularly vulnerable to this type of fraud because they are often at home during the workday to answer the phone. Social isolation is also a factor where fraudsters prey on lonely seniors anxious for someone to talk to. They devise schemes that require multiple phone calls and the development of a trusting relationship. 
• A payday lender - “Congratulations, you’ve been approved for a payday loan!” This is a variation on the sweepstakes scam and the call from “your credit card company” offering you lower interest rates. A good rule of thumb: If you didn’t apply for a loan, ask for a rate adjustment or enter a sweepstake, it’s probably a scam.
• Reverse mortgage scams - Reverse mortgage scams are engineered by unscrupulous professionals in a multitude of real estate, financial services, and related companies to steal the equity from the property of unsuspecting senior citizens or to use these seniors to unwittingly aid the fraudsters in stealing equity from a flipped property.
• Obituary scam - Using obituaries to target recent widows, scammers attempt to collect false debts of the deceased.
• Magazine subscriptions - Company sends free magazines and convinces a senior he owes money for the subscription.

• Yourself - If your own phone number ever pops up on your phone screen, don’t answer. It may seem harmless in the moment, but this scam reportedly collects and classifies numbers of people who answer the phone as good numbers to target with other scams. It may be tempting to see who’s on the other end of the line — since it clearly isn’t you — but you may be signing yourself up for many more unwanted phone calls.
• Identity theft – Using one or more pieces of the victim’s personal identifying information (including, but not limited to, name, address, driver’s license, date of birth, Social Security number, account information, account login credentials, or family identifiers), a perpetrator establishes or takes over a credit, deposit or other financial account in the victim’s name.  Fraudsters gather victim’s information through various means; however, senior citizens are often susceptible to social engineering techniques that fraudsters use, such as “phishing” to entice victims to supply personal information such as account numbers, login IDs, passwords, and other verifiable information that can then be exploited for fraudulent purposes. Phishing is most often perpetrated through mass emails and spoofed websites, but it can also occur through old fashioned methods such as the phone, fax and mail. Learn more
• Fake accident ploy - Similar to the Grandparent scam, here a perpetrator convinces an older adult that the older adult’s child has been seriously injured or is in jail and needs money for medical treatment or bail.
• Fictitious relative – The perpetrator calls the victim pretending to be a relative in distress and in need of cash, and asks that money be wired or transferred either into a financial institution account.
• Online Dating and Romance / Sweetheart scams – The perpetrator enters the victim’s life as a romantic interest in order to gain influence and eventual financial control. This type of scam often goes unreported due to the embarrassment and emotional impact on the victim. At times the victim knows they are being duped but they simply don’t want to be alone. Click here for more about Romance / Sweetheart scams.

Conclusion:  All of these tactics can put you at risk for identity theft, fraud or financial losses that could damage your credit or financial stability. If you receive a suspicious phone call, you can report it to the Federal Trade Commission, and as a fraud-monitoring precaution, it’s a good idea to regularly review your credit scores and reports for signs of abuse.

6 Warning signs that its a phone scam:

1. "You must act 'now' or the offer won't be good."
2. "You've won a 'free' gift, vacation, or prize." But you have to pay for "postage and handling" or other charges.
3. "You must send money, give a credit card or bank account number, or have a check picked up by courier." You may hear this before you have had a chance to consider the offer carefully.
4. "You don't need to check out the company with anyone." The callers say you do not need to speak to anyone including your family, lawyer, accountant, local Better Business Bureau, or consumer protection agency.
5. "You don't need any written information about their company or their references."
6. "You can't afford to miss this 'high-profit, no-risk' offer." 

9 Tips to Avoid Telemarketing Fraud:

1. Don't buy from an unfamiliar company. Legitimate businesses understand that you want more information about their company and are happy to comply.  It's never rude to wait and think about an offer. Be sure to talk over big investments offered by telephone salespeople with a trusted friend, family member, or financial advisor.  Always take your time making a decision. Legitimate companies won't pressure you to make a snap decision.
2. Always ask for and wait until you receive written material about any offer or charity. If you get brochures about costly investments, ask someone whose financial advice you trust to review them. But, unfortunately, beware -- not everything written down is true.
3. Do your research.  Always check out unfamiliar companies with your local consumer protection agency, Better Business Bureau, state Attorney General, the National Fraud Information Center, or other watchdog groups. Unfortunately, not all bad businesses can be identified through these organizations.
4. Ask for information.  Obtain a salesperson's name, business identity, telephone number, street address, mailing address, and business license number before you transact business. Some con artists give out false names, telephone numbers, addresses, and business license numbers. Verify the accuracy of these items.
5. Sending money.  Before you give money to a charity or make an investment, find out what percentage of the money is paid in commissions and what percentage actually goes to the charity or investment. Never send money or give out personal information such as credit card numbers and expiration dates, bank account numbers, dates of birth, or social security numbers to unfamiliar companies or unknown persons.
6. You must not be asked to pay in advance for services. Pay services only after they are delivered.  Some con artists will send a messenger to your home to pick up money, claiming it is part of their service to you. In reality, they are taking your money without leaving any trace of who they are or where they can be reached.
7. Don't pay for a "free prize." If a caller tells you the payment is for taxes, he or she is violating federal law.
8. Before you receive your next sales pitch, decide what your limits are -- the kinds of financial information you will and won't give out on the telephone.
9. Never respond to an offer you don't understand thoroughly.   Before you send money, ask yourself a simple question. "What guarantee do I really have that this solicitor will use my money in the manner we agreed upon?"