A Customer’s Guide to Common Fraud Schemes


Each year, countless consumers fall victim to fraud schemes. While the fraudsters are often very convincing, many of these schemes can be easily avoided by looking for common red flags. This guide will assist you in recognizing these schemes.

LOTTERY WINNINGS

Fraudsters often contact consumers and tell them that they have won the lottery. This can be in the form of foreign lotteries, Publisher’s Clearing House, or even local lotteries. Things to look out for include unsolicited lottery winning
letters, emails, or calls which request that you not tell anyone about your win, ask you to deposit a check into your bank account and pay for taxes or processing fees using wire transfers or services like Western Union or MoneyGram, or you pay fees out of pocket for your winnings.

You can visit the following websites to obtain additional fraud prevention information and tips designed to educate consumers.

PUBLISHER’S CLEARING HOUSE
info.pch.com/consumer-information/fraud-protection

WESTERN UNION
www.westernunion.com/us/en/fraudawareness/fraud-home.html

MONEYGRAM
corporate.moneygram.com/compliance/fraud-prevention

SIGNIFICANT OTHERS

Another way in which fraudsters are successful is by playing with consumers’ heart strings. Fraudsters will comb through online dating websites, chat rooms, message boards, or send spam email messages and try to cause someone to fall in love with the fraudster. Once a relationship is established, the fraudster will begin asking for money to pay for medicine, a financial hardship, or help them return to or move to the U.S. The fraudster may also use information that they know about the victim to trick the victim into thinking the fraudster is an old acquaintance. Things to look out for include very poor grammar in emails or messages, online relationships in which the other person refuses to meet in person or talk on the phone, situations where you are asked to receive checks or wire transfers and then wire the funds to another individual for your significant other, or an individual who claims they are from the United States but are currently overseas for
work or military service.

Visit this site for scam prevention tips.

ROMANCE SCAMS
www.romancescams.org

ONLINE PRODUCT SALES

Fraudsters often target individuals selling products on Craigslist, EBay, or other similar websites by sending the victim a counterfeit check which is in an amount greater than the price of the item to be purchased. The fraudster asks the victim to send the excess back or send the excess to a courier for shipping, etc. The victim is left paying for the balance owed after the check returns to the victim’s bank. Things to watch for include very poor grammar or spelling in emails or text messages, a buyer who sends a check in an amount greater than the price of the item for sale, and mention of sending funds using services such as Western Union. You can visit the following websites to obtain helpful fraud prevention information.

CRAIGSLIST
www.craigslist.org/about/scams

EBAY
www.ebay.com/securitycenter/

PHONY LOANS

Fraudsters often pose as payday or other lenders and trick victims into providing their personal information in order to obtain a loan. The victim is then sent a counterfeit check and asked to send a portion back to the fraudsters as the first payment or asked to provide the fraudsters with their online banking or mobile deposit login information so that the funds can be sent to the victim.

INHERITANCES

Fraudsters will also often send emails to victims claiming that they have inherited money overseas or ask for help moving large sums of money into the U.S. These schemes often involve sending a counterfeit check to the victim or asking the victim to wire funds to another individual to secure the transfer or pay legal counsel fees.

WORK FROM HOME

Fraudsters also scour online employment websites and offer job seekers jobs that pay large sums of money for little work. The result is generally that the victim is sent a counterfeit check to cash, fraudulent wire transfers, or other disbursements of funds. Things to look out for are jobs which appear to pay unrealistically high amounts, poor grammar in ads or emails, the receipt of a check to send funds to others, or being asked to act as a “secret shopper,” or other similar functions.

WIRE FRAUD

It’s especially important to know who you are sending money to. Wires are a useful, fast, and convenient way to send money. Problems occur when you authorize the delivery of funds to individuals you don’t know, or to unfamiliar organizations with questionable backgrounds.

BEST PRACTICES

All of the above schemes noted have several similarities. Some best practices include:

  • Be wary of checks received by mail.
  • Keep online banking and remote deposit login information private.
  • Be cautious if you are asked to wire or send money through Western Union or MoneyGram.
  • Be careful about what information you provide to someone over the phone, via email, or online.
  • Frequently change passwords, and avoid re-using previous passwords.

RESOURCES

  • Sunflower Bank associates are always available as an information resource!
  • www.scamawareness.org – The Scam Awareness Alliance is a nonprofit organization that promotes social welfare, focusing on consumer scam awareness and providing information about scams and how to identify them.
  • www.fraud.org – The National Fraud Center is a non-profit advocacy organization that actively promotes interests of consumers and workers in the U.S. and abroad.

FREE CREDIT REPORTS

  • The Fair Credit Reporting Act requires Equifax, Experian, and TransUnion to provide you with one free copy of your credit report at your request every 12 months.
  • To obtain your credit report, visit annualcreditreport.com.

IF YOUR IDENTITY IS STOLEN

  • Contact Equifax, Experian, or TransUnion and ask for a fraud alert on your credit report.
  • Order credit reports from each credit reporting company.
  • File a complaint with the Federal Trade Commission at ftc.gov/complaint.
  • File a police report with your local law enforcement agency, or the agency where the theft occurred.

REPORT FRAUD TO AUTHORITIES

  • Report to the Federal Trade Commission at ftc.gov/complaint.
  • www.IC3.GOV – The FBI’s Internet Crime Complaint Center is a partnership between the FBI and the National White Collar Crime Center.
  • Report to your State Attorneys General Office of Consumer Affairs.
  • Report to your local law enforcement agency.

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