There are a lot of people out there who do nothing else but devise ways to extract money from you illegally. These people are fraudsters, con artists on a mission. And that mission is to trick you into doing something that will separate you from your money. Consumer fraud is a huge issue, one that can be avoided by avoiding the following scams.
1. Give money only to recognized charities. You’ve seen the ads asking for money: floods in Bangladesh, an earthquake in Haiti, tornadoes in Missouri and a tsunami in Indonesia. Each crisis brings forth appeals from a host of organizations — some legitimate, others not so much. When an appeal tugs at your heartstrings, carefully consider the organization making the appeal. The Red Cross, Samaritan’s Purse, Oxfam and World Vision are each legitimate organizations, IRS-recognized charities that are also accountable financially.
2. Avoid foreign lotteries. The stories seem too good to be true: an impoverished individual in a third-world country buys a lottery ticket, wins and soon claims a multi-million dollar prize. What’s more, that lottery is open to people around the world and you just have to get in on the action. This can be a big mistake as there are fraudsters who target Americans with promises of great riches. What they’ll do instead is take your money, find out your Social Security Number and steal your identity.
3. Keep your personal information private. Unsolicited phone calls can turn into a big problem. It may sound innocent enough: an individual calls you to say that they work for your bank and that there has been a problem with your account. To resolve the problem, they ask to verify your Social Security Number or provide some other personal information. Hang up on this individual and call your bank. Most likely, your bank did not place the call and would never ask you to provide personal information over the phone.
4. Do not believe every debt elimination offer. You owe thousands of dollars to your creditors as do many other Americans. That alone has hucksters looking for an easy kill, namely your credit standing. Promises to eliminate most debt by paying just pennies on the dollar for what you owe are false promises. They’ll take your money, never pay off your creditors and leave your credit rating trashed.
5. Never wire money to someone you do not know. Wire transfers are a great way to send money to another party, including someone you know halfway around the world. The problem isn’t the money, rather the individual receiving the funds notes Watson Burns, PLLC . If you send money to someone you do not know, they may clean out your account. And once the money is gone, it is nearly impossible to retrieve what you lost especially funds that have been sent overseas.
6. Do not cash that check. If you have a bank account, never cash a check for someone you do not know. This person may approach you and say that you inherited money and to receive your funds you’ll have to cash a check to have those funds sent to you. The individual gets the money, but the check bounces later. Your bank comes to you for the funds and you’re out of money.
7. Never pay a fee in advance for a mortgage modification. You’ve heard the pitch: a company will lower your monthly mortgage payments by underwriting a new loan. You send money for closing costs, but you don’t yet have a contract in hand. That’s the problem: closing costs and other fees should be collected after the fact, not before. You’ve been scammed!
Fraudsters are always looking for ways to trick consumers. Some of the methods used have been around for years, but people are still falling prey. New methods arise and may take some time to get the word out that they are bogus. Always be on the look out for con artists that may to relieve you of your money.