Article: How to Spot a Scam a Mile Off
by Elena Fawkner
Received the following forwarded email from a subscriber
this morning:
"I am an Executive Director with the Nigerian National
Petroleum Corporation (NNPC) and a member of the Contract
Advisory Committee (CAC). I am seeking your assistance
to enable me transfer the sum of $26,500,000 (Twenty Six
Million, Five hundred Thousand United States Dollars)
into your private/company account."
Carole told me she has received "3 or 4 of these
in the last week, I think from different people. I deleted
the others. It makes me nervous. Sounds like a dangerous
scam."
That's exactly what it is, of course. Maybe you're reading
this thinking I can't believe people are still falling
for the Nigeria scam after all this time". On the
other hand, maybe you're reading this thinking, "Wow,
I might have responded to that. How am I supposed to know
what's a scam and what's real?"
The reality is that there are hundreds of thousands of
people coming online, for the first time, each year. Many
of these people have simply not been exposed to scams
like the ones that are constantly touted on the Internet
before. Many of these people come online to try and find
a way to make money with their computers and/or they're
looking for ideas for making money from home.
The fact that they may not recognize scams off the bat
doesn't mean they're naive or stupid, it just means that
they haven't been in an environment where this sort of
stuff came their way before now. And don't the scammers
know it.
Like vultures circling overhead, they await their prey.
They know they have only a narrow window of opportunity
because it doesn't take newbies long to catch on so they
have to be quick about it. And how do they do that? They
hang out where newbies hang out so they can get them while
they're still young and fresh and vulnerable. They're
nothing but predators looking to pick off the
easiest game. Wouldn't want to have to engage in any real
work, after all. In this article we look at several main
scams and how to recognize them.
Nigerian Advance Fee Scheme
The gist of this worldwide scheme is that small to medium-size
businesses receive a letter from someone who purports
to be an official of the Nigerian government or major
utility or similar who needs to transfer some huge amount
of money out of the country. The money typically is an
overpayment by the government on a procurement contract.
The object of the exercise is to get you to provide your
bank account details (for the purpose of wire transferring
the money of course). Surprise surprise, there's a transfer
all right but not INTO your account!
The FTC "Dirty Dozen"
These are the top 12 scams that have been identified
by the (U.S.) Federal Trade Commission as the most likely
to arrive via email:
1. Business Opportunities - often pyramid schemes (see
below) thinly disguised as legitimate opportunities to
earn money. What to look for: high returns with little
or no effort or cash outlay required.
2. Bulk Email - offers of lists of thousands of email
addresses all of whom, of course, are just dying to receive
your marketing message. What to look for: "Bulk Email
Works! 10,000 addresses for $9.99."
3. Chain Letters - send $5 to the next name on the list
then cross the bottom name off the list, replace it with
your own, then forward the letter to 500 of your nearest
and dearest. What to look for: A jail cell. This is a
pyramid scheme and is illegal. The letter goes to great
pains to say that it is not illegal.
4. Envelope Stuffing - think you're going to be paid for
stuffing envelopes? Think again. You get a kit that you
can turn around to recruit others to an envelope stuffing
scam of your very own! Watch out for craft assembly work
as well. You'll probably find all of your hard work is
not up to their exacting "quality standards"
and therefore you won't get paid for your work.
5. Health and Diet Scams - magic pills that eradicate
the need to eat fewer calories than you expend in order
to lose weight. They don't work.
6. Effortless Income - no such thing. As the FTC says,
if they worked, everyone would be doing it.
7. Free Goods - you're told you'll get a free computer.
You have to pay a fee to join a club and then told you
have to recruit other members. You get paid in computers.
They're nothing but pyramid schemes.
8. Investment Opportunities - look for outrageously high
rates of return with no risk.
9. Cable Descrambler Kits - they probably won't work and
even if they do, you're stealing a service from a cable
company and committing a crime.
10. Guaranteed Loans or Credit - pay a fee and you're
given a list of lenders, all of whom turn you down. Credit
cards never arrive.
11. Credit Repair - no matter how bad your credit, pay
these people and they'll fix it. They generally just advise
you how to lie on future credit applications - how to
commit fraud in other words.
12. Vacation Prize Promotions - your accommodations will
be so bad you'll want to pay for an upgrade. You'll probably
have to pay to schedule a vacation at the time you want
as well.
Pyramid Schemes
Make money by recruiting members into the program without
giving anything of equal value in exchange for membership
fees. Contrast MLM (multi-level marketing schemes). These
are not pyramid schemes because they involve the sale
of products and services in return for membership.
Medical Billing
Prepackaged businesses requiring an investment of $2,000
to $8,000. Few people who purchase one of these "businesses"
are able to find clients, start a business and generate
revenues. Competition in this area is fierce and concentrated
around a few big, well-entrenched firms.
Your In Box
Finally, go to your in-box now. You'll find no end of
scams sitting right there. Here's one that just arrived
in mine ...
"Subject: How to make $1,000,000 in 20 weeks selling
to Newcomers on the Net"
Like all the rest, it gets the one-finger salute - index
finger to the delete key. Works beautifully every time.
Where to go for more information on internet scams:
FTC Website http://www.ftc.gov/ftc/consumer.htm
Scambusters http://www.scambusters.org
Netscams http://www.netscams.com/frameset.html
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Elena Fawkner is editor of A Home-Based Business Online
... practical home business ideas for the work-from-home
entrepreneur. Visit http://www.ahbbo.com
