Common Forms of Fraud

There are countless scams and con artists who prey on unsuspecting consumers. Generally, they offer a large financial reward for minimal effort or attempt to steal credit card and banking information to use for their own benefit. Below are some of the more common scams to be aware of.

Telemarketing Fraud

You may receive a call telling you that you have won a free gift and you need to pay for taxes, postage, or handling. Or you may be offered a special deal that you must accept right away or the offer will expire. The caller will normally pressure you to act before you have time to really evaluate the offer and will ask for financial information (a credit card number, for example, or bank account information).

Once you agree to participate and you pay, it will be very difficult to get your money back. Some simple ways to avoid telemarketing fraud are:

· Never give out your Social Security Number, credit card number, banking information, or date of birth if you have not initiated the call. Ask for contact information and return the call.

· If you believe an offer is legitimate, verify the accuracy of items like the salesperson's name, company name, street address, and business license number.

· Check out any unfamiliar companies before you do business with them. Legitimate companies will be more than willing to provide information about themselves. If you are still in doubt, you can also contact the Better Business Bureau, your state Attorney General, or the National Fraud Information Center.

· Do not pay for services before they are delivered.

· Remember that it is against federal law to charge taxes on a free prize.

· Never respond to a deal that you do not thoroughly understand. You should always take the time to fully consider an offer and talk it over with trusted advisors if necessary.

Online Scams

The Internet has become a convenient way to find and purchase the goods and services you want. However, it has also opened up a whole new way to scam consumers out of their hard-earned money.

Some general guidelines to follow when doing business online:

· If you are not familiar with a seller, check them out. Search for other sites with information about the company or check with the Better Business Bureau.

· Use a credit card for online transactions. If something goes wrong, you can dispute the charges.

· Check out a company's contact information before you do business with them. Send an e-mail and call their phone number to make sure both are active. Confirm that the company has a street address, not just a PO box.

· A site's security can be difficult to verify. The padlock icon is not a guarantee that the site is secure, but it can give you some assurance. You can also check the site's security and encryption software.

· Review the online merchant's privacy policy and the siteGroups on data handling. Seek to do business with online merchants who have earned and display a respected privacy seal, such as the Better Business Bureau Online Privacy Seal or TRUSTe.

International Lotteries

Did you know that it is against U.S. law to buy or sell lottery tickets across borders, either by phone or mail? And according to the FTC, most offers you receive to participate in foreign lotteries are fraudulent. Many solicitors never purchase the tickets you pay for, others keep the winnings for themselves, and some use your bank account number or credit card information to steal money from you.

U.S. consumers are losing more than $120 million per year on these lottery scams. The best thing to do is ignore all phone and e-mail solicitations for foreign lotteries. If you respond, you can be pretty sure that you'll receive more offers since these scam artists share their lists.

Money Transfer or "Nigerian" Scams

You may have received e-mails, faxes, or postal mail that offers you a large financial reward if you will help to transfer money out of Nigeria or another country. The sender asks you to pay a number of fees for a variety of reasons. You are promised repayment of those fees as well as a percentage of the millions of dollars you help to transfer.

The millions of dollars do not exist. And not only do you never receive reimbursement for the fees, but you may have provided information that will allow the scammer to place charges on your credit cards or clear out your bank account.

· Do not respond to any solicitations of this sort. Report them to the U.S. Secret Service or FBI.

· Be skeptical of offers of large sums of money for doing little or no work.

· Do not provide your personal information.