Let’s face it, in an age of complete anonymity, internet fraud is getting worse all throughout the world. And why? Perhaps because it is a lot easier and safer to steal over the Internet. The logistics make it easy for anyone to pose as a legitimate entrepreneur or investor yet difficult for law enforcement agencies to investigate and prosecute these fraudsters.
In a perfect world there would be no crime, hence there would be no internet fraud. In our world, internet crime is a reality and we are left with no other option than to become better informed and much more alert about the prevalent internet fraud schemes.
Advance-Fee or Up-Front Payment Fraud
Scenerio: An individual or company requests an up-front fee, a so called “legal” or “transaction” fee, usually of several hundred dollars or more in exchange for a pre-approved loan. The loan is often approved swiftly and is guaranteed despite no credit rating or bad credit history.
Result: The up-front fee is paid, but the promised funds are never delivered.
Cashier’s Check or Money Order Fraud
Scenerio: An individual or company makes an investment offer and sends a check or bank draft, but the check is fake and it is for more money than the agreed amount. A refund of the excess amount is requested via a wire transfer such as Western Union. The mistake in the amount on the check is often attributed to an error in writing out the check.
Result: Excess money is wired back, the check bounces and the victim is out several hundred dollars and may even be criminally prosecuted.
Scenerio: An individual or company originating from outside of North America undertakes deals internationally usually for a small “transaction” fee.
Result: The fee is paid, but the business transaction is never consummated.
Do’s and Don’ts
- Do verify names, phone numbers and website addresses
- Do examine all correspondence for spelling and grammar errors
- Do be wary of speedy money endorsements
- Do keep a record of all transactions via internet, telephone, fax or mail
- Do be extra cautious when considering international business offers
- Do use common sense - if an offer sounds too good to be true, then it is
- Do consult a financial advisor or attorney before agreeing to any business deal
- Do report fraudulent activity to authorities
- Don’t give out any personal information, especially financial information such as bank account number, PayPal information or social security number
- Don’t be fooled by a “guarantee”
- Don’t pay any fees including bogus “legal”, “contract”, or “transaction” charges
- Don’t wire back funds via Western Union or any other wire service
- Don’t use on-line escrow services
- Don’t cash suspicious checks or money orders
- Don’t be pressured to “act now”
- Don’t assume that all people on-line are legitimate or truthful
Most importantly, DO take the necessary measures to protect yourself, but DON’T let these scam artists erode your confidence in the internet.