Common Scams

Con artists are clever and cunning, constantly hatching new variations on age-old scams. Still, skeptical consumers can spot questionable or unsavory promotions in offers. Should you receive an email that you think may be fraudulent, forward it to the FTC at, hit delete, and smile. You'll be doing your part to help put a scam artist out of work.


ATM Skimming Scams

The Bait: Criminals install equipment on legitimate bank ATM's in at least 2 regions to steal both the ATM card number and the PIN. They sit nearby in a car receiving the information transmitted wireless from equipment they install on the front of the ATM.

The Catch: The equipment used to capture your ATM card number and PIN are cleverly disguised to look like normal ATM equipment. A "skimmer" is mounted to the front of the normal ATM card slot that reads the ATM card number and transmits it to the criminals sitting in a nearby car. At the same time, a wireless camera is disguised to look like a leaflet holder and is mounted in a position to view ATM PIN entries. The thieves copy the cards and use the PIN numbers to withdraw thousands from many accounts in a very short time directly from the bank ATM.

Your Safety Net:  In order to protect yourself from this and other ATM-related crimes, remember the following:

  • Always examine the ATM or card reader before you use it. Typically, a "skimmer" is attached to the slot into which your debit/credit card is inserted. Another possibility is a small camera mounted above the slot to record your card number and PIN. If you notice anything unusual or suspicious, report it immediately to the bank using the 800 number or phone on the front of the ATM.
  • Use ATM's that carry your bank or credit union logo and are preferably located at your bank or credit union.
  • Only use ATM's in well lit and public areas.


Check Overpayment Scams

The Bait: A response to your newspaper ad or online auction posting, offering to pay with a cashier's, personal, or corporate check. At the last minute, the so-called buyer (or the buyer's "agent") comes up with a reason for writing the check for more than the purchase price, and asks you to wire back the difference after you deposit the check.

The Catch: If you deposit the check, you lose. Typically, the checks are counterfeit, but they're good enough to fool unsuspecting bank tellers; when they bounce, you are liable for the entire amount.

Your Safety Net: Don't accept a check for more than your selling price, no matter how tempting the plea or convincing the story. Ask the buyer to write the check for the purchase price. If the buyer sends the incorrect amount, return the check. Don't send the merchandise. As a seller who accepts payment by check, you may ask for a check drawn on a local bank, or a bank with a local branch. That way, you can personally visit to make sure the check is valid. If that's not possible, call the bank the check was drawn on using the phone number from directory assistance or an Internet site that you know and trust, not from the person who gave you the check. Ask if the check is valid.


Debt Relief

The Bait: Offers touting a way you can consolidate your bills into one monthly payment without borrowing; stop credit harassment, foreclosures, repossessions, tax levies and garnishments; or wipe out your debts.

The Catch: These offers often involve bankruptcy proceedings, but rarely say so. While bankruptcy is one way to deal with serious financial problems, it's generally considered the option of last resort. The reason: it has a long-term negative impact on your creditworthiness. A bankruptcy stays on your credit report for 10 years, and can hinder your ability to get credit, a job, insurance, or even a place to live. To top it off, you will likely be responsible for attorneys' fees for bankruptcy proceedings.

Your Safety Net: Read between the lines when looking at these offers. Before resorting to bankruptcy, talk with your creditors about arranging a modified payment plan, contact a credit counseling service to help you develop a debt repayment plan, or carefully consider a second mortgage or home equity line of credit. One caution: While a home loan may allow you to consolidate your debt, it also requires your home as collateral. If you can't make the payments, you could lose your home.


Foreign Lotteries

The Bait: These offers boast enticing odds in foreign lotteries. You may even get an offer claiming you've already won! You'll just have to pay to get your prize or collect your winnings.

The Catch: Most promotions for foreign lotteries are phony. Participating in a foreign lottery violates U.S. law. The scammers will keep any money you send for "taxes" or fees. In addition, lottery hustlers use victims' bank account numbers to make unauthorized withdrawals or their credit card numbers to run up additional charges.

Your Safety Net: Skip these offers. Don't send money now on the promise of a pay-off later.


Investment Scams

The Bait: Offers claiming "investments" that promise high rates of return with little or no risk. One version seeks investors to help from an offshore bank. Others are vague about the nature of the investment, and stress the rates of return. Promoters hype their high-level financial connections; the fact that they're privy to inside information; that they'll guarantee the investment; or that they'll buy it back. To close the deal, they often serve up phony statistics, misrepresent the significance of a current event, or stress the unique quality of their offering.

The Catch: Many unsolicited schemes are a good investment for the promoters, but not for participants. Promoters of fraudulent investments operate a particular scam for a short time, close down before they can be detected, and quickly spend the money they take in. Often, they reopen under another name, selling another investment scam.

Your Safety Net: Take your time in evaluating the legitimacy of an offer: The higher the promised return, the higher the risk. Don't let a promoter pressure you into committing to an investment before you are certain it's legitimate. Hire your own attorney or an accountant to take a look at any investment offer, too.


Pay-in-Advance Credit Offers

The Bait: News that you've been "pre-qualified" to get a low-interest loan or credit card, or repair your bad credit even though banks have turned you down. But to take advantage of the offer, you have to ante up a processing fee of several hundred dollars.

The Catch: A legitimate pre-qualified offer means you've been selected to apply. You still have to complete an application and you can still be turned down. If you paid a fee in advance for the promise of a loan or credit card, you've been hustled. There may be a list of lenders, but there's no loan, and the person you've paid has taken your money and run.

Your Safety Net: Don't pay for a promise. Legitimate lenders never "guarantee" a card or loan before you apply. They may require that you pay application, appraisal, or credit report fees, but these fees seldom are required before the lender is identified and the application is completed. In addition, the fees generally are paid to the lender, not to the broker or person who arranged the "guaranteed" loan.



The Bait: You receive an email or pop-up message asking for you to update your personal or financial information.

The Catch: Phishing is a scam where fraudsters create emails and websites designed to look like those of legitimate businesses, with the desire to deceive users into disclosing personal and financial information. (A similar scam, vishing, occurs through the use of a phone.)

Your Safety Net: Don't click on links which appear via email or pop-ups. Don't call the phone number listed in these sources either. Contact the business directly.



The Catch: Pharming is a scam where hackers hijack your web browser, redirect Internet traffic from one website to a false website to retrieve personal data. Normally, the spoofed website will adopt the design of the target website and sometimes has a similar web address or will conceal the address of the bogus website. You can be redirected to a false website without any participation or knowledge on your part.

Your Safety Net: Turn on your firewall, accept security patch updates and install virus software protection.


"Nigerian" Scam

The Bait: Con artists claim to be officials, businesspeople, or the surviving spouses of former government honchos in Nigeria or another country whose money is somehow tied up for a limited time. They offer to transfer lots of money into your bank account if you will pay a fee or "taxes" to help them access their money. If you respond to the initial offer, you may receive documents that look "official." Then they ask you to send money to cover transaction and transfer costs and attorney's fees, as well as your bank account numbers, or other information. They may even encourage you to travel to Nigeria or a border country to complete the transaction. Some fraudsters have even produced trunks of dyed or stamped money to verify their claims.

The Catch: The offers are from crooks trying to steal your money or perpetrate identity theft. Inevitably, emergencies come up, requiring more of your money and delaying the "transfer" of funds to your account; in the end, there aren't any profits for you, and the scam artist vanishes with your money. According to State Department reports, people who have responded to "pay in advance" solicitations have been beaten, subjected to threats and extortion, and in some cases, murdered.

Your Safety Net: If you receive an offer from someone claiming to need your help getting money out of a foreign country, don't respond.



Also known as ‘malicious software’, malware is designed to harm, attack or take unauthorized control over a computer system. Malware includes Trojans, viruses and worms.

  • A Trojan is malicious code that is hidden within another program that appears to be safe. When the program is used, the Trojan allows unauthorized access to the attacker so information can be stolen. A common Trojan component is a “keystroke logger” which captures a user’s keystrokes in an attempt to capture the user’s credentials. Trojans commonly spread through email attachments and Internet downloads.
    A virus is a malicious program that attaches itself to and infects other software applications and files without the user’s knowledge. Viruses can carry executable scripts designed to damage, delete or steal information from a computer.A virus only infects a computer and begins replicating when the user executes the program or opens an “infected” file.Viruses spread from computer to computer only when users unknowingly share “infected” files. For example, viruses are commonly spread when users send emails with infected documents attached.
  • Worms are powerful malware programs because they can copy themselves and can execute and spread themselves rapidly across a network without any help. It does not require a person to send it along to other computers.