Just some typical scams to be on the lookout for.by Dawie Bezuidenhout Systems Engineer I.T.
Most of these Scams have been around for years, and they are still going strong. Now you may ask why do these Scams still exist, the simple answer being, they work, and the scammers actually make money, otherwise they would stop promoting it.
This is just a short list of some of the rubbish out there.
1. Google Money Scams Using the popularity of the Google name, scammers promise to make you rich by teaching you how to place ads on Google. The fee, on the surface, seems small, but the fine print tells another story, and buyers find their credit cards being billed about $75 monthly for a "membership" plan.
2. Auction Listing/Rebate Processing Scams The scammers imply that you'll be doing basic data entry work, and making good money at it. But once they get your $197 (the typical buy-in), they eventually reveal that you'll actually be doing affiliate sales. But with no sales, you get no income.
3. The "Instant" Online Business ("Biz-in-a-Box") So many of these business-growth "programs" are spewing spam, it's hard to know where to begin. They often carry names like "wealth builder," "cash secret," etc., and all promise high income quickly. Typically, the bait is big money for basic work-- typing, data entry, placing ads with Google. But the truth is, you'll be selling everything from diets and vitamins to dating services, website hosting services, and even other work-at-home scams. Worse yet, the "kit" or "system" is often marketed as "free," but the victim's credit card is immediately hit with ongoing monthly "consulting" or "web hosting" fees of $39.99, $59.90, etc.
4. Check Cashing/Forwarding Often originating in Senegal, Romania, or Nigeria, this scam lures victims with promises of an easy commission (typically 15 percent) on the deposit of an apparently authentic cashiers check--which may be a real check, stolen from a bank. The victim deposits the check and wires 85 percent to the scammers. A week or two later, when the bank declares the check fraudulent, the victim is stuck with the loss.
5. Data Entry Scammers know that basic home-based administrative work is in high demand, and very scarce. (A few companies offer legitimate data entry work, but their waiting lists can be literally years long.) If you get an e-mail telling you how desperate a company is for qualified data entry specialists, it's a scam Period.
6. Get Rich Taking Surveys Yes, you can make a little money , sporadically taking surveys (usually $1-$5, more if it's a focus group). But contrary to the scammers schemes, you should never have to pay a fee to take one.
7. Package Forwarding Postal forwarding losses are on the way to the $1 billion mark. In this scam, you agree to receive and repack electronics (MP3 players, video recorders, DVD players, etc.), fill out customs forms, and send the goods overseas. In exchange, the "hiring company" says they will reimburse you for shipping expenses and pay you a fee. The truth? You're a "fence," giving a cover of legitimacy to goods bought with stolen credit cards. Not only will you not get paid, you may be arrested for shipping stolen goods and the misleading information you put on the customs forms.
8. Mystery Shopping Before, this scam usually involved selling you an outdated list of companies that hire mystery shoppers. Now, scammers lure victims with a nice cashiers check to be used for the shopping. You deposit the apparently-legit check, buy whatever you want up to a certain limit, then wire the balance of the funds back to the scammers via MoneyGram or Western Union. Later, the bank discovers the check is bogus, and the victim is on the hook for the funds--and may be answering Police questions about bank fraud.
9. Order Processor Jobs (aka E-mail Processing) In this e-version of the classic envelope-stuffing scam (see No. 10), you're asked to pay a fee to learn how to make money processing orders from ads that you'll place on the internet. But your chance to "process orders" comes when you turn into a scammer yourself, and start sending the same scam to your own victims.
10. Envelope Stuffing Typically, you're asked to send money to learn how to make money stuffing envelopes. Then, you either receive nothing, or a letter instructing you to place the same ad that you yourself replied to, so you can scam others the same way you were scammed. (Remember: companies have machines to stuff envelopes.) The last time this was actually viable was in the 80's, we are now in the 21'st century.
There is so many others, feel free to leave your comments, and list some of the ones you know of.
11."Ponzi" schemes promise high financial returns or dividends not available through traditional investments. Instead of investing the funds of victims, however, the con artist pays "dividends" to initial investors using the funds of subsequent investors. The scheme generally falls apart when the operator flees with all of the proceeds or when a sufficient number of new investors cannot be found to allow the continued payment of "dividends."
This type of fraud is named after its creator Charles Ponzi of Boston, Massachusetts. In the early 1900s, Ponzi launched a scheme that guaranteed investors a 50 percent return on their investment in postal coupons. Although he was able to pay his initial backers, the scheme dissolved when he was unable to pay later investors.
Here is a Link to a Post by Louise Venison regarding Ponzi Schemes.
Tips for Avoiding Ponzi Schemes:
Be careful of any investment opportunity that makes exaggerated earnings claims.
Exercise due diligence in selecting investments and the people with whom you invest in other words, do your homework.
Consult an unbiased third party like an unconnected broker or licensed financial advisor before investing.
12. "Pyramid Schemes." As in Ponzi schemes, the money collected from newer victims of the fraud is paid to earlier victims to provide a veneer of legitimacy. In pyramid schemes, however, the victims themselves are induced to recruit further victims through the payment of recruitment commissions.
More specifically, pyramid schemes also referred to as franchise fraud or chain referral schemes are marketing and investment frauds in which an individual is offered a distributorship or franchise to market a particular product. The real profit is earned, not by the sale of the product, but by the sale of new distributorships. Emphasis on selling franchises rather than the product eventually leads to a point where the supply of potential investors is exhausted and the pyramid collapses. At the heart of each pyramid scheme is typically a representation that new participants can recoup their original investments by inducing two or more prospects to make the same investment. Promoters fail to tell prospective participants that this is mathematically impossible for everyone to do, since some participants drop out, while others recoup their original investments and then drop out.
Pyramid Schemes are still very successful, mainly because new websites are calling it new names like "Cyclers", "Matrix" and "Money Gifting" etc. The concept still boils down to a Pyramid Scheme, once people stop joining in under you the program falls flat and you are out of pocket.
Here is a link to a Post by Andy Zeus Anderson expanding on this topic.
Tips for Avoiding Pyramid Schemes:
Be wary of "opportunities" to invest your money in franchises or investments that require you to bring in subsequent investors to increase your profit or recoup your initial investment.
Independently verify the legitimacy of any franchise or investment before you invest.
I will add some more in the followung days, and you will notice the list is going to be long. Their is scamming going on in almost every type of business you can think of, and it certainly becomes harder to spot them.
Created on Dec 31st 1969 19:00. Viewed 0 times.