Consumer fraud comes in many forms and can range from annoying telemarketing calls to destructive computer viruses and horrifying bank and debt frauds that many people innocently fall for. Essentially fraud is any type of claim, assurance, agreement or program that deceives the consumer so as to benefit the originating person or corporation. However, not all fraud necessarily adheres to this format. A large amount of fraud is also unsolicited, such as false emails or physically mailed letters claiming that the recipient has won a lottery prize. According to survey undertaken by the Federal Trade Commission in 2007, a whopping 30.2 million Americans were found to be the victims of various types of fraud. The most common type is products and services advertising false weight loss claims.

There are two main reasons that so many people are deceived. The first is because the bulk of these scams are made to appear incredibly legitimate and often dangle the lure of a large reward or sum of money. The second reason is quite simply because many people are unaware of the sheer extent of the types of fraud out there. By learning more about them, it becomes easier to recognize and avoid scams in future. People can also stay safe from fraud by being cautious of submitting information like personal contact details, bank card numbers, and addresses. Always read the full details and fine print on any form before signing it. When in doubt about a company or a promotional offer, do some research to find out whether they are reputable or not. If the company fails to provide clear contact details for their offices, it is a sign that something is not entirely right. When faced with any type of fraud, file a complaint with full details to the FTC. This helps them to keep track of new or recurring scams. Read through the rest of this article to learn more about the types of frauds you may encounter as well as how to stay safe and report any suspicious claims.

Fraud Scams and Types

• Astrology, Psychic, Faith, and Religion Scams
• Banking Scams
• Buying, Selling, Shopping and Auctions Online and Off
• Checks - Fake and Counterfeit
• Computer Viruses, Worms and Other Malware
• Counterfeit products
• Credit Reporting Scams
• Debt Collection Scams
• Education Scams
• Email Scams and Spam
• Extortion Scams
• Fake Organization Scams
• False or Deceptive Advertising and Defective Products
• Fax Scams
• Foreign Scams
• Hoaxes, Myths, and Email Chain Letters
• House, Home and Apartment Scams
• Identity Thefts
• Investing, Retirement, Loans, and Other Financial Scams
• Jobs and Recruiting Scams
• Loan and Mortgage Scams
• Lotteries, Promotions and Prizes Scams
• Mail/Postage Scams
• Medical Scams and Quackery
• Money Making, Get-Rich Scams
• Online Dating and Social Networking Scams
• Phone Scams
• Product Scams
• Shopping Online Scams
• Work From Home Scams
• Tax Scams
• Telemarketing Scams

Fraud Protection Tips

1.    Never be too trusting or too greedy when faced with an offer that seems to good to be true.

2.    Be very careful about who you provide sensitive personal details to. Phishing scams often try to convince people to give up their information by sending letters or emails that appear to be from major legitimate institutions.

3.    When approached by strangers or unknown companies, it pays to be suspicious, especially in the case of door-to-door sales people and unknown solicitors.

4.    Never make any payments or online money transfers to people you do not know.

5.     Disregards claims about credit reports or offers to clean your credit history. Very often, these companies will take a payment and never follow up again.

6.    Ignore unsolicited mail about sweepstakes and lotteries, especially when it has originated from another country or mentions that a fee has to be paid in advance.

7.    Letters or phone calls claiming that you are eligible for a prize of a contest that you cannot remember entering, try to collect their details and report a complaint.

8.    When browsing online, do not click on pop-up ads, as well as flashing ads on websites claiming you have won a prize.

9.    When contacted for a donation, research the charity group in question before giving them either personal information or any type of payment.

10. Be careful about accepting possible bad checks and never give away banking account numbers or blank checks.

11. Change your online passwords regularly and don’t use the same password for all of your accounts. Ideally passwords should be longer than six characters and should contain a combination of letters, numbers and symbols. Avoid using real or common words as a password and never give out your password.

12. Unsolicited emails from foreign countries claiming that the recipient has inherited a large amount of money or that an advance fee has to be paid to a foreign bank to receive a large sum are types of email fraud. Many of these types of emails are from Nigerian people, or if an English name is used, the banking information will lead to a Nigerian location. Do not respond, click on any links within the email or open attachments.

13. Beware of scams targeting senior citizens, such as fraud collection services which request a fee up front, services for direct deposits of Social Security checks and shady household renovation services. For any such scams, do not respond and instead report them to the FTC.

14. Avoid identity theft by keeping personal details private and shredding any documents that contain your contact information and mail or banking details before putting it in the trash. This includes envelopes that have your name and address on a label on the front.

15. A large number of Americans believe in astrology and psychics. Whether these techniques are plausible or not, the fact remains that a number of con artists take advantage by hawking fraudulent psychic services. Delete any emails from psychics or mark them with a spam filter and avoid calling psychic hot lines. Another trick to be wary of are the psychics who claim they can remove negative energy for a series of payments. Do not sign up for psychic or astrology mailing lists either.

16. Consumers can protect their computers from viruses and malware by installing a reputable anti-virus program and a pop-up blocker in their browser. Do not open any files or attachments that were unexpectedly sent by a stranger or even a known and trusted person. Very often a virus in one person’s computer can automatically generate messages or emails to their online contacts and pass on infected files. If there is ever a doubt, give the person a call and ask if they intentionally sent the file.

17. Popular social media tools and sites such as Facebook and MSN Live Messenger are rife with scams. Strange messages containing suspicious links or apps that ask for personal details should always be avoided. Most often, these types of fraud appear to come from known contacts. It is helpful to let them know so that they can address the issue within their accounts.

18. Fraud by fax can be identified by checking it against a database of known fax spammers and reporting it. If the fax is from an unknown person or service, do not follow up or contact them.

19. Many job hunters will come across sales and work at home scams at some point. Several of these types of scams ask the applicant to pay up front for a training course, training manual or sales materials. Remember that no reputable company should ever ask a potential applicant to pay in order to be hired.

20.  Home owners should always thoroughly read through paperwork before signing and agreeing to anything. Ideally, they should also have a lawyer double check it. If the contractor ever tries to rush you or imply that there is some type of deal or promotional offer, walk away. A respectable organization will allow their clients to take the time to properly examine the papers before entering an agreement.

21. Be aware of health care fraud by always making sure that the services and medication received is exactly what was requested earlier. Patients who receive a bill or receipt for any additional or unrequested treatments should double check with their physicians and report it to the Medicare office if it still seems suspicious.

22.  People should also discuss online privacy habits with children and teens. Many online games and social media apps request a credit card number or personal information before installation. If a child is unaware of the consequences, they may unwittingly provide this information to scammers.

23. There are many tax scams and it is important to remember that apart from just being deceived, it is also illegal to participate in a tax scam whether intentional or not. The best way to avoid this is to learn about tax scams and report them.

24. Always remember that there are no “get rich quick” schemes that work. Foreign exchange (Forex) trading is one of the most popular ones right now. While Forex and other types of online trading are indeed legitimate, do not trust scammers who claim that they can make you rich overnight. Trading, like most other work, requires training, lots of practice, knowledge and skill.

25. Even dating sites are not immune from fraud. When subscribing, look for details about hidden or recurring fees, unused credits and trial periods. If something does not sound right, do not sign up or submit any additional information.

Fraud Agencies

• United States Postal Inspection Service - helps citizens to identify and protect themselves from various types of mail fraud and identity theft. Their website features a large selection of articles focusing on consumer awareness of these issues.

• The Federal Bureau of Investigation - supplies a number of resources on educating citizens about Internet fraud. It also supplies several online forms for people to make complaints about Internet fraud. 

• Internet Crime Complaint Center - can be used for non-urgent complaints and reports. The FBI and National White Collar Crime Center sponsor this organization to help empower citizens against online fraud.

• National White Collar Crime Center - known as NW3C, helps to address fraud and crime among electronic and online areas.

• Internal Revenue Service - provides a large amount of information on their website about different types of tax scams and tax evasion schemes

How to File a Complaint

1.    File a Complaint: Through the FTC’s website, consumers can file a national or international fraud complaint and register their phone numbers on the national “Do Not Call” list to avoid telemarketers. It is optional for complainants to provide their contact details, and they are asked to provide as many details as possible regarding the fraud and how they came to receive it.

2.    The IRS encourages citizens to report any instances of tax fraud. It is not mandatory to divulge personal details but it is encouraged. Individuals may also submit a complaint by physical mail.

3.    Fraud that causes suspicion of physical threat or harm should be reported to the local police. Other types of fraud can be addressed to the appropriate federal agency depending on the type of scam.

4.    Complaints about false advertising or other fraud by local businesses can be addressed to the Better Business Bureau through an online form. The BBB also recommends that the complaint be filed simultaneously with the FTC.

5.    The local state attorney general can help to direct citizens to the appropriate authority, or advance a complaint on behalf of the person. Each attorney general has a consumer complaint section on their websites with further information on how to proceed.