Scam (n): a dishonest scheme or fraud, typically aimed at obtaining money.
The first recorded financial scam dates back to 300 BC when a Greek merchant tried to profit by sinking his own, empty ship and claiming it was full of cargo to get an insurance payout. Unfortunately for him, he was caught in the act and ended up drowning.
These days, scams seem to require much less effort and usually don’t put criminals at risk of drowning. It took just over 10 years from the invention of the internet to the first recorded incident of a phishing scam. Today, more than 3 billion fake emails are sent every day around the world!
I find the creativity of criminals both impressive and disturbing, and the stats on internet scams mind-blowing. Here I’ll share some of the common, bizarre, and costly scams to be aware of, including some aimed at business owners.
Counterfeit cashier’s check
Cashier’s checks are difficult to trace and can take a week or more for banks to identify whether one is legit or fraudulent. Even so, most banks provisionally clear these checks after 24 hours.
Modern scammers take advantage of this flaw in the system in a variety of ways. One popular method is using a cashier’s check to purchase expensive items online from sites like Craigslist, eBay, or even Facebook marketplace. Unwitting sellers cash the counterfeit and, believing it has cleared, send the goods. Days later the check bounces, turning the items into stolen property.
Fake tech support call
Scammer calls claiming to be from Windows, Microsoft, or their internet provider. They claim their computer, modem or other device is creating errors and they need to correct it. They offer support for a fee and, of course, collect their credit card information. If the device is a computer, they request remote access so the computer can be fixed. The scammer may then download malware, spyware, or an undetectable remote connection software onto the victim’s computer.
Fake virus/antivirus software
Malware is promoted as antivirus software, often by a pop-up that may say a virus was detected. Once downloaded, the virus supposedly finds multiple viruses and may even pretend to remove some. It then asks for payment to download the pro or full version of the software. The website may appear legitimate, but it’s not.
Bogus dry-cleaning bill scam
This one is a mail fraud scheme aimed at restaurant owners. Scammers take a receipt from a legitimate dry cleaner, duplicate it hundreds or thousands of times, and send it to every upscale restaurant in town. An attached note claims a server in the victim’s restaurant spilled something on a diner’s expensive clothing and demands reimbursement for dry cleaning costs. As the amount requested is relatively low, some will simply pay the claim.
An elderly person gets a call/email from someone saying it’s their grandchild or a friend of the grandchild, and claim the grandkid is in trouble. They claim they were arrested and need money wired for bail. The name of the grandkid is typically found through social media.
Every year and especially around tax season, IRS scams abound. Official-looking phishing emails attempt to collect your personal and financial information. Taxpayers can forward these scam emails to firstname.lastname@example.org – and then delete them.
Tax Arrest Scam
Another common tax-related scam involves phone calls from people claiming to be from the IRS. They insist that the taxpayer owes the IRS money and if they do not pay immediately they will be arrested (or deported).
Ransomware doesn’t require the same trickery as many scams listed here, but it is still a scheme to cheat people – and especially businesses – out of their hard-earned money. Ransomware is a type of malicious software designed to encrypt files and block access to a computer system/network until a sum of money is paid. Devices and networks can be affected when an unsuspecting person clicks a link in an email or downloads an email attachment.
You may remember the ransomware attack on the Colonial Pipeline earlier in 2021 which disrupted the gas supply to much of the East Coast of the US. The company paid the ransom of $4.4 million dollars in Bitcoin to resolve the matter.
While there were a handful of ransomware attacks in the news this year, it’s estimated there have been hundreds of millions of ransomware attempts in 2021 alone. Successful ransomware attacks on a business can bring business operations to a halt, cost a business millions of dollars, risk leaks of their internal documents, and destroy consumer trust in the company.
Protect yourself from being scammed
Be diligent, and perhaps a bit skeptical, when you receive communication from people and companies you don’t know, or those you do know with requests that are out of the ordinary.
You can inspect emails sent to you by moving your cursor over links to see the destination URL before clicking on it. When in doubt, don’t click!
The IRS has stated that they never call taxpayers to demand immediate payment, they never ask for a credit card over the phone, or require a specific payment method for your taxes.
When it comes to ransomware, there are ways to strengthen your cybersecurity to prevent attacks and lessen the effects in case the attackers do find a way in. Check out this article for 7 steps to take to counter ransomware attacks.
It’s amazing the lengths some people will go to try to scam others out of their money. And as technology advances, so do the scams. See more tips on spotting a scam from the FTC.
Check out more articles from Numberwise: