A scam is a deceptive scheme or trick used to cheat someone out of something. For the longest time, many individuals and businesses have scammed people for monetary gains. The history of scamming is vast, and scammers are still around because they continue to cook up new schemes that people end up falling for.
The good thing is, there are plenty of credible information sources that consumers can learn from to counter scams. The key is to have a solid foundation of knowledge of common scams and the signs to identify them. Awareness is crucial so you can spot red flags before scammers can get a hold of your money.
There are various types of schemes an individual, group, or business entity use to scam consumers. However, knowing the common ones will help you picture how scammers operate, effectively stripping them of the power they can have over you.
Here are the types of scams most consumers may encounter nowadays:
Since most consumers rely on banks, many scammers will think of a scheme to use that relationship for monetary gain.
Popular banking scams you may encounter:
Telephone scams are designed to steal your information over a phone. Scams may come through phone calls from real people, robocalls, or text messages. Callers often make false promises, such as opportunities to buy products, invest your money, or receive free product trials.
They may also offer you money through free grants and lotteries. In addition, some scammers may call with threats of jail or lawsuits if you don’t pay them.
Government grant scams
In this type of scam, an individual will approach you in person or online, guaranteeing you a government grant for costs like college or business capital.
In reality, government grants are rarely awarded to individuals and usually go to local governments, universities, and other organizations. The money is awarded to help pay for research and projects that will benefit the public.
Scammers will deceive you into investing in an investment opportunity with the intent to run away with your money. It’s like gambling where they lure you in with easy ways to make money until you’ve trusted them enough to invest a larger amount.
A common example of an investment scam is the pyramid scheme, where scammers use it to recruit people to invest in having a constant flow of participants for the profit to continue. These scams are typically marketed as multi-level marketing and are always bound to fail.
Prize scams are fabricated to steal your details by deceiving you into joining a fake contest for a prize. Scammers will contact you and claim you’ve won a prize from a contest you never even participated in.
Others will require you to provide personal information to enter a “contest.” These scams may reach you by postal mail, email, phone call, robocall, or text message.
Aside from rewards, scammers also use tickets to bait consumers into giving them their money. They sell fake tickets or legitimate ones at a much higher price, and they never send them when you pay for them.
Scammers take advantage of the public’s generosity with charity scams. They’ll set up a fake organization that aims to help people struck by tragedy or natural disasters and encourage people to donate through an account they set up.
These are the typical signs that someone is attempting to scam you:
Arm yourself with information to be aware of fraudulent schemes and how scammers execute them to avoid being a victim. Below are some of the recent scams that we have covered news on: