Junk Mail

The Better Business Bureau of Chicago and Northern Illinois has released its top 10 scam list for 2007. Even though this is a regional list, it fits nicely with what we're seeing here at Fight Identity Theft:

1. Check Scams

Would-be victims receive a check in the mail, allegedly for winning a sweepstakes, lottery or promotion. The check supposedly covers taxes or other fees (see the text of the letter below). Here's how the scam works:

• You deposit the check in your bank.
• You then pay the fees described in the letter via a money transfer.
• Unfortunately there isn't any prize money and your bank eventually will tell you that the check you deposited is a forgery.
• You now owe the bank the money ($2,998.65 in the example below).
• You try to track down the money you sent out via money transfer, which is just about impossible.
• The scammers are now richer and you are poorer.

Here's a sample of a check one of our readers received in the mail. The scammers will often place a reputable company on the forged check:

2. Advance Fee Lenders

These frequently will contact people by phone after they've filled out an online loan application or have found an advertisement in a local newspaper.

This is a similar scam to the check scam described above.

3. Online Employment Offers

Offers that look for "shipping" or "billing managers," "payment processors" or anything with a financial sounding name very frequently turn out to be fraudulent listings that are, in actuality, looking for victims to commit money laundering.

Other bogus online employment offers request money for travel, work visas, etc. Some scammers don't ask for money, but instead ask for your personal info (name, DOB, SSN, address, mothers maiden name) in order to steal your identity or sell your info to someone that will.

Be extremely careful when dealing with online employment. Don't send money to anyone. Use a company's main number and then ask for your contact within the company vs. just dialing direct to the number you've been given in order to verify your contact really works at the company you're interested in.

4. Lottery/Sweepstakes Notification Letters

Epidemic in proportion, these are very much like the fake check scams.

5. Overpayment Scams

These usually are found in forms of online ads and typically in places such as Craigslist or other classified forums on the Internet.

Same kind of scam as #1 with a slight twist.

A check overpayment scam begins when a scam artist replies to the classified ad or auction posting and offers to purchase the item for sale with a check, then comes up with a reason for writing the check for more than the purchase price for the item. The scammer asks the consumer to wire back the difference after the check is deposited. Later, the scammer’s check bounces, leaving the consumer liable for the entire amount.

6. Mortgage foreclosure rescue scams

Scammers contact residents and offer them a desperate plan that is affordable and supposedly allows them to keep the home. Here's how it works:

The scammers will offer to lower your monthly mortgage payment while also promising that in a short time you can own your home free and clear of any debt. The con artist claims to offer or arrange for a new loan but instead tricks the homeowner into selling the home to the con artist or a third party and agreeing to either lease the home back or purchase it back on a land contract.  The con artist or third party will pay off the existing mortgage or take out a loan. If the scammed homeowner lived in the home for a number of years, he or she likely built up and is surrendering significant equity. Equity is the market value of the home minus the value of all mortgages and other liens on the home. The con artist now owns the home and has stripped or taken the equity out of the scammed consumer's home.

Consumerlaw.org has a great pdf which covers this fraud in detail - http://www.consumerlaw.org/news/ForeclosureReportFinal.pdf

7. Marketing/Investment Scams

People are solicited by mail or e-mail and told they can make thousands of dollars working from home by buying a special kit, book or tape collection.

8. Inheritance Scam

An e-mail or letter is sent to the victim from someone claiming to be related to them, or from somebody that claims to know that the victim's distant relative is either very sick or has died and left inheritance money.

9. Phishing Scams

Generally, e-mails are sent from what looks like a legitimate bank or financial institution, asking for confirmation of account numbers and personal information.

- See some examples of a typical phishing email - Paypal phishing scam.

10. Nigerian Scam

E-mails or letters are sent from someone claiming to be an official or agent from a foreign country, informing the recipient he or she is seeking a foreign company or individual into whose account they can deposit funds left over from government funds, a business bank transaction or a confiscated family inheritance.

- See some examples of a typical Nigerian Email Scam.