Online scams continue to be popular with criminals and are becoming more complex. But that doesn’t mean that offline scams aren’t still happening as well. Scams conducted via text messages, phone calls, and even snail mail remain popular with criminals. Indeed, with so many people treating their cellphones as an extension of their bodies, people are more accessible by phone than ever before. This is one of the reasons telemarketing scams are still around and often successful.
Many people use caller ID and won’t even answer the phone to a number they don’t recognize. However, there are still plenty of people who do answer every call and many who feel obliged to engage in conversation with every caller. Fraudsters can be very persuasive, so once they’ve got you listening, it can be difficult to say no or to detect a scam. Thankfully, if you’re aware of the types of scams to look out for and you keep your wits about you, you’ll have a better chance of avoiding becoming a victim.
In this post, we reveal some common telemarketing scams and how to spot them. We’ll also discuss a few other types of phone scams to look out for and provide general tips for keeping scammers at bay.
Common telemarketing scams
Some of these schemes target specific or groups of individuals, while others involve people being called at random. Some involve phishing, a type of scam in which the caller is trying to find out information (such as personal or banking information) that can be used in other crimes. Phishing via phone is often referred to as voice phishing or vishing.
Foreign lottery tickets
In this con, the caller proclaims that you are the winner of a foreign lottery. They’ll go to great lengths to convince you of how you even entered for this lottery in the first place, especially since you may not have visited the country it supposedly took place in. They may tell you someone else entered on your behalf or that you qualified for the draw by shopping at a popular store such as Walmart.
The foreign factor is important, though, as that’s where the scam comes in. Because these winnings are earned abroad, you need to pay some imaginary fees such as provincial taxes or transfer or administration charges. The caller will either give you instructions on how to make a payment or ask for your banking details over the phone. The money, of course, is going straight to the scammer and your winnings don’t exist.
Similar scams might include claims you’ve won an all-expenses paid trip or a new car, but you need to pay some type of upfront fee.
Payment processor scams
These schemes involve victims being approached via email, text, or phone to process payments on the senders behalf for a variety of possible reasons. It could be related to donations, loan payments, and more. For each payment processed you’re promised a fee, often 5-10%.
The gist of the scam is that the payment is sent to the victim who is then required to transfer most of the money to another account, keeping a fee for themselves. In most cases, the initial payment to the victim turns out to be fake and they lose the money, but don’t realize until after they have already transferred most of it. In some cases, the payment is real, but has come from a stolen credit card, in which case the main victim is whomever had their card details stolen.
Guaranteed government grant scam
The name of this hoax pretty much explains it. Someone calls claiming you’ve been selected to receive a free government grant. But really what the scammer wants is your personal information, some form of payment, or both. They may ask for details such as your Social Security number. which can then be used in identity theft. Or they might tell you that in order to access the grant you need to pay an administration fee.
In reality, government grants require an application and would never require a fee.
Advance fee loans
This scam is very similar to the government grant scam, but instead of posing as a government representative, this call will appear to come from a financial institution representative. You will be told you’ve been approved for a loan but need to pay a small fee in order to receive the funds. You might be asked to send payment or provide banking information. Of course, you should do neither.
Identity theft insurance
In a rather sick twist, some scammers will try to sell you insurance that protects you against being scammed. Identity theft and credit card fraud are common these days and at the top of people’s minds. So insurance against these types of crimes isn’t too hard of a sell. Callers might be extra persuasive by telling you that you’ve already become a victim and purchasing the insurance will wipe your liability for hundreds or thousands of dollars that have been stolen.
Of course, no such crime has taken place (yet) and you would just be handing over your money or banking information to criminals.
Secret shopper scam
If someone approaches you claiming you can earn $400 per week just for shopping at a few stores, it would probably sound too good to be true. Unfortunately, many people have fallen for this scam that can be initiated by email, text, or over the phone. Once you agree to become a “secret shopper,” you will receive a check or money order for a larger sum (often upwards of $2,000). You’re told to keep a fee for yourself (typically a few hundred dollars) and then use the rest at certain stores, banks, or other service providers and report on their customer service.
Tasks might include sending money transfers (back to the scammers) or purchasing gift cards and sending the numbers to your “employer” (read: fraudster). To make the scam even more legitimate-looking, some instructions tell you to simply purchase items and keep them for yourself.
Eventually, once most of the money is spent or handed back in various forms, the check is revealed to be a fake. Note that it might take a few weeks to find out that a check isn’t real, even if the bank has already cleared it.
The no hang-up scam
This scam is a little more sophisticated than others on the list and involves hijacking the victim’s phone line. The scammer will call pretending to be someone from the victim’s bank. The caller actually wants you to become suspicious and call your bank to check if there really is an issue.
The problem is that the fraudster has hijacked the phone line and the call was not hung up. The victim thinks they are speaking to a bank representative, but they are actually speaking to the scammer. By asking a few questions to “authenticate” that the victim is the account holder, the original caller will have enough details to drain the victim’s bank account.
Other common phone scams
The above scams involve someone calling and trying to sell you a product or service or posing as an existing service provider. Many other scams that are initiated via telephone. Here are just a few to be aware of:
Robocall scams may not be very sophisticated, but because they are automated, they can reach exponentially more people than an individual making cold calls can. Robocall scams vary greatly but all involve an automated message that plays when you answer the phone or check your voicemail.
One scam targets people with Chinese surnames. The message appears to be from the Chinese Consulate and threatens that if the victims don’t hand over money they will face dire consequences, including imminent arrest should they travel to China. Other similar scams involve criminals posing as immigration officials from across the globe.
Schemes involving the Internal Revenue Service (IRS) in the US, HM Revenue and Customs (HMRC) in the UK, and other tax authorities elsewhere often involve an automated voice message telling you to call a number. They will typically claim that you have committed some type of tax-related crime and threaten serious action if you don’t follow instructions. Directions might involve wiring or depositing money to an account owned by the criminal.
While most people know that a government agency would never contact you via an automated message, these calls can be frightening enough for some people that they jump into action. For example, many foreign students have fallen for these scams and have lost large sums of money for fear that will be deported if they don’t comply.
Computer tech support
This hoax involves someone calling to let you know that your computer needs updating, perhaps claiming that you have downloaded malware or your computer is at risk of having a virus. The caller will ask for remote access to your computer to fix the issue. Access can easily be provided by opening an email link and following a few simple instructions.
However, once they have control of your computer, the scammer can use it to access any personal information you have stored on there, such as private files and folders. They can also use saved credentials in your web browser to log in to various platforms such as your online banking or investment accounts.
On top of that, the scammer might even demand a fee for “fixing” the fake problem.
The “can you hear me?” or “yes” scam
This con is used to bypass authentication processes that use voice signatures. For example, if your bank uses voice signatures during telephone banking, all a criminal needs is a recording of you saying the right words. Often, the only word they need is “yes.” To get a recording of this, they will call your number and say “Can you hear me?”
When you respond “yes,” they will record you. If you pick up the phone and unfamiliar voice is asking you that question, avoid saying the word “yes” at all. Although this sounds like it would be a rare scam, the FCC has actually received many related complaints.
Grandparent scams prey on vulnerable seniors who would do anything to ensure their grandchild’s safety. The caller poses as the grandchild and states that they are in trouble and need some money to get out of a situation. Perhaps they need help with legal fees or money for transportation from abroad.
The caller gives the grandparent directions for sending money and makes the situation sound urgent so they don’t have time to check it out. They also urge the victim not to tell anyone under the pretence that they don’t want others (such as their parents or partner) to find out about the trouble they’re in. All of this adds credibility to the story behind the scam while also making it more likely that the grandparent will comply.
Tips to spot and protect against telemarketing scams
- Look out for red flags. Common signals that a phone call is part of a scam include too-good-to-be-true offers, someone asking for personal information right away, or a caller pressuring you to take action.
- Ask for a name. If you’re at all unsure, just ask for a name and a callback number so you have time to conduct some research. If the caller refuses to provide a name and number, then you can be pretty sure you have a scam on your hands anyway.
- Be very wary of automated messages. Most institutions, including banks and government agencies, won’t use an automated message to communicate. If there is a callback number included, run a search for the number online before attempting to call it.
- Use a caller ID app. There are various apps available such as Truecaller and Caller ID & Call Blocker that will block known spammers from calling. Just bear in mind that although these can help filter calls, they won’t be completely reliable.
- Watch out for numbers similar to your own. If you see a number similar to your own, don’t be tempted to answer. Scammers use a technique called “neighbourhood spoofing” to help persuade you to pick up. The idea is you might think it’s someone local calling and be more likely to answer and trust the caller.
- Go on the Do Not Call (DNC) list. In many jurisdictions, you can add your number to a DNC registry. In the US, this scheme is run by the Federal Trade Commission (FTC). Telemarketers who call people on the DNC list are liable for hefty fines. It definitely doesn’t guarantee you won’t receive any scam calls, but it can reduce the number of calls you receive from legitimate telemarketers, so it’s easier to spot the fakes.
- Consider changing your number. Once your number is on one scammer’s list, it’s probably on a lot of others, too. If you get a high volume of scam calls, you might consider changing your number and getting it on the DNC list right away.
How to report suspected scams
Whichever country you live in, the government encourages you to report scams or suspected schemes. Even if law enforcement is unable to investigate every case, knowledge of various hoaxes helps government agencies to issue warnings to other members of the public. Here’s where to report scams for various countries:
- US: FTC Complaint Assistant
- Canada: Canadian Anti-Fraud Centre
- UK: Action Fraud (National Fraud & Cybercrime Reporting Centre)
- Australia: Scamwatch (Australian Competition & Consumer Commission)
Image credit: “Telephone” by Peter Douglas licensed under CC BY 2.0