Different fraud tactics all share the same goal: to obtain your personal, confidential and financial information for fraudulent use. From obtaining your information "the old fashioned way" via discarded mail, to emails that ask you to verify personal information under the guise of a trusted source - like your financial institution - fraudulent activity comes in many different forms.
The term identity theft refers to the use of a consumer's identifying information (such as your name, social security number, date of birth, and other sensitive identifying numbers) by another person, without authorization, and with the intent of committing fraud. The theft of sensitive personal information may result in considerable harm including financial loss, to the victim as well as adversely impacting other persons or entities which accepted the fraudulent information in the process of providing a product or service to the identify thief.
Be careful about providing personal information. Only provide information to reputable companies or persons that have a need to know. Review credit card and bank statements upon receipt. Your bank would not initiate a call to you asking for your Social Security number, date of birth, and other sensitive identifying numbers such as a PIN or account number because it would already have your personal information within bank records. If you ever question the authenticity of a request for information, please verify the legitimacy of the request. To learn more about identity theft please visit the Federal Trade Commission’s website.
Advance Fee or Nigerian Letters
Advance fee scams occur when you receive a communication such as a letter, fax, or email that requires you to pay a fee up front or in advance of receipt of any goods or services including money. A particular type of advance fee scam is commonly referred to as the Nigerian 419 advance fee scam. In this scam, a person pretends to be a Nigerian official or business-person asking ordinary individuals like you and even companies to help move millions of dollars out of Nigeria in exchange for large sums of money.
Do not respond. If you think about it, why would anyone give you so much money (a percentage of millions) to establish an account? All these fraudsters want is your money - the check and your account number that you have sent in advance. Once the check is cashed, the money is gone and difficult if not impossible to recover. If you have suffered a financial loss from a Nigerian "Advance Fee Fraud" scheme, please contact your local U.S. Secret Service Field Office. If you have not lost any money, but received a solicitation, please send the information by email to email@example.com. As always, if you receive a request such as this, please feel free to contact your bank representative for additional guidance.
The scam starts when you receive a call, an email, or a letter telling you that you've won a large sum of money in a foreign lottery (Canada, Australia, another country). To claim your "winnings," you'll have to provide your bank account number so your winnings may be deposited into your account. You're told you've won a sizeable lottery and are asked to wire a few thousand dollars to a "customs agent" to cover fees and taxes. After wiring the money, you may be contacted again and told to send even more money to collect your prize. Shortly thereafter, you receive a congratulatory letter in the mail along with a check for the winnings. You're instructed to deposit or cash the check, and then wire a portion of the funds to a third party to cover taxes and fees. The catch is that you think you are keeping the remaining money as your "lottery winnings." However, bad news arrives from your bank: the check was counterfeit and you now must repay what you spent of the deposit.
Do not send a check or attempt to wire any money for these lotteries. Again, this is the fraudster's attempt to get as much money as possible from you and move on. Keep in mind – if you sent the fraudster a personal check, they now have your account number. Additionally, according to federal law it's illegal to play a foreign lottery via mail or telephone. Please contact your local U.S. Secret Service Field Office or local Xenith branch if you have questions about a lottery communication that you've received.
There are many legitimate companies that use the telephone for marketing to consumers and businesses. Unfortunately there are many consumers and businesses that lose millions of dollars to telemarketing fraud each year. One sure sign that something is wrong is when telemarketers ask for a fee upfront (it is also illegal). This occurs when the telemarketer claims that they can get you a credit card or loan, or that they can repair your credit for a fee. Watch out for a telemarketer that uses scare tactics or tries to intimidate you.
Don't give any of your personal information unless you have a very good reason to trust the caller. Know who you are dealing with. If you want to know more about a person or their business, take their name and number and check it out with your state or local consumer agency and the Better Business Bureau. You may also consider placing your number on the National Do Not Call Registry to stop most telemarketing calls. "Just like any other situation, if you aren't sure, just say no.".
The scam starts as a notification that you have just won a sweepstakes, prize, car, boat, jewelry, etc. Upon notification, you are informed that you must first pay a fee to claim your prize. Legitimate sweepstakes do not require you to pay for handling, insurance, taxes and the like to claim your prize.
You should never pay a fee to claim your prize. No legitimate sweepstakes company will ask for your bank account information. There are legitimate circumstances in which you may need to provide your social security number for tax reporting purposes; however, you should be absolutely sure that you actually entered the contest and that you are familiar with the company operating it. Do the necessary research about the sweepstakes and company before submitting any sensitive personal information.
The fraudster uses unsolicited email (spam) to bait you into disclosing sensitive personal information such as your social security number, bank account, credit or debit card numbers, PINs (personal identification numbers) and passwords. The email may appear to be from a legitimate business. The request is to update or validate billing account information. There is usually a threat attached such as: "Failure to do so may terminate your relationship." Thus, consumers submit their personal information to the imposter, who then uses that information to commit identity theft.
Do not click on links in the email or open attachments. Do a separate search on the company cited in the email. Contact the company directly if you have a concern about an email that you receive. Always avoid sharing personal or financial information unless you are sure of the website. One way you can do this is by looking for the "lock" icon on the browser's status bar before you submit. This means it is secure for transmission. If the email appears to be from Xenith and you believe it to be fraudulent forward the email to firstname.lastname@example.org. If you feel you are a victim of fraud due to a phishing email, please file a complaint at the Federal Trade Commission's website and contact your local branch immediately.
Counterfeit Cashier's Checks
A cashier's check is a check drawn on a bank using the bank's own funds. Cashier's checks are typically considered guaranteed funds and people use them to facilitate the purchase of goods and services, usually for large dollar amounts or if the seller wants additional assurances about the legitimacy of the funds. It has been a reliable method of payment. Unfortunately, technology has made it easier for fraudsters to use scanners and high quality printing to create a genuine-looking cashier's check. The loss occurs when the counterfeit check is deposited and the depositor uses those funds (believing the check is good); it can be returned and charged back to the depositor's account. The quality of counterfeits is so good that even bankers have a hard time telling the difference.
Consider if you know the person or business giving you the check. You may contact the bank that issued the check to determine if it is authentic. They would know the safe guards for their checks and if the check number has been issued. Research the bank to be sure that you have a good phone number - don't rely on the number listed on the check. If you are not comfortable with the transaction/person/business, you may be better off not moving forward with it. You could also seek another form of payment such as a wire. Remember, if it sounds too good to be true, it is!