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Summer survey of Scopes top 25 2007-2009

Ten Most Common Internet Scams from NCL's (National Consumers League) Fraud Center at fraud.org/stats/2006/internet.pdf
Type
Descr % of
Compl-
aints
Average
Loss
Auctions*
Goods never delivered or misrepresented 34% $1,331
General Merchandise
Sales not through auctions, goods never delivered or misrepresented 33% $1,197
Fake Check Scams
Consumers paid with phony checks for work or items sold, instructed to wire money back 11% $4,053
Advanced Fee Fraud (AFF)
Nigerian Money Offers
419 scams
False promises of riches if consumers pay to transfer money to their bank accounts 7% $3,741
Lotteries/Lottery Clubs
Requests for payment to claim lottery winnings or get help to win, often foreign lotteries 4% $1,750
Advance Fee Loans
False promises of business or personal loans, even if credit is bad, for a fee upfront 3% $1,515
Phishing
Emails pretending to be from a well-known source, asking to confirm personal information 2% no losses reported
Prizes/Sweepstakes
Requests for payment to claim prizes that never materialize 1% $2,447
Internet Access Services
Cost of Internet access and other services misrepresented or services never provided 1% $920
Investments
Made false promises about returns on investments 1% $4,759
* In the fall of 2003, eBay removed the link to fraud.org. As a result, the number of auction complaints reported to NCL's fraud center has dropped to a fraction of it's previous levels.

Other common scams:
Payment-transfer and on-online job scams
Work-at-Home Schemes
Counterfeit Drugs
Affinity group fraud - These frequently use religious or ethnic communities to gain trust. e.g. Nutrition aids

At the FTC Bureau of Consumer Protection (BCP):
- Online Shopping - Investment Schemes
- Work at Home Schemes
- Web Scams
- Miracle Health Claims
Computers & the Internet: Privacy & Security

Most Common Investment Scams at Wash. State Gov. Dept. of Financial Institutions
Most Common Medicaid Rip Off and Fraud Schemes at cms.hhs.gov
Most Common Older Investor Scams at sec.gov
See Links below for more:


Identifying Fraud
Check valid routing codes on checks at ConsumerFraudReporting.org

Reporting Fraud:
See reporting page.
Ten Most Common Scams Perpetrated on EBay at SearchWwarp.com
  1. Take over someone else's account, and if possible, steal their whole identity.
  2. Sell items and goods that you don't own.
  3. Old School Bait and Switch Tactics: offer something great, but sell them junk.
  4. Pyramid Scheme Recruitment: Find gullible individuals to work for you.
  5. Fencing Stolen Property on EBay: who needs a pawn shop nowadays?
  6. Selling illegal and counterfeit goods: knock offs and frauds
  7. Schill bidders: bump up the prices on your goods
  8. Phony second chance offers to failed bidders.
  9. Phony Escrow Service Scams: get the big money!
  10. Scams Done by the Buyer to the Seller: scam the honest businessman

Terms:
Advanced Fee Fraud - AFF A very common scam in which a fee is demanded from the victim in advance of the victim receiving a lottery winning, a loan, money from a dead relative, etc. Often these scammers are based in Nigeria, the Netherlands or China.
Also called the 419 scam named for the violation of Section 419 of the Nigerian Criminal Code.

Multi-Level Marketing (MLM) - These plans typically promise that if you sign up as a distributor, you will receive commissions -- for both your sales of the plan's goods or services and those of other people you recruit to join the distributors. You are typically recruited by a friend of family member. In a legitimate MLM company, commissions are earned only on sales of the company's products or services. If participants are paid primarily from money received from new recruits, then the company is an illegal pyramid or Ponzi scheme.
The FTC issued a decision, In re. Amway Corp. in 1979, which indicated that multi-level marketing was not illegal. In this case Amway was however found guilty of price-fixing (by requiring "independent" distributors to sell at the same price) and making exaggerated income claims.

Phishing - is the act of sending an email that is designed to trick the recipient into believing that it is from an established legitimate business, in an attempt to scam the recipient into providing personal information that will be used for identity theft.

Ponzi schemes - The promoter collects payments from a stream of people, promising them all the same high rate of return on a short-term investment. Like Pyramid schemes they use money from new investors to pay previous investors. They are the legacy of Italian immigrant Charles Ponzi. In the early 1900s, he took investors for $10 million by promising 40 percent returns from arbitrage profits on International Postal Reply Coupons.

Pyramid schemes promise consumers or investors large profits based primarily on recruiting others to join their program. They use money from new investors to pay previous investors. The only people who consistently make money are the promoters who set them in motion. Links:
Glossary of terms at: ConsumerFraudReporting.org, EndIDTheft.com
Counterfeit Drugs
Internet Scams, Identity Theft, and Urban Legends at ScamBusters.org
Today's most common scams at eons.com
Internet and telemarketing Fraud at National Consumers League (NCL)
Fraud and Scams at the Federal Reserve Bank of Richmond

last updated 14 Aug 2007