Every year, Better Business Bureau receives thousands of calls and emails from consumers who have been scammed or from the lucky ones who have dodged scams by being wary. Some scams are widespread, getting a lot of people for small amounts of dollars. Others are more narrowly focused, taking people for thousands or tens of thousands of dollars. The Council of Better Business Bureaus (CBBB) - the umbrella organization for the 113 local BBBs across the U.S. and Canada - shares its annual “Top Ten Scams” list compiled from a variety of sources, including reports from consumers, federal agencies, and other reliable sources.
“These are not necessarily the scams with the biggest losses, or those with the most victims, as many people don’t report scams or even know they’ve been victimized,” said Katherine Hutt, CBBB spokesperson. “These are scams that seem to be the most widespread, aimed at the most vulnerable, growing in popularity, or just plain audacious. Scams are ever-changing, but BBB wants to help consumers recognize them and be prepared next time they receive a suspicious call, email, text or solicitation.”
Top 10 Scams of 2013
1. Medical Alert Scam – With promises of a “free” medical alert system, the scam targets seniors and caretakers by offering a system free of charge claiming a family member or friend has already paid for it. In most cases, seniors are asked to provide their bank account or credit information to “verify” their identity and, as a result, are charged a monthly $35 service fee. The “free” system, of course, never arrives and seniors are left with a charge difficult to get refunded.
BBB Tip: Easy rule of thumb; be wary of “free” offers that require personal information. Always verify with the supposed friend or family member the caller claims paid for the “free” product or service.
2. Auction Reseller Scam – Many people turn to Ebay and other online auctions sites to sell used items. However, scammers have figured out a way to fool sellers into shipping goods without receiving payment. Usually the buyer claims it’s an “emergency” of some sort – a child’s birthday, a member of the military shipping out – and asks the seller to ship the same day. The seller receives an email that looks like it’s from PayPal confirming payment, but the email is fake.
BBB Tip: Always confirm payment with Ebay and PayPal before shipping, especially to an overseas address. Do not rely on email payment verifications.
3. Arrest Warrant Scam – In this scam, con artists take advantage of technology to change what displays on Caller ID, allowing them to pose as a local sheriff’s office or other law enforcement agency. Scammers call claiming there is a warrant out for your arrest and ask for a fine in order to avoid criminal charges. Of course, these "officers" don't take credit cards, accepting only wire transfers or pre-paid debit cards as forms of payment. Sometimes the scammer may mention a loan or other financial matters to build credibility.
BBB Tip: Avoid intimation tactics even if personal information is referenced. Contact your local sheriff’s office or police department to find out if there is a local warrant out for your arrest.
4. Invisible Home Improvements – Home improvement scams vary little year to year, and most involve some type of inferior workmanship from unlicensed or untrained workers. The hardest for homeowners to detect, and therefore the easiest for scammers to pull off, are repairs or improvements to areas of the home that can’t be seen such as roofs, chimneys, air ducts, and crawl spaces. Scammers may simply knock at a door offering a great deal because they were in the neighborhood, but more and more, they are using telemarketing, email and even social media to reach homeowners.
BBB Tip: Obtain and verify contractor information with local licensing agencies, such as the Registrar of Contractors. Also, check the company’s BBB Business Review to view consumer comments and complaint detail at bbb.org.
5. Casting Call Scam – While not as widespread as other scams, the casting call scam seems to have increased in recent years due to the popularity of television talent shows like “American Idol” and “Project Runway.” Scammers pose as agents or talent scouts looking for actors, singers, models, reality show contestants, etc., using phony audition notices to fool aspiring performers into paying to try out for parts that don't exist. There are several ways the scam plays out; it can simply be an unscrupulous way to sell acting lessons, photography services, or it can be an outright scam for fees for online “applications” or upcoming “casting calls.” Even worse, the information provided on an online application could be everything a scammer needs for identity theft.
BBB Tip: Before “breaking a leg” at an audition or paying for professional services guaranteed to get you the part, do your part and research the company at bbb.org.
6. Foreign Currency Scam – Investments in foreign currency can sound like a great idea, and scammers frequently use real current events and news stories to make their pitches even more appealing. Scammers advertise an easy investment with high return and low risk when purchasing Iraqi Dinar, Vietnamese Dong or, most recently, the Egyptian Pound. The plan is that when those governments revalue their currencies, increasing their worth against the dollar, you just sell and cash in. Unlike previous hoaxes, you may even take possession of real currency. The problem is that they will be very difficult to sell and it's extremely unlikely the currency will ever significantly increase in value.
BBB Tip: Be informed about exchange rates and extremely skeptical about predictions. Also, watch for unsubstantiated, sweeping statements on religious or charity affiliations.
7. Scam Texts – With online and mobile banking skyrocketing, it’s no surprise that scams quickly follow. One major tactic is the use of scam texts, known as “smishing,” to steal personal information. Scam texts look like a text alert from a bank, asking you to confirm information or reactivate your debit card by following a link on your smartphone. Banks of all sizes have been targeted, and details of the scam vary, but the outcome is the same: scammers obtain personal banking information, including card numbers and PINs. You may even inadvertently download malicious software that gives the scammer access to anything on your phone.
BBB Tip: Do not reply to texts asking for personal or financial information. Instead, contact organizations or banking institutions directly by calling a verified phone number.
8. Do-Not-Call Scams – The National Do Not Call Registry offers consumers a free way to reduce telemarketing calls. However, scammers call anyway, and they’ve even found a way to scam consumers by pretending to be a government official calling to sign them up or confirming previous participation on the Do Not Call list! In one variation, scammers ask for personal information, such as name, address and Social Security number. In another, scammers charge a fee to join the registry. Either way, hang up. These services are free.
BBB Tip: The National Do Not Call Registry nor the Federal Trade Commission will call offering the opportunity to sign up for the Do Not Call list. If you receive such call, hang up!
9. Fake Friend Scam – Have you ever received a friend request on Facebook from someone you thought was already your friend? If you hit “accept,” you could have befriended a scammer. A popular scam is the theft of people’s online identities to create fake profiles. A new “friend” can learn a lot about you to scam you later. New friends can recommend sketchy websites that download malware, use your account to scrap information on other friends, even impersonate a military officer or other trustworthy person to perpetrate a romance scam.
BBB Tip: Be careful on social media. Keep privacy settings high and don’t share confidential information. While you can’t be sure that friends are really your friends, try your best to verify their identity.
10. Scam of the Year: Affordable Care Act Scam - Scammers had a field day with the Affordable Care Act (“Obamacare”), using it to fool Americans into sharing personal information. Scammers call claiming to be from the federal government saying the would-be victim needed a new insurance or Medicare card. However, before they could mail the card, they needed to collect personal information. To build credibility, some scammers use bank routing numbers and ask for just account numbers. Others ask for credit card or Social Security numbers, Medicare IDs, or other personal information.
BBB Tip: No matter the circumstance, before sharing banking account, Social Security, credit or debit numbers, or any type of personal information, make sure it is not a scam. It is okay to verify all information and call back.
To view an infographic of BBB’s Top 10 Scams of 2013, click here.
About BBB of Central, Northern & Western Arizona
BBB is an unbiased organization that sets and upholds high standards for fair and honest business behavior. In 2014, people turned to BBB more than 165 million times for BBB Business Reviews® on more than 4.7 million businesses and 11,000 charities, all available free at bbb.org. Incorporated locally in 1938, BBB Serving Central, Northern and Western Arizona is supported by over 11,400 BBB Accredited Businesses. Businesses that earn BBB Accreditation contractually agree and adhere to the organization’s high standards of ethical business behavior. BBB provides objective advice, free business reviews and charity reports, and educational information on topics affecting marketplace trust.