Don't Fall Victim to Fraud

Criminals perpetrating fraud are extremely creative. There are all types of fraud: credit card fraud, phishing (online), spoofing (on the phone), slamming (when your telephone service is switched without your approval), and phony disaster relief appeals. The federal government and private industry have many safeguards in place to protect unwitting consumers but consumers themselves need to beware.

Phony Disaster Relief Appeals

Unfortunately, the greatest natural disaster in US history, Hurricane Katrina, opened the floodgates for crooks as well. In order to help those truly in need, do not give goods or money to an organization that is inexperienced in carrying out relief efforts. Katrina has made it difficult enough for professionals and experienced personnel. Inexperienced agencies, although possibly well-meaning, may not be able to deliver on their promises and achieve economy of scale so that the vast majority of your donation can be used to help those in need directly. If you decide to contribute, do not give cash. Make a check or money order out to the name of the charitable organization, not to an individual collecting the donation.

Phishing

Phishing is a product of the Internet. The most common form of phishing is by email. The sender, posing as a bank or a retailer with whom you do business, asks you to confirm your personal information. When you receive the email, don’t click on a link if there is one. Never give any personal information about yourself. Your real bank, for example, has all your information already and has back-up systems in case their computer system goes down temporarily. And credit card companies, trying to track down fraud, will never ask you for your account number or other personal information; they will ask only if you have made particular transactions that might be questionable because they are not within your normal spending habits, such as a foreign transaction.

Spoofing

Telemarketing scams (spoofing) are extremely common. Often the call is about a prize you have won or you’re offered a once-in-a-lifetime investment opportunity. The caller is very excited about the opportunity and plays on your emotions to get you excited enough so that you don’t think clearly. Sometimes, to lend authority to the call, the person claims to be a manager, or a government official or some other person in authority. Frequently, the caller addresses you by your first name and tries to become very friendly with you, asking questions about your children and your interests to gain even more information. These calls can be relentless, up to several a day so as to wear down the resistance of the person being called. The best way to deal with spoofing is to hang up. It’s not rude, just smart.

Slamming

Slamming came about when telecommunications was decentralized. It occurs when your telephone service is switched from your current company to another one without your permission. It can happen with long-distance, local and/or local-toll service. Sometimes, someone posing as a representative from your current telephone company may try to trick you by asking if you are satisfied with your service or if you’re interested in purchasing an additional service, such as call waiting or a new calling plan. Your response could be recorded so that a “yes” answer is used as proof that you agreed to switch phone companies.

Don’t return calls to numbers on your voice mail that you don’t recognize. A slammer may be using Automatic Number Identification to see the number you are dialing from and then process an unauthorized switch of service.

And then there’s cramming: when a company charges you through your telephone bill for extra services that you never agreed to buy. Your phone company may be billing you on behalf of other companies for services they sell such as voice mail, paging or Internet access. If you are unsure about charges that appear on your phone bill, call the number listed on that page for billing questions and ask for an explanation.

Credit Card Fraud

You should treat your credit cards like cash. Fraud with credit cards still in your possession usually occurs when someone gets your personal information, such as your PIN (personal identification number). Sometimes an unprompted phone call or email may request that you divulge your credit card number, PIN or card security number (the last three digits on the back of your card near the signature line). Don’t answer the email. If the request is made by phone, hang up.

Your best policy against fraud is to do business with a reputable and proven company. Or one displaying a nationally accredited association, like the Better Business Bureau Online.] In addition, use a PIN that you can remember easily so that you don’t have to keep a written copy of it on your person or near your credit cards. Only shop at secure web sites, where the security icon (the locked padlock or unbroken key symbol) shows up in your browser window before you are asked to send your card details. If you lose your credit card, report it immediately. For the most part, you will not be held liable for unwanted charges.

General Protection Tips

Only trust transactions that you initiate.
Never respond to a request you receive for personal information via phone or email.
Keep PINS, passwords and personal information safe and out of sight.
Keep records of transactions you make.
Rip up or shred personal documents such as bills, statements and receipts.
Beware of any situation, whether on the phone, online or by mail, wherein you are pressured to act immediately.
Check all of your bills – credit cards, phone bills – carefully.
Do not hesitate to ask for written information that describes programs, privacy issues, guarantees, etc. from other sources with whom you might wish to make a transaction of some sort.
Hang up on unwanted callers.

Source: Omni Financial®