Fraud, Con, Swindle, Scheme, Snake oil, Scam, Racket, Sham
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We’ve all received them. Anyone who uses the Internet, has an email account, or opens postal mail has found offers that appear too good to be true. “Let us fix your bad
credit report.” “No down payment? Poor credit? No problem. We can approve your mortgage instantly.” Some of these come-ons are so appealing and so persuasive; they manage to obscure the standard advice: “If it looks too
good to be true, it probably is.”
Many appear to be not only appealing but risk-free. They offer financial advice, debt relief, pre-approved or guaranteed acceptance credit cards and mortgages, low-rate mortgages, “free” vacations, or work at home opportunities. Some may seek payments for these services and deliver little or nothing in return; others may seek no money at all, which makes them particularly dangerous to consumers. They don’t ask for any money, at least not
initially, so why not just fill out those tiny forms and see what  they bring? What do you have to lose by answering a few simple questions? The answer, unfortunately, is a great deal. Some of these offers are simply
rip-offs, providing far less than promised; others are identity theft schemes that can steal a victim’s money, credit
rating, or both. They almost always entail hidden costs and only rarely provide any benefits at all.
Behind the Screen
We’ve explored a few recent Internet offers and found some strategies you can use to distinguish between scams and legitimate offers and reduce your risk of being taken for a
long and potentially expensive ride.
One offer forwarded to us was for refinancing a mortgage. The hook here was the opportunity to avoid the alleged humiliation, intimidation, and excessive demands of
traditional lenders. Just fill out our simple form, the email says, and we turn the tables on those grubby lenders. We’ll have them competing for your business, so you can take advantage of them instead of letting them take
advantage of you. The link takes you to an online form requesting some basic financial data and identifying information -- address, telephone number, home value and the like. Fill out the form and, the instructions say, a representative of the company will call you immediately to tell you how large a loan you will receive. In fact, one of their representatives did  call, and said he needed only one additional piece of information to complete the application – a social security number. Our “tester” wisely hung up at that point – identity still intact.
Tell Tale Signs
Consumers don’t always recognize this kind of encounter for the attempted identity theft that it often is. If there is a legitimate and appealing offer to be had, consumers
don’t want to miss out. Our experience suggests that the odds of really finding “something” at the end of these “something-for-nothing” offers are slim to none. But the scams tend to have some common characteristics that
make it easy to identify them. All of the offers we investigated:
Provided no information on the company making the offer, or offered only superficial information that could not be confirmed.
Involved companies with addresses outside the United States, sometimes in several countries. The direct link to the company led to one country while the consumer response link led to another. (This arrangement isn’t hard to understand; most consumers would not respond to offers for mortgages, debt counseling, or work-at-home opportunities posted by companies based in Romania, Korea, China, or India. But your members also should be aware that a U.S. address is no guarantee of legitimacy.)
Provided incomplete or inaccurate contact information.
Checking these addresses was not difficult; we used Whois, a popular name for a combination of Internet information directories containing information about website
operators. The Federal Trade Commission and other law enforcement entities use this tool to identify fraudulent websites by verifying the accuracy of the contact and other information they provide; it can be an equally
effective tool members can use to protect themselves. For example, checking our target Web sites against Whois, we found:
 The company promising consumers to have lenders
“compete for your business, links the initial consumer response to a site based in Japan, but the consumer information form actually goes to a site in Romania. Check that Romanian site in Whois, and you’ll
find that most of the identifying information is labeled “NA” – Not Available.
The site offering “Free  Debt Help – No Loans” shows it
is registered to a company based in Autsin, TX. This could be an honest typographical error for Austin, TX, but the listed zip code, 59483 is for Sun River, Montana, and while the phone number
has an Austin area code, it is not a working number in Austin. Another site offering debt relief list the company’s address as “private”, California with a nonexistent zip code and a telephone number with an area
code that is in Georgia.
If the Whois database shows a foreign address for a Website promoting domestic activities, or if the site information seems to obscure the identity and
location of the offering firm, you should run, not walk, in the opposite direction.
Advice to Consumers
Here are some additional hints you can use to protect yourself:
If it sounds too good or too easy, it probably is. This is old advice, but it can’t be repeated too often.
Never give financial or personal information over the Internet, on the phone, or in writing unless you know to whom the information is going, are certain that the
company receiving the information has a legitimate need for it, and that providing the information is in your interest.
Research any entity you don’t know before turning over any personal information. The Better Business Bureau is a reliable source, but they often don’t have
information on new businesses. And many fraudulent enterprises die and are reborn with different names regularly.
Don’t be in a hurry. If you see an offer on a Web site, wait a couple of weeks and return. Often the Web site will no longer be working. Don’t be pressured by
“limited time offers.”
Never give any information to any entity that does not supply you with accurate, verifiable, identifying information. Never, ever send payments to an entity if
you can’t confirm their address and their legitimacy. Never give credit card information for “identification purposes.”
Use the Internet for research. Whois can tell you where and to whom the site is registered. If it isn’t where you think it should be or if the
information isn’t complete, don’t deal with the company.
You can find Whois at several locations, including these: www.betterwhois.com
and www.swhois.com . A reverse telephone lookup is another useful tool. You will find one at www.anywho.com/rl.html. Enter the telephone number and this service will provide the matching name and address. Use it to look up the telephone number listed in the
Whosis database to make sure it matches. Additionally, www.zipinfo.com/search/zipcode.htm offers free zip code and
area code matching you can use to verify company information.
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