Avoid Money Scams

This is a variation of the cheque cashing scam, but applied specifically to landlords.

In essence the scammer offers to rent a place, generally for a short period of time but willing to pay for a full month.  I.e. they have a wedding or a vacation or similar and won’t need to spot for a long period of time but need it (usually on short notice) and are willing to pay any all extra costs.  Naturally the landlord agrees (who wouldn’t).

The scammer pays with a money order or cashier’s cheque.  However, after the cheque or moeny order arrives the scammer calls up and cancels the reservation.  I.e. the wedding has been called off or an illness prevents the vacation.  Because it is a money order, they ask that a portion of the cash be wired back to them, but agree to let the landlord keep a good portion to compensate them for their trouble.

Of course, the money order or cashier’s cheque turns out to be fraudulent.  Which leaves the landlord holding the bag for check fraud.

The Black Money scam is basically silly, but I could see it working on somebody who is both dishonest and very gullible.  The essence of the scam is that a person tries to convince someone that a bunch of black paper is actually cash that has been dyed black to avoid detection by customs.  The victim is persuaded that if they will advance some cash to help pay for chemicals to remove the dye that they will then get a split of the cash in exchange.

Now, not only is it ludicrous, but it lacks logic.

If you smuggled a bunch of cash into the country, why would you seek help from a total stranger?

If you smuggled a bunch of cash into the  country, why wouldn’t you think of a way to remove the dye ahead of time?

If you were so stupid as to not think of a way of removing the dye, why would I want to do business with you?

If you are so dishonest as to need to smuggle cash, why would I trust you?

In general it is not a good idea to trust someone who has already admitted to being dishonest with someone else’s money.

This scam has been used and re-used many times.  It works pretty simply.  The scammer calls the victim and tells them that they have won a cash prize, usually around $250,000.  There is just one hiccup the scammer will tell you.  They need to have the income taxes pre-paid in order to release the funds.

Usually this is a relatively small fee compared to the prize, a few thousand dollars.  Once the taxes are paid the funds can be released and you are on your way to wealth and fame.

Of course this is a complete scam.  The IRS does not need a middleman to collect their taxes for them.  They do a fine job all by themselves.  In fact you have not won any kind of prize.  In truth most legitimate cash prizes state quite clearly that they will not be responsible in any way for paying the taxes that you owe.

So just hang up on the scammer and then warn your friends.

Have you ever received a sweepstakes prize which stated that “you are positively confirmed eligible for a cash prize?”  If you have, then you are not alone.

If you take the time to read through the dizzying fine print you will likely discover that in fact you have won absolutely nothing.  For $20.00 you can also send in to claim your prize you will discover the same thing.

This scam operates very simply.  Technically they promise nothing.  But they dress up the envelopes nicely and throw in some official sounding language to convince you that you have in fact won something spectacular.  The whole idea is to get you to send them their fee, which normally is rather small.  In exchange they give out coupons and sell your information to other scammers.

Be sure to read all the fine print, and then throw it away.

To all those of you who read this column, have a safe and happy holiday.  This is the one time of the year when we all deserve to feel completely safe and comfortable, but unfortunately it is also one time of the year when scammers and con artists try their hardest to prey on the unwary.

As you wish your loved ones the best, keep them safe by being alert and watchful towards products, services, and people who promise to deliver more than they do.  Watch out for those who would take your money and leave you nothing in return.

This is a time of giving and of loving.  Be careful that you are giving to the honest and helping those who need it most.

Happy holidays.

Networking these days is essential in order to even get by.  Our social groups, from employers to school mates, to colleagues and people we know from church, clubs or other social organizations help us in many very important ways.  One way that they can help is to give us a reality check against scams.

Talking to people we know about business opportunities, investments, work at home jobs, or products advertised on television can be a good way to get real feedback on what may be going on.  Often someone you know either has purchased the product or service or knows someone who has and they can give you an honest opinion about it.

Be a little careful here though.  All too often the scammers are those we know and trust.  In particular identity theft is very popular amongst family members so be a little bit careful.  As always use your instincts.  If something seems strange there probably is something wrong.

One of the scams that people tend to get caught up in more at this time of the year than at other times are those involving charitable organizations.

The way the scam works is pretty simple.  Someone claiming to represent a charitable organization, real or imagined, asks for a donation.  They get as many donations as possible, but the money is never given to the charity (if it even exitisted).

Some things to watch out for are:

How are you approached?  Typically the more reputable charities will not go door to door or cold call on the telephone seeking donations.  They will have drop boxes or other organizational methods.

If they do approach door to door, look for a uniform or identification as well as a phone number and address.  Not every organization has uniforms or identification, but they will have an address and a phone number that can be called.

Ask to pay with your credit card.  This may not always be possible, but if you can you do offer yourself some protection.  The next best method would be a check that you can cancel if you need to.

Ask to pay later.  A real charity won’t mind waiting a day or two or even a week to get the money that they need.  A scammer will insist on being paid immediately.

Finally - just give to the charities you know and recognize.  Go out and find the charities that you know and give without being asked.  You can always tell the potential scammer that you already gave.