Internet Fraud - Basic Classes

In this lesson you will learn:

Internet Fraud

First, let's state the obvious: if you are the victim of fraud on the internet, you have no way of immediately telling WHERE the fraud came from or WHO did it. You were not held at gunpoint, robbed face to face or confronted directly.

The problem with internet fraud is that the usual law enforcement safeguards of 'citizen rights and protection' to property are very hard to enforce. It is not likely that you can call an emergency number and expect a person to respond, take the complaint, file a report, hunt the criminal down, and try them in court. It is not like you can regain your property by going to a crime scene, and worse, it is not like you can ever gain your life and reputation back once you have been victimized on the internet.

Why is that? Because it could be the person down the street or in the same city, or in the same state or even in the same country! It is very difficult to cyber-chase criminals in Africa, Asia or anywhere that have different laws governing what is defined as fraud, privacy or 'public domain'.

Not everything on the internet is bad, in fact, it is in the best interest of almost every single individual and vendor in cyber land to be honest and supply good services and products with good packaging and timely delivery. Buying and selling on the internet can be a quick and easy solution to finding what you need and paying what you want and having it delivered to your door.

Communication by email is also an assurance that all is well and going as intended, and a tracking number for your product also helps in easing anxiety over big purchases. I have Personally purchased a lot of equipment over the internet, and except one article that cost $1.18 and was never delivered I have not had a problem. I believe that the person was probably sent on deployment in the military and was simply unavailable to respond. Most of my purchases have been with on-line auctions and vendors using online payment services which have done a wonderful job of delivering money safely. In fact, using services such as these gives both buyer and seller certain protections, such as identifying and confirming identities of the buyer and seller. If something goes wrong, there are several recourses that can be useful in recovering goods or money. Others are not so fortunate.

Scams

How to define scam artists.... Scam artists are people who are very good at persuasion and manipulation and understand the human natures of greed and pride. They are convinced that you are a person who can't resist a good bargain, a great deal on something you want real bad, or interesting information, enticing cards or titles or the 'inside scoop' or other bait. They depend on the fact that people don't have a stomach for trouble or have the tenacity to pursue them, or have the smarts to know what to do. They operate on the idea that with the right bait you will give up your money, information or even your entire identity without ever meeting them, knowing who they are or knowing anything about them, or fighting them!

Actual scams happen more through email avenues than any other means. Buying and selling email addresses is in itself a business. Scams involve presentation of something that is less than accurate as though it were. It can come in the form of product misrepresentation, as in a refurbished or used piece of equipment being presented or sold as new, or as billing double by a 'company' that has no recourse built in to represent the customer, or as presenting an idea that seems so good that desperation, curiosity or greed makes it irresistible. Who could pass up such a good thing?

Time pressures, FREE items requiring registration information, irresistible items, exclusive offers, inside information, private transactions or convoluted banking transactions are all indicators that something should be looked at twice and thought over for days before deciding. If something goes wrong, what would you be able to do about it? Who would you be able to contact besides the 'culprit'? Where would your transaction actually arrive at? When?

Business Opportunities

Scam artists love profiles and easy targets: they know about the elderly, the not-so-savvy on-line user, like teens or moms or the 'average' surfer, the credit card holders with bad or no credit, the un-educated, or those on the edges financially that 'need a break' and will take anything that looks like a way to easier living. The 'Free Money' mentality, the 'Work at Home' business or 'Perfect Business" plans requiring trips, hotel stays, investment "seed" money, or calling phone numbers for additional information are all signs of scams.

Chain Letters

Letters containing a check that can be cashed, usually for a very small value, will LEGALLY obligate the recipient to conform to ALL of the rules of the offer. There are binding laws protecting the business, so read all of the fine print before cashing your check. Each State has laws governing what can or cannot come through the mail. Unfortunately, the mail laws don't always apply to electronic email! You may get offers that sound perfect and just what you want. Appeals for help, financial hardship, or unusual contact of any sort should be viewed as suspicious unless you know for certain that it came from someone you know. Unfortunately, the nature of chain letters is such that the best way for them to be delivered is through someone you know! the chain letter idea and pyramid scheme letters are ILLEGAL and can be prosecuted. Unfortunately, that means YOU can be prosecuted by those on the receiving end even much further down the chain. BEWARE!

Health and Diet

Products, Products, Products! Drugs, Supplements, Diet aids, Machines, Gadgets and other bait are the lure to tempt you and make the offer so tantalizing that nothing else matters. "I need that, I can afford that, and I WANT that!"

Free Money

Testimonials of those before you who 'made it rich', overnight, no money down, no obligation. The reason you are getting this offer is because selling plans to other people is in itself a big business.

Free Products

Getting something for 'Free' means that you do not pay money. It does not mean that you don't pay a price! Software is a good example. There is an offer on the software that can be obtained free. First, you log in with your 'registration' requiring you home address and phone number and email. Then there are several pages of 'subscriptions' or 'offers' and on each page, at the bottom is either a 'Continue' or 'Next' button. When that button is clicked, the information of choices is entered into a database along with your profile information. As you navigate through the site, as the choices become more 'granulated' as the categories are narrowed into finer detail, a report is generated on what your preferences are, how often something is done, where your choices or preferences lie and other 'benign' information. Finally, in order to obtain the 'Free' software, at least one choice must be made that requires a commitment to something. Even though it is 'Free' as far as money, or cheaper than the product itself would cost through normal channels, the hook is now that your are obligated to something OVER TIME.

Plans, Kits and Packaged Deals

Free Cruises, Free Trips, Free Money, Free Seminar!' Free' Seminars and Cruises usually mean that you are obligated to attend a very HIGH PRESSURE seminar conducted at the sponsor's choice of location and times BEFORE the promised cruise or trip. It means also that at least one product choice has to be made. It also means that as a package, you are bought and paid for along with the other attendees, and are therefore obligated to the rules and norms of the sponsors and are subjected to business pressure and financial obligations at a later time! 'No pressure now though.' If the primary meeting is off shore of the U.S., either on an island or even on ship in international waters, then you have no legal rights or recourses!

'Make money at home' falls in this category. 'Comfort', 'Convenience', 'Luxury', 'Dream' are the buzzwords of the Buzzards. Remember that in this picture it is you on the ground! Assembly at Home, Placing Ads, Mailers, Selling Products that are drop shipped to customers: the point is this: It is NOT about the product! It is about the cost you pay in getting the kit! The initial start up of 25 to 60 dollars and more is all that the company cares about. Multiply the number by the tens of thousands of subscribers and you get the idea! Once you get that kit into your hands, the rest is entirely up to YOU! And you are usually alone!

Even the most workable plan will NOT keep you financially afloat in the first months because ANY business start up venture has a projected break-even point. Depending on the business, because of start-up costs, establishing clientele, gathering product, learning business practices etc, you are doomed by statistics to NEVER make the break-even mark in the first month. Depending on the business, it is rarely done even in the first year! These business facts are as sure as the laws of nature and are not lost to those who know how to use these stats to advantage!

Home assembly seems simple. Buy the kit with everything that you need, assemble the product and ship it back. Unfortunately, if the product isn't the point of the business, then your hard work will never be accepted as having been assembled properly. Feeling rejected lately?

Email Fraud

If you have studied well the paragraphs above, you are armed with the awareness of email fraud. The main difference, in my opinion, between email fraud and any other mail fraud is that there is little or no legal protection for email fraud. Burden of proof, enforcement, legal definitions, jurisdiction and state national and international territory are all boundaries that re-define privacy, free speech and basic citizen rights.

Beware of the subject line. Auto generated emails will contain nonsensical word phrases to get past filter software. Filters look for certain words, like drug names, sex or malicious names etc and automatically screen these out, placing the letter into 'Junk' mail folders and informing you in some way that a letter went into junk mail. Foreign writers or auto generated subject lines may end up in your inbox. In some cases it is best to move them into junk mail manually, and in some cases it is best to delete them. The junk folder 'remembers' the subject and any other mail with similar header information will automatically go there. If the letter is deleted, the process will have to be repeated.

What to do with 'Junk' mail will be covered in another lesson on specific email subjects. At any case, remember that any mail you open can send a flag that the email address (yours) that it was sent to was accurate and active. So DON'T open the email. Simple enough.

Phishing

Sounds like fishing, which is exactly what it is. The email or web link is the bait and you are the next meal! With phishing, the website or email is created to EXACTLY match those of a legitimate company! By clicking into the site you are at the mercy of whatever the creator of the page wants. Some pages are so close to identical it is hard to tell the difference. The usual pages that are created are those with popular names, like Ebay, PayPal, Utility companies, Banks, Savings & Loans, Universities, Government sites etc. You can guess that any of these being copied would be a problem of a legitimate company!

Phishing is an example. You want to pay a bill on-line. Clicking on a link takes you to a site that looks identical to the one you've always used. But, if you look at the url in the status bar at the bottom of the page, it is pointing to a site that is NOT the banks! Clicking on the link will take you to the other website which is set up to look and act exactly like the original!

There are certain methods that 'phishers' use to ensure that the trap is baited. If you spot the bait you can deduce that there is an attempt to trap you:

Bait and Switch

Getting something on sale may be a trap. Sales, low prices and good deals and bargains are lures for this type of fraud. The unit is flagged as 'Out of Stock' or 'Back Ordered' but the next item offered is available for a small fee or increased price. On the internet it could be in the form of buying one thing and receiving another, like a previous version or dated model. On the web the ad shows a different product than the one that shows up at the door. Substitutions can include refurbished instead of new units, used instead of new, last years model instead of the newest version, or different products entirely.

Some transactions can be 'accidentally' bait and switched through 'misunderstanding'. In other word: you see the product in a web site that picture is exactly what you want. So after delivery it is discovered not all of the pictured items are there! Either the picture showed something 'Not Included' or there may be a clause buried deep inside the description that explains that 'such and such NOT INCLUDED'.

Excessive Shipping and Handling Charges

All vendors have to 'handle' the products they sell, even if they have it drop shipped. Some vendors and internet sellers will deliberately drop the price much lower to entice the buyer into the product bargaining, but the 'Shipping and Handling' charges are adjusted up to compensate. This is routine on internet auction sites, and some 'calculators' built into the site are set to allow the margin. Product shipping is ALWAYS standardized, so once you learn the method of shipment, simply look it up and compare. The difference is the 'handling' charge. Some differences will be minor, as the term 'Shipping and Handling' is a ball-park, good faith estimate to give the buyer some idea of how much money to send. This avoids the buyer having to wait until the package is processed for the final number. Usually these differences are kept low as a customer service.

In the case of vendors or sellers recapturing some of the 'sales' price, the difference will be large. In this case, a comparison of similar product is going to be necessary and choose the vendor that gives the best deal. Honesty does matter, and the fact that they are less than forthcoming on the transaction may be a red flag about potential problems if something goes wrong in delivery.

Vendor Integrity

If something is available on display in the store and it is to be 'back ordered' make sure that if you pay for the item to get the clerk to SIGN the sales slip. If there is a problem with the delivered product, at least one person is on the hook for the transaction besides you!

There is nothing wrong with buying on line. But there are a few tools and rules to use.

To Do List

Prevention

Email

When in doubt..... If you have your guard up and are not in a hurry, desperate, or heavily in debt, you should have no problems. Depending on your email reader the settings will be different. Check your email settings for:

Phishing

Bait and Switch

Shipping and Handling and Delivery Problems