Frauds and Scams in the World

As much as we would like to think that people are good people and have good intentions towards other people, there are many frauds and scams in the world that take advantage of naivety to loot and steal. While we shouldn't go around fearing everyone and everything, just having simple knowledge and common sense will make you much more prepared to identify and avoid these schemes. Here are some of the worst ones:

Phishing Scams

This scam usually involves a scammer sending a message (usually through email) pretending to be an authority in order to dupe victims into giving over sensitive information like passwords, credit card numbers, and even money. An example of this scam would be getting an email claiming to be Google and that you need to click on a link to update your account otherwise it will close. Then you would be directed to a bogus link that seems legit, and the scammers gather your information when you put in your information. Always check the url of the link, if it looks wildly different that the normal company link, then it is probably a bogus site. 


IRS Phone Scams

Over the phone, scammers will tell you that they are from the IRS and that you did not pay enough taxes. If you do not send them the remaining amount, they say they will arrest you. Unfortunately many unsuspecting victims believe the scammers and go ahead and send them money, often thousands of dollars that will never be recovered. It is extremely hard to get the money after it has been send through a transfer, so prevention is the key. The IRS will never call you to discuss official business, they will send you a letter, so always take caution and avoid scams like this.


Fake Antivirus Software Scams

A common tactic scammers will employ is using pop up ads that claim to detect a virus on your computer and you need to call the number to resolve the problem. When you do, they typically either ask for payment to fix the problem or even worse use software to remotely control your computer to steal valuable and sensitive information such as credit card numbers and social security numbers. To prevent this scam from happening to you, always be wary of pop up ads that you see, especially if you are on a less than reputable site. The ad will sometimes be written in broken English and have a sense of urgency to them, telling you to call the number now. Don't. If there is nothing wrong with your computer, ignore the ad.


Pyramid and Ponzi Scams

The pyramid scam has been featured prominently in the media, from the classic Ponzi scheme to Bernie Madoff's massive scheme that left almost $20 billion in losses and a movie that was made about it. The main structure of the pyramid scheme is having new people pay a fee to join, while promising them a direct share of the fees paid by new members that they recruit. A Ponzi scheme differs by having a main schemer pay the profits to earlier members by using the funds of later members; in essence "rob Peter to pay Paul." Both scams have red flags that can help you avoid them; pyramid schemes highly encourage you to get referrals to the program and pay more for recruitment than for sales while a Ponzi scheme will offer high returns with little risk and investments that are overly consistent, secretive, and unregistered.


Investment Scams

In the world of finance there is a lot of potential for bogus investment opportunities, sly marketing, and too-good-to-be-true offers waiting to scam people out of their hard-earned money. Some of the common investment scams include currency scams, prime bank scams, and investment scammers. They aim to take advantage of vulnerable groups such as the elderly and gain their trust by posing as trustworthy, relatable figures, which is why it is even more important to guard yourself from naivety. To avoid these scams, be sure to do your homework on the investment opportunity and check out other reviews and websites.


They say in life that there is no such thing as a free lunch, so if someone offers you one, you might just want to check out the offer to make sure its not a scam. A little knowledge can go a long way to keep scammers from swindling your money.