Phishing. Phishing scams are information gathering scams for identity theft. They usually come as a message indicating that there is a problem with your account, credit card, etc. and ask for a lot of personal information such as your username and password. Usually they point you to some web pages that appear to be associated with the real company. They use all sorts of methods to hide the fact that you are not really where you think you are. The web pages contain a login page for your username and password and then a page for all your personal information. What you don’t realize is that the login page accepts anything for a username and password and saves what you typed for the scammer. If you dutifully fill in all your personal information the scammer now has everything he needs to empty your bank accounts and charge items to your credit card. He can open new accounts in your name and make charges without paying. Eventually, you will find out when your bank account is empty or your credit report shows unpaid accounts.
A difficulty here is in determining if an e-mail message really came from your bank or came from a scammer. Most of the scam e-mails are crafted so that it is difficult to tell that you are not going to the company you expect to be going to. In the current ones you have to read the html source code for the message in order to tell where the link will really take you. The best course of action if you get a message of this type from a financial organization where you have an account is to open the organization’s web page directly. Never use a link in an e-mail message to connect to your account. If there really is a problem with your account, you will be able to find that information when you login. You can also test the login by typing garbage for your username and password. If the website lets you in anyway, the site is a scam. Don’t do this more than once or twice in a row as most sites disable your account if they get too many login failures. If the message is from an institution where you do not have an account, just put the message in the trash or send it to abuse@sitename and let the company handle it.
A useful link is the Anti-Phishing Working Group (http://www.antiphishing.org).
Advanced Fee Fraud. Probably the most well known examples of advanced fee fraud are the Nigerian 419 and Lottery scams. In advanced fee fraud, you are generally offered a lot of money in exchange for what appears to be a safe transaction. What happens later is that after you are "sucked in," the scammer will start asking for money for taxes, shipping, bribes, etc. in order to get the large amount of money out of the country. What’s $10,000 when you are going to get $15,000,000 for just the use of your account? You may also be asked to travel to a foreign country to pick up the money. At which time you are kidnapped and your relatives are asked for money for your release or you enter the country illegally with the scammer’s representative (he told you it is OK to enter without a visa) and are blackmailed into delivering more money.
The most well known of the advanced fee fraud is the Nigerian 419 scam. In this scam there is some money in a foreign country and the scammer wants you to help him get it out of the country. The money may be someone’s inheritance, stolen money obtained from over billing a government, money stashed away by a dictator, or any other source of a large amount of money (usually many millions of dollars). The scammer only needs to use your bank account and offers you a substantial percentage for its use. You could give him access to an empty account but as soon as he has you hooked, he will start asking for money. Bribes, shipping fees, taxes, whatever he can talk you into until he cannot get any more and then he is gone.
Foreign Lottery scams are the second most well known of the advanced fee fraud schemes. In this scam you get a message from an official of the lottery telling you that you have won. Woopie, you are rich!! Of course you do not remember entering the lottery but they come up with some sort of a story for why you don’t remember. They get your information and then you start getting requests for money. Taxes are due before the money can be paid out. A bribe is needed for a public official because it is illegal for an American to play foreign lotteries. And so on until they take as much from you as they can get.
A new version of advanced fee fraud involves people listing expensive items for sale on the Internet. The scammer sends you a message indicating that he wants to buy your item. Someone in your country owes him some money so that person is going to send you a cashier’s check for your item and you should take out what you are owed for your item and forward a new cashier’s check to him with the balance. As you might expect, the cashier’s check sent to you is a fake but while you are waiting for the check to clear, the scammer will be bugging you to send him his share.
If you have been scammed, contact your local or federal law enforcement as soon as possible and change the passwords on all your accounts.
A very useful link is to Publication 300a at the U.S. Postal Inspection Service. It describes many of the frauds we see every day and describes what you will really get if you answer them. The IRS has also instituted a fraud and scams page on their website.