Tough economic times are a boon to the crooks who prowl the Internet looking for their next victims. They know how eager (desperate?) so many of us have become in our quest to remain solvent.
It seems not a day passes without the appearance of some new Internet scam. Unfortunately, many of the ruses people fall victim to are older than the Internet itself.
Wiring money and Internet purchases don't mix
Take, for example, the bogus cashier's check. In last week's Santa Rosa Press-Democrat, Cathy Bussewitz wrote about Bart Edson's disastrous attempt to sell an antique upright piano on Craigslist. As soon as I saw in Bussewitz's story the words "wire the difference," my gut wrenched.
Yet again, a Craigslist buyer offered to send the seller -- Edson, in this case -- a cashier's check in an amount greater than the sale price and requested that Edson wire the buyer the difference. Edson did so after he deposited the check in his credit-union account.
As Bussewitz reports, Edson learned the hard way that forged cashier's checks are becoming more difficult for even trained tellers to spot. Banks are required to have funds deposited via cashier's checks available for withdrawal the next business day.
The Federal Reserve returns bad checks to the bank from 5 to 10 days after receiving them. Any funds paid on the bad checks are withdrawn from the depositor's account -- in this case, Edson's.
Buying or selling on Craigslist? Read this first
Craigslist remains one of the most popular online marketplaces, which naturally makes the site a magnet for scam artists: it's where the money is. The Craigslist "avoid scams & fraud" page highlights its first piece of advice: deal locally whenever you can.
The page provides a handful of links to sites for reporting fraud (see below for many more such links), as well as descriptions of seven common scams and four real scammer e-mails.
Internet scammers claim to be FBI agents
Last month the Internet Crime Complaint Center (IC3) released the 2011 Internet Crime Report (pdf). It's no surprise that the IC3 recorded a 3.4 percent increase in fraud complaints in 2011 over the previous year (just under 315,000 total complaints). Even the estimated total loss for the year of nearly a half-billion dollars may not raise an eyebrow.
What caught my attention was the high number of fraudsters impersonating FBI agents. This was the most prevalent Internet crime reported to the IC3, followed by identity theft, advance-fee fraud, non-auction/non-delivery of merchandise, and overpayment fraud.
The major fraud categories reported to the IC3 in 2011 were FBI impersonation, work-from-home scams, loan-intimidation scams, auto-auction fraud, and romance scams.
(Note that some malware authors are using fake free protection from online banking fraud to promulgate a Trojan that targets the very same online bank accounts, as reported last month by CSO's Taylor Armerding.)
Free fraud detection from AllClear ID
In a post from last November I described how to know when your private data is lost or stolen. A free service from AllClear ID (formerly Debix) promises to detect stolen and lost personal information and alert you via phone and e-mail.
Start by providing your name, e-mail address, and birthdate. Enter and confirm a password. You're then prompted to enter a phone number, although you can choose to receive only e-mail alerts.
After you enter your phone number, you receive a call from the service asking you to record your name, a pass phrase, and a four-digit security code.
When you receive an alert and suspect it's fraud, you can press the star key to be connected to an AllClear ID investigator. The free service also sends you a monthly fraud-detection report.
The $15-a-month Pro version of the service adds identity repair, $1 million in ID theft insurance, monitoring of the three major credit bureaus, and lost-wallet protection.
More fraud-reporting resources than you can shake a stick at
If you believe you're the victim of an Internet crime, report the incident to your local police (unless there's imminent danger to life or limb, dial the local police phone number, not 911).
In addition to the useful anti-fraud tips offered by the sites listed below, you can file a report with many of the crime-fighting government agencies and organizations included in this roster.
- U.S. Federal Trade Commission: Consumer Information and Complaint Assistant
- USA.gov: Internet Fraud
- U.S. Federal Deposit Insurance Corporation: Identity Theft & Fraud
- U.S. Securities and Exchange Commission: Internet Fraud
- Sallie Mae: Avoid Online Fraud
- National Consumer League: Fraud Center and Internet fraud tips
- National Consumer League: Celebrate Cyber Security Month
- National Consumer League: Scholarship Scams
- Better Business Bureau: Credit-card fraud prevention guidelines
- Wall Street Journal: Identity Theft & Credit Card Fraud -- How to Protect Yourself
- PayPal: Fraud Protection Services
- Google Checkout: Reporting Abuse
- Google Checkout Merchant: Fraud protection
- UPS: Fight Fraud
- AARP Foundation: Fraud Protection
- Grow Financial: Fraud Protection