Scams
If a person you don't know greets you on the street, ignore them. Do
not say anything or make eye contact. Just continue walking. They will
almost certainly be a con artist, panhandler, or other hustler. If
they persist, call the police.
Many international students become victims of scams because of their
generosity and their unfamiliarity with the US. Coming from countries
with lower crime rates, they assume that all people are honest. They
are alone and no longer in close contact with family and friends, so
they don't have anybody to ask for advice. They are often desperate to
make new friends. They find it difficult to say no and break off a
conversation because they are very polite and eager to please. They
may have very limited financial resources, and so be interested in
bargains and ways to earn additional money. They may have heard the
United States described as the land of opportunity, and hope to get
lucky and strike it rich. They may be a little naive and not have
enough experience to distinguish legitimate offers from frauds. All
of these characteristics make them more likely to become the victim of
a scam.
Con artists can be of
any age, sex, or race, and may even look respectible. Sometimes they
work alone, and sometimes they work in pairs. Often they will
present you with a sob story, such as needing money for a taxi to the
hospital to visit a relative or to buy food for their
children. Sometimes they will show you a roll of money and ask for
your help in returning it. For example, they might say that the
automatic teller machine (ATM) disbursed too much money. The story
might sound innocuous, but at some point they will try to get you to
give them money or something of value. Sometimes they'll just go for
the money you have on your person. Other times they ask you to
withdraw a larger sum of money from your bank account. Once you give
them the money, you'll never hear from them again (except perhaps to
bilk you out of even more money).
A good scam often involves some of the following characteristics:
- Playing on your greed. They will tell you how you can make a
lot of money quickly. Many normally cautious people forget their good
sense when they see an opportunity to profit or are desperate for
money. That's why some of the best con artists make you think that
you're scamming them or getting a bargain.
- Sugar money. They may show you a bundle of money or pay
for your lunch because they know that they'll be able to defraud you
of an even greater sum of money. Or they'll pay off the first few
people they encounter to lend credibility to their scam. These people
will recommend the scam artist to all their friends, yielding an even
greater number of victims.
- Illegal activity. Not all scams involve the victim in
illegal activity, but some do. After all, if the scam artist cheats
you while you're participating in an illegal activity, you're unlikely
to report the scam artist to the police. The most common illegal
activity involves gambling.
It is in the nature of the lie that it is very close to the
truth. That's what makes it so convincing and so easy to believe the
scam. For example, scholarship scams work because there are legitimate
organizations that give away money for college. The difference is the
scams ask you to pay money to get money, and the real scholarship
sponsors don't. It helps to be cautious and a little paranoid.
If an offer sounds too good to be true, it probably is.
Some of the more common scams include:
- The Block Hustle. The con artist will try to sell you an
article of value for a fraction of the cost. They will say something
to provide a sense of urgency. They may even suggest that the items
are stolen. Only after you part with
your money do you discover that the item is fake. For example, you may
be offered a set of expensive stereo speakers off the back of a
van. Later, when you open the boxes, you find that you bought a wood
frame with a cloth face but no speaker components. If you're offered a
diamond ring, you'll later discover that the stone isn't a real diamond.
- The Pigeon Drop. The con artist approaches you with a
wallet or envelope filled with money, and asks you if you dropped
it. When you say no, he asks for suggestions as to what to do. He will
then suggest splitting the money after advertising the wallet in the
lost and found section of the local newspaper. As a sign of "good
faith", he will ask you to withdraw a large sum of money from your bank
account (he'll probably withdraw an equal sum from his bank) and he'll
put this money together with the wallet. He might hand the wallet to
an accomplice. In any event, the person with the money will disappear
with a reasonable excuse, such as needing to make a phone call or
visit the toilet.
- The Fake Charity. The scam artist will show you a
notebook of information and pictures for a charity and ask you to make
a donation. The charity might even be a well-known organization or
have a name that sounds like a legitimate charity. But even if the
charity is real, it will never see even a penny of the money.
- The Boiler-Room. Telephone scammers will call you by
phone and try to sell you something or sign you up for a
service. The call may be disguised as a survey, but
ultimately they will get to the sales pitch. Such offers are rarely in
your best interest.
- Credit Repair Scams. This scam promises to fix any problems in
your credit report and guarantees to provide you with a credit
card. International students are frequently victimized by this scam
because few US banks will issue a credit card to international students.
- Sweepstakes and Prizes. You receive a telephone call or
a postcard notifying you that you've won a prize, but must pay a
redemption fee, taxes, or other fees to claim the prize. Sometimes the
call itself costs you money or you may be required to purchase a
product. Variations on this scam include vacation certificates and free
hotel rooms.
- Door-to-Door Sales. They may be selling home repair,
magazine subscriptions, water purifiers, cosmetics, vacuum cleaners, or
encyclopedias, but almost all of them are frauds. Tell them you are
not interested and shut the door immediately. Don't waste your time or
money on such unsolicited offers. If you have need of such services,
seek out legitimate businesses on your own.
- Fake Deliveries. A delivery person asks you to pay a
C.O.D. charge for a package you weren't
expecting. After you pay the charge, you open the package to find
nothing of value inside. If the delivery service isn't one you
recognize (e.g., not listed in the telephone book) or the delivery
person refuses to show identification, ask them to return later.
- Chain Letters and Pyramid Schemes. The chain letter asks you to send money
to the addresses listed in the letter, sometimes in the guise of
selling you "reports". The letter tells you to put your name and
address at the top of the list and to mail out hundreds of copies of
the letter. You comply, because you believe that you will earn a lot
of money from this scheme. Unfortunately, it doesn't work, and such
schemes are illegal. Pyramid schemes are similar, but involve
"distributorships" or "multi-level marketing".
- Ponzi Schemes. In a Ponzi scheme, the investor is
promised a high rate of return on their investment. In reality,
money from later investors is used to pay early investors. The early investors
recommend the investment to their friends, who invest as well. The
early investors may even reinvest the interest because the investment
has been so amazingly successful. This
continues until the scheme collapses, often after the scam artist
disappears with most of the money. For example, the scam artist may
promise to pay for your full four years of college tuition, in
exchange for payments of 10% to 20% per year before you matriculate.
Even colleges and universities have been victimized by a variation on
this scam, in which they were promised matching contributions from
benefactors to double the amount of their investments.
The following are a few precautions to help protect you from scams:
- Be suspicious if someone approaches you for money, even if for
a charitable purpose. If you feel like giving money to a good cause,
do so of your own accord and make the contacts yourself. Don't give
money when someone solicits you, because it is likely to be a scam.
- If you have to pay money to get money, it is probably a scam.
- Don't trust promises from people you don't know. If you receive
an unsolicited offer, get a second opinion from someone you know and
trust.
- Be wary of offers you receive during unsolicited telephone
calls. Certainly, if you initiate a call to an established business to
make a purchase, there's no problem. But if you receive an unsolicited
sales call, it almost certainly is not in your best interest to
respond. Tell them that you're not interested and hang up immediately.
- Never give out personal information to any unsolicited
caller. Don't give out your name, address, social security number,
bank account numbers, or credit card numbers.
- If you're being pressures to make an immediate decision, that's
a good sign of a scam.
If you sign a contract in your home, you have a right to cancel the
contract within three days. So if you do have second thoughts or
buyer's remorse and the outfit is legitimate, you can cancel the
contract within the cooling off period. But if the outfit isn't legitimate, your money will be long
gone.
If you are the victim of a scam, report it to the police. If the scam
was more than just a street hustle,
you can also
report it to the National Fraud Information Center at 1-800-876-7060
or
http://www.fraud.org/. They pass
the information they receive on to the Federal Trade Commission and
state consumer protection offices. The FTC and states Attorney General
are only like to take action when there is a pattern of fraudulent activity.