5 Identity Theft Scams to Avoid - dummies

5 Identity Theft Scams to Avoid

By Michael J. Arata, Jr.

Phishing is a familiar identity-theft scam, but other scams — such as phone fraud, credit card verification, and fake lottery winnings — are just as prevalent. Thieves are constantly devising new variations on common acts of fraud, so learn to recognize these basic forms to protect yourself against identity theft and to keep your money intact.

Phone fraud

Here’s one version of phone fraud: You receive a call from a person who says he’s with the fraud division of your credit card company and is investigating fraudulent charges on your card. He tells you that the false credit card activity comes from a company that sells computer hardware and is under suspicion. He mentions the name of the company and you tell him you’ve never heard of them and have never ordered anything from them.

Here’s where you need to be careful: In order to help them, he says he needs to verify your card number, your full name as it appears on the card, and the expiration date of the card.

What to do: Never give your credit card number to someone who’s called you. Tell him youll call the credit card company. Don’t ask the caller (the thief) for a callback number. Hang up, and, immediately call the number on your credit card statement and inquire about the investigation.

Credit card verification

Card verification scams are usually done by phone or via e-mail. The person calling or writing says that he needs to verify your credit card information for your account at some online merchant or pay service. He tells you that the computer-server containing the credit card numbers has been hacked into and all the data on the credit card accounts has been lost, or he tells you that he’s verifying your information to make sure that it’s current.

To scare you into action, he offers up this line or something like it: “If you don’t provide the information, your account will be cancelled.” Don’t fall for it! It’s designed to intimidate. The thief will record all the information needed to use your credit card for fraudulent purposes.

If the scam is done by e-mail, the provided links send you to a site set up by the thieves and when you enter the information to “verify” your credit card number, name, and expiration date, they capture the information on their server.

What to do: Don’t give thieves any credit card information either on the phone or by e-mail.

You won the lottery!

Here’s how this scam works: You receive a letter, fax, or e-mail claiming that you’ve won a large sum in an overseas lottery game. You probably didn’t know you even entered the lottery. The letter says that the lottery commission for whatever country’s lotto has tried unsuccessfully to contact you about your windfall. In order to collect your winnings, you need to provide the lotto commission with your bank account information so that it can wire transfer the money to your account.

Some of these scams have a form sent with the letter that asks for personal information, such as your full name (including your middle name), birth date, address, your occupation, marital status, and telephone number. Some of the forms also ask for next of kin information, including first and last name, address, telephone number, and occupation. What a great way to solicit more victims. The form also features a bank transfer section that asks for your bank’s name, address, account numbers, routing number, and telephone number.

What to do: Don’t give out any of your personal information. Just discard the letter, e-mail, or fax.

These letter scams have been successful because they play to the greed aspect of human nature. There’s no such thing as free money.

Bogus invoices

This scam involves phony invoices made to look like the real thing. You can get these bogus invoices in your e-mail or regular paper mail. The idea is to get you to pay for something you didn’t order. Sometimes the scam is used to solicit credit card information. This may be the new trend to garner personal information from you.

To comply with U.S. Postal regulations, these solicitations are supposed to have the following disclaimer, which is easy to spot in the e-mails, but it doesn’t always appear:


The wording is supposed to be near the top of the invoice in capital letters in bold type that is at least as large as the letters on the solicitation. Often, the disclaimer is overlooked or misunderstood.

One of the telltale signs of a bogus invoice is the lack of a phone number for an alternative contact method.

What to do: Don’t respond to invoices that don’t have phone numbers on them. If you didn’t order what’s stated in the invoice, simply ignore it.

Job scams

You probably receive several offers a week in your e-mail to work at home or as a shipping clerk or to transfer funds for various companies. These are usually scams. If you fall for them, you could lose money and put your personal information — such as your address, SSN, bank account number, and so on — into the wrong hands.

Most of these bogus job scams suck you in with the promise of thousands of dollars for working a few hours a day from your home. Some of the job scams can land you in trouble with the law, because the activities you’re asked to perform involve money laundering and repackaging of merchandise bought with stolen credit cards.

What to do: Don’t apply for unsolicited job offers even if the e-mail states that your information was garnered from a job website.

ScamBusters.org lists all the known e-mail scams that are currently being distributed. You can also subscribe to a free e-mail newsletter that outlines the latest scams and is a monthly publication.