Better Business Bureau Releases Top 10 Scams Of 2012

The Better Business Bureau has released its list of the top 10 scams for the past year.

The list is created from those having the most widespread impact using a variety of sources, gathering information on scams from consumers, some of whom have been victims of scams; from federal agencies; and from other reliable information sources.

“It’s hard to say which are the ‘biggest’ scams, as far as the number of people affected or the amount of money stolen, because many go unreported or under-reported,” said Warren Clark, Better Business Bureau president. “Ripping folks off has been around as long as BBBs 100 years, since some of these scams have been around as long as us and still work! But some take advantage of brand new technologies. Our list is made up of the ones that seemed the most audacious, the most egregious.”

To help consumers in their quest to figure out which offers are real and which ones are possibly frauds, BBB is proud to announce the recent launch of two new websites designed to prevent falling for scams:

BBB Smart Investing, developed in partnership with the FINRA Investor Education Foundation, informs consumers about investment fraud, Ponzi schemes and risky investments, and helps them assess their risk, check out brokers, and avoid getting taken. The site is located at www.bbb.org/smartinvesting.

BBB Scam Stopper, developed in partnership with Western Union, educates consumers about the major types of scams and provides information on how to avoid them and how to report them. The site is available at www.bbb.org/scamstopper.

“These scams hurt a lot of people, and it seems they are only getting more prevalent even as consumers are getting savvier,” Clark said. “We hope by working together and sharing this roster more and more individuals will know what and how to avoid them.”

The top scams listed by the bureau are:

TOP OVERPAYMENT/FAKE CHECK SCAM: CAR ADS

The online ad says something like “Get Paid Just for Driving Around” – a prominent company is offering moret han $400 a week for those who will drive around with their logo all over the person’s car. They send a check, which the driver is supposed to deposit in their account and then wire part of the payment to the graphic designer who will customize the ad for the vehicle. A week later, the check bounces, the graphic designer is nowhere to be found and the person is out the money they wired.

TOP EMERGENCY SCAM: GRANDPARENTS SCAM

The “Grandparents Scam” has been around a while, but it’s still prevalent. A grandchild/niece/nephew/friend is traveling abroad and calls/texts/emails to say he or she has been mugged/arrested/hurt and needs money right away The FBI reports social media has made it easier for scammers to tell a more plausible story because they can use real facts from the supposed victim’s life. Before wiring money in an emergency, check with the supposed victim or their family members to make sure they really are traveling.

TOP EMPLOYMENT SCAM: MYSTERY SHOPPING

For those who love to shop, working as a secret shopper may sound like an ideal way to supplement income. But scammers have many job offers that are nothing more than a variation on the Overpayment/Fake Check Scam. Sometimes they say evaluating the wire service company is part of the job, which is why people need to send back part of the money. The Mystery Shopping Providers Association says it’s not the practice of their members to pre-pay shoppers. Those who want to do such work can find a legitimate job through www.mysteryshop.org.

TOP ADVANCE FEE/PREPAYMENT SCAM: NONEXISTENT LOANS

Loan scams continued to fester in 2012. It seems for every legitimate lender out there, there is a scammer waiting to prey on people in desperate situations. Most of the scams advertise online and promise things like no credit check or easy repayment terms. The first payment is to be made up front, with the person having to buy an insurance policy, or there is some other kind of fee to be paid before receiving the loan. A new, aggressive twist on loan scams in 2012 saw consumers who were threatened with lawsuits and law enforcement action if they didn’t “pay back” loans they said they had never even taken out in the first place. Some got calls at their workplace, even to relatives. The embarrassment of being thought of as a delinquent caused some victims to pay even when they knew they didn’t owe the money.

TOP PHISHING SCAM: PRESIDENT OBAMA WILL PAY YOUR UTILITY BILLS

Of all the politically-related scams, this scam seemed to be the most prevalent, according to BBB officials. At the peak of summer with utility costs soaring, consumers got emails, letters and even door-to-door solicitations about a “new government program” to pay utility bills. Victims “registered” with an official-looking website and provided everything scammers needed for identity theft purposes, including bank account information.

TOP SWEEPSTAKES/LOTTERY SCAM: JAMAICAN PHONE LOTTERY

This is an old one that flared up again this year. We consider it flattering (in a weird way) that BBB is such a trusted brand that we “star” in so many scams. In this one, the calls come from Jamaica (area code 876) but the person claims to represent BBB (or FBI, or other trusted group). Great news: you’ve won a terrific prize (typical haul: $2 million and Mercedes Benz) but you have to pay a fee in order to collect your winnings. There are lots of variations on this; sometimes it’s a government grant. Best just to hang up and then file a phone fraud report with the appropriate government agency.

TOP IDENTITY THEFT SCAM: FAKE FACEBOOK TWEETS

Two top social media sites were exploited in one of this year’s top scams. You get a Direct Message from a friend on Twitter with something about a video of you on Facebook (“ROFL they was taping you” or “What RU doing in this FB vid?” are typical tweets). In a panic, you click on the link to see what the embarrassing video could possibly be, and you get an error message that says you need to update Flash or other video player. But the file isn’t a new version of Flash; it’s a virus or malware that can steal confidential information from your computer or smart phone. Twitter recommends reporting such spam, resetting your password and revoking connections to third-party applications.

TOP HOME IMPROVEMENT SCAM: SANDY “STORM CHASERS”

BBB spends a lot of time investigating and reporting on home improvement scams, but this year we saw an unusual amount of “storm chaser” activity following Super Storm Sandy. Tree removal, roofing, general home repairs some were legitimate contractors who came from other areas for the volume of work available; others were unlicensed, uninsured and ill-prepared for the work; while some were even out-and-out scam artists who took the money and never did the work. In an emergency, it’s tempting to skip reference checking, but that’s never a good idea. BBB has tens of thousands of accredited businesses in the home contracting field. To find a contractor, visit bbb.org/search.

TOP SALES/RENTAL SCAM: REAL STARS, FAKE GOODS

Sports memorabilia and phony tickets always make the list of top counterfeit goods. From the Super Bowl to the World Series, counterfeiters manage to have their hands in your pocket all year long. With the London Olympics added to the mix, it appears that 2012 was a good year for sports fakes. Some scammers were selling cheap knock-offs in front of stadiums. Others set up websites that just stole your money and never had any goods to begin with. Counterfeit goods are not only a rip-off for you because the merchandise is usually shoddy, but they are also a rip-off for the teams, athletes, designers and artists who create, license and sell the real thing. Buy directly from team stores and websites, or from legitimate retailers. Remember, if a deal sounds too good to be true, it probably is.

SCAM OF THE YEAR: NEWTOWN CHARITY SCAMS

Within hours of the horrific shooting at Sandy Hook Elementary School in Newtown, Conn., social media pages dedicated to the child victims began cropping up … and some of them were scams asking for money. The FBI has already arrested one woman for posing as the aunt of one of the children killed, and state and federal agencies are investigating other possible fraudulent and misleading solicitations. In response to these reports, BBB Wise Giving Alliance offered tips for donors to understand how and when to best support those dealing with such a tragic crisis.