Protect Yourself from Internet Fraud
The Internet has spawned a whole new lexicon and brought the world
to your living room, 24/7/365. And while the opportunities online for
consumers are almost endless, there are some challenges, too. As in
"dot con".
Dot con? Dot con.
Con artists have gone high-tech, using the Internet to
defraud consumers in a variety of clever ways. Whether
they're using the excitement of an Internet auction to
entice consumers into parting with their money, applying
new technology to peddle traditional business opportunity
scams, using email to reach vast numbers of people with
false promises about earnings through day trading, or
hijacking consumers' modems and cramming hefty
long-distance charges onto their phone bills, scam artists
are just a click away.
Fortunately, law enforcement is on the cyber-case. Using
complaints to Consumer Sentinel, a consumer fraud
database, as their guide, law enforcement officials have
identified the top 10 dot cons facing consumers who surf
the Internet, as well as many of the fraudsters behind
them.
In addition to putting many online con artists out
of business, the Federal Trade Commission, the
nation's chief consumer protection agency, wants
consumers to know how not to get caught in their web.
According to the FTC, here's what online consumers are
complaining about most:
Internet Auctions
The Bait: Shop in a “virtual
marketplace” that offers a huge selection of
products at great deals.
The Catch: After sending their money, consumers
say they've received an item that is less valuable
than promised, or, worse yet, nothing at all.
The Safety Net: When bidding through an Internet
auction, particularly for a valuable item, check out the
seller and insist on paying with a credit card or using an
escrow service.
Internet Access Services
The Bait: Free money, simply for cashing a check.
The Catch: Consumers say they've been
“trapped” into long-term contracts for
Internet access or another web service, with big penalties
for cancellation or early termination.
The Safety Net: If a check arrives at your home
or business, read both sides carefully and look inside the
envelope to find the conditions you're agreeing to if
you cash the check. Read your phone bill carefully for
unexpected or unauthorized charges.
Credit Card Fraud
The Bait: Surf the Internet and view adult images
online for free, just for sharing your credit card number
to prove you're over 18.
The Catch: Consumers say that fraudulent
promoters have used their credit card numbers to run up
charges on their cards.
The Safety Net: Share credit card information
only when buying from a company you trust. Dispute
unauthorized charges on your credit card bill by
complaining to the bank that issued the card. Federal law
limits your liability to $50 in charges if your card is
misused.
International Modem Dialing
The Bait: Get free access to adult material and
pornography by downloading a “viewer” or
“dialer” computer program.
The Catch: Consumers complained about exorbitant
long-distance charges on their phone bill. Through the
program, their modem is disconnected, then reconnected to
the Internet through an international long-distance
number.
The Safety Net: Don't download any program to
access a so-called “free” service without
reading all the disclosures carefully for cost
information. Just as important, read your phone bill
carefully and challenge any charges you didn't
authorize or don't understand.
Multilevel Marketing Plans/Pyramids
The Bait: Make money through the products and
services you sell as well as those sold by the people you
recruit into the program.
The Catch: Consumers say that they've bought
into plans and programs, but their customers are other
distributors, not the general public. Some multi-level
marketing programs are actually illegal pyramid schemes.
When products or services are sold only to distributors
like yourself, there's no way to make money.
The Safety Net: Avoid plans that require you to
recruit distributors, buy expensive inventory or commit to
a minimum sales volume.
Travel and Vacation
The Bait: Get a luxurious trip with lots of
“extras” at a bargain-basement price.
The Catch: Consumers say some companies deliver
lower-quality accommodations and services than they've
advertised or no trip at all. Others have been hit with
hidden charges or additional requirements after
they've paid.
The Safety Net: Get references on any travel
company you're planning to do business with. Then, get
details of the trip in writing, including the cancellation
policy, before signing on.
Business Opportunities
The Bait: Be your own boss and earn big bucks.
The Catch: Taken in by promises about potential
earnings, many consumers have invested in a “biz
op” that turned out to be a “;biz flop.”
There was no evidence to back up the earnings claims.
The Safety Net: Talk to other people who started
businesses through the same company, get all the promises
in writing, and study the proposed contract carefully
before signing. Get an attorney or an accountant to take a
look at it, too.
Can you avoid getting caught by a scam artist working the
web? Not always. But prudence pays. The FTC offers these
tips to help you avoid getting caught by an offer that
just may not click:
-
Be wary of extravagant claims about performance or
earnings potential. Get all promises in writing and
review them carefully before making a payment or
signing a contract.
-
Look for a privacy policy. If you don't see one -
or if you can't understand it - consider taking
your business elsewhere.
-
Be skeptical of any company that doesn't clearly
state its name, street address and telephone number.
Check it out with the local Better Business Bureau,
consumer protection office or state Attorney General.
Source: Federal Trade Commission