You’ve probably heard of the scam in which a fraudster phones you up, claiming you owe the IRS thousands of dollars. To avoid jail, you have to pay immediately through an untraceable method like a gift card.
This is just one of many digital-age scams, but fraud was rampant even before the internet. By knowing how scammers use modern technology to swipe money from victims — and the low-tech origins of those scams — you can keep your money safe and working how you want it to.
Digital con: The Nigerian prince scam
The granddaddy of internet scams is the Nigerian prince scam. Although perpetrators may claim to be from other parts of the world, Nigeria is a common location named in this scam.
Although the Nigerian prince scam has evolved, in its basic form, it involves a supposed member of a royal family or someone in an important position who needs to move money out of the country. The person needs your help and will give you a cut of the millions of nonexistent dollars if you’ll pay for transfer fees upfront.
Another popular variation involves con artists posing as attorneys or bankers with recently deceased clients. They ask you to pose as a relative, promising to help you get the money as an inheritance. But of course, that involves a variety of legal fees that you’re expected to handle.
Email is the current favorite medium, but scammers have also used fax, regular mail and Telex before electronic communication became ubiquitous. The scam still takes in millions of dollars, with a ring of Nigerian con artists taking victims for at least $6 million between 2014 and 2018, according to a recent indictment.
Classic con: The Spanish prisoner scam
The great-great granddaddy to the Nigerian prince scam dates back to the 19th century when a version known as the Spanish Prisoner scam lured marks into sending money to a con artist posing as an inmate’s wealthy family. Victims were promised riches if they helped get him out by bribing officials or providing money for a variety of other made-up reasons.
Digital con: Craigslist overpayment scam
Craigslist is a great place to buy and sell used items, but scammers have swooped in to trick sellers with a fake check scam that involves making an overpayment. The con artist emails or texts you, offering to purchase your time, and “accidentally” sends you a check for too much money or asks you to accept a check with extra funds for a mover who will pick up the item. The buyer has an excuse for why he or she can’t meet you in person.
You cash the check and wire the excess funds, and you’re out the money when the check gets returned as fraudulent later. Meanwhile, the buyer disappears once the fraud is complete.
Classic con: Bad check scams
This scam involves knowingly passing bad checks on accounts that are closed or that don’t have enough money for the check to clear. Writing a bad check was a crime in the days before the internet, and it’s illegal today. But it’s much harder to hold criminals accountable now. Many scammers are overseas where it’s difficult to find and prosecute them — compared to the pre-internet days when you were more likely to meet your would-be scammer in person.
Digital Con: Online car sales scams
Scammers often sell nonexistent cars through online classified ads and bring in a trusted name like eBay to make the transaction seem legitimate. They might claim to be overseas or on a military base and say that eBay Motors will handle the transaction.
In reality, eBay only assists with transactions originating on its website. The con artist sends forged emails with the eBay logo asking you to wire payment for the car. They promise the funds will be held in escrow until you receive the vehicle. Of course, the car never arrives, and you’ve lost the money you sent.
Classic Con: Unscrupulous car dealers
While online scammers deal in nonexistent cars, car sales fraud has a long history. One common scam that predates the digital age is known as yo-yo financing.
You complete paperwork to finance your car and proudly drive it home, but the dealer calls a few days later and claims the financing fell through. You’re told you must sign a new deal with a higher interest rate.
This tactic is illegal, as they’re bound by the original contract. Car dealer con artists hope you don’t know that because they want to squeeze more money out of you with this fraud.
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Digital con: Fake job scams
You might be thrilled to apply to a major company and get an almost immediate response asking you for an interview. Don’t get excited yet, especially if the company wants to interview you via online chat and “hires” you without even meeting you.
It might be fraud and if so, you’re being set up by a scammer who will ask you for money or a background check or set you up for an overpayment scam. In the latter, you’ll receive your supposed first paycheck, along with an additional amount for office supplies or some other expense. You’ll be instructed to wire the excess to the company’s preferred vendor.
That “vendor” is the con artist or an accomplice. The check will later bounce, leaving you responsible for the funds you forwarded.
Classic con: Paying for jobs that don’t exist
The internet makes it easy for scammers to impersonate legitimate businesses, but job scams have been around for as long as con artists have had access to advertising — starting out with newspaper, TV and radio ads. Old forms of employment fraud often involved making you pay for recruitment services that never resulted in employment or selling you lists of government jobs that are available for free.
Digital con: Utility company scams
You know you paid your electric or water or phone bill, but suddenly you’re second-guessing yourself because you just received a phone call or email claiming you owe money right now. It says your utility will be turned off in a few hours if you don’t pay immediately using a wire transfer or gift cards.
It’s all just a fraud designed to make you panic and pay without checking its legitimacy. The digital age makes this scam easy because con artists use technology to contact a large volume of potential victims without being traced.
Classic con: Door-to-door utility scamming
Utility company scams are nothing new. Even before the internet and VOIP, con artists went door to door, pretending to represent legitimate utility companies and switching unwitting consumers over to a different provider that charges much higher rates.
They often asked to see a current utility bill under the guise of “checking to make sure you’re getting the best rate.” That gave them all the information needed to make a sneaky switch. Even today, this scam still goes on.
Digital con: Computer tech support scam
With computers ubiquitous in American homes, scammers call people randomly under the assumption that most have a PC. The con artist callers claim that there’s something wrong with your Windows, implying or even stating outright that they work for Microsoft, and trying to get you to give them remote access to your computer.
Once in, they’ll bring up screens that they claim show proof of viruses or other problems, even though there’s nothing wrong, and try to sell you overpriced software remedies. At worst, they might install malware or steal your bank logins or other financial details.
In another form of this scam, a fake virus warning pops up on your computer screen. It often looks like a real Windows warning and directs you to call a number for immediate assistance. The number leads right to a scam call center.
Classic con: Unscrupulous computer repair shops
Computer-related scams have been around ever since the first monochrome-screened machines made their way into homes. Even before the internet, people were at risk for scams if they brought their computers to unscrupulous repair shops.
Common scams included installing unlicensed software and charging full price for it, stealing parts from the computer and replacing them with inferior parts or lying about the extent of the needed repair. This can still happen today, so choose a repair shop with care.
Digital con: Online apartment rental scams
The adage, “If something seems too good to be true, then it probably is,” might apply when you think you’ve just scored a gorgeous, spacious apartment in a hot area for a below-market cost. A scammer somewhere is salivating, hoping you’ll wire first and last month’s rent and a security deposit to lock in that unbelievable deal.
These rental con artists claim to be out of town and ask you to wire the money. In reality, the ad is fake and they have nothing to do with the property. You’ll lose any money you send and won’t have any place to live if you gave up your previous apartment in anticipation of your fancy new digs.
Classic con: In-person apartment rental cons
Skilled scammers don’t need the internet to rip off prospective tenants. Before Craigslist and other online rental search sites, con artists advertised rentals through low-tech methods like newspaper classified ads or signs in an apartment window.
Sometimes scammers didn’t own the apartment building but were simply using a property they knew had been vacant for a long time. In some cases, they might rent the apartment themselves to use as a prop in their scams. Either way, they would show the unit to interested parties, collect rent and a security deposit, then disappear.
Digital con: Romance scams
Online dating makes it easier for lonely hearts to link up with potential partners, but it also gives con artists a direct line to vulnerable victims. Romance scams top the chart for the amount of money lost to digital fraud, with victims losing a total of $143 million in 2018, according to the Federal Trade Commission.
Scammers lurk on dating websites and apps, posing as widows/widowers, members of the military or doctors working on charitable missions. They string lonely women and men along, claiming to be madly in love and sending texts and emails describing an idyllic future together. Once their victims are hooked, the scammers ask for money for a variety of phony reasons.
Classic con: Sham marriages for immigration
Romance scams aren’t always about money. In the days before dating sites, and continuing through today, men and women from other countries would seek marriage partners in the United States in order to get around immigration laws.
Sometimes scammers would pretend to be in love with a U.S. citizen, so they could get married and qualify for U.S. residency. Sometimes the citizen would be in on the scam. Either way, the desired result was the same: to appear as a happily married couple in the eyes of the United States government.
One recent scam charged between $50,000 and $70,000 for this type of matchmaking, the U.S. Citizenship and Immigration Services discovered in a 2019 bust.
Digital con: The blessing loom/airplane game Facebook scheme
Social media sites like Facebook are places where financial scams flourish as they’re spread from friend to friend. One recent example is a Ponzi scheme that goes by a few different names, like the Airplane Game or the Blessing Loom.
This classic pyramid scheme gets people on the bottom to pay money to a person at the top through a payment app. They hope to reach the top themselves, but the scheme is unsustainable, even when you dress it up with a cute name and fancy graphics. This type of financial scam spreads rapidly due to the ease of online sharing and the desire of participants to get others involved so they can get their own payoff.
Classic con: Offline version of the blessing loom/airplane game
Online pyramid schemes are simply the evolution of versions passed along in person or through postal mail. Back then, payments were made in cash rather than through payment apps, but the chance of coming out ahead was still minuscule. Participants then and now are at risk of fines or jail time, since many states consider this type of exchange to be illegal.
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Digital con: Online crowdfunding scams
Crowdfunding sites like GoFundMe make it easy to find and donate to good causes. Unfortunately, when there’s easy money to be made, scammers will find a way to invade the system.
Although most appeals for things like funds to rebuild a home destroyed by fire or to get a family through a rough spot caused by job loss are genuine, it’s easy to post a fake sob story and let the money come rolling in. It’s not a good financial decision to let emotions rule your charitable giving because you might inadvertently be lining the pockets of an online scammer.
Classic con: Fake charity solicitors
Charity scammers don’t confine themselves to the internet. Many get out and pound the pavement, asking people for money on the streets. Big cities like New York have solicitors who impersonate Buddhist monks and hit up pedestrians for donations. Businesses like gas stations often attract scammers claiming to need money for gas or bus fare or to feed a starving child. Some of these con artists moved online, but some still ply their time-honored trade with in-person pleas.
Digital con: Lottery scams
The internet makes it easy for con artists to lure you in with claims that you’re a big lottery winner, even if you don’t remember buying a ticket. They might offer a cash prize or some other enticement, like a luxurious trip. All you have to do is pay some miscellaneous fees.
Scammers know that you can do an online search to see if the lottery is real. They try to head that off by using the names of legitimate foreign lotteries and companies with name recognition, like Publishers Clearing House.
Classic con: Lottery claim scams
Lottery scams are about as old as the game itself. One offline scam involves con artists who try to convince a person that they have a winning lottery ticket but cannot cash it because of being in the country illegally.
The scammers often target senior citizens and claim to need money in order to get the prize. They offer to split the winnings if the potential victim will pay the supposed fee. Of course, it’s a fraud, and those who hand over money will never see it again.
Digital con: Sextortion blackmail scam
Data breaches expose email addresses and passwords to con artists who use them to scam victims with tactics like sextortion. One common iteration of this scam involves an email in which the scammer claims to have hacked your computer, providing an old password as proof.
Supposedly the scammer activated your webcam and got footage of you in a compromising position. The password was actually purchased as part of a list on the black market, and no one has access to your computer. But this scam often scares victims into paying to avoid embarrassment. The con artists might demand bitcoin, making them difficult to trace.
Classic con: Old-fashioned blackmail
Blackmail is a very old form of financial fraud that’s even referenced in the blockbuster play “Hamilton.” Alexander Hamilton was set up by a man named James Reynolds and his wife, Maria. Hamilton had an affair with the woman, and her husband blackmailed Hamilton for hush money.
Scammers eventually turned to sending blackmail letters by postal mail before email became a thing. Ironically, some still approach their victims with letters but add a modern touch by asking for payment in bitcoin.
Digital con: Local locksmith online scam
If you’ve ever locked yourself out of your house or car, you know that sinking feeling. Fortunately, the internet puts 24-hour service at your fingertips. You think it’s safe to find a local locksmith on Google, but call centers posing as nearby companies may pop up in your results to scam you.
If you use the con artists they recommend, your finances will take a hit because their aim is to wring as much money from you as possible while you’re in a desperate situation. The scammers on the phone quote a low estimate, but the person they send out inflates that figure. If you don’t pay, you’re back to square one, needing to find another locksmith.
Classic con: Traveler home repair scams
You don’t have to look online to find scammers eager to take advantage of a desperate situation. One classic scam involves traveling home repair crews who head to places where there’s been a natural disaster.
These con artists offer repairs at a cheap rate, but they either do a substandard job or disappear with your money without doing a lick of work. In a related scam, traveling crews make the rounds in spring, going across the country to offer repairs, then absconding with the funds.
Digital con: Money flipping on social media
If a stranger on social media told you that he or she could take your $200 and turn it into $2,000 with zero effort on your part, would you believe it? Unfortunately, many people do, sending funds to con artists on sites like Twitter, Facebook and Instagram and hoping for a quick profit. Of course, they never see a penny in return. Social media scammers are smart, making their posts look genuine and peppering the comments with fake testimonials.
Classic con: The Ponzi scheme
Social media money flip scammers are following in the footsteps of Charles Ponzi, an early financial con artist whose fraud was so successful that his name is forever attached to this type of scheme.
In the 1920s, he promised investors huge returns in a postal stamp speculation scam. People showered him with money, but the promised returns never materialized.
Other scammers ran similar schemes, paying off early investors with money from those who joined up later in order to get good recommendations. The pyramid always collapsed, leaving most investors empty-handed.
Digital con: Instagram influencer scam
Being an Instagram influencer seems like a dream gig. Who wouldn’t like to get paid to promote their favorite brands? But shady companies are pulling a scam on inexperienced Instagram users by tricking them into buying products under the guise of giving them a discount in exchange for promotion.
The products are really overpriced, and the supposed company representatives are con artists. They don’t care about promotion because they get sales from the wannabe influencers who pay too much for an inferior item.
Classic con: Modeling scam
The modeling scam is a precursor to scams that target aspiring Instagram influencers. Back in the days when shopping malls were hot spots, con artists posing as talent scouts would approach potential victims and offer them modeling jobs.
The catch is, the jobs were contingent on buying pricey photo packages from a specific photographer, taking expensive acting classes and spending money in a variety of ways. The modeling job was nonexistent. It was just a carrot dangled by the scammers to keep the money flowing.
Digital con: Fake gift card requests from your boss
We all want to please our bosses, and scammers love to take advantage of this tendency with telephone or email impersonation tricks. They hack a manager’s email or create a similar address and send a message to an employee urgently demanding gift cards. The con artists always have a good story about needing cards for clients.
They ask the employee to buy the cards and send photos of the numbers. Of course, they promise full reimbursement if the employee doesn’t have access to company funds and has to use his or her own money. Once they get those gift card numbers, the money is gone for good, and the real boss is baffled when asked for payback.
Classic con: Short-changing cashiers
Con artists are adept at scamming cashiers in person, and they’ve been doing it for much longer than the telephone and email scammers who fish for gift cards. This classic scam targets employees who handle money by confusing them.
The scammer pays for a small item with a big bill, then baffles the cashier with ever-changing requests about how he or she wants the change. Sometimes the scammers just use sleight of hand to get the money back. Either way, it ends up with a financial fiasco when the cashier’s drawer doesn’t balance at the end of his or her shift.
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