WORK-AT-HOME SCAMS
Work-at-home and business opportunity scams are often advertised as paid work from home.
On application, would-be workers are asked for money up-front to pay for materials and, after payment, hear nothing.
Alternatively, people are asked to invest in a business with little chance of success.
TELEPHONE LOTTERY SCAMS
These include scams which go under the name of genuine lotteries like the Canadian lottery and the El Gordo Spanish lottery.
Unsolicited calls tell people they are being entered into a draw
Unsolicited telephone calls tell people they are being entered into a prize draw.
Later, they receive a call congratulating them on winning a substantial prize in a national lottery.
But before they can claim their prize, they are told they must send money to pay for administration fees and taxes.
The prize, of course, does not exist.
MATRIX SCHEMES
These schemes are promoted through websites offering top-of-the range electronic gadgets as free gifts in return for spending about £20 on an inexpensive product, such as a mobile phone signal booster.
Consumers who buy the product then join a waiting list to receive their free gift.
The person at the top of the list receives his/her gift only after a prescribed number of new members join up.
The majority of those on the list will never receive the item.
PRIZE DRAW MAILINGS
“Prizes” such as holidays can only be claimed in return for administration fees
Holiday prize draws, sweepstakes and foreign lottery mailings form the basis of many scams.
The majority appear to be notification of a prize in an overseas draw or lottery.
Prizes can apparently only be awarded in return for administration or registration fees.
PROPERTY INVESTMENT SCHEMES
Investors attend a free presentation, which aims to persuade them to hand over large amounts of money to enrol on a course promising to make them a successful property dealer.
Schemes can involve the offer of buying yet-to-be built properties at a discount.
Other variations include a buy-to-let scheme where companies offer to source, renovate and manage properties, claiming good returns from rental income.
The properties are generally near-derelict and the tenants non-existent.
INVESTMENT-RELATED SCAMS
An unsolicited telephone call offers the opportunity to invest in ‘soon-to-be-rare commodities such as shares, fine wines or gem stones.
These investments often carry high risk and may be worth a lot less than you pay.
The shares are not quoted on any stock exchange and could be difficult to sell afterwards while gem stones are often said to be stored in secretive Swiss bank vaults, so the investment can never be seen.
More information here.
NIGERIAN ADVANCE FEE FRAUDS
These frauds take the form of an offer, via letter, e-mail or fax, to share a huge sum of money in return for using the recipient’s bank account to transfer of the money out of the country.
The Nigerian advance fee fraud has been around for a number of years
The perpetrators will often then use the bank account details to empty their victim’s bank account.
Alternatively, they can convince the victim that money is needed up front.
They will often say this money is necessary to bribe officials.
More information here.
CREDIT SCAMS
This is another advance fee fraud, this time usually originating in Canada.
Adverts appear in local newspapers offering quick loans regardless of credit history.
Respondents are told their loans have been agreed but they must pay a fee to cover insurance before it is released.
After that fee is paid, the consumer never hears from the company again and the loan never appears.
PYRAMID SCHEMES
Pyramid schemes offer a return on a financial investment based on the number of new recruits to the scheme.
Investors are misled about the likely returns.
There are simply not enough people to support the scheme indefinitely.
Source: Office of Fair Trading