How to Tell if a Company is Scamming You

According to the FBI’s 2017 crime report, victims lost over $1.4 billion to scams including data breaches, real estate/rental scams, dating/romance scams, credit card fraud, identity theft, and even non-payment/non-delivery scams. While they are not limited to the Internet, many scams these days are conducted online. According to data compiled from the BBB’s scam tracker, Internet scamming nearly doubled from just over 23,000 to well over 45,000 cases reported to the BBB between 2016 and 2017. With so many scams, more consumers are taking precautions and are wary of offers that seem too good to be true, and rightfully so. But gut instinct isn’t the only way to try and decide whether or not an offer, product, or company is a scam. There are a number of red flags you can watch for to help you spot a company that’s running a scam and keep your personal information safe.

What Kinds of Scams are There?

In order to spot a scam, one of the best things you can do is be aware of the different types of scams out there. There are a handful of common scams that companies are employing, but some of the ones you may run into most often include the following:

Phishing/Email Scams – Phishing scams can be quite dangerous and are designed to trick you into giving up sensitive information that will allow scammers access to various types of accounts. Phishing scams are conducted through online messages or via email and look as though they are coming from an official source. Generally, they will include a link that will take you to an official-looking page and will prompt you to enter your information, which will then give them access to your accounts through your credentials.

Credit Card/Loan Scams – You’ve likely received letters from banks and credit card companies letting you know that you’re pre-approved or pre-qualified for a card or loan. When the amount you’re pre-approved for seems too good to be true or you aren’t familiar with the company, it’s possible you could be dealing with a scam. Should you proceed, you could end up paying high amounts in “processing fees” and end up without any loan.

Fast/Easy Money Scams – While it would be wonderful to be able to make tons of money while you sleep or while you watch TV without having to leave the couch, you can’t. While most people can spot a fast money scam based on the fact that it sounds too good to be true, some sound realistic enough to draw people in. Whether it be working from home, earning passive or residual income, joining a multi-level marketing company,  there are a lot of easy money scams that sound tempting but should be avoided.

Travel Scams – Travelling is a dream that many have, but the cost can make it difficult to do. It’s possible to find incredible deals, but when you get emails that seem too good to be true, you’ll want to be cautious. Many scammers will send emails posing as travel deals that would help you enjoy your dream vacation for an affordable price but will require you to pay other costs once you’ve paid for the initial offer. Others will take your money and not send you anywhere.

Fake Shopping Websites – Shopping has become easier and easier as it has gone digital, but that has also made it easier for scammers to trick victims. While shopping online is a favorite pastime, it’s important to keep an eye out since there are thousands of fake shopping websites that can breach your personal data, include malicious links, or discount products that not as advertised.

Tips for Spotting a Scam

While scammers will try different tactics to trick victims into making purchases, sending money, or giving up data, there are red flags you can keep an eye out for that will help you spot a scam before it’s too late. Here are five of the most common tactics scammers will use:

Requests for Money via Wire Transfer. In 2018, scammers were able to get approximately $423 million via wire transfer which was, reportedly, the most common payment method scammers chose to use. While it’s not the only way, if a company is requesting you send payment via wire transfer, it’s a good idea to stop doing business with them right away.

Contacting You Unsolicited. If a company you’ve never shopped or requested information from starts contacting you without your request, it’s possible it could be a scam—especially if they are asking for money. If you’ve never heard of a company and they’ve reached out to you without you initiating contact, it’s a good idea to steer clear of them and their business.

Unsecured Websites. Most legitimate websites these days will have certificates proving that they are secure, which can also help indicate that they are a legitimate business. If you are taken to a website or visit a website that does not have security icons and measures in place, it’s best to leave it right away to avoid falling prey to a dangerous scam.

Emails Sent from Somewhere Other than the Company Site. Scammers do their best to disguise emails as coming from legitimate companies; however, if an email seems off, check the sender’s address. If it says instead of, don’t click any links, don’t enter any information, and delete the email right away.

There are Time Constraints. While many companies will offer deals or coupons that expire after a certain amount of time, if a company is giving you unrealistic or extreme time constraints or putting on too much pressure, there’s a possibility they’re running a scam. In some cases, scammers will even include threats to pressure purchases, signatures, or other actions, so if you feel like there’s too much pressure or too little time, it’s a good idea to walk away.

Final Thoughts

There are a lot of great and legitimate businesses out there, but there are a number of dangerous scams as well. It’s important to be wary and go in with your eyes wide open. As you become aware of different scams, you will be able to protect yourself, your identity, your personal information, and your loved ones from falling victim to malicious scammers.

What other tips would you offer other consumers to help them avoid being scammed?