Charitable giving can be jolly or folly, depending on who you give to. This is the time of year that brings out the scams - here are 5 to look for.
The holidays are a time for gift-giving and gestures of good will — which makes them the perfect time of year for scammers. When better to be selfish than in the season of selflessness?
There are a lot of rip-offs out there, especially online: from fake charities to knock-off merchandise sold at “bargain” prices. If you’re not careful, you can go from good Samaritan to victim in a blink of an eye, or the click of a mouse. As mentioned in the video above, here are five of the worst scams to watch for this year:
By now, you’re probably familiar with phishing, where scammers try to steal passwords and credit card info with fake e-mails, often imitating your bank or other familiar merchants. Now some rip-off artists are turning to text messaging, resulting in this silly-named variant, “smishing.” (It’s short for SMS – short message service – phishing.) Scammers use text messages hoping you’ll trust them more than unsolicited e-mails, possibly preying on the assumption that phone numbers are more private or safe than e-mail addresses. Example? You get a text that says “We’re confirming you’ve signed up for our dating service. You will be charged $2/day unless you cancel your order – go to www.I’mAboutToRipYouOff.com.” Another variation asks you to call a number, e.g., “Notice – this is an automated message from (your bank), your ATM card has been suspended. To reactivate call 866-###-####.” When you call, a legitimate-sounding automated voice response system asks for your account information.
Solution: If you get a text message from any company asking for personal details – including your cell phone provider – don’t call the number they provide. Contact the company directly and find out what’s up. For example, if the text concerns your credit card, call the number on the back of your card. Avoid using any contact information included in the text message.
2. Fake charities
There are plenty of organizations supporting good causes, but there are also plenty of imitators and con artists — and many deliberately choose names that are similar to authentic charities. Other charities are technically legit, but are poorly run and spend too much of their revenue on executive salaries and fund-raising instead of programs that advance their stated purpose.
Solution: Before donating, check a charity out online. A good place to start is the Better Business Bureau which keeps a directory of charities along with evaluations and ways to inquire about them. Be especially wary of door-to-door solicitors asking for cash donations, and never be pressured to “act now”. Simply tell the person at your door that you never donate without thoroughly investigating a charity – you’ll look them up, and should you decide they’re a good cause, you’ll send a check.
3. Fake checks
Speaking of checks, watch out for these. There are a wide variety of check scams — the Federal Trade Commission discusses several. One popular theme: You receive a cashier’s check for something you sold on eBay, but for an amount in excess of the purchase price. The buyer asks you to deposit their check and send – or more often wire transfer – the difference. Weeks later your bank informs you that the cashier’s check was counterfeit and the money comes back out of your account.
Solution: If anyone sends you a check for the wrong amount, ask for a corrected one. Don’t offer to return the difference, and avoid wire transfers, which have few safeguards or assurances if something goes wrong. Best bet? Don’t accept checks at all: Use payment services like PayPal.
4. Internet pets
While it’s certainly possible to deal with a legitimate breeder online, be especially careful when buying puppies long distance. As with anything you buy online, they could be non-existent. But even if they’re real, you could be supporting a puppy mill – a business designed to generate profits at the expense of humane treatment. Know who you’re dealing with: investigate before you invest.
In addition, don’t ever give an animal as a surprise gift. At the first of every year, the Humane Society is full of puppies and kittens given as unwanted gifts: see the story we did last year: 3 Reasons Pets Make Bad Gifts
Solution: Be skeptical of independent sellers on sites like Craigslist, and check things out before you buy any pet online. If you’re buying online because the price seems too good to be true, it probably is. Don’t ever surprise anyone with an animal. And most important: why would you pay for a puppy or kitten, when dozens are waiting for you at your local animal shelter? Save some money while you save a cute and innocent life.
5. Counterfeit Merchandise
Buying generic is one thing. Buying counterfeit is something else entirely. Their are two places where you’re almost certain to confront counterfeit merchandise: on the sidewalks of major cities, and online. The U.S. government just last week shut down 82 websites selling counterfeit goods.Things that are commonly counterfeit are expensive brands of everything from golf clubs to clothing to watches.
Solution: “If it sounds too good to be true, it probably is” bears repeating. Only buy from trusted websites or from sellers who will show you the merchandise first, or otherwise provide evidence that they’re legitimate.
Protect yourself – and others
Money Talks has been investigating and exposing rip-offs for more than 20 years. While the variations have changed radically over that time (nobody was “smishing” in 1990), today’s scams are nonetheless similar in several key respects. First, many begin with greed – everybody wants a deal. Next, they often involve believing someone else’s smooth talk (or text) rather than paying attention to one’s own inner voice. And one thing they all have in common: thieves capitalize on our basic core belief that most people are good. We don’t think about someone creating a fake charity, because we’d die first.
So while avoiding holiday scams may not be easy, it is simple. Deal only with merchants and people that are verifiable and legitimate, and think twice before handing either money or personal information to anyone.
And if all this advice is obvious to you, it isn’t to someone you care about, such as an elderly friend or relative. If you’re confident you’re scam-proof, reach out to those around you who might not be so lucky.