SCAM ALERT: Phone Scams And Other Scary Monsters

scamPhone fraud is a multi-million dollar industry that crosses international and industry borders. Attackers target call centers, as well as consumers, in attempts to gain access to funds, steal merchandise, and phish for identities. Americans lost an estimated $7.4 billion to phone scams in 2015, according to an online Harris Poll survey. It’s projected that 27 million people  (11% of all Americans)  got taken by phone scammers last year. This does not include the damage that fraud and other security breaches can have on the reputation of an enterprise.

Male millennials (age 18-34) had the highest rate of gullibility, with 38% reporting they’d lost money to phone scams in the past twelve months. Only 17% of female millennials were tricked out of money, perhaps because they’re on guard against phone calls from male millennials. You might think that seniors would be the most likely to get scammed. Yet, it appears that the younger generations, who grew up with tech and don’t view it skeptically, are more likely to fall for a phone scam than their elders.

Subscriber fraud

Subscriber fraud is simply an offshoot of identity theft. It is far and away the biggest cell phone scam, costing the industry an estimated $150 million a year and causing untold anguish to the victims.  Generally, someone steals your personal details and opens a cell phone account in your name, racking up huge bills that may land in your mailbox.

IRS Fraud Calls

This scam generally begins with a call claiming the recipient is in trouble with the IRS and must call a certain phone number for more information. Eventually, the person is asked to provide money or personal information, supposedly to resolve the problem or avoid jail time.  They demand that the victim pay a bogus tax bill. They con the victim into sending cash, usually through a prepaid debit card or wire transfer. They may also leave “urgent” callback requests through phone “robo-calls,” or via a phishing email.  CBS recently reported that more than 900,000 people have received threatening calls from scammers pretending to be from the IRS.   Nationally the U.S. Treasury Inspector General for Tax Administration reports that since October 2013 more than 5,500 victims collectively have paid about $29 million as a result of the scam.The scammers try to intimidate taxpayers by threatening to have them arrested for tax fraud unless they pay immediately.  Apparently they are so good at this that even lawyers have fallen for it. Another tax scam generally follows the announcement of a security breach at a company or a government agency. Scammers will call people who may be affected, under the guise of helping out. In their panic, people give them personal information including their birth date, social security number, address and tax-filing status.

Windows Support Call

Have you ever picked up the phone to hear the following: “I’m calling from Microsoft. We’ve had a report from your Internet service provider of serious virus problems from your computer”? Of course the caller offers to help, offering a free scan, which invariably leads to warnings over mass malware infections, and the offer of paid technical support to assist.  Microsoft does not do that nor do they have partners who do that nor do they hire sub-contractors or people or even get volunteers to do that.  Security professionals know to steer clear of such scams. Since they persist, scammers are apparently tricking sufficient numbers of consumers into forking over their cash–$250 or more, in some cases–to fix the virus infections identified by the caller’s in-house technicians. Windows phone scams–targeting PC owners–appear to have begun in earnest in 2008, and been on the rise ever since.  Microsoft support scams are a type of social engineering attack, which succeeds not through attackers’ technical sophistication, but rather by tricking people via smooth talking and playing on their fears.  Generally, the caller pretends to be from a department–non-existent, by the way–at Microsoft that was following up indications that his computer was either broken or had been infected by malware.  They ask for some identifying information from you and access to your computer and then…..well, the rest is ugly.  This scam not only occurs by phone, but also by e-mail, instant messaging, regular mail and every way imaginable. Just remember that Microsoft does not do this and hang up or delete emails or messages or mail from anyone claiming they are doing this because they know information about your computer or want information from you to confirm your account so it won’t be closed and ask you for your username and password and all sorts of other personal information.

Jury Duty

Individuals identifying themselves as U.S. Court employees have been contacting citizens by telephone and informing them that they have been selected for jury duty. The caller asks to verify names and Social Security numbers and then asks for credit card numbers. If the request is refused, citizens are then threatened with fines and prosecution for failing to comply with jury duty. Federal courts do not require anyone to provide any sensitive information in a telephone call, such as Social Security numbers or credit card numbers. Most all contact between a federal court and a prospective juror will be through the U.S. Mail.  If you receive one of these phone calls, do not provide any personal or confidential information to these individuals. This is an attempt to steal or to use your identity by obtaining your name, Social Security number, and potentially to apply for credit or credit cards or other loans in your name.
If you have already been contacted and have already given out your personal information, please monitor your account statements and credit reports, and contact your local FBI office. It is a crime for anyone to falsely represent himself or herself as a federal court official.

Credit Card Theft

Similar to other schemes, this is a scam designed to convince you to give up your credit card number over the phone or via email. This allows an unauthorized person to use your card and run up illegal charges. Usually, you will receive a phone call or email from someone masquerading as a representative from a legitimate company you might normally do business with. The person will try to convince you they need your credit card number to check your account.
The only time you should provide your credit card number is when you are actually buying something from a trusted company. Also, remember to check your credit annually through one or more of the major credit bureaus.

Bogus text messages

There are numerous variations of this cell phone scam but the bottom line is that you receive an unsolicited text message (which you may have to pay for!) which prompts you take some sort of action you’ll later regret. Most common is what seems to be a message from your bank (this may also arrive as an automated voicemail) saying your account has been suspended and asking you to call a 1-800 number where your account number, PIN and other details may be requested. In reality, your identity is being stolen.  Another variation is a “pump and dump” ruse, where you receive a tip urging you to buy stock in a particular company. If enough people fall for it, the share price goes up and the scammers offload their previously worthless stock for a profit. If you get any message supposedly from your bank, call them on their normal number to check it out. And never buy stock on the basis of a single tip — from any source. Scammers use special software that crawls websites like Facebook and Craiglist looking for phone numbers you post. Don’t post phone numbers. And if they get your number, use your cell phone provider to block the number.

Medicare Fraud

Medicare is a favorite subterfuge of phone scammers. Selling supplemental Medicare Part D insurance is pretty easy, especially if the price is exceptionally low because the product doesn’t exist. Mobility scooters, walk-in bathtubs, and other hardware are also scammer favorites, with the lure that “Medicare will pay for every dime.” Usually, either the price is inflated or the product is of low quality. The victims, in such cases, are Medicare and all taxpayers.

Student Loan Hoax

You’ll receive a call from the “IRS” telling you that you owe money due to not paying taxes on student loans.   It’s a hoax;  the IRS doesn’t initiate contact by phone, nor does it get involved in student loans.
Other Phone Hoaxes

Finally, there are a couple of hoaxes related to cell phone scams to look out for:

  • An email that warns against taking a call from a bogus engineer who asks you to key in 90# for a test of your cell phone. The message claims the caller can then use a scanner to collect ID numbers for cloning or to collect other confidential information. It’s an urban legend and untrue.
  • You get a message warning you that cell phone companies will soon be releasing all mobile numbers to telemarketers and that to avoid them you must add your number to the “do not call” registry. Sometimes, this is just a bit of mischief; other times they ask you to call a bogus number for which you will be charged an excessive fee.
  • The Too Good to Be True Deal.  It’s a very appealing offer at an unbelievably low price. It’s almost always a scam.
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