Protecting Yourself Against Fraud
As a fraud victim, you have a strong motivation to avoid being defrauded again. The following recommendations may
help. Remember, of course, that not every organization that calls you or sends you mail is involved in fraud--most are not.
Still, if you encounter any of the techniques described below, use caution before buying, investing, or making donations.
Avoid Identity Fraud
- Never provide personal or financial information, such as your Social Security number, mother's maiden name, savings
or checking account numbers, or credit card numbers or expiration dates, to a person or agency with whom you are not
familiar, especially over the telephone or Internet.
- Don't imprint your Social Security number or driver's license number on checks. When filling out checks, avoid using
pencil or light-colored ink, which can be altered easily.
- Remove mail from your mailbox as soon as possible. Also, it's better not to place mail in your mailbox for postal
pickup--take it directly to the post office.
Review Financial Dealings
- Investigate all referrals from family, friends, colleagues, or acquaintances concerning financial investments or
purchases, especially if you are unfamiliar with the vendor. Your local Better Business Bureau (BBB), consumer
protection agency, and local, state, and federal licensing agencies may be able to help you verify the vendor's business
license and professional credentials or any complaints filed against the vendor or his or her business. (Unfortunately,
many fraud organizations close business before complaints reach the BBB.)
- Carefully document all transactions related to your finances or business, including dates and the names of individuals
you dealt with.
- Never send money orders or checks to a post office box unless you are sure of the recipient. When in doubt, contact
your local Better Business Bureau or consumer protection agency.
- Be wary of ads claiming that bad credit is no obstacle to obtaining a car loan, secured credit card, or other service. Many
businesses that market to people with bad credit charge exorbitant interest rates or require an advance fee to apply for
credit that may not be available. Check with your local Better Business Bureau or consumer protection agency first.
- Be cautious of lenders who use 800 or 900 numbers. You may call an 800 number only to be directed to a 900 number,
which you pay to use, allowing the vendor to profit from the call while giving you little or nothing in return.
- Be wary of individuals or companies that require you to send contracts, payments, or other items through non-postal
delivery systems, such as overnight couriers. Many fraudulent companies and individuals use such delivery systems to
avoid detection and prosecution by the U.S. Postal Service.
- For personal services and repairs, always obtain several estimates and compare costs. Don't sign any contract you don't
fully understand, and don't advance any money for services or repairs until you have thoroughly investigated the
individual or company.
- If you are making investments through a bank, make sure you understand whether they are insured by the federal
- Before buying any product or service, find out the company's refund and cancellation policies. Check with your state or
local consumer protection agency to see if the product or service you are buying has automatic cancellation rights, such
as a cooling-off period. Be sure to get all refund and cancellation policy information in writing.
- Always be careful about making any loan agreements over the telephone.
Check on Company Background
- Check a company's or individual's record with your local Better Business Bureau; Attorney General Consumer
Protection Unit; local, state, and federal licensing agencies; or other consumer protection agencies.
- Advertising through recognized media outlets or on-line services does not ensure a company's legitimacy. Newspapers,
television stations, magazines, and other media are not required to verify the legitimacy of their advertisers.
- If you have not conducted business with a company or individual in the past, never pay in advance without a thorough
- Be wary if a charitable organization asks to come to your home to pick up money. Ask for written information about all
charities before deciding whether to contribute.
- Verify business addresses and telephone numbers through the phone company. Many fraud criminals do not stay in an
area long enough to be included in directory assistance data banks.
- Check professional credentials and licenses through organizations like the county medical society, state or local bar
associations, or other professional licensing associations, such as the Association of Licensed Financial Planners.
- Franchises and some other business opportunities are required to give detailed written disclosures before asking
consumers for payment. Read them carefully and check all references.
- Contact the National Fraud Information Center to educate yourself about current scams and tips on how to avoid
becoming a victim. You can also report fraudulent activities to the NFIC, which will notify the appropriate law
enforcement or other government agencies. The NFIC can be reached at (800) 876-7060.
- When in doubt, ask for information in writing. If they don't supply it, don't buy.
- Be suspicious of all mail, phone, or computer promotions that require you to act quickly to receive goods or services.
- Beware of checks for small amounts that are mailed as prizes. Often, if you cash them, you will authorize a charge for
services or items you did not want.
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