Need To Know: Common Online Scams And Frauds

Here is a look at some common online scams and frauds.

Number one:

One of the most popular online scams is the Ponzi scheme. This type of scam was named after a man named Charles K Ponzi, and it is a type of investment scam. Basically what happens in this type of scam is that you are given an investment opportunity, which means you are given a chance to invest some money into the program and then receive some type of return on the money you have invested. A typical Ponzi scheme is any program or claimed investment opportunity that relies on new investments to pay off the older ones. Basically what happens in this type of scam is that the people who invest first do see a return on their investment but if you are the last one to invest in the scheme then you won’t see any return on your investment because there are no funds left to pay you with.

Number two:

Another popular online fraud is a phishing fraud. What happens here is that the people running this fraud usually send you an email from a website that you normally trust, such as PayPal, your bank, credit card companies, etc. In the email they tell you that your account information needs to be verified or the account will be closed or you need to update your account info. Many times the email will include a link that will take you to an authentic looking website for you to enter in your information. Most of the information they are asking for is personal and can be used to steal your identity.

Number three:

Another common online scam is an international lottery scam also known as the lottery scam. Basically what happens in this scam is that you receive an email telling you that you have won the lottery in some other country and all you need to do to claim the prize is to send this much money to this address and you will get your winnings directly. You can also just receive an email stating you have won this “prize” and all you need to do is give the company some personal information and they will send the prize directly to you.

Number four:

Another common scam that you will find online is the get rich quick schemes or the make millions stuffing envelopes. What happens is that these emails and ads will tell you that you can make hundreds or thousands of dollars a day without doing any work. Basically these emails and ads are short on the exact details of the business opportunity but they will give you plenty of promises. Most times you will receive a telephone number to call for more information but all they do when they call back is give you the sales pitch.

Number five:

Another common scam and fraud that you find online is online auction scams or frauds. What happens in these scams is that you are bidding on an item at an auction website, such as Yahoo! or eBay. But what you don’t know is that it is a fake ad that you are bidding on and when you win the bid and send in your money you won’t receive any merchandise.

Number six:

Another popular email scam is the Nigerian email scam. What happens in this scam is that somebody sends you an email asking you to help them bring millions of dollars out of their country and into the United States. These emails are always being modified but the most common thing about them is that the person is from a foreign land and needs help transferring a large sum of money into the United States. And if you help them they promise to give you a few million dollars.

Number seven:

Another popular online fraud is when somebody sends you an email offering to buy your item but wants to have you ship it to some foreign place and will pay with a cashier’s check or money order for over the amount and you can keep the extra amount as compensation for having to cash the money order.

Number eight:

The last popular online scam is the phony identity theft protection or credit repair scams. Many times these people are offering you services that claim to erase negative items off your credit report even though they are valid or they offer certain features to protect your identity but they are just trying to get your personal information so that they can take over your identity.

Cite This Page

Feldman, Barbara. "Need To Know: Common Online Scams And Frauds." Surfnetkids. Feldman Publishing. 22 Oct. 2007. Web. 2 Aug. 2015. < >.

About This Page

By . Originally published October 22, 2007. Last modified October 22, 2007.

Personal Digital Security: Protecting Yourself from Online Crime
Personal Digital Security: Protecting Yourself from Online Crime
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