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Online Fraud and Scammers
By Joshua Vanderwerf
Most scammers tend to focus most of their time on elderly people because they are less knowledgeable of the technology used. If they don’t know how to use Western Union for example, the scammer may give the elderly person wrong information which would make them more susceptible to being scammed. The scammer may say that Western Union is the safest way to send money to somebody when really it is dangerous and only should be used when sending money to family. I tried looking for statistics on how many people are scammed each year, but couldn’t find a reliable source. One of the websites that sells products from China has a forum. I searched for “I was scammed” and 96 pages came up of people who were scammed with 20 people per page. That’s almost 2,000 right there. Scams have been increasing every year because many people have been laid off and they are looking for a way to make money (Dickson). To fight all the scams online, I created a website, www.stopchinafakes.com/forum, that tells people how to avoid scams. You can also report scams to http://www.ic3.gov/. Last year, I was a victim of a few scams (4 or 5); some more serious than others. I ended up losing about $1,000 over 2 or 3 months. Ever since then, I wanted to help people avoid scammers by providing them with information on how scams work and what to look for if you think you are being scammed. That is only one aspect of scammers. The other aspect is the psychological part: how scammers gain a person’s trust and why they fall for them. First, I looked for some reasons why people believe scams. I found some myths people believe which make them more likely to fall for a scam at a government created site, www.scamwatch.gov.au. One of those myths was that people believe the government approves every business and that every business is legitimate. Along with this, people also believe all websites are legitimate. I do not agree with this, however, because over the years people have become more aware of the scams out there. People used to think that way, but not anymore. Next, I found psychological tricks that scammers use. There are several tricks scammers use. One of them is incentives. The scammer will give you something to entice you to buy their product sooner rather than later. One of the scams I almost fell for was buying Apple iPhones for a very low price. I would make about 200% for each iPhone I sold. I felt like I needed to take action because I did not want to pass up this great deal. I didn’t want to miss out on it. There was a MOQ (minimum order quantity) of 10 units. At the moment, I only had enough money to buy 5 of them. So the scammer said he would sell me 5 at that moment, and 5 a couple weeks later. The scammer also said he would give me an extra iPhone for free if I paid for the 5 iPhones that day. This really enticed me to purchase the iPhones because of the great opportunity to get something for free. I ended up not buying them because I found out that the wholesale price of the iPhone was twice the cost of the iPhones the scammer was going to give me. So the iPhone the scammer was trying to sell me was either a counterfeit iPhone or he/she didn’t even have the iPhones and just wanted my money as soon as possible. Another trick that is new to me is social proof. According to my research, the scammer will refer to a bunch of people that have used their product to make it look legit and real. I saw a similar example of this for an at-home job opportunity. The scammer made about 20 fake comments from fake people saying how wonderful this at-home job was. I think social proof is one of the most compelling tricks used by scammers. Other people’s opinions on products have the most impact on whether a person will purchase something or not. The most important trick scammers use if relating to you, becoming your friend, and persuading you. When people have similar interests they tend to become friends. Good friends are honest and truthful. After the trust is gained between the scammer and potential buyer, the scammer tries persuading you to buy the product. I didn’t realize this but scammers use this quite often. Almost all the scammer I have talked to have been very polite and friendly. They asked me what my name was and things about my life. They really wanted to get to know me to gain my trust. Now I know they don’t actually care about me, they just want to gain my trust and persuade me into buying their product. Scarcity is another trick that I researched. The scammer will tell you this offer is available for a limited time and you must take action. Or the scammer might say that there is a limited supply of product x and they will be sold out by the end of the year. Scarcity makes people want to take action right now because of the potential gain. People don’t like missing out on an opportunity. I know I don’t. An authority figure also makes a scam look more legit. Some scammers make false accusations saying that their company is approved by a certain government organization. Some even go so far as to give you a fake business certificate or license so it looks like they are real. I experienced this once and was almost fell for it. But I looked on the internet for the person’s name and people said it was a scam. What I learned was that first, scammers try to gain your trust by relating to you. Then, they try to show proof that their business is real by using social proof and authority figures. Then the scammer will tell you that this is a limited time offer or the product is going to run out. This makes you want to take action soon. To reinforce this, the scammer will give an incentive that is hard to turn down because of the potential gain. Knowing how a scammer scams people is the best way to figure out what is a scam, and what isn’t. The research I found will help me think like a scammer and will prevent me from being scammed again. I will also be able to use this new information to warn others about how scammers think and help them avoid scams.
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 | | frederick recommended this intel. May 4, 2011 |  | | Magreth appreciated this intel. May 4, 2011 |  | | crawfish recommended this intel. May 4, 2011 |
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What I have seen lately is a scammer putting up a web page and it looks like the story is coming from a news reporter. And the story is about someone in your home town that has made a lot of money doing something. If I remember it was about working at home.
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This intel was contributed by Jwerf
Jwerf
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May, 2012
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