According to the Federal Trade Commission (FTC) there are a number of different type of phone scams out there. They classify them into the following types:

Buying Club Memberships – These scams go something like this. You get a call from a Caller who asks you if you’d like to join a program with a “free trial” or other “free” offer (I’m sure the words “trial” are not announced very clearly).  These offers are promoted to sound like they are the most amazing deals in the whole world, but then of course, if they were then why would the person be calling you out of nowhere and pushing hard to get you to sign up? Should sign up? Of course you shouldn’t! Even if you really do think it’s a great deal, then get a callback number (or better yet, a website) and do some research. If you search for more information on it (and especially if you search places where people frequently post comments), you should have the “real” information on that club within minutes of your search. There are very, very few great deals out there where someone is pushing hard to get you to sign up. One of the most important lessons you may ever learn is how to say the simple word “No”.  Don’t feel guilty, don’t be polite, its just like the anti-drug campaign from the 80s: “Just say No, a Right to say No!”.

Charities & Fundraising Fraud – This is more complicated and controversial as often these aren’t complete scams but aren’t exactly what you think either. Basically, you get a phone call from someone who claims that they are calling on “behalf” of a charity. It could be a well known Charity like the Red Cross, it could be an organization with “Fire Fighter” or “Police” in their name or it could be a Charity that you haven’t necessarily have heard of but sounds legitimate. So, how could this be wrong? These are volunteers for the charity and 100% of your donation goes straight to their organization to help those less fortunate, right? Wrong! The big name charities don’t call people out of the blue unless they have donated before (and DON’T believe the line, “thanks for your donation last year” as that could be a lie as well) and generally don’t call people and harass them. So, who is actually calling? Well, there are a number of possibilities. First off (starting at the worst offenders), it could be someone who is looking to take your money and run. Their company name might be very similar to a well known charity organization, a familiar and professional sounding company or even an Organization that has “fire fighter” or “police” in their name. Just because they say that they are with a “firefighters” group doesn’t mean that a single dollar is going to your local Firefighters. Don’t also forget that there are people out there who are willing to flat-out-lie to get your money, so they could say they are with the Red Cross but they may just take your money and run, especially if they are located within another country and know that they cannot be prosecuted.  These are the worst people, but don’t necessarily represent the largest group of offenders. Basically, Charities are willing to give a portion (often a very high %) of the donation back to the Telemarketer meaning that most of your money isn’t going to the Charity, but instead to this Telemarketer. Think about it this way, if you worked for a Charity and a company offered to give you 30% of whatever they made, would you take it? Of course! You’ll take whatever money you can get, even if its only a small amount of what people thought was being donated. In addition, you really don’t want to be added to a “sucker” list do you? Once added, your phone will be at the top of the list for Telemarketers to call you and harass you constantly. When you get a call the day after a horrible natural disaster and you receive one of these calls, say “No”, hang up and then decide whether you want to give or not. If you do, then its quite easy to find the websites for the largest Charities out there and can easily donate money directly from their website.

Credit & Loan Offers – You’re pre-approved! No Credit needed! Bad Credit, No Problem! It shouldn’t take a genius to realize that if a Telemarketer is calling you and has no idea who you are, what your name is, what your Social Security # is or anything else having to do with your history and/or credit report that its not likely that you are going to be offered a legitimate, low interest loan or Credit Card from them. Sorry, its not going to happen. So, why do people not hang up on these guys immediately? Simple. They’re desperate. Maybe (like millions of other middle class Americans) they don’t have fulltime employment, maybe they’re underemployed. Maybe they are a single parent. It doesn’t matter, their only focus is paying one more rent payment or putting food on the table for their children. When they get a call, desperation overrides logic and they fall for it. Basically, you can expect one of two things to happen after you give them your personal information. One, they are total scam artists and have no intention of giving you anything and once they have your Bank Account # and Routing # (I’m sure they tell you that, for your benefit, they only offer “Direct Deposit”), they’ll drain every dollar out of your account and will continue to do so until you tell your bank. Two, they ARE a legitimate company, but they are going to offer you a loan that should frankly be illegal. Not only will you have a 30% interest rate, but the system will be designed to charge you as many fees as they can. Want to pay your bill online? Sure: monthly fee. Want a card for your spouse? Monthly Fee. You start with a tiny credit limit and then are charged fees everytime your limit is raised (which I’m sure is every month). Fees, and more fees and additional fees are in your future if you accept their money.

Government Grant Scams – Guess what? The Government is going to give you a grant just because you’ve been a good citizen and paid your taxes on time and a hard working American. Wow, really? Yeah… not! Guess what? There are very few legitimate grants out there and you can be assured that they aren’t going to be calling you and giving you that money just by giving them your bank account number. People that get grants for things like Business startups go through a lot (and I mean A LOT) of work providing Government will form after form after form with hundreds of pages of documentation and the such… and that’s for Businesses that are going to HIRE lots of people, not some schmuck sitting at home with a $50 per year eBay business. There are lots of grants for education, but again, you’re going to have to work hard to get them. So, if you’re a left handed, sure, you might be able to fill out some forms to get $100 towards college expenses, but again, no one is going to let you know of that. So, what does this mean to you? Well, it means that it’s a scam. You’ll give them your bank account (again, “Direct Deposit” lines) expecting to see it increase, but instead will be drained as the scammer takes as much money as they can leaving you with no recourse.

Identity Theft & Telemarketing – Its simple. Don’t give out your Social Security Number to ANYONE on the phone. EVER. I don’t care who you are talking with and who they say they are from. Never Ever! Next, don’t give out your Bank Account number unless you have initiated a call to a company to order something. If someone from “Card Services” calls saying that you’ve missed a payment, then go online and verify that and do the payment online. If you can’t, ask them 100 questions about your account to verify they are who they say they are. They should know your Credit Card number (giving them the last 4 is okay, but no more), they should know your Social Security number. If they ask you for that info, HANG UP IMMEDIATELY. A scammer can get a surprising amount of money just by telling people that they are from American Express or Discover or even “Mastercard” (if someone was foolish enough to believe Mastercard would call you directly) and the recipient will assume that the person is who they claim to be. Assume they are NOT! If the caller gets mad at your questions, HANG UP! Your Credit Card company values your security even more than you do, so they will not get annoyed when you try and verify the information.

Medical Discount Plans – Not having medical insurance is one of the biggest problems in our country today. Drug, Hospital and Doctors charges have all skyrocketed exponentially over the years. Now, $10,000+ drug infusions are common (yes, for just a single sitting), $5,000 for a 30 minute operation and even a 10 minute talk with your doctor (plus an hour of waiting) will set you back $300-$400. Things are out of control. So, how are Americans able to pay for these crazy prices? They aren’t. They get Insurance from their employer who gets legally guaranteed coverage (you either take the whole company or don’t – can’t exclude an individual) with the employer absorbing a lot of the cost with the employee taking in the rest. While this may mean $500-$1,000 monthly out of pocket for the employee, its still a lot better than paying thousands (if not tens or hundreds) for “retail” cost medicine. So, what happens if your employer doesn’t offer this coverage or if you don’t have fulltime employment? You’re in trouble, that’s what. Telemarketers and Scam Artists prey on this fact and offer you Medical “Discount Plans” or “Health Insurance”. The catch? Well, the catch is that the only reason that people can get quality Health Insurance is due to the all-or-nothing laws. No legitimate Health Insurance company would EVER offer coverage to anyone that’s not in 100% perfect health. If you’ve ever applied to coverage, you know what I’m talking about: if you take a single prescription pill, you’re going to be denied. Insurance Companies exist to make money, not to help you out. So, with that being said, what’s the chance that this Telemarketer is really offering what they are claiming to offer. Not a chance in heck. I’m not saying that some of the Discount Plans might not have value, but you will extensive research to find one that provides you will more value than you are paying. The rest are flat-out scams.

Reloading Scams – This is a classic. You get scammed. You’re upset. You’re mad. You’d do anything to get back at those people that took advantage of you. So, you get a call from someone who is aware that you’ve been scammed and claims to be a government agency come to help you out. Thank goodness, right? Wrong, fool! They are just trying to scam you AGAIN. Once again, don’t give out your Bank Account information to someone who calls you! There is no such thing as a “recovery” fee or a “processing” fee and they are not going to get back your money. They are just going to steal more and more money until you stop falling for these scams. Don’t do it! Learn your lesson and Wise Up! It’s a tough world out there and fools will get taken for everything they have!

Robocalls – Robocalls. You know exactly what they are: automated systematic messages. The good news about these type of calls is that they are easily dealt with: no need to be polite to a robot, simply hang up! There are many organizations that use Robocalls from automated messages indicating that you might be late on a Credit Card or Utility bill to Political Candidates using them to encourage you to vote for them. Either way, don’t listen to the message and don’t waste any more of your time. Scammers use this as well to tell you that you’ve “won” something. Guess what? If you actually won something, do you really think that the company would go through the effort of setting up a robotic caller to tell you? Of course not! How many “winners” do they have to make that worthwhile? If you guessed “many”, you’re correct. You haven’t “won” anything more than the right to have your money taken from you. If you’re still listening to the message past about 5 seconds (once you figure out that its not a legitimate notice about a late bill), you’re going to get scammed.

Sweepstakes & Lotteries – You get a call telling you that its your “lucky day” and you’ve just won $5,000. Sweet! The best part is that a money order is being sent to you immediately and all you have to do (once the check clears, of course) is to send them a check for “taxes” and “fees”. Wow!!! If you’ve read everything up till now and still believe that this is the case (not to mention the fact that you probably receive at least 1 or 2 you’ve-won-millions-of-dollars emails today) then I think you need to let someone else control your money. Look people, the checks/money orders are fake! Just because it shows up in your bank account doesn’t mean that its legit. What’s going to happen is that you’ve going to lose any money you send to these scammers and THEN you are going to get a knock on the door from your local police wanting to talk to you about that fake check you deposited and telling you that, oh, by the way, its completely illegal and now you’re in some hot water. You can’t win lotteries you don’t enter! Also, if you get calls from someone wanting you to enter foreign lotteries, DON’T DO IT – its illegal. Even if you win (which is a billion to 1 shot), good luck trying to collect that money. By doing so,  you might be getting jail time along with it. Finally, don’t be one of those suckers (amazing how many people you see doing it) and fill out one of those “sweepstakes” entries at the mall for a car. Have you ever thought to look at the back of the entry? In big letters it tells you that you become obligated to go to one of those high pressure, low value, borderline scam Timeshare presentations. You’ll get a call saying something like “Congratulations! We have good news about your sweepstakes entry”… yeah, good news for them, not for you.

Travel Scams – Great, you’ve just “won” a free trip! Yup, sure you have. You may have been called from a “VP” of an “airline” that sounds like a legitimate airline and all they need for “verification” is your credit card number. Yeah, they are calling YOU but they need to VERIFY who you are by getting your CREDIT CARD number. Doesn’t sound suspicious at all, now does it? Beware of these “free” trips and they are either flat-out-scams or you’ll get a “vacation package” that’s not nearly as good as they make it out to be at a price that’s WAY more than you would reasonably pay for that. You’re not really going to pay for a trip that you weren’t planning with a company that you have no idea who they are, are you? If you were to actually win (which you never will be), then have them send you all of the information to you via Fedex or UPS. When they start making excuses, you’ll know that you really haven’t won anything other than the maybe the right to give them lots of money for nothing (or next to nothing) in return.

Work at Home & Business Opportunities – Everyone would like to make extra money. Everyone. I don’t care whether you work 40 hours, 80 hours, are unemployed or are a stay at home Mom/Dad. Everyone would be willing to squeeze in an extra hour of work to make an extra $50 or $100. So, when someone calls and tells you that you can make $3 to $4 PER ENVELOPE for putting stuff into an envelope (stuffing envelopes), that’s too good of a deal to pass up, right? Come on. You don’t really think that a company is going to pay you $4 PER ENVELOPE, do you. Come ON!!! A company could put an ad for work at $6 per hour (or whatever the minimum wage is) and get someone to stuff 100 envelopes for what it’d cost them to pay you one. In addition, there are these new things, you may have heard of them. They’re called MACHINES. They do things like this 24 hours a day for nothing!

I’m sorry if I sound too pessimistic, sarcastic or mean, but these are the things you need to tell yourself everytime you hear one of these deals that seems too good to be true. Its easy to listen to the resounding voice in your head that says “what if its true?” and then greed, excitement and even desperation can override your rational senses and get you to do something that you wouldn’t normally do in a million years. These scam artists are good at what they do. They’ve heard the same questions over and over again and have come up with answers that always seem to make sense when you hear it. These people are often  very nice, friendly and often give you official sounding information that’s often based on real information but twisted into a way that becomes a scam. We all want to believe in people and believe what people tell us, but there is a large segment of the world population that will do absolutely anything to make money even if that means taking advantage of someone else. In many of these poorer countries, these actions are not only not punished, but are often rewarded socially in much the same way that we root for Robin Hood in his pursuit of getting money from the rich and giving to the poor. You may not feel like you’re “rich” but since the average American makes more per year compared to 99%+ of the world’s population, we are very rich in comparison.

Be very, very careful. Scams are everywhere!