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A Dislike Button on Facebook? 7 Scams You Should Avoid

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Despite widespread warnings about scams, fraudsters continue to bilk consumers out of billions of dollars each year.

Why?

One reason is that scam artists are continually tweaking their stories with an eye on new natural disasters, news events, technological innovations, economic conditions, and different ethnic groups.

And let’s face it, many consumers want to believe that they can suddenly become rich by doing something fairly simple, such as wiring a few hundred dollars to get millions in return.

Last year, for example, scammers targeted consumers looking for work and trying to get out of debt, according to the Better Business Bureau’s top scams of 2010.

“With the economy still on the mend, scammers had a field day targeting struggling families who were looking for work and trying to make ends meet,” Stephen A. Cox, president and CEO of the Council of Better Business Bureaus, said in a statement.

Which scams are most popular these days? Read on to find out.

1. Taking advantage of people in financial difficulty

Job hunter scams, work-at-home schemes and debt relief services were among the most popular scams last year, with complaints to the BBB up 30%. The job hunter scams, topping the list, included attempts to get bank account or social security numbers from consumers or requests for payments to be considered for a job. Debt relief and settlement services companies typically require upfront fees and could potentially leave the consumer owing even more to lenders, the BBB warned. And work from home schemes promise to teach you the “secrets” of making money online, or getting paid to be a mystery shopper.

2. “Free” trial offers, lottery and sweepstakes schemes

Misleading “free” trial offers — most often for diet supplements, penny auctions and money making schemes — result in thousands of complaints to the BBB each year. Free trial offers may seem or even advertise openly to be “no-risk,” but defrauded consumers have complained of being billed each month and finding it extremely difficult to cancel once the “free trial” period is over.

3. Home repair

These are challenging times for many homeowners and when faced with an emergency — say, a leaking roof — it’s only natural that we would try to get it repaired at minimal cost. But too often, choosing a contractor based solely on their price offer doesn’t end up well. Complaints to the BBB about roofing companies increased by about 40% in 2010.

4. Check overpayment scam

This scam is mostly targeted at consumers who list items for sale on websites like Craigslist. The “buyer” sends a check much larger than the sale amount and asks the victim to wire the extra money back to him or her. The victim loses the wired money because the check is forged.

5. The Iraqi Dinar scam

ConsumerAffairs.com, which also issues an annual Top Scams list based on consumer complaints, reminds us of the so-called Iraqi Dinar scam. Basically, consumers are scammed into buying Iraqi dinars, lead to believe that the currency is now so devalued, they are bound to make millions when it’s worth more. Since no exchange exists for the Iraqi Dinar, dealers can charge whatever they want to sell and buy back the Dinars, according to the Washington State Department of Financial Institutions.

6. “Free” and “cheap” offers online

The growth of the Internet spawned thousands of new opportunities for fraud. Most consumers know not to reply to suspicious emails, but new ways of buying items on the Internet abound, providing ways to scam the gullible from their money in ways that didn’t exist even 15 years ago.

This article outlines the seven biggest Craigslist scams, warning consumers about ads for free furniture, cheap rental homes, used cars for less, free items from troops leaving for deployment, and college roommates. (Be sure to read the comments, where many defrauded consumers have shared their experience).

7. Facebook scams

Facebook scams last year included a fake “dislike” button to download that gave hackers control of consumers’ Facebook accounts and fake ads to “test” Apple iPads, reports ConsumerAffairs.com.

Fraudsters also are on the lookout for news events that could hook consumers. A few hours after the death of Osama Bin Laden, scammers offered photos and news about the event that led to websites that would steal personal information, according to Consumer Reports.

Now, it’s time for a pop quiz. See the Federal Deposit Insurance Corporation’s “Can You Spot a Scam?” to find out if you know about common frauds and their warning signs.

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