Internet fraud can be defined as any type of scheme that uses one or more components of the internet (e.g., chat, email, website) to publish fraudulent solicitations, conduct fraudulent transactions, or transmit proceeds obtained through fraud.
- Learn about the types of internet fraud.
The more you know about various fraud schemes, the better you can protect yourself from them.
- Use common sense.
- If something sounds too good to be true, it’s probably a fraud.
- Offers of large sums of money in exchange for help in transferring funds out of a country (e.g., Nigerian letter scam) fall into this category.
- Keep your personal information secure.
Do not give out any information regarding your savings, checking, credit, or other financial accounts.
- Guard your Social Security number especially carefully.
- This is the single most important item sought by many types of fraudsters.
- They can use it to wreak financial havoc that will be very difficult and time-consuming for you to repair.
- Don’t give this number out unless it is absolutely necessary;
e.g., needed for application for major credit or a mortgage but not for sales of merchandise or services.
- Take the time to make certain that anyone you give it to is legitimate.
- Deal only with legitimate, reputable companies and individuals.
- Take time to thoroughly investigate the other party involved in your transaction.
- Use a search engine to find out what’s already known about a business or individual.
- Check with Better Business Bureaus, online references, or feedback from buyers or sellers.
- Don’t be fooled by fancy websites, which can disappear quickly.
- Buy direct.
- Purchase name brand items only from the companies who make them or have appropriate licenses to sell them.
- Low-priced new name brand products may actually be counterfeits.
- Obtain and verify addresses and phone numbers.
- Get a physical address (not a PO box) for a company you are buying from and make sure it exists.
- Verify email addresses and be wary of those that could have been obtained without providing traceable information such as a credit card number.
- If the person or company won’t give out the information you need, don’t deal with them.
- Be aware of the pitfalls of foreign commerce.
- It can be very difficult to deal with persons and companies in foreign countries with regard to warranties, returns, and laws concerning sales.
- Educate yourself on all the requirements of a particular overseas transaction and its potential for fraud.
- Learn how online auctions work before you bid or sell.
Make sure you understand :
- the obligations of both bidders and sellers
- the actions that will be taken by the Web site hosting the auction in the event of fraud
- feedback provided on the seller by other bidders
- Clearly understand the details of an online sale or purchase.
Make sure you know:
- how and where payment is to be made
- when delivery of the item is to be expected
- all the additional costs involved in a transaction
- return and refund policies
- Don’t buy anything promoted in a spam email.
Even if the seller is legitimate, you would be encouraging the use of spam.
- Buy with a credit card.
- If there is a problem, you can later dispute the transaction.
- Before entering your credit card number on a website, make sure it is both reputable and secure.
- CAUTION: It may not always be possible to know whether a site is secure; fraudsters can also use secure sites.
- The site URL should begin with https instead of http.
- Make sure there is a locked padlock icon or similar security designation in the address bar.
- Make sure the site’s TLS or SSL certificate issuer (e.g., Symantec) is legitimate and the certificate is both valid and up to date.
- Be sure to use an up-to-date major browser so you will be alerted to a security certificate problem.
- Consider using an escrow service, if appropriate.
- Some companies serve as go-betweens, accepting payment from buyers and delivering it to sellers.
- Be sure to research any escrow service thoroughly before you use it. Some of them are fraudulent.
- Take your time.
Pressure to complete a transaction quickly is often a sign of fraud.
- File a complaint immediately with:
- Contact law-enforcement officials in:
- Your city and state
- The perpetrator’s city and state
See Internet Crime Complaint Center to learn more about the various categories of fraud, including:
- Advance fee (Nigerian letter scam)
- Business or employment scams
- Counterfeit check
- Credit or debit card fraud
- Freight forwarding or reshipping
- Investment schemes
- Nondelivery of goods/services
- Online auction and other sales
- Phony escrow
- Pyramid or ponzi schemes
- FBI: Common Fraud Schemes
- FBI: Filing a Complaint with the IC3
- Federal Trade Commission: Privacy, Identity and Online Security
- CarBuyingTips.com: Guide to Avoiding Internet Fraud
- US Securities and Exchange Commission: The Internet and Online Trading
Go to Safe Computing at NC State.