Financial Horror Stories

Financial Horror StoriesBoo! America’s favorite frightful day is approaching and the day is filled with more than ghosts, goblins and candy! In the spirit of Halloween we’ve gathered some of the most frightful financial horror stories to share. WARNING: Don’t let these horror stories happen to you!

  • Having your new car wrecked, only to discover your insurance carrier only covers the (lower-than-cost) Blue Book
  • The IRS has reported several variations of a refund-related bogus e-mail, which falsely claims to come from the IRS. The email tells the recipient he/she is eligible for a tax refund for a specific amount and instructs the recipient to click on a link in the e-mail to access a refund claim form. The form asks the recipient to enter personal information which the scammers can then use to access the e-mail recipient’s bank or credit card account. FYI: The IRS does not send unsolicited e-mail about tax account matters to individual, business, tax-exempt or other taxpayers.
  • Receiving a large check made payable to you or your company and written on a credible bank. Here’s how scammers work this trick: You get a check for a large amount of money and are asked to refund or pass on a portion of the amount to the sender or a third party. By the time you find out the check is fake, your money is long gone. The typical victim loses between $3,000 and $4,000 in the scam, says Susan Grant, director of consumer protection at the Consumer Federation of America. “Once you send money to a crook, it’s almost impossible to get back.”
  • 419 scams are a type of fraud and one of the most common types of confidence tricks. The scam typically involves promising the victim a significant share of a large sum of money, which the fraudster requires a small up-front payment to obtain. If the victim makes the payment, the fraudster either invents a series of further fees for the victim, or simply disappears.
  • Have you been getting a lot of e-mails from the United Kingdom and Nigeria? Delete them as fast as you can! Sometimes these will be sob stories asking you to help, because they are sick or dying. Other times, the people behind the messages claim to be officials, business people, or the surviving spouses of former government honchos in Nigeria or another country whose money is tied up temporarily. They offer to transfer lots of money into your bank account, if you will pay the fees or “taxes” they need to get their money. If you respond to the initial offer, you may receive documents which look “official.” They may even encourage you to travel to the country in question, or a neighboring country, to complete the transaction. Some fraudsters have produced trunks of dyed or stamped money to try to verify their claims. These emails are from crooks trying to steal your money or your identity. Inevitably, emergencies come up, requiring more of your money and delaying the “transfer” of funds to your account. In the end, there aren’t any profits for you, and your money is gone along with the thief who stole it. According to State Department reports, people who have responded to these emails have been beaten, subjected to threats and extortion and in some cases, murdered.
  • You answer an ad for a mystery shopper. The company sends you a check supposedly to cover the items you’ll be buying and to “test” Western Union’s services. You get a check for more than $1,000 and the company says you can keep $200, plus deduct your pay from the check. Real mystery shoppers get paid $10 to $25 per job, after the job is done.
  • Congratulations! You have won an international sweepstakes or lottery! Here’s a $20,000 check, for just a portion of your winnings. To claim the additional hundreds of thousands of dollars which you’ve won, all you have to do is send a personal check for the taxes due on your winnings.
  • Be careful when the cable or cell phone rep calls. You may say yes to more charges than you realize. Always check your monthly statement for erroneous charges and report them immediately.
  • Using your debit card can be frightful! More cases of credit card thieves using “skimming” devices to steal unsuspecting customers’ credit card information are popping up at gas stations, ATMs and restaurants. When a credit card is run through a skimmer, the small device stores the cardholder’s data. Once the credit information is obtained, the thief can then sell the information or clone the credit card. Lesson: run the card at the counter or pay in cash.

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