The unpleasant reality: many people are dishonest and will try and scam you or your loved ones. Awareness is your biggest defence. Here are the most prevalent scams in Australia, and how you can avoid them.
Picture by Bo Hughins
Floods of spam mail about Nigeria and your genitalia might make you think the internet is the predominant source of scam activity in Australia, but you'd be wrong. According to the annual Targeting Scams report released this week by the Australian Competition and Consumer Commission (ACCC), the biggest source of scams is the phone.
Of the 83,000 scams reported to the ACCC in 2011, 43,000 were received via phone. Many of those would have been the familiar fake call claiming to be from Microsoft or Telstra which is used to install spyware and other nasties on unsuspecting victims' machines in the guise of "tech support". Others might pretend to be from Australia Post and demand a fee for a non-existent undelivered parcel. As you can see in the table below, phone dominated all other methods:
For many Lifehacker readers, these calls are an annoyance and also a source of potential amusement, since it can be fun to string along a scammer and waste their time. However, we shouldn't ignore the fact that these scams also cost real people real money. The estimated impact of the reported scams is $85 million, and that doesn't include people who are too ashamed to report the incidents, or don't realise that they can do so. With that said, 88 per cent of scams reported to the ACCC are from people who didn't fall victim, so awareness is growing. You can help by recognising common scams, not falling for them yourself, and keeping less tech-savvy friends or relatives up-to-date on potential issues.
Here are the five most common scam types, according to the report:
- Advance fee scams (30,426 reported, 36.6% of reported scams). Includes requests for payment for package delivery, or promises of a large inheritance followed by requests for a "processing fee". Why would you send money to a stranger you've never met?
- Computer hacking scams (19,473 reported, 23.4% of reported scams). Callers say a problem has been detected on your machine and offer to walk you through how to fix it. This in turn makes your computer vulnerable to spying and potentially part of a botnet. Social media scams also fall in this category.
- Lottery and sweepstake scams (7.863 reported, 9.5% of reported scams). Remember that lottery you never entered? Apparently you've won money and can receive a fortune in return for a small up-front payment. There's only one person getting rich in this scam, and it isn't you.
- Banking/phishing scams< (5,430 reported, 6.5% of reported scams). Emails which ask you to confirm account details to avoid account cancellation or read an online statement, then redirect you to a non-bank site. The aim is to steal your login details.
- Online auction and shopping scams (5,012 reported, 6.0% of reported scams). Auctions or web sales for non-existent or counterfeit products.
Despite the range of these scams, avoiding them comes down to three simple rules:
Never respond to unexpected mail
Spam detection on modern email platforms eliminates many of the obvious nasties, but some still get through. Ignore any message claiming you have a lottery win, an unexpected bill, a tax refund, a parcel awaiting delivery, or so on. Contact the relevant institution (bank, ATO, Post Office) directly if you're concerned, but don't rely on details in the suspicious email to do so.
Don't give any personal information on calls
If someone calls claiming to be from Microsoft (or anywhere else) saying a problem has been detected with your PC, simply hang up. If someone claims to be from your bank or the tax office, ask for a phone number where you can call back -- and double-check the number with other sources before doing so. (Most scammers will refuse to supply a number.) Never give out any personal information on a call you haven't made yourself.
You're not about to get something for free
You have not won the lottery. A dying widow is not about to leave you a fortune. Forwarding a message won't make Facebook give money to a cancer victim. You can't have an iPad for $2. If it sounds too good to be true, it's a scam.
None of this is rocket science. Staying safe often means simply stopping to question what is happening. In this area, cynicism is a far better friend than hope.
Lifehacker's weekly Loaded column looks at better ways to manage (and stop worrying about) your money.