What is a Chain Letter?

This is another scam that keeps on returning with slight changes to appear to be something new and even legal, but if it looks like a duck, walks like a duck and quacks like a duck, it is most likely a duck and a chain letter is easy to spot unless you are blinded by greed.

At its most basic a chain letter involve you receiving a letter that contains the names of a number of people, often five.  You are asked to send a sum of money to the first person on the list, take his or her name off of the list, add your name to the list as the last person and send it to five more people with the same instructions.

The problem is not only are chain letters illegal, they are also doomed to failure as they will rather rapidly run out of people to participate.

Chain letters are sometimes disguised to resemble legitimate business operations and you may even be sent some inexpensive item as part of the scam to make it appear to be a legitimate business proposal.  However, it is easy to see that it is the pyramid that drives the chain letter and nothing of value is done to put oneself in a position to receive compensation.  A scam by any other name is still a scam.

TIP

Never get involved with chain letters regardless of their format.

What is Malware?

Malware is the term for malicious software that you unwittingly download on your computer when you click on links in emails from scammers or fall prey to phishing and download the program from a phony website to which you were lured in the belief that it was a legitimate website.

One of the most common and dangerous types of malware is the keystroke logging program which is often referred to as a Trojan horse.  Once this malware is installed on your computer, the scammer is able to access all of the information on your computer and can provide the scammer with access to your bank accounts, credit cards, brokerage accounts or any other information that is contained on your computer.

TIP

Never click on links unless you are absolutely sure it is legitimate.  Also make sure you have an operating firewall on your computer and your computer security software is up to date.

What is Smishing?

Smishing is similar to phishing on your computer, but this time the scammers message comes as a text message on your cell phone.  Often it comes purportedly from your bank telling you that your account has been frozen and then asks you to provide personal information or your account will be frozen.  Smishing is also used by scammers, particularly during the holidays to appear to provide free coupons or free coupons.

TIP

Never respond to a smishing message.  By so doing you only succeed in telling the scammer that you are out there.  Never provide personal information in response to a text message from anyone.  If you believe the message may be legitimate, contact the entity at a telephone number or website that you know is accurate.  Don’t download coupons from emails or text messages.  Again, if you think it may be legitimate, go to the website of the company that you know is legitimate and download the coupons there.

What is Vishing?

Vishing is a scam that takes advantage of Voice over Internet Protocol technology that permits you to make telephone calls through your computer instead of through a regular phone line.  When you use your computer to make a telephone call, your voice is converted into a digital signal that is transmitted over the Internet and then is converted to a regular telephone signal when it reaches the regular telephone you are calling.

Vishing occurs when a recorded phone message is sent by computers using Voice over Internet Protocol technology.  Often the message appears to be from your bank or credit card company informing you that the security of your account has been compromised and that you must provide confirming personal information to keep your account active.

TIP

You will never receive a prerecorded message concerning the security of your account.  If you have any questions about your account’s security, call your bank or credit card company directly at a telephone number you know to be accurate.

What is Phishing?

Phishing occurs when an identity thief lures you through a phony email that purports to be from a bank, another legitimate company or even the IRS or other governmental agency to a phony website that looks like the website of that legitimate company, but actually is just a con to entice you into providing personal financial information.    Often phishing scams prey upon our fears by telling us that our accounts have been compromised and that if we do not provide verifying information, our accounts will be closed.

Clicking through to the phony websites also carries the risk of unwittingly downloading malware such as keystroke logging programs that once installed on your computer provide the scammer with all of the information found about you on your computer. This information can be used to make you a victim of identity theft or even to empty your bank accounts if you use your computer for online banking.

TIP

Never click on a link to a website unless you are totally sure that it is legitimate.  Trust me you can’t trust anyone.  Even if you receive an email from someone you trust, it may not be from them at all, but rather from someone who has hijacked their email or even if it is from them, they may have, in turn, fallen prey to a scam artist and may be passing along dangerous malware without even knowing it.

Install antiphishing software on your computer to warn you before going to a website that may be tainted.  A good, free antiphishing software can be found at www.toolbar.netcraft.com.