What Are The Common Types Of Scam?

In the world today, illegality, fraud and trickery all come together to form the menace popularly referred to as scams. Year in, year out, people lose trillions of dollars to scams, and the most painful part of it is that they cannot tell what types of scams are coming their way. In this post, we shall be asking the question: what are the most common types of scam?

What Is A Scam?

According to the Merriam Webster Online Dictionary, a scam is defined as a noun which is “a fraudulent or deceptive act or operation”, it also goes on to define a scam as a verb which means “to deceive and defraud (someone)”. Also as a verb, the dictionary defines a scam as a way “to obtain (something, such as money) by a scam”.

Online search engine, Google, defines a scam in a broader sense and it states that scams “...are deceptive schemes designed to trick individuals or organizations into parting with money, personal information, or other valuable assets. They often involve manipulation, false pretenses, and the exploitation of trust.”

No matter what you define it, one set of things come forth: deception, fraud or illegality. Someone gaining at the expense of another; falsehood, tricks and more.

In general, a scam could be an act, a person or an idea and facts according to a 2024 estimate, show that scammers have defrauded people all over the world of an astounding $1.03 trillion between then and the 2013. As the years go by, this number continues to increase.

Unfortunately for many, they can’t tell what a scam is, what it looks or feels like. To solve this issue, we shall be moving on to answering: what are the common types of scam?

What Are The Common Types of Scam?

The world is full of scams, from well known ones like advance fee scams to marriage scams. To narrow these scams down, we shall be focusing on the 10 most common ones.

1. Banking, credit card and online account scams

This set of scams happen when Scammers claim that you have an issue with your financial institution like your bank, online payment service or mobile wallet. They get to claim these, contacting you through emails and text messages that appear to come from your trusted financial institution. 

They also usually request that you rectify the issue with your account by verifying your details on a  website which is usually a fake but convincing copy of your financial institution’s website.

Another popular scam under this category is the card skimming scam. Here scammers access your financial information by copying it from the magnetic strip of a credit card or automatic teller machine (ATM) card. They do this by previously installing an electronic device called a card skimmer on an ATM or POS machine. They may even install a camera to capture your pin as you input them on the machine.

As soon as your card gets skimmed, scammers begin to make copies of your card, using them to make transactions behind your back.

2. Lottery, sweepstakes and competition scams

This example of scams involves scammers posing as an overseas lottery or sweepstakes company. They send you emails, letters or text messages out of the blue, claiming that you have won some money or a fantastic gift prize or a sweepstake, especially in one that you never participated in.

They lure victims into giving money upfront or their personal details to receive the prize on offer. In most cases this upfront payment is tagged as a tax or fee to process the release of the winnings.

3. Dating and romance scams

This mostly involves scammers building a relationship with a victim on a dating website or on social media. These scammers usually use cloned, fake or taken over accounts of people to chat with their victims. Over time they build a strong rapport with the victim and begin to ask for financial aid for some illness, injury or other pressing need. They prey on feelings and emotions of the victim for their own financial gain.

4. Computer hacking

Computer hacking scams typically involves emails used by scammers to trick you into sharing your personal information with them. These emails and communications are called phishing attacks. Criminals  “fish” for your personal details by encouraging you to click on a link or attachment. Doing so will have malicious software gain access to your computer, sending back your personal information or grant them remote access to your computer.

Phishing emails frequently prompt you to input your account password on a phoney duplicate of the website's login page, posing as correspondence from a company you know and trust, such as a bank or financial institution.

The fraudster can access your account and take over your profile if you provide them your account information.

5. Advance fee fraud

In this type of scam, scammers ask for advance payments or personal information, usually by mail or email, in exchange for incentives, money, goods, or services that they never provide.

In advance fee fraud, scammers fabricate compelling and authentic-seeming justifications for demanding money, including paying taxes or fees. 

Frequently, they want money via international wire transfer. It is worth noting that these scams are commonly sent out to thousands of people all over the world at the same time.

6. Charity and medical scams

This type of scam targets people who wish to give to a worthy cause or discover a solution to a medical issue. Charity scams entail con artists obtaining funds by posing as employees of a real charity or cause, or a fake one they have established.

Scammers frequently take advantage of a recent crisis or natural disaster that has made headlines. By pretending to be collecting for a cause that would win your compassion, like helping sick children, they could also try to play on your emotions.

Medical scams promise quick and efficient treatments for serious medical conditions and offer a variety of goods and services that can look li\ke genuine alternative medications. False testimonies from people are frequently used to promote the treatments.

7. Small business scams

This scam as the name implies is targeted at small business owners. It happens through the issuance of fake bills or unwanted or unauthorized listings of advertisements, products or services.

Here scammers try to get the target to be tricked into signing off for an offer which has been disguised as an outstanding invoice or a free entry requirement. Unknown to the target this invoice has been rigged with a hidden subscription agreement.

Scammers trick you to sign up by disguising the offer as an outstanding invoice or a free entry, but with a hidden subscription agreement in the fine print. 

They also go as far as calling businesses and pretending that a certain service or product has already been ordered by them. They then ask you to pay for those services over the phone.

8. Job and employment scams

Scammers use the opportunity of high employment rates to extort people of their hard-end money through this scam. Promoted through spam email or advertisements in well-known classifieds, including websites, scammers get to entice victims with offers to work from home or to invest in a business opportunity promising a high salary or a high turnover rate. 

They claim that the payments will cover 

elements like the business plan, training course, software, uniforms, security clearance, taxes or fees. 

9. Golden opportunity and gambling scams

For those with the knack of looking for luck through bets or gambling, scammers 

make an unexpected phone call or email to them, offering a not-to-be-missed high return or guaranteed investment in shares, real estate, options or foreign currency trading. 

This proposition may look convincing and too good to miss, but the scammer will disappear with your funds, leaving you high and dry.

In other ways a scammer can promise a victim the accurate prediction to the outcome of a batch or competition. This usually includes the results of football matches and other sporting activities or lotteries.

This prediction results come with the promise of a high turnover or return based on past results and trends. In order to participate, you may be asked to pay for membership fees, special calculators, newsletter subscriptions or computer software programs.

10. Online shopping, classified and auction scams

Online shoppers are frequently the target of this type of scam. They fall victim when they don't receive what they paid for.  A con artist will sell you a product and send you a defective or subpar item, or nothing at all.  Additionally, they might pose as a salesperson in order to obtain your bank account or credit card information.  Reputable internet classified pages are another place to find these scams.  In an online auction fraud, the con artist says that because the winner has withdrawn, you have another chance to purchase the item you bid on.  The con artist will request payment outside of the safe payment system offered by the auction site. If you do pay through the proposed medium, your money will be lost and the auction site will not be able to help you.

How to protect yourself from scams

You can protect yourself from scams through the following ways:

• There is a popular saying that only the greedy get conned. That means that if you do not go around looking for cheap and easy ways to get money, you will not become a victim of scammers. 
• You can protect yourself from scams by investing in very effective antivirus and data protection software on all your devices including your personal computers and handheld devices. 
• You can also protect yourself from scammers by ensuring you properly check ATM and POS machines to find out if they are not being rigged with card skimmers. Also convert the camera on the machine to ensure that nobody is watching you put in your personal details. 
• Furthermore, you can ensure you protect yourself from scammers by not encouraging business proposal conversations with people you do not know or have not done business with.
• In case someone reaches out to you under the guise of your financial institution, ensure you do not give out any of your personal details or login details to your account. Your bank or financial institution will never ask you for your login details to correct a problem. Report such calls or communications to your financial institution.
• Do not click or open any links to websites that are not familiar to you while using the internet. Some of them are run by scammers.
• Also resist being pressured to sending money by someone you do not know for some help you never knew about.
• Use strong passwords for your online accounts. A combination of words, numbers and symbols can make up some of the strongest passwords unbreakable to scammers.

How To Identify Scams 

If someone you don’t know reaches out asking for money or personal info, or if they’re pushing you to pay in weird ways, it’s probably a scam. Also, if an offer sounds way too good to be true, it usually is. Here’s a breakdown of what to watch out for:

1. Random Messages or Calls

If someone you don’t know contacts you out of the blue, don’t just trust them. Look up their company or agency and contact them directly to check if it’s legit.

Even if the message seems to come from someone you know (like a friend or family member), double-check. Scammers often pretend to be people you trust.

2. Asking for Private Information 

It is important to note that real banks or financial companies will never ask for your PIN or passwords. If someone does, it’s a scam.

Be careful if someone asks for personal details like your Social Security number or birthday. Scammers love to use that info against you.

3. Weird Payment Requests

Watch out for overpayment scams. If someone sends you too much money and asks you to send some back, it’s probably fake.

If they insist on payment methods like wire transfers, gift cards, or cryptocurrency, that’s a big red flag. These are hard to trace and reverse.

Be suspicious if someone asks you to send money or gift cards to get something in return.

4. Too-Good-to-Be-True Offers

If an offer seems way too amazing (like crazy high returns or unbelievable deals), it’s likely a scam. Trust your gut.

Scammers often make big promises they can’t keep just to hook you in.

5. Other Warning Signs

• They might try to be super friendly or act like your best friend really fast. Don’t fall for it.
• They avoid video calls or always cancel them.
• They claim to be traveling all the time or living far away.
• They always have some “emergency” going on.
• You can’t find any info about them online.
• They say “I love you” way too soon.
• Their photos look way too perfect (like they’re straight out of a magazine).

Stay sharp, and if something feels off, it probably is!

Final Words

In this course, we have been able to give the best answers to the question: what are the common types of scam? Always put in mind that only a greedy person gets to be a victim of scams. You should also understand that when things look too good to be true they are most likely scams. 

If you are the person or an organization that needs to safeguard themselves from being scammed by criminals, you should choose no other than Youverify.

We offer individuals and businesses the opportunity to keep themselves within the realm of compliance, protecting them from fraud and other illegal and illegitimate practices with solutions tailor to suit their activities. Youverify is trusted by more than 2,000 people worldwide and has been the go-to for big businesses and corporations like Standard chartered, MTN and many more. Give yourself and your organization peace of mind, trust Youverify today by booking a demo now.