6 common scams and how to detect them

From an email promising an extravagant prize to an enticing online offer that seems too good to be true, scams have become an unfortunate part of life online. It doesn’t help that many of them are more sophisticated and trickier to detect than ever before.

The good news is that by knowing what some of the most common online scams may look like, people can become savvy detectors and potentially protect themselves from falling into traps.

Learn about some common scams and potential ways to spot them.

Common scams and what they may look like

While some scams can be spotted easily — like princes in distant lands offering their riches — it can be surprising how far some cybercriminals will go to trick people into handing over their money or personal information. Scammers might pose as a family member, a trusted charity, a financial adviser, or even the IRS.

From romance scams to retail fraud, scams can happen across almost all industries. Here are some common online scams to be aware of.

Phishing scams

In some of the most common phishing emails, fraudsters will typically masquerade as trustworthy entities — such as reputable organizations, banks, or even friends — to trick unsuspecting individuals into divulging sensitive information or unwittingly downloading malicious software.

These tips can potentially help to avoid phishing:

• Be cautious of unsolicited emails or messages, particularly those requesting personal or financial information.
• Verify the authenticity of the sender by independently contacting the organization through official channels rather than clicking on provided links.
• Pay attention to the website's URL. Look for the secure "https://" prefix and double-check the domain name for any variations or misspellings that could indicate a fake site.
• Be wary of websites that prompt users to enter sensitive information without a legitimate reason or appear unprofessional and poorly designed.
• Report fraud or any instance of suspicious activity.

Messaging scams

Also known as “smishing", messaging scams are another type of phishing that occur through text messages, social media platforms, or messaging apps.

In these cases, scammers may employ urgent or alarming scenarios, pretending to be from a bank or a trusted institution, aiming to create a sense of urgency that prompts someone to disclose confidential information without proper verification.

Not sure if a message is legitimate? Never give out personal or financial information and always report suspicious messages.

Marketplace scams

Marketplace scams exist on marketplace sites, such as reseller websites or peer-to-peer marketplaces, where a scammer will list an item for sale at a below-market rate to entice buyers. Once a sale is made, the buyer sends payment. The scammer then never sends the item and will cut off all communication with the buyer.

If shopping on a marketplace website, some things to consider to avoid being scammed could be:

• Look at a seller’s history to see whether they’ve made prior sales and have positive feedback.
• Search around for other listings for the same item. If the price is significantly less than the others, it could be a sign it is a scam.
• Avoid communicating with sellers outside of the marketplace platform. This could help make it easier to document communications and make a case to the marketplace website that a scam has occurred.
• If possible, label payments as for G&S (Goods and Services) when making a purchase. For example, PayPal may offer Purchase Protection for eligible G&S-labeled purchases that are not received or that don’t match their description upon arrival.¹

Dating and romance scams

As many people seek relationships online, dating scams have become increasingly common. By creating fake profiles on dating websites or social media platforms to establish romantic connections, scammers gain trust and affection before asking for money or personal information.

To best avoid online dating scams, people should never share personal details or send money to someone they’ve met online without verifying the person’s identity.

Insurance scams

Insurance scams can target anyone and might occur across all types of insurance, from travel to health. They may offer bogus insurance policies or fake claims to swindle money from unsuspecting individuals.

Be skeptical of unsolicited offers and always verify the legitimacy of the insurance provider before sharing any personal or financial information.

How to spot a common scam

Detecting a scam is crucial in protecting oneself. If anyone is trying to gather personal information or ask for money — whether it's to pay a fee or are offering something for free — it’s wise to question it.

Most common fraud schemes employ similar tactics. Here are some considerations to help spot common internet scams:

• Check the email and verify the sender. Common types of fraud will use email addresses or phone numbers that look like legitimate companies. Look up and visit the company's website or contact them directly to verify the contact information.
• Research the company. If unsolicited communication is received from a company, visit the company’s official website or contact the company directly using verified contact information.
• Remember: If something seems too good to be true, it probably is. Whether it’s winning something unexpectedly, meeting a dream partner online (but never in the real world), or getting approached to take an amazing out-of-this-world job, always do due diligence before providing any information or making a payment.

What to do if you think you've spotted a common scam

Here are some steps people can take to help protect themselves if they think they’ve been targeted by a scam:

• Avoid responding to suspicious emails or texts.
• Do not click on any links in emails or messages.
• Never provide personal information, such credit card details, banking details, or passwords.
• Report the scam to the FTC.
• Get in touch with the company being impersonated and report fraud.

Knowledge is a critical defense against scams. Stay alert, trust instincts, and always verify the authenticity of any suspicious communication.