Becoming Aware of Internet Fraud

The internet can be a wonderful place to find information. You can surf the web, shop online, invest in stocks, and even attend online classes. However, the internet can be a playground for those wishing to commit various types of internet frauds. It seems today that everywhere you turn there are rumors of online scams. Online fraud schemes can range from emails attempting to have you retrieve money from an account for a percentage of the amount, to bogus online contests. These scams can look very tempting to most individuals, but the fact is that you should be leery of anything online that seems too good to be true.

Most of us think to take extreme measures to protect our children from online predators, which in today's world unfortunately is something that we must do. But what about protecting ourselves from fraud online? Being aware that there are criminals online who are using different methods to introduce online scams is the first step in protecting yourself. Some of the frauds that are used are obvious, while others might not seem to pose a threat to your money or identity. Scammers use tactics ranging from email spamming of bogus lottery contests to methods of stealing your credit card information. Knowing the methods that internet criminals use to commit these crimes can be a huge step in protecting yourself.

When we use our credit cards online, we assume that our information is safe. This is not always the case. Individuals committing internet frauds use various ways to either steal your information or to receive a card in your name. Two of the most common types of card fraud are credit card account takeovers and credit card application fraud.

Account takeovers happen when an individual takes over another individual's credit card account. This happens by gathering pertinent information about the victim and then contacting their credit card company or bank. These types of frauds are committed first by asking for all relevant documents to be mailed to an alternate address, then the credit card is reported lost and a new one is sent to the new address. This type of scam allows the individual committing the fraud to easily obtain the victim's credit card information and then fraudulently make charges in the victim's name.

Application fraud differs in that they are committed by opening new credit card accounts using stolen information. This occurs when fake or stolen documents are used to open up a credit card account in another person's name. Frauds such as this are not as hard to commit as you might think. Personal information contained in household bills and bank statements can be used to create fraudulent documents, which most of the time are credit cards. Even when there are fraud protection systems in place, internet scams involving credit cards can happen.

Other individuals may get caught up in online fraud that concerns manipulation of the stock market. These types of scams can happen in areas of the internet that may seem harmless to most. They are called pump and dump. This takes place when false stock information is broadcast in places such as internet forums, chat rooms and also through spam emails. The reason that people committing the fraud do this is to cause a huge increase in the stock prices of stocks that are normally thinly traded and owned by shell companies. Shell companies are those that have no independent operations of their own and are used by their owners to normally maintain control over other companies. This is the pump in the pump and dump scheme. The dump happens when the stock prices get to a certain level, and those committing the fraud sell off their stock. This allows them to gain an abundant profit before the prices of the stock go back to the normal levels. In this case, the victims are those who purchased the stock and were unaware that the price was going to fall.

Educating yourself on internet frauds can be a huge first step in making sure that you don't fall victim to online scams. Always research company names and gather information about them before you choose to take part in any investment opportunity. There are also sites online that can keep you aware of current frauds that criminals might be practicing at the moment. Good quality information can go a long way in protecting yourself.

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