How it works: Skimmers swipe your credit or debit card through a handheld device, or they install an overlay device—a slightly different color than the machine—on an ATM or gas pump. The device gleans information—your name, account number, expiration date, security features—off the magnetic stripe on the back of the card. The thief copies information from your card to a fraudulent one and sells it to a counterfeiter.
How it works: A criminal gets your personal information under false pretenses, such as by calling and posing as a survey firm, then sells it to people who may use it to get credit in your name, steal your assets, or investigate or sue you.
How it works: Scammers send emails—often including the name and logo of a legitimate business or financial institution—luring victims to a "spoofed" or fake website where they're asked to enter personal information.
How to avoid it: Beware of emails that use a generic greeting (Dear Visa customer, or Dear friend) rather than your name, refer to an urgent problem, say that your account will be shut down unless you reconfirm billing or other personal information, or urge you to click on a link within an unsolicited message. Remember: A legitimate business or financial institution will never ask you to enter sensitive financial information via email.
Smishing is phishing via SMS (short message service) and it's targeted at cell phone users who use text messaging.
How it works: You receive a text message along these lines: "We're confirming you've signed up for our dating service. You will be charged $2 a day unless you cancel your order." The message includes a Web link that routes you to the main phishing page, where you're prompted to download a program—a Trojan horse that turns your computer into a zombie controlled by hackers and used within a larger network to steal personal account information and perform other malicious activities.
How to avoid it: Be cautious about deregistering from a service when you're sure you didn't make a formal arrangement with the sender. Be as vigilant about security for your cell phone as you are for your computer. If you have children who have cell phones, warn them about this scam as well.
How it works: You receive a phone call from an automated random dialer informing you that your credit card has been used illegally and asking you to call a fake 800 number, where you'll be asked to confirm your account details. Or you may receive an email asking you to call a toll-free number.
How to avoid it: If you get a call asking you to give personal information, hang up and call the financial institution that issued your card, using the number on the back of the card. Your provider will know if the call is legitimate. Delete any emails making similar requests, and never provide personal information in response to an email.
How to avoid it: Keep your firewall and virus-protection software up-to-date. Also, look for "https" in the URL before entering sensitive information and for the closed padlock icon in your browser frame, separate from the vendor website window; these indicate secure sites.
How it works: While all payday loans have certain features—such as loan- shark-high interest rates—in common, loans arranged online are even more troublesome than those applied for in person. The online loan applications ask for the personal and financial information anyone would need to steal your identity. And some online payday lenders lack secure Internet connections, so you could be broadcasting your personal information throughout cyberspace. You'd have to give the lender permission to access your checking account to withdraw fees and interest, which could result in overdraft fees from the lender and your financial institutions. Since lenders want you to renew or "flip" the loans, they often make it difficult to pay them off, and it's typically difficult to track the lender down.
How to avoid it: As Todd Mark, vice president of education for Consumer Credit Counseling Service of Greater Dallas, warns, "It's just plain and simple a bad idea to give a payday lender access to your account."
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