How To Protect Yourself Against Online Scams

Source: http://onguardonline.gov/  

The internet is a powerful tool that helps make our everyday lives easier. Whether we want to manage our finances, get in touch with old friends, or just browse the news, the web makes it easier.

With those benefits come new risks. Criminals have learned to use the internet to attempt to gain access to your financial data, often through scams that can be quite convincing at first glance. We've listed a common internet scam below. Check it out, then head over to http://onguardonline.gov/articles/0002-common-online-scams to read about more.

The Preapproved Credit Card Scam
 

The Bait:
You get the “good” news that you've been "pre-qualified" to get a low-interest loan or credit card, or repair your bad credit even though banks have turned you down. To take advantage of the offer, you have to ante up a processing fee of several hundred dollars.

The Catch:
A legitimate “pre-qualified” offer means you've been selected to apply for a credit card or loan. You still have to complete an application, and you can still be turned down. If you paid a fee in advance for the promise of a loan or credit card, you've been hustled. You might get a list of lenders, but there's no loan, and the person you've paid has taken your money. It’s very unlikely you’ll be able to depend on that loan.

What You Can Do:
Legitimate lenders never "guarantee" a card or loan before you apply. They may require that you pay application, appraisal, or credit report fees, but these fees rarely are required before the lender is identified and the application is completed. In addition, you’re generally required to pay the fees to the lender, not to the broker or person who supposedly arranged the "guaranteed" loan.

Report Online Scams
If you believe you’ve responded to an online scam, file a complaint with:

The Federal Trade Commission
The FBI’s Internet Crime Complaint Center
Your state Attorney General