Scammers push people to pay with iTunes gift cards

By Amy Hebert, Consumer Education Specialist, FTC

One thing we know about scammers — they want money, and they want it fast. That’s why, whatever the con they’re running, they usually ask people to pay a certain way. They want to make it easy for themselves to get the money — and nearly impossible for you to get it back.

Their latest method? iTunes gift cards. To convince you to pay, they might pretend to be with the IRS and say you’ll be arrested if you don’t pay back taxes right now. Or pose as a family member or online love interest who needs your help fast. But as soon as you put money on a card and share the code with them, the money’s gone for good.

If you’re not shopping at the iTunes store, you shouldn’t be paying with an iTunes gift card. Other payment methods scammers might ask for include Amazon gift cards, PayPal, reloadable cards like MoneyPak, Reloadit, or Vanilla, or by wiring money through services like Western Union or MoneyGram. Government offices won’t require you to use these payment methods.

If you get targeted by a scam like this, report it to the FTC at ftc.gov/complaint.

Want to know more about avoiding scams? Read 10 Ways to Avoid Fraud.

A Friend of a Friend Might Be a Scammer

Social media has become a great way to communicate with friends. Unfortunately, scammers are taking advantage of this in order to steal your identity. Known as “farcing,” these scams start when you get a friend request from someone who supposedly shares mutual friends with you. And that's just the beginning.

Learn how to recognize and avoid this common social media scam and other online scams.

The top money and scam alerts this summer

For Americans taking a vacation, attending a concert, or working on their home or garden this summer, this season comes with its own unique consumer challenges. Learn the top five money and scam alerts for this time of year:

1. Don’t buy gas additives that claim to increase fuel mileage. Even though gas prices go up in the summer, the Environmental Protection Agency has not found any product that significantly improves gas mileage, and some could damage a car’s engine or increase exhaust emissions.

Facebook scam: In Farcing, Thieves Ask 'Would You Be My Friend?'

Consider this scenario: You're on Facebook (FB), and you receive two friend requests, both from people you don't know. With one person, you have no mutual friends, and with the other, you have some. Do you accept either request? Both? Just the one who shares your friends?

Scammers are banking on the likelihood you'll accept the request if you have mutual friends -- the more, the better -- even if you have no clue who the requester is. From there, they'll have access to everything you share with friends, and they'll start friending your friends and family to see what they share. All that good stuff helps them reach their ultimate goal: identity theft.

It's called farcing, and a researcher at the University of Buffalo published a study on it in an academic journal called Information Systems Frontier, saying these scams spread quickly and widely, as the scammer gathers friends and appears more legitimate.

More from Daily Financing.

Don't Be Fooled: Beware of Washington State Mudslide Charity Scams

In the wake of the deadly mudslide in Washington State, the Federal Trade Commission, the nation’s consumer protection agency, reminds consumers that scams often follow disasters. If you’re asked to make a charitable donation to help people in disaster-affected areas, before you give, be sure your donations are going to a reputable organization that will use the money as promised.

Unfortunately, legitimate charities face competition from scammers who either collect for a charity that doesn't exist or aren't honest about how their “charity” will use the money you give. Like legitimate charities, they might appeal for donations in person, by phone or mail, by e-mail, on websites, or on social networking sites. For more information, read the FTC consumer blog post, Helping victims of the Washington State mudslide — Make sure your donations count and, for a list of groups that can help you research a charity, go to Charity Scams.

Military Members and Veterans - Watch Out for Scams

There are a number of scams currently circulating that target members of the military and veterans, such as fake military charities, identity theft targeting active service members, and veteran pension scams.

In general, all of these scams try to take advantage of military members by offering to provide a service and then taking your money, while you get nothing in return.

You can learn more about specific scams by visiting the Scams Targeting Service Members or Veterans section of StopFraud.gov.

If you've been the victim of a scam, there are a few ways to file a complaint:

File a complaint online with the Federal Trade Commission (FTC) or call them at 1-877-FTC-HELP (1-877-382-4357) or 1-202-326-2222.

File a complaint about Internet-related fraud issues with the Internet Crime Complaint Center (IC3).

StopFraud.gov offers information about how to report financial fraud.

Disaster Survivors Urged to Beware of Recovery Scams

WASHINGTON – The U.S. Small Business Administration is urging disaster victims seeking federal aid to be alert to scam artists posing as federal officials and to be cautious about any solicitations for fees to perform services that are available from federal agency staff for free.

In the wake of widespread flooding, wildfires and tornados in many areas across the country over the past few months, the SBA is particularly concerned about flyers that have appeared in tornado-damaged areas asking for non-refundable fees of up to $450 to help disaster victims fill out their loan applications and as much as $1,000 to verify losses and file loan applications.

Federal agencies involved in disaster recovery will never ask for a fee or payment to file an application for financial assistance or to inspect damaged property.

“Historically, natural disasters bring out the very best in people, and there are countless stories of the selfless acts of helpful neighbors and volunteers,” said SBA Administrator Karen Mills.

“Unfortunately, we have also seen in the past individuals who attempt to take advantage of people who need assistance. Disaster survivors should be vigilant in protecting their personal assets, particularly in the stressful environment of a disaster recovery.

“The SBA will not tolerate the defrauding of those who have already lost so much in the aftermath of these devastating disasters,” Mills said. “Those who are found taking advantage of disaster victims will be prosecuted to the fullest extent provided by law.”

If you suspect a person is posing as a local or federal agent, or encounter what you believe are fraudulent activities connected with disaster relief operations, contact your local law enforcement officials, phone the toll-free National Disaster Fraud Hotline at 866-720-5721, or send an email to disaster@leo.gov. The phone line is staffed by a live operator 24 hours a day, seven days a week.

To register for federal help after a disaster declaration, visit www.DisasterAssistance.gov, or call FEMA at 800-621-3362 (800-426-7585 for the speech or hearing impaired).

Disaster survivors may also visit one of the local recovery centers to get help with filing for assistance. To get help with the disaster loan application, contact the SBA by email at disastercustomerservice@sba.gov, or by calling 800-659-2955 (800-877-8339 for those with speech or hearing disabilities). Those affected by recent disasters may also file a loan application online by visiting SBA’s secure website at https://disasterloan.sba.gov/ela/.

The SBA makes low-interest, taxpayer-backed disaster loans to homeowners, renters, businesses and non-profit organizations of all sizes. More information about the disaster assistance program is available at www.sba.gov/disasterassistance.

Six Online Shopping Scams

Since we're now in the midst of the holiday shopping season, here's an article from Smart Money magazine.