Types of scams

Year 10 Banqer High

SCAMS UNIT

Scammers are skilled at tricking you out of your money.

Knowing the signs of a scam can help you identify when something doesn't
feel right.

Scamwatch, run by the National Anti-Scams Centre (NASC) says:

• Stop - Don't give money or personal information to anyone;

• Think - Ask yourself could the message or call be fake?
• Protect - Act quickly if something feels wrong.

NAME______________________________________

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 Types of scams
TOPIC 1 - TYPES OF SCAMS
Research and Define each of the following scams.

Banking and online

account scams

Chain letters and

pyramid schemes

Health and medical

scams

Identity theft scams

Investment scams
(get rich quick)

Job and employment

scams

Lottery and
competition scams
(fake prizes)

Mobile phone scams

Money transfer scams

(Nigerian requests)

Online scams

Personalised scams

Small business scams

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Types of scams
Read the following 10 case studies on the next page and classify according to this list.

a) ADVANCE FEE FRAUD

b) COMPUTER HACKING
c) LOTTERY AND SWEEPSTAKES SCAMS
d) BANKING, CREDIT CARD and ONLINE ACCOUNT SCAMS
e) ONLINE SHOPPING, CLASSFIEDS and AUCTION SCAMS
f) UNEXPECTED PRIZES
g) SMALL BUSINESS SCAMS
h) JOB AND EMPLOYMENT SCAMS
i) DATING AND ROMANCE SCAMS
j) GOLDEN OPPORTUNITY and GAMBLING SCAMS
k) CHARITY SCAMS
l) MEDICAL SCAMS

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CASE STUDY TYPE OF SCAM
Yasmine saw and advertisement for a new box of vitamins. The
ad claimed that the vitamins would cure several types of disease,
although the claims cannot be verified by any reputable organisation.

Shan received a letter offering her an easy way to earn money by betting
on horse races. All she had to do was buy a piece of software which would
accurately predict the race winners.

A popup message appears on Harry’s computer screen advising him

of a win in a national competition. He is invited to collect his prize by
calling a premium rate phone number.

Dave’s Plumbing recently received an invoice for advertising in a local business

trade magazine. Dave was a little disorganised when it came to keeping business
records. Without checking his orders, he paid the bill. In reality the magazine
didn’t exist.
An email is sent to Skye asking for help to transfer a large amount
of money from an overseas country. In exchange for her help, she
is promised a share of the money. The scammer asks for her bank
account details so that transfer taxes can be paid, and her share of
the money can be deposited. When Skye next checked her account,
all of her savings had been withdrawn.
Alessandro loves to buy things on line, and recently found a site
selling smart phones discounted by over 50%. He used PayPal to
buy a phone, but it never arrived. When went back to the site to
complain, he realised that the seller had not provided a phone
number or physical address for further contact.
Jake received a phone call from a technology firm informing him that his
computer has a serious error. The caller offers to fix the problem for a small fee
by accessing his computer remotely and installing software. The scammer actually
installed spyware to collect all of James’ personal details.
Heidi received an email from her bank. The message asked her to
log in to her account and verify her details via a link in the email. In
reality, this was a fake site.

James has an online relationship with Verushka who lives in another country.
Verushka wants to meet James very much so that they can develop their
relationship. She cannot afford to travel overseas, so convinces James to send
enough money to pay for Verushka and her mother to fly to Australia
Meryl is looking for a job and sees an ad offering excellent an
excellent rate of pay and full training. When she calls the phone
number to apply for the job, it takes nearly five minutes for her to
realise that there is not job, and she’s actually called a premium rate
phone number.

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PERSONAL STATEMENT TYPE OF SCAM
Whenever I get an email offering easy money or free items Always Sometimes Never
I ignore and delete it straight away
I always read any offer or contract closely to make sure I Always Sometimes Never
know exactly what I am getting myself into
I don’t think it is easy to get rich quick. I prefer not to take big risks in the Always Sometimes Never
pursuit of quick money
If I owned a credit card I wouldn’t feel comfortable giving my personal Always Sometimes Never
details and credit card number to someone over the phone I didn’t know
Whenever I do internet banking I always go directly to the bank’s internet Always Sometimes Never
site rather than access the site through an email I may have received

When choosing to buy from a particular business I like to do research first Always Sometimes Never
so I know exactly what I am buying
I would never hand over money unless I was confident that the business or Always Sometimes Never
person I am dealing with is reputable
If I ever got into trouble and needed help or advice I would try to find out Always Sometimes Never
the best person to contact to get advice

Mostly always
Congratulations- you are a savvy consumer who is very unlikely to be scammed. You like to
check out and research everything thoroughly before buying. You are careful when using the
internet and ignore so called “amazing” offers when they reach your inbox. You don’t believe in
get rich schemes but realise that building wealth takes hard work.

Mostly sometimes
Good- you are on the right track, but there are areas for improvement. While you don’t
believe everything you hear or read, you can sometimes be a bit too trusting. If in
doubt, always seek independent advice. Make sure you do background research first
before handing over money to any person or business you are unsure about.

Mostly never
Poor- you have a lot of work to do if you want to avoid going through life and
being scammed. It’s important that you take the time to read the fine print of any
contract closely. If an offer is too good to be true, it usually is. Ignore any emails
that you may receive when you are unsure if it is suspicious and never share
personal details over the phone.

You can also take the MoneySmart scam quiz.

https://www.moneysmart.gov.au/tools-and-resources/quizzes/scams-quiz or the
Consumer Affairs Victoria Scam quiz
http://www.consumer.vic.gov.au/resources-and-education/scams/scams-quiz

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 TOPIC 2 – HOW SCAMS WORK

1. GET RICH QUICK???

Gemma receives an offer too good to be true!

“I sometimes get envious of friends who seem to have more money than I do. They buy
more expensive clothes than I can afford and manage to go out all the time.

There must be an easier and faster way for me to make more money than I presently earn
as a sales assistant at a supermarket”.
“A friend of my cousin has asked me to join a new investment club that promises to
make big bucks fast. All I have to do is pay an upfront joining fee of $500, then
convince as many friends and family as possible to join this money making venture.

I’ve been told that if I can persuade enough people to join the group I can make at
least ten times as much as my initial investment. I like the sound of this as I

sometimes get bored in my job and would rather earn better money for little effort. Should I
join this new investment club?”

Identify (by internet research or check the ACCC Little Black Book of Scams) the type of scam
Gemma has been invited to participate in.
Explain how this type of scam operates.

What are the consequences of this type of scam?

If getting rich quick is so easy why isn’t everybody doing it?

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 2. SCAM EMAILS

Why would a bank never send emails requesting a customer to enter personal information, or
redirect the customer to login to Internet Banking?

Hoax emails that look like they come from banks are a nuisance for banks. Naturally, banks
will try to minimise the amount of fraud and scams targeted at their customers. Access bank
websites and note any current scams being targeted at customers.
For example:
www.boq.com.au>Online banking > Internet Banking > Internet Banking Security.

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 3. Selina who has been a customer of the Bank of Queensland (BOQ)
for 10 years recently received this email.

Examine it closely, and comment on

a. What factors indicate that this is not a genuine email from BOQ?
b. What action Selina should take?
c. How you would expect a bank to make a genuine approach to a customer?
d. What would most likely happen if Selina verifies her account information on the link
provided?

From: BOQ
Sent: Friday 15 April, 2014
Subject: Verifying Account Details Immediately

Dear Customer,
In order to protect the security of our customers, BOQ is upgrading our security systems. In
order to ensure the safe and secure continuation of BOQ’s online banking system, we are
currently reviewing all our customer accounts.
We were unsuccessful in contacting you by phone during week to complete this process,
but wish to verify your account details for our important security update.
To ensure this verification is a success please verify your account information by following
This link.
If you do not verify your account details on the above link within the next three business
days, your account may be frozen.

Customer Service BOQ

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4. You are the Customer Service Manager at BOQ and have noted that a significant number
of customers are being scammed into giving out their bank account and personal
details by scammers setting up hoax websites.
Design a letter that you would send out to all of your customers. You should warn them
about scam emails and include some advice on how to deal with these, and how to
conduct safe internet banking.

5. Read the following statements about scams and circle true or false.
Your teacher will then discuss the answers with you.

STATEMENT True (Circle) False (Circle)

1 Scams are targeted at all types of people regardless of their age,
location or income.
2 Almost all scams fail because Australian consumers are well
educated and almost never fooled.
3 For a scam to be successful it must look authentic and real so that
the potential victim doesn’t suspect it is a scam.
4 Worrying about scams is a waste of time because all organisations
must follow strict laws in Australia and they would never scam or
rip of their customers intentionally.
5 The widespread use of the internet has made it easier for
scammers around the world to pray on victims.
6 Scammers often succeed because they seek out vulnerable people
who they manipulate to follow their instructions.
7 Successful scams often lure potential victims by offering free gifts.
8 Most scams involve promises such as monetary incentives.

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Case Study 1:
Jordan has received an email
informing him that he has won
$100,000 in a lottery. Jordon
found this exciting for a moment
but then thought it a bit strange
as he couldn’t recall buying a
lottery ticket. To claim the prize
the email stated that Jordan
should to call the prize line phone
number (which begins with 19).

1. What is it that alerts you to the fact that this is a scam, and not a genuine offer?

2. What problems might Jordan face if he took up the offer?

3. What advice would you provide to Jordan?

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Case Study 2:
Craig was checking through his emails
when he noticed one from a source he
didn’t recognise. This one was from
Dodgy Brothers Lawyers and stated
that a distant relative had recently
passed away and Craig had been left
$500,000 in the will. In order to claim
this money, Craig was asked to
forward his account number and
personal details to the lawyers so the
money could be deposited into his
bank account.

4. What is it that alerts you to the fact that this is a scam, and not a genuine offer?

5. What problems might Craig face if he took up the offer?

6. What advice would you provide to Craig?

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Case Study 3:
Your Gran, who is a widow, now lives alone in the house she and your
Grandfather lived in since they were married. Recently, she answered a
knock on the front door. It was a man dressed in overalls. He said his
name was Bill and that he was a roof tiler. Bill said that he had noticed that
the roof of your Gran’s house needed retiling urgently as it was in a terrible
state
…. the whole house could be water damaged the next time it rained! He
told her that if she signed up today with a cash deposit of 50% he would
retile the roof within a week for her for a discounted price of $3,000.

7. What is it that alerts you to the fact that this is a scam, and not a genuine offer?

8. What problems might your Gran face if she took up the offer?

9. What advice would you provide to Gran?

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How scams
work
Scenario 4:
Jing recently received a text message from a number
which was not in her contact list. The message
read “Hi, hope you’re still able to come to my party
on Saturday. Everyone will be there! See you then.
Sam”. Jing did have a friend name Sam, but this
was definitely not Sam’s number.

10. What is it that alerts you to the fact that this is a scam, and not a genuine offer?

11. What problems might Jing face if she took up the offer?

12. What advice would you provide to Jing?

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Case Study 5:
Jessie who is 19 has had a lot of trouble finding a job she
really likes. She recently noticed a poster in a shop window
offering a guaranteed income of $1,000 a week. The job
involved selling jewellery at parties. The poster encouraged
applicants to call a phone number quickly as only a limited
number of positions are available. Jessie called the number
and was told that to get started she would be required to
purchase a starter kit with a full set of the jewellery. The cost
of the kit is $750, and is used to demonstrate the products at
the parties.

13. What is it that alerts you to the fact that this is a scam, and not a genuine offer?

14. What problems might Jessie face if she took up the offer?

15. What advice would you provide to Jessie?

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Case Study 6:
Tomas Ramos answered his phone one evening. The
caller said that she was working for a charity collecting for
families affected by the recent flood. She mentioned that
the area he lived in was not flood affected, and she knew
that most people who escaped flood damage would want
to help those who didn’t. She said that even a small
donation would help. Tomas would not be
inconvenienced, as he could easily donate over the phone
by giving her his credit card details. Tomas felt sorry for the
flood victims. He also felt guilty as he had not contributed
anything in response to the recent appeals.

16. What is it that alerts you to the fact that this is a scam, and not a genuine offer?

17. What problems might Tomas face if he took up the offer?

18. What advice would you provide to Tomas?

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Case Study 7:
Teresa is a stay at home Mum with two young children.
She recently received an email from a business
advertising software which guaranteed to predict share
market movements. Teresa knew a little about the share
market, as she and her partner already owned some
blue chip shares. She thought that maybe this could be a
great way to earn a little extra money. Teresa could
easily buy and sell shares using the predictions from the
software. The advantage of this over a regular job would
be that she could do it from home, and not have to put
her children into childcare.
19. What is it that alerts you to the fact that this is a scam, and not a genuine offer?

20. What problems might Teresa face if she took up the offer?

21. What advice would you provide to Teresa?

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Use the clues given to rearrange the words below into the correct term:

a. I C N A H
Clue: This type of letter is a scam and requires you to send money to people.

b. C Y S C I P H
Clue: These people may offer you winning lottery numbers or
solutions to personal problems for a fee.

c. A W E R I P S
Clue: Software which takes information from a computer without the owner’s consent.

d. A X H O
Clue: This type of email may result in unauthorised access to your bank
account if you follow through with the instructions.

e. F A C I T N I N I O T I D E
Clue: If someone approaches you for a donation to a charity be sure to ask for this..

f. T I G A L E T I M E
Clue: These types of lotteries do not require you to pay a fee to collect your winnings.

g. C V D A E I
Clue: You should always access this before investing money.

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TOPIC 3 – LAWS TO PROTECT US

Scams do not discriminate, anyone can be conned. It

may be impossible to stop all illegal scams, but in
Australia there are laws aimed at stamping out
illegal and fraudulent schemes.
Have you ever been the victim of a scam or seen
something that you think is a scam? There are
organisations in Australia ready to provide action
and advice about what to do. It’s very important to
seek help if you have been targeted for a scam as
this will help not only you but assist others from
being scammed too.

Who would you report a scam to?

Complete the table on the next page by selecting one or more organisations from the list below.
The following websites may help you with this task.
www.moneysmart.com.au www.accc.gov.au

ORGANISATONS
ASIC – Australian Securities and Investments Commission ATO
– Australian Taxation Office
ACCC Australian Consumer and Competition Commission (SCAMwatch) State
Consumer Affairs or Fair Trading office
ACMA – Australian Communications and Media Authority www.acma.gov.au Your
bank or financial institution
Your local police

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TYPE OF SCAM REPORT SCAM TO
Email requesting banking information

You pay upfront cash deposit for your house to be painted, but
the painters who offered the service never arrive.

Email inviting you to participate in a pyramid

marketing scheme

Chain letter requesting money

Identity theft involving your tax file number

Financial Investment Scam guaranteeing

unbelievably high returns on your money

Online theft of money from your bank account

Zombie spammers have infected your computer with software

which spams other people

A local business (which has a shop front) fails to provide a

service for which you’ve paid.

Someone has hacked into your Facebook account and is asking

your friends for money.

Email from bank asking you to verify your password

You receive a bill demanding payment for services which you’ve

never ordered

You receive a text from a ‘19’ number

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 Go to SCAM watch (The Australian Competition and Consumer
Commission)
http://www.scamwatch.gov.au/content/index.phtml/tag/Scamwatch/
and answer the following questions:
(a) The website provides information to consumers and small businesses about how to
recognize, avoid and report scams. What are the current scams on the SCAM watch
radar?

(b) What is the procedure for reporting a scam?

(c) List and briefly describe the six psychological tricks used to scam people.
•

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(d) Select two victim stories featured on this site. Briefly describe how the victims were scammed.
Story 1:

Story 2:

(e) What are the 8 golden rules for protecting yourself against scamming?
1
2
3
4
5
6
7
8

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 1. Consumer Affairs Victoria
Go to http://www.consumer.vic.gov.au/resources-and-education/scams
and take the online scam quiz.
STEVIE’S SCAM SCHOOL
Select and watch one of Stevie’s videos. How does Stevie set up the scam described?
What are his suggestions for avoiding this type of scam?

2. NSW Government Fair Trading

Go to http://www.fairtrading.nsw.gov.au/ftw/Consumers/Scams.page?
Check the interactive map for scam reports around Australia.
Choose and describe one scam from three different states.

STATE

STATE

STATE

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Identity theft

3. SCAM DETECTIVE
Design an advertising campaign to warn teenagers about scams. Mention three to five
scams most likely to catch people in the 14 – 16 year age bracket.

Design components:
a. Poster or print advertisement
b. Fact sheet with FAQs
c. Set of text messages or tweets

Design guidelines:
d. Your campaign should be informative and persuasive.
e. The individual components should be brief and to the point.
f. The individual components should be linked to each other.
g. Use a key word or catch phrase such as “Say no to scams!!”
h. The message should be clear and easy to remember.
i. Aim for visual appeal with appropriate text, colour and illustrations (such as a picture or
graph).

Use these websites to start your research.

www.moneysmart.gov.au
www.accc.gov.au

www.scamwatch.gov.au www.consumer.vic.gov.au
www.moneysmart.gov.au
http://www.fairtrading.nsw.gov.au/

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Identity theft
TOPIC 4 – AVOID BEING SCAMMED

In 2012 the Australasian Consumer Fraud Taskforce conducted

an online survey on consumer fraud. Access the report from the
Australian Institute of Criminology:
http://www.aic.gov.au/media_library/publications/tbp/tbp056/
tbp056.pdf

Answer the following questions.

1. Which three scam types were considered to be a crime?

2. What commodity did most of the scams that took place on online shopping and auction
sites involve?

3. Which three states reported the highest number of scams?

4. Which age group reported the highest percentage of age victimisation?

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Identity theft
5. Which income category reported the highest percentage of victimisation?

6. What were the most common reasons for not reporting scams?

7. What were the most common reasons given for reporting scams?

8. What were the top two reasons given for not responding to scam invitations?

9. From the findings of the survey, what are the two recommendations made for the focus of
future campaigns?

Finally, graph the data on page 8 for:

a. Scam invitations received by type
b. Sam by method of delivery

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Identity theft
TOPIC 5 – IDENTITY THEFT

1. Many Australians have had their personal details stolen by criminals. They have become
the victims of identity theft Consider carefully each of the situations below and then
describe the impact it could have on the victim. Write your answer in the space provided

Situation 1:
Kerry throws out all her old bank and credit card
statements without shredding them. The next day
when Kerry goes to put more rubbish in her bin she
notices that some of her rubbish is gone, including the
bank and credit card statements that she threw out.

The probable impact on Kerry?

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Identity theft

Situation 2:
Jonathon was on a flight from Sydney to
the Canberra recently. When he went to
the bathroom (leaving his wallet in the
seat pocket) he didn’t realise that the
friendly man sitting next to him had
opened his wallet and stolen Jonathon’s
driver's licence, a credit card and his
Medicare card.

The probable impact on Jonathon?

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Identity theft

Situation 3:
Thomas has been chatting online to a
Russian girl, Svetlana. Svetlana recently
told Thomas that she was in love with
him even though they had never met
in person. Svetlana thought it would
be romantic if she flew out to Australia
to meet Thomas. She asked Thomas to
pay for the flight, as she had very little
money.
Thomas was happy to pay for the flight as he really wanted to meet Svetlana. He gave her
his bank account details so that the money for the flight could be transferred quickly
via internet banking.

The probable impact on Thomas?

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Identity theft

Situation 4:
Maria, who lived in a large apartment
block, has been waiting for a new
credit card from her bank. As she
arrived home from work on Thursday
afternoon she met one of her
neighbours who told her that a lot

of mail had apparently been stolen from the apartment letterboxes (which are not secured)
early in the week. Concerned, Maria called her bank and was told that the credit card
and passwords had been mailed at the end of the previous week, and that her account
had been used quite heavily over the last few days.

The probable impact on Maria?

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Identity theft

2. Go to http://www.ag.gov.au/RightsAndProtections/IdentitySecurity/Pages/
Protectingyouridentity.aspx and download the “Protecting Your Identity Guide - What
Everyone Needs to Know”.
Complete the Identity security checklist on page 29 of the guide.

3. Prepare an advisory guide for young people setting up a Facebook page for the first time. In
your guide, you should include the following points:
a. tips for creating a safe and secure profile
b. how to make your profile private
c. what personal information should/shouldn’t be included
d. the importance of selecting photos wisely
e. the importance of being careful when posting on your own or someone else’s page
f. any other points you think are relevant.

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Identity theft
IDENTITY THEFT

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Identity theft

STATEMENT (TICK ✓ THE CORRECT RESPONSE) TRUE FALSE

1. Providing your personal information for online family trees could
be used in identity theft.
2. The address of secure websites, such as online banking, will start
with ‘https’ or have the ‘closed padlock’ symbol displayed.
3. It is possible to win a lottery competition without having entered
the competition
4. If you update your computer you just need to delete all files
from your hardware before you dispose of it.
5. You are the only person who will ever be able to use your tax file
number.
6. Money transfer requests are sometimes referred to as the
“Nigerian scam”
7. Under no circumstances should you use a credit card to pay for
online shopping
8. You would expect that higher risk investments would offer a
lower return to investors
9. Information stored on mobile or wireless devices is at risk of
physical or electronic theft.
10. Phishing refers to a fake email arriving that tries to trick you into
handing over your bank account details
11. It’s a good idea to use the same password for your bank
accounts so that you don’t get confused.
12. data destruction software should be used before selling a
computer online.
13. It’s a good idea to always manually type a website into your
browser rather than clicking on a link.
14. Only use a public computer for banking transactions if it’s in a
public library.
15. Being a victim of a scam can have a significant emotional effect
on the victim

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 How to avoid being the victim of a scam

WORDSEARCH

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