Type of Scam or Fraud

A scam is a fraudulent scheme that is generally some sort of business transaction that involves money. There are various type of scam or fraud and can reach us via email, telephone, or even in person. Any person carrying out a scam activities is called a scammer. The dictionary meaning of scam is blackmail, con game, deceit, dirty pool, deception, hustle, extortion, fraud, hoax, double-dealing, hosing, racket, rip-off, sting, cheating, shakedown, sham, con, flimflam, and double-cross. 

On the other hand, fraud involves deception. It is a breach of sureness, confidence, or trust. It is a violation of civil law and is a serious crime. The motivation for fraud can be to discredit an opponent or adversary, monetary gain, or financial advantage. Any person guilty of fraudulent activity is called a fraudster. The dictionary meaning of fraud is blackmail, flimflam, deceit, extortion, graft, fake, hoax, misrepresentation, con, craft, scam, duplicity, artifice, barratry, dupery, cheat, chicane, chicanery, double-dealing, and fraudulence. 

A scam virtually becomes a fraud when a scammer gets someone’s financial or personal details and uses them for their own profit, or obtains money from their victim under false pretences. The difference is very minor. In most cases, it is seen that the terms “scam” and “fraud” are used interchangeably.

Types of scam or fraud.

There are many types of scams or fraud. Trading scams (forex, cryptocurrency, binary options, etc.), investment scams, pet scams, romance/dating scams, student loan scams, inheritance scams, fund recovery scams, securities scams, travel prize scams, student loan scams, tax scams, charity scams, debt collection scams, etc. We will discuss a few types of scams or frauds that are very common, prevalent, and widespread.

Forex trading scam

Forex is a multi-billion dollar market where currencies are traded in pairs. Since an enormous amount of money is floating in the market, scammers also have an eye on it. These scammers or unscrupulous operators are not accountable to any government body or regulatory authorities and lure investors or traders to earn a fortune in a limited time with no or very nominal associated risk.

Crypto trading scam

This is another trading arena where a lot of money is involved. In most countries in the world, crypto is not recognized legally just as fiat money is. There is no governmental control over this virtual currency, which works on blockchain technology. 

Crypto scams can take many forms. Scammers try to steal your crypto (just as they try to steal your money) and will go to any extent to do so. There are several ways scammers, fraudster, con artist and thieves can get your crypto or trick you into giving it to them. The scammers trick you into parting with security codes or trick you into sending crypto to a conceded or compromised digital wallet.

Investment scams

To protect themselves from future inflation and lead a contented lifestyle post-retirement, people invest their money during their working lifetime. Many approach financial advisors for help with better investment opportunities. Most financial advisors are skilled, honest, and ethical. However, there are always a few bad eggs that spoil the reputations of thousands of upright financial advisors.

Many scam investment advisors try to spoof money from the rich and elite clients to fill their own pockets and are engaged in fraudulent behavior. Bernie Madoff is a very good example of an investment scammer and is synonymous with the Ponzi scheme. An investment scammer targets a group of friends and, along with the Ponzi scheme, siphons off money that the recruit has paid. The Ponzi scheme claims to generate huge, unrealistic returns, but at the end of the day, the scheme collapses as recruits dry up.

Fund recovery scams

Many companies or firms promise to recover funds lost to or stolen by scammers. But only on the condition that a small amount of fee is paid in advance or upfront. They do nothing to help you but take the fee and disappear.

It is a double whammy for the scam victim. First, the scammers make away with the victims’ hard-earned money, and then to retrieve their lost funds, they are swindled by fund recovery companies or firms.

Be aware of fake fund recovery service providers who claim to have expertise and experience in recovering lost or stolen funds. Mostly, they get your contact details from scammers, court filings, or the grey market. Be alert if you get any soliciting calls regarding fund recovery out of the blue. They cold-call you out of the blue, use aggressive tactics, demand secrecy, and promise inside connections. At the end of the day they will just scam you.

If you are a victim of any of these scams, contact us immediately. We can help help you to file a complaint against a scam broker and help you in fund recovery.

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