Scams aimed at consumers

If you are a consumer in Cheshire and want to report a scam, go to Citizens Advice Consumer Service. Alternatively look at some of the consumer communications scams.

Direct mail scams

Have you ever been told that you have won a prize draw or holiday or lottery but you do not remember entering a competition? Many people receive mail or telephone calls advising them they have won a prize when it is in fact a scam. We would advise you to throw the offer away but here are some more tips to avoid becoming victim of a scam:

  • Read the small print very carefully to see what the restrictions and costs are. The prize might not be as attractive as it first appears.
  • Never send any money in order to receive a prize
  • Check to see if you need to pay an administration fee, it might suggest that the holiday is “free” but you may have to pay taxes, transfers, administration costs which can all add up. There is usually availability restrictions and you might have to give very short notice.
  • Do not give your personal or bank details to anyone.
  • Look at the small print to see what the chances of winning are.
  • Do not ring the premium rate number. Often the cost of the call is more than the prize is worth.

Limit the volume of unsolicited mail you receive by registering with The Mail Preference Service.

MPS can help consumers in decreasing the amount of junk mail they receive at home.

If you are unsure about any mailing you have received you can check if the company is a member of the Direct Marketing Association. Their members have to comply with a strict code of practice.

Solar energy

Many people are looking for a more economical and environmentally friendly way of providing your household energy needs. Be aware of unscrupulous companies making false claims in relation to potential savings in fuel costs and solar energy systems at inflated costs.

If you are considering changing to solar energy then shop around and get quotes, ensure prices given are written quotations and not estimates. Listen carefully and take notes about what the salesperson says, request written information to back up the claims that they make.

For information visit the Solar Trade Association

If a trader cold calls at your property then you have 7 days to cancel however remember if you invite a trader to your home you usually do not have the right to cancel so think carefully before signing.

Scratch cards

You may have seen scratch cards that come free with magazines and newspapers. These scratch cards ask you to scratch the panels to see if you are a winner. Every card will be a winning card but there is a catch! If you read the small print you realise that you have to ring a premium rate number to claim the prize. The product you are likely to win would be of less value than the telephone call you have to make.

We would advise you to throw the cards away. Remember, if it looks too good to be true it probably is.

Holiday clubs

A holiday club is marketed as a membership scheme offering consumers the opportunity to have lifetime luxury holidays. In return for your membership the company will find you holidays. Although some of these clubs are genuine, many leave consumers out of pocket and only provide last minute and low quality holidays. Consumers may end up paying thousands of pounds upfront but some Holiday Clubs do not deliver what they promise. The consumer may also have to pay a lot of money for flights, transfers etc and it can end up costing them more than if they had booked through a travel agent.

Holiday clubs are not timeshares so consumers do not get any cancellation rights and consumers may have to sit through a presentation which can last up to 6 hours. They will tell you that you have to sign up on the day.

We would advise anyone to think carefully before attending a Holiday Club presentation and if they do attend the presentation they should not sign anything on the day but ask if they can take the details away with them to consider. If you do not have time to consider the offer do not sign the contract. You have no cooling off period if you change your mind. Further information on holiday clubs and timeshare.

Nigerian or 419 scam

Hundreds of people have been affected by the Nigerian or 419 scam. It is called 419 after section 419 of the Nigerian Penal Code, where it is thought the scam first originated.

This scam is aimed at both consumers and businesses. The way the scam works is that you receive an email or a letter from someone who claims to be a senior government official, politician, solicitor or accountant.  The writer of the letter indicates that he has a large sum of money and he needs your help in moving it out of the country.  All you need to do is provide your bank details and if you can help you will be financially rewarded. There is no money and once the person has your bank details they will take money out of your account. Do not reply to these letters or emails. There have been cases where businesses have sent polite written refusals to the request and have found that their letterheads and logos have been copied.

If you have lost money to this scam, you can contact the West African Organized Crime Section of the Serious Organised Crime Agency.

Pyramid selling

Pyramid selling involves recruiting members to invest money and then those people recruit others who also pay. If enough members join the scheme the pyramid will continue to grow. The people at the top of the pyramid (investors) make money because they take profits from those who join later but people further down the pyramid have less chance of making money because the amount you make depends on the number of people you recruit. Those at the bottom of the pyramid usually lose out because at some point no new members can be found.

The main purpose of the pyramid selling is to recruit new members not to sell the products. Pyramid selling is different from Trading Schemes also referred to as Direct Selling or multilevel marketing. These schemes can offer individuals a legitimate opportunity to earn money by selling the scheme's goods or services from home. The individuals are self employed and make money by selling goods and services.

Trading Schemes become illegal if the sole purpose of the scheme is to make money by recruiting other participants, rather than trading in goods or services. This is then referred to as “Pyramid selling”.

The Department for Business Enterprise and Regulatory Reform (formerly the DTI) has produced a guidance leaflet on Trading Schemes. For more information go to the BIS website.

You can also check whether the operator of a trading scheme is a member of the Direct Selling Association, which is a trade association for the direct selling sector.

Phishing / spam emails

Phishing is when you receive a spam email sent by someone who is pretending to be from your bank, building society or credit card company. The emails will ask you to verify your personal details, account number, pin number and passwords.  It will often say this is to prevent fraud or to update bank records. The emails look genuine and have all the correct logos. It is easy to be fooled into thinking that the email has come from your bank. A number of UK major banks have been affected by “phishing”.

If you respond to the email you may lose money from your bank account or you may be victim of identity theft!

To find out more about phishing and how to avoid it visit the banking industry advice website for safer online banking.

Missed phone call

Someone rings your mobile and leaves a message with their telephone number. When you return the call you ring a premium rate number. This is sometimes a mobile number starting 07 or premium rate number starting 09.

We advise consumers to check the number of the missed call before returning the call. Premium rate telephone numbers are usually a lot more expensive than the cost of a local or STD call. Do not dial a premium rate number until you have checked how much it will cost. Check out the premium rate number online at Phone Pay Plus and forward the details to Phone Pay Plus the regulatory body for all premium rate charged telecommunications services - you can fill out an online complaint form or telephone 0800 500 212.