How to Recognize Six Major Types of Scams

Investment scams ask you to spend money with the promise of making more in return. 

How to recognize an investment scam 

Some common signs of an investment scam: 

• You are promised big investment returns, guaranteed income, or guaranteed profit. 
• You are told there is little risk. 
• It doesn’t involve any special skills or effort. 
• You are promised a “'secret method”' or a “'proven system”' that supposedly makes money reliably. 
• You are pressured to invest immediately or risk missing out on the opportunity. 

Making early profits does not mean it is a real investment. Scammers often give small profits to encourage larger investments. 

How to avoid an investment scam 

Before you invest your money, verify the investment opportunity is real. 

• Research the investment. Look up the company or person online and add the word “scam” to your search. 
• Talk to someone you trust before committing any money. 
• Do not let anyone rush you. If someone says the opportunity will not last, consider it a warning sign. 

The Federal Trade Commission (FTC) has more information about investment scams at this link. 

Job scams may ask you to pay money for a job or get you involved in a crime without your knowledge.  

How to recognize a job scam 

Common signs that a job is a scam: 

• It pays well but does not require much experience or skills. 
• You can work from home and set your own hours. 
• You are asked to pay for materials, equipment, or classes before you can start. 
• You are not sure what your job really is. For example, your only task is to receive packages and forward them somewhere else. 

How to avoid a job scam 

Protect yourself with these actions: 

• Contact the company using a different method and ask if the job is real. 
• Never pay an employer money to get a job. 
• Ignore generic or unexpected texts about jobs.  

Real employers will never ask you to pay to start working.  

The FTC has more information: 

• More information on job scams. 
• More information on task scams. 

A related scam is the business opportunity scam 

Business opportunity scams may promise huge profits but cost you much more than you'll earn. 

Common signs that a business opportunity is a scam: 

• The company is not clear about whether you will be an employee or not. 
• The best or only way to make money is by recruiting additional people into the program. 
• Ads talk about making “up to” a certain amount of money, but do not say how much the average person earns. 

The FTC has more information: 

• More on business opportunity scams. 
• More on multi-level marketing programs and pyramid schemes. 

Imposter scams involve someone pretending to be a trusted organization or person. Their goal is to steal money or your personal information. 

How to recognize an imposter scam 

Here are some ways to tell that someone is pretending to be someone they’re not: 

• You are contacted unexpectedly by phone, text, email, social media, or a pop-up message.  
• Their story does not make sense or changes when you ask questions. 
• They tell you to act right away or say something bad will happen if you wait. 
• They ask you to send money or share passwords and personal information without giving you time to verify their identity. 

How to avoid an imposter scam 

Don't assume someone is who they claim to be. Here's how to verify: 

• Slow down and double-check the information. If it's real, they'll let you hang up and call back.  
• Don't trust caller ID, email names, or text messages. Scammers can fake these.  
• If there are requests for personal information, ask yourself whether the organization should already have that information. 
• Talk to someone else, like a trusted friend or family member.  

Imposter scam #1: Government imposters 

In this scam, someone calls or texts you pretending to be from a government agency. They often say you are in trouble and need to act right away. 

Some examples: 

• Someone texts from the DMV saying your license has been revoked. You need to act quickly to get it back. 
• Someone calls from the sheriff’s office and insists there is a warrant out for your arrest because you missed jury duty.  
• Someone calls from the IRS claiming you owe back taxes. If you don’t pay immediately, you could be arrested. 

These scammers may know personal details about you and can give you case numbers, badge numbers, or names that sound real. 

Government agencies will never: 

• Ask you to pay using crypto, gift cards, or direct person-to-person payment apps. 
• Tell you to transfer money immediately to “protect it.” 
• Reach out to you using social media to discuss important matters.  

Most government agencies post their phone numbers and email addresses online. 

The FTC has more information about how to avoid government imposter scams here.   

Imposter scam #2: Family imposter and “grandparent” scams 

In this scam, someone calls you pretending to be a family member in trouble. For example, someone calls pretending to be your grandson who has been arrested and needs money immediately to make bail. 

To avoid these scams, take a deep breath, write down what was said, and hang up the phone. 

• Call back using the number you already have saved in your contacts.  
• If you can’t reach the family member who called, ask other relatives or friends if they can contact them. 
• Consider setting up a safe word with family members to use when calling each other. 

The FTC has more information about how to avoid “grandparent scams” here. 

Imposter scam #3: Romance scams 

Many relationships now begin online, and scammers take advantage of this. They may pretend to be interested in you just to ask for money or gifts. 

How to protect yourself: 

• Talk to your friends and family about your new relationship. Are they concerned you may be taken advantage of? 
• Ask to meet in person or to video call with them.  
• Search their name and job online along with the word “scammer.” Scammers often reuse the same job story, so you may find others reporting the same scam. 

The bottom line: Do not send money or gifts to someone you haven’t met in person. 

The FTC has more information on how to avoid romance scams here. 

Imposter scam #4: Business imposters 

Scammers frequently pretend to be well-known businesses. Here are some examples:  

• You get a text claiming that your Amazon account was accessed from another country. You need to provide your name and password to stop access. 
• You get a message from “Geek Squad” saying your computer has been compromised. You need to provide remote access for it to be fixed.  
• You get a message from FedEx claiming they were unable to deliver a package and asking you to click a link to reattempt delivery. 

Even though these scammers try to rush you, take your time and check if the information is real. 

• Call the business at the number listed on their website. 
• Or log in to your account the way you normally do.  

The FTC has more information to help: 

• Tech support scams 
• How to recognize and avoid phishing scams 

Oregon Consumer Justice has a comic book about building digital safety skills.

Rental scams usually involve someone posting an advertisement for a rental to get you to wire money or steal your identity.   

How to recognize a rental scam 

Here are some common signs that a rental is a scam: 

• The rent is much lower than similar homes in the area or seems too good to be true. 
• You are told to send money before you can see the home or meet the landlord. 
• The landlord makes excuses for why they cannot show you the home in person. 
• The listing has missing details, photos that do not match the home, or a story that does not seem to make sense. 

How to avoid a rental scam 

Before sending money or personal information, take these precautions: 

• If you can, visit the apartment or house in person. 
• Search the property owner or rental company’s name online with the words “scam” or “complaint.” 
• Never pay with gift cards, cryptocurrency, or wire transfer services like Western Union. 

The FTC has more information on how to spot rental scams.

Online sales scams usually happen on websites or apps where people buy and sell items. A scammer may pretend to be a buyer or seller to steal your money or personal information. 

How to recognize an online sales scam 

Here’s how to tell if someone is using an online marketplace to try and scam you: 

• An item is priced much lower than similar options on the market. 
• Someone offers to pay before seeing the item you are selling in person. 
• Someone wants to pay you, or asks to be paid, using an unusual method. 

How to avoid an online sales scam  

To stay safe in online transactions: 

• Refuse to accept a mobile payment from someone you haven’t met in person or a payment for more than the selling price. 
• Meet in a safe, public place whenever possible. 
• Look at the item before you pay for it. 
• Do not share passwords or security codes with anyone. 

The FTC has more information on how to avoid scams when you're buying or selling online.

Disaster scams usually happen after a wildfire or other disaster. A scammer may pretend to offer help or services to steal your money, personal information, or insurance payments. 

How to recognize a disaster scam 

Some common signs of a disaster scam: 

• Someone contacts you after a disaster and offers help you did not ask for. 
• You are pressured to pay right away or sign over your insurance proceeds. 
• You are asked to pay before the work is done or before you have a written agreement. 
• The person makes promises that seem too good to be true or cannot clearly explain what they will do. 

How to avoid a disaster scam 

Scammers move fast after disasters. Before you hire anyone: 

• Take your time before hiring someone or signing a contract. 
• Get written estimates from more than one contractor before you decide. 
• Do not pay the full cost before the work is finished. 
• Check the contractor's license, insurance, and references before hiring them. 
• Be careful of anyone who shows up at your door or pressures you to act right away. 

Tip: FEMA never charges application fees.