The best way to keep from being get scam refund in the first place is to avoid them upfront. Remember the old adage, “If it’s sounds too good to be true, it probably is”. The secret to avoiding scams is to be able to recognize them before you spend your money.
There are several clues to a scam. The first, as stated above, is a fantastic offer. And the scammer is in a hurry, trying to convince you the time is now. Act fast before its too late. They don’t want you to think.
For example, investments are one place for scams. Witness the Bernie Madoff in the papers. They typically will offer a return on investment (roi) 2 to 3 times what you can do in the marketplace. If most investments are paying 4%, then they will offer 8% to 12% or even more. Madoff’s Ponzi scheme worked that way. People got caught up in a frenzy and didn’t check things out.
A Ponzi scheme, named after a gentleman almost 100 years ago, where he took money from secondary investors to pay the primary investors their high return. And it escalates from there. But, investors are not aware of this upfront.
The fact the scam artist is paying such high rates should be a tipoff immediately. Check it out before investing. How long is he in business? What actually is he investing in? The fact Madoff was working with billions of dollars, and no one thought to investigate. Start with state and federal regulators. There usually is a license of some type required. Check with competitors in the same field.
Other means of recognizing a scam, include the fact they usually want cash up front. It may be only a few hundred dollars. But that’s usually the first step. Once they have you hooked, then they put you on the elevator and start going for thousands. Again, they are always in a hurry, tomorrow may be too late. Hurry, do it now.
Determine if this company really exists. Call BBB, call state regulators. Run a Google search on the company. Do they have references? If so, call them. Is it a local company? Then they should be listed in local yellow pages.