Watch out for financial scams around you

There are many kind of scams and frauds around you and chances are to loose your money, if you are not informed about them. These are tips and some essential information which would help you know more about financial scams.

These information are provided from "Money Made Clear"(FSA)a site, UK’s financial watchdog set up by the government to regulate financial services and protect your rights.
Tips:

* It sounds too good to be true – when it comes to scams and swindles it usually is!
* You have to give away personal or account information – trustworthy firms never normally ask you for this.
* You have to make a quick decision – scammers don't like to give you time to think about the offer, saying things like "if you don't act now you'll miss out".

Current financial scams

Identity fraud – someone impersonates you without your knowledge, often by stealing discarded or lost documents or your personal data. Details are also collected through bogus communications, phishing and social networking websites. The first you may know about this this is when you check your account statements.

Bogus communications – you might get letters or emails from scammers posing as an FSA-regulated firm (or even scammers claiming to be the FSA) to try to persuade you to give away your personal or financial account details. If in doubt, call the firm directly using the number listed on our Register to make sure the communication is genuine – see Check our Register

Online fraud (phishing) – fake bank websites are another tool that crooks use to try and get your details and money.

Social networking websites – with the growing popularity of websites, such as Facebook, Myspace and Bebo, fraudsters have more and more ways to get personal details. Think carefully about the information you put online – remember, it's not just your family and friends who can see it!

Advance fee scams – letters or emails that offer you vast sums of money if you make payments up front. The scammer will tell you that you have been singled out to take advantage of a profitable business venture, won a lottery that you didn’t enter or help a charity to move money abroad where it is needed. But there is no reward and no such charity – only the risk of severe financial loss if you enrol!

Share scams (also known as boiler rooms) – a stranger rings you out of the blue and tries to offer you shares in a company you have never heard of. They may be part of a financial scam using hard-sell tactics to persuade you to buy shares. If you buy them, you may be left with potentially worthless shares, and because most of these boiler rooms are based overseas you may have no rights to complain or claim compensation.

Affinity fraud – investment scams that usually target members of a group, such as a community or a religious, ethnic, elderly or professional group. Often the scammer will claim to be a member of the group, or sell the scam to a few prominent members first in order to gain the trust of the others.

Chain letters – letters or emails that contain a list of names and guarantee you a huge return for your small initial investment. This scam operates in a similar way to pyramid schemes in that you pay a fee to join the chain. The only way to recover any money is to recruit more members, but it’s only people who join at the very start that make any money.

Fund transfer schemes – scams that tempt you to use your bank account to withdraw cash transferred into it and send it on using a money transfer service (for a generous commission). But you could wind up with a prison sentence too as the scammers are only trying to launder money gained through criminal activity.

To know more about scams and swindles
There are tips and suggestions from the same site: Staying safe against scams