The scam? Sometime after the money has been sent off by the victim and claimed by the scammer, the check is discovered to the a forgery. The victim’s bank demands that they pay back all of the money, plus fees for the returned check and any checks the victim has now bounced because their account was debited for the amount of the bogus check.

We refer to mystery shopper scams, but in fact this is a check/wire transfer scam.

Mystery shopping is just one of many disguises used by the scammers. One version involves the scammer buying something through eBay or CraigsList, then sending a check for thousands more than the purchase price and asking the seller to wire the difference back to them. Scam.

Now the scammers are targeting lawyers. According to a story in the ABA Journal, two Hawaiian law firms were swindled out of half a million dollars with this same scam. A “client” retained them, then sent a huge overpayment and asked them to wire back the difference. Same song, new verse.

Folks, the bottom line on this is: NEVER WIRE MONEY TO SOMEONE YOU DO NOT KNOW. Ever. Even if you think you know them, even if they claim to be giving you money or a job, or buying something from you. Even if they claim they are a friend of your grandson, and he needs the money to get out of jail. (Another common variation on this scam.) Even if anything.

Once more: NEVER WIRE MONEY TO SOMEONE YOU DO NOT KNOW. It is always a scam. In every case. Always.

Here is the story about a secret shopper scam that appeared on a Wisconsin television station. According to the report, a woman signed up to be a mystery shopper and completed some price audits. She was paid $10 to $20 for each of them. Fairly common, right?

According to the news story, after doing several of these audits over the course of six to eight months, the company for which she had been working sent her a check for $1975, telling her to keep $100 or so for her fee, and to wire most of the money to someone. You know how this ends, right? Of course, the check she received was fraudulent, and she was out the money.

It is possible it happened exactly as stated in the report: A scammer actually made several small payments to a potential victim to convince her that she was working for them as a mystery shopper, so that she would not question it when they sent her a large check and told her to wire money somewhere. However, I doubt that.

Why would scammers spend so much time (and work that hard) over the course of six to eight months for $1500 or so, when there are still people lining up every day to fall for their scams without all that effort? That makes me think that the story is not exactly as it appears.

My theory? I think the victim signed up as a mystery shopper and was doing some actual mystery shopping jobs for a real company. When the check showed up, she assumed that it was from one of the companies for which she had been working.

Many scammers use the names of legitimate companies when they run their scams, and the names of many mystery shopping companies are very similar. It would be easy to confuse them if you are not paying attention.

The most important thing to remember is that NO MYSTERY SHOPPING COMPANY WILL ASK YOU TO CASH A LARGE CHECK AND WIRE MONEY TO SOMEONE. It is always a scam.

What else could this woman have done to avoid getting scammed? If something is out of the ordinary, check it out. Most mystery shopping assignments are made over the Internet. If you have been getting assignments via a website and suddenly something shows up in the mail, contact the company and ask about it. And do not use the contact information in the mailing. Go online and look up the company to find out if the legitimate company is the one that sent the mailing.

Not sure what the real company website should be? Check to see if they are members of the Mystery Shopping Providers Association. There are links to member companies there. Or check this list of legitimate mystery shopping companies.

Likewise, if you have been dealing with schedulers at a company and suddenly get an email from someone claiming to be with that company but using an email address at Gmail, Yahoo, Hotmail or some other service, it is probably not legitimate. Mystery shopping companies and their representatives tend to use the email addresses associated with their company websites, not free services such as Gmail.

Another out of the ordinary thing about this assignment was the pay. She was offered at least $100 for a simple shop, when she had been receiving $10 – $20. Huh? What’s up with that? Something sounds fishy.

Keep track of where you have applied and which companies you have worked with. Do not assume that when a possible assignment comes to you, it is from the company you know and trust. Many of these names sound similar: Mystery Shoppers Something, Something Secret Shoppers, Customer Service Whatever…

Do not become so excited by the possibility of making a couple of hundred dollars that you allow yourself to be scammed out of thousands. Be vigilant.

One shopper forwarded some correspondence between a friend of hers and a scammer. Fortunately, the shopper had stopped her friend before she fell for the secret shopper scam. However, I was somewhat shocked to see some of the assumptions her friend had made. It was clear that this woman was bright and educated, but it never occurred to her to question anything the scammer presented about himself. For example, at one point she informed the scammer that she had checked out his company with the Better Business Bureau, and was pleased to find that they had a satisfactory rating. That would not be a bad idea, except that the scammer had no affiliation with the company whose name he was using. You read that right: a criminal was willing to lie. Are you surprised?

First rule of scams: Do not assume that scammers are telling you the truth about who they are or what company they represent. If they will steal thousands of dollars from you, they will also lie.

How can you tell that they may be misrepresenting themselves? Start with the email address. If someone is a scheduler or other employee or official representative of XYZ Company, their email address will probably be at that company’s domain. For example, john.smith@xyzcompany.com. If they are using an address from Gmail, Yahoo, AOL, Hotmail or elsewhere, assume it is a scam.

Another way to check is to do a Google search for the name of the company they claim to be with. If you find nothing, that is not a good sign. That probably means they made up the name. If you find a company that has nothing to do with mystery shopping (e.g., a textile company) they are probably not offering a legitimate opportunity. If they are using the name of a legitimate mystery shopping company, there will probably be a scam warning on the real company’s website, warning of the scam. Pay attention.

Do not rely on calling a phone number or looking at a website provided by the scammer. They can lie about these things, too. Do your own research.

Research is probably not necessary in a few situations. For example, if you get a check in the mail and they want you to cash it and wire money somewhere, it is a scam. No question about it. It doesn’t matter how much the check is for, what company they claim is making the “mystery shopping” assignment, where you are to wire the money or anything else. It is a scam. Do not cash the check and never wire money to anyone you do not know.

I get a lot of questions from people who say they got a check from a company and they want to know if this company is legitimate. THE NAME OF THE COMPANY DOES NOT MATTER. If they sent you a check and want you to wire money somewhere, it is a scam. The one you got is not the exception. One more time: It is a scam.

Do not rely on the judgment of the teller at your bank that the check, “looks good to me.” These checks often look very good. Looking good is not the same as being a valid check. And the teller will not be responsible for paying the money back to the bank, you will be.

Other warning signs of a mystery shopper scam include representations of full-time employment (very rare in mystery shopping) and promises of hundreds of dollars for a couple of hours of work.

The people asking questions about these scams are suspicious or they wouldn’t ask. Trust your instincts. It is trite, but true: If it sounds too good to be true, it probably is.

MoneyGram International, Inc., the second-largest money transfer service in the United States, will pay $18 million in consumer redress to settle FTC charges that the company allowed its money transfer system to be used by fraudulent telemarketers to bilk U.S. consumers out of tens of millions of dollars. MoneyGram also will be required to implement a comprehensive anti-fraud and agent-monitoring program.

While this is only a fraction of the money stolen by fraudsters using MoneyGram and Western Union transfers, it is a start. (You can read more about the mystery shopper scam here.)

I spoke to representatives of both Western Union and MoneyGram a while back about what they were doing to prevent fraud. The answer, although they claimed otherwise, turned out to be, “not very much.” It also appears now that, at least in the case of MoneyGram, in some cases their agents were active participants in the scams. According to the FTC:

The FTC charged that MoneyGram knew that its system was being used to defraud people but did very little about it, and that in some cases its agents in Canada actually participated in these schemes. According to the FTC’s complaint, MoneyGram knew, or avoided knowing, that about 131 of its more than 1,200 agents accounted for more than 95 percent of the fraud complaints it received in 2008 regarding money transfers to Canada; a similarly small number of agents was responsible for more than 96 percent of all fraud complaints to the company in 2006.

This settlement not only requires MoneyGram to pay $18 million to be used in consumer redress, they also have to change their practices and more closely monitor complaints and agents involved in questionable transactions.

The agreed-upon court order settling the FTC’s charges bars MoneyGram from knowingly providing substantial help or support to any sellers or telemarketers that are violating the Telemarketing Sales Rule and requires it to implement a comprehensive anti-fraud program. Under the anti-fraud program, MoneyGram must conduct background checks on prospective agents; educate and train its employees about consumer fraud; institute agent monitoring; and discipline agents who don’t comply with the rules. The order also requires MoneyGram to provide a clear and conspicuous fraud warning on the front of all its money transfer forms. The order’s conduct provisions apply to all MoneyGram money transfers sent worldwide from either the United States or Canada.

The order contains monitoring and discipline provisions that will ensure MoneyGram is properly training, monitoring, and taking actions to address problems related to its agents. To do this, the order requires MoneyGram to develop and maintain a system for receiving consumer complaints and data, and to provide that information to the FTC upon request. MoneyGram also must take all reasonable steps to identify agents that are involved in fraud. It must review its transaction data to identify any unusual or suspicious activity by its agents and fire any agent who it believes may be participating in fraudulent activities. It also must fire or suspend any agent who has not taken appropriate steps to stop fraudulent money transfers.

This is certainly good news for those of us who are working to educate the public about these scams. Let’s hope that the actions required by the FTC help in some way to reduce the incidence of this fraud. Unfortunately, fraud will never go away, but if some potential victims are saved from the scammers, it is a victory for the good guys.

If you were a victim of one of these scams, the FTC says you should call 202-326-3755 to learn about claiming redress funds.

Question from a secret shopper:

I want to become a mystery shopper. When I search for information, I get a lot of sites that want me to join. Some of them seem to offer free mystery shops, but others charge a monthly fee. Before I start running up a bunch of charges, I need to know if I can make money as a mystery shopper, and which site I should join. Do I need to join more than one? Help!

First of all, yes, you can make money as a mystery shopper. But you do not need to pay anyone to become a mystery shopper or get mystery shopper jobs. Legitimate mystery shopping companies will not charge you to apply to them.

The “mystery shopping sites” that want to charge you range from sites that provide a service (such as notifying you of job postings) to out-and-out scams. Even most of the sites that provide a service, however, are unnecessary and redundant. Just sign up with a few companies and you will soon have lots of notices of mystery shopper jobs in your area.

Start by applying to some of the companies on this list of nearly 200 legitimate mystery shopping companies. You don’t need to apply to all 200, of course. Start by applying to 10 or so, then apply to a few more as you can. There is no magic number of companies you should apply to. Many shoppers have registered with 50, 100 or more mystery shopping companies. Don’t forget to apply to mystery shop scheduling companies. They work with many secret shopping companies and can offer a wide variety of shops. (Just as with legitimate secret shopping companies, mystery shopper schedulers do not charge you to apply to them, either.) This post on how to become a mystery shopper (and the quick start plan in The Mystery Shopper’s Manual) can help you jump start your mystery shopper career. Good luck!

Using a state-sponsored job board is just another example of the things criminals will do to make their scams appear to be legitimate. Many job seekers probably believe that companies and their postings are reviewed and approved by the state before a job can appear on the board. Not true. From this article about the mystery shopper scam, it sounds as if it was a job seeker who discovered the fraud and informed the state. Fortunately, the state did take action when they learned about the bogus jobs.

The lesson in this is not to be too trusting and assume that anything with a cloak of respectability is actually respectable. The people behind these secret shopper scams do things to make themselves appear to be legitimate. They use the names of legitimate mystery shopping companies. They claim to be mystery shopping for respected brands, such as McDonald’s and WalMart. And now they are soliciting victims through state employment agencies.

Learn more about mystery shopping scams.

Find legitimate free mystery shopper jobs.

A woman in Brooklyn Center, Minnesota (near Minneapolis) received one of those “be a mystery shopper for us” scam emails promising $300 for a simple mystery shop. After responding, she received a check for $2700, with instructions to cash the check, perform the “mystery shop” and wire most of the money to someone in Africa.

When she went to her bank to cash the check they immediately spotted it as a fake, and called the police. The good news is that she didn’t wire the money to Africa and lose thousands of dollars to scammers. The bad news is that the wanna-be mystery shopper was arrested and spent the night in jail.

Police say they have not decided whether or not they will file charges against her. (My guess is that they will not. It seems pretty likely that she truly was the victim, not the criminal, in this scenario.)

The lesson: If it sounds too good to be true, it probably is. And passing a bad check could land you in jail.

You can see the mystery shopper scam story from CBS-affiliate WCCO at their website.

07/31/09 Update: Same basic story, but this time in Georgia. Another mystery shopping scam victim jailed.

Learn more about mystery shopping scams.

Mystery shopping companies do not send checks for thousands of dollars to potential mystery shoppers. Ever. They do not ask you to wire money. Ever. I have written about mystery shopper scams many times, but even some of the people who read those articles will want to believe that their situation is the exception, and they are going to get paid $400 for a couple of hours of work. Not gonna happen. Ever.

Before you cash the check and wire the money off to the scammer, humor me for a minute. Do a couple of things to check them out. If I’m wrong and the “offer” if legitimate, you can post a comment and say I was wrong. But if I’m right, you will save yourself thousands of dollars, lots of aggravation, and possibly some jail time. (Cashing a forged check is a crime, and you may have to convince the police that you are the victim to get out of trouble.)

Here’s what to do…

Call the company listed on the check and see if they sent it to you. Do not rely on a phone number on the check or in the package you received. Go look them up online and find contact information for them. Sometimes the check has the name of a legitimate mystery shopping company on it, although they did not send the check. But I have seen some drawn on accounts for auto parts stores and other businesses. Why would an auto parts store be paying you to mystery shop WalMart and Western Union?

Anytime a scam involves a cashier’s check, official check, or money order from a bank, and you believe that it could be counterfeit, you should contact the issuing bank directly to verify authenticity. As with the company that supposedly issued the check, when contacting the bank, do not use the telephone number provided on the check, as this number is probably not associated with the bank, but rather with the scam artist.

To locate a bank’s mailing address, you can check the FDIC’s Web site at:
http://www2.fdic.gov/idasp/main_bankfind.asp.

So now you have learned that the check is a fake. What should you do next? Resist any impulse to call the person behind the mystery shopper scam. One option is to shred the check and throw it in the trash. Another is to contact the authorities. In addition to notifying the bank named on the check, there are others whom you also should notify if you receive a counterfeit item. They include:

• For all scams: Federal Trade Commission (FTC): by telephone at 1-877-FTC-HELP or file an electronic complaint via their Internet site at www.ftc.gov.
• For Internet-based scams: Federal Bureau of Investigation (FBI) Internet Fraud Complaint Center: www.ic3.gov.
• For mail-based scams: U.S. Postal Inspector Service: by telephone at 1-888-877-7644, by mail at U.S. Postal Inspection Service, Office of Inspector General, Operations Support Group, 222 S. Riverside Plaza, Suite 1250, Chicago, IL 60606-6100 or online at http://www.usps.com/postalinspectors/fraud/MailFraudComplaint.htm.

If I was wrong about your check, post a comment and let me know. You can even taunt me. But if I was right…well, I won’t even say, “I told you so.”

Recently, the psychology department at Exeter University, working on behalf of the UK’s Office of Fair Trading, released a study detailing how and why people fall victim to scams. They found that several persuasive techniques were commonly used by scammers, including:

• Appeals to Trust and Authority – In the secret shopper scam, this is done by using the names of trusted mystery shopping companies, and well-known businesses such as Wal-Mart, Western Union, McDonald’s and others.
• Visceral Triggers – Scammers prey on basic human desires and needs to get an emotional response from their targeted victim. Many scams, including the secret shopper scam, convince the recipients that large sums of money await them.
• Scarcity – Many mail and e-mail scams appear to be personally directed to the recipient. They make it sound as though you were “chosen” out of many other people for this opportunity. There is also a stated or implied sense of urgency—you must respond now or miss out.
• Behavioral Commitment – Scammers may begin by asking for a small commitment. For example, they may ask you to respond to the e-mail with some basic information. Once the victim has taken an initial step, no matter how small, it becomes easier for them to take the next step and the next.
• The Promise of a Big Reward for a Small Cost - The mystery shopper check scam promises hundreds of dollars in return for work that they claim will take more no more than a couple of hours.

Although many of the findings of the study were as to be expected, there were some surprises too. Many scam victims:

• Have a better than average knowledge about the topic involved in the scam – This may not be true with the mystery shopper scams; however, it is commonly true in scams involving a lottery or investments.
• Spend more time analyzing the scam then non-victims – This may reflect the fact that people who do not fall victim to the scam it immediately recognize it as a scam and give little or no thought to it.
• Recognize that there is something wrong with the offer and they are taking a gamble – Often, though, the size of the promised reward causes them to ignore the little voice in their heads and take a chance that it is in fact legitimate.
• Do not discuss the scam offer with others – Perhaps this is because they intuitively know that there is something wrong with the offer, and they do not wish to risk someone else pointing out the flaws in the offer to them.

How can you avoid being the victim of a scam?

Do not take the information in an offer at face value. Scammers who will steal thousands of dollars from you will lie about who they are, and what organizations they are affiliated with. Do not assume that because they use the names of trusted organizations they have any association with those companies.

Investigate before you commit. Go online and do a search. For example, a search for “mystery shopper check” turns up dozens, if not hundreds, of warnings describing exactly how the scam operates. Talk to people you trust to get advice about other ways you might check out the offer.

Most importantly, listen to your little voice. If something sounds too good to be true, it probably is.

Here is the email the mystery shopper received:

Subj: Vacant Post for Mystery Shoppers
From: xxxxxxxxx@gmail.com
Reply-to: xxxxxxxxx@hotmail.com

Mystery Shopping Providers Association is giving you a chance to get paid for shopping and dinning out. Mystery shoppers are Needed Throughout America . You’ll be paid to shop and dine out-plus,you can also get free meals,Free merchandise, Free services, Free Entertainment, Free travel and lots more, Great Pay, Fun Work, Flexible Schedules,No experience required.If you can shop-you are qualified! But you must be 18yrs and above.

This is a new Year, you can start earning free cash as our Shopper. We can assure you that is going to be fun and you will love it
kindly send us a reply to inquiry about the Job offer to the email below

xxxxxxxxx@gmail.com

We care and We share. We will be expecting to read from you

[Alleged Name of Slimy Scammer]
Admin Agent
www.mysteryshop.org
© MSPA, 2009

There are a few clues that this is a scam.

First, the MSPA does not hire shoppers. They are an association of mystery shopping companies. Their members hire secret shoppers, but MSPA does not.

Most legitimate mystery shopping companies do not use free email services such as Gmail, Hotmail and Yahoo. Emails will come from addresses at their domains. Be suspicious of emails from free services. Most email scams use these free services, not email from the domain they claim is theirs. In this case, the mystery shopping scam is supposed to be from the MSPA, but the scammer is using Gmail and Hotmail.

The email is very badly written. The grammar, capitalization and punctuation are…awful. Another sign of a scam.

The secret shopper scam relies on at least some of the recipients believing it is legitimate, and responding. To that end, the email scam uses gimmicks to make the offer appear to be from a legitimate mystery shopping company. For example:

They claim to represent the Mystery Shopping Providers Association, a respected organization in the secret shopping industry. Other scams have used the names of legitimate mystery shopping companies. Do not take this at face value. Remember that if a scammer will steal thousands of dollars from you, they will lie about who they are.

The email closes with, “We care and We share.” What a lovely sentiment! This email scam must be from very nice people. I certainly feel I can trust them now. (Not!!) This is followed by the name of a person to make it appear real.

The email scammer even put a copyright notice at the bottom of the email, saying that the email copyright is held by MSPA.

Healthy skepticism is a good thing. Do not take emails at face value, and do not believe everything you read.

If you receive an email claiming to be from a legitimate mystery shopping company that raises any of the red flags listed here, look up the company online and find their real contact information. Contact them to verify that the request is from them before providing any information.

And do not assume that every mystery shopping company with a web site is legitimate. It is easy and cheap to put up a web site, and there is nothing to stop a scammer from setting up a nice looking site to fool you. See my earlier article for tips on spotting a mystery shopper scam site.