Anyone who’s already been a scam victim can become a target of being scammed again by the worst of the worst – the refund and recovery scammers. They seek out scam victims who had already lost money or a social media account with the false hope that they can help them get back their money or account.
But don’t believe it.
Not only won’t they get back what you lost, but they’ll extract even more money from you. Their strategy is to pose as “experts” or “saviors” who can recover lost money or hacked accounts, and they target the vulnerable who have already been scammed, leading them to experience more financial loss, and commonly, they gain personal information they can use like a weapon against the victim.
One way they extract money is to ask you to pay them a retainer with the promise that you’ll get back much more. The other, even more diabolical method, they use when pretending to “help” you is getting information about your bank account, credit cards, and passwords. The lure is assuring you they can refund your money, and then they claim they need to gain access to your bank account, computer, or phone – they just need the number, link, or password. Or maybe they can find it while you are connected, by hacking your email, phone, or computer. Give them that access and the result is you end up losing not only money, but critical personal information.
In some cases, they might send you a check, supposedly to repay the money they recovered. But the catch is that they will ask you to pay a commission or maybe they send you too much and ask you to return the excess payment. Then, that check will turn out to be phony in a few days or weeks and you will be out whatever money you send them.
Sometimes the scammers will claim to be lawyers, government officials, consumer advocates, or even pose as recovery specialists with fancy websites to match. But the whole point of their persuasive pitch with reassurances that they’ll recover your money is to lull you into believing and trusting them. Then, after they’ve gotten your money or personal and account information, they’re gone. And often they’re elusive and hard to track down, since they may be in another state or country, or even part of a network of scammers who are adept at eluding the authorities.
The most common victims include:
Victims of recent frauds who are already anxious about their lost assets, so they are especially susceptible to false promises of recovery.
Active social media users, who are highly engaged on platforms like Facebook, since that makes them attractive targets, because losing access to these accounts can seem devastating.
Older adults who are scam victims or have social media accounts, since they may be less familiar with the online world, and often scammers target them for their perceived vulnerability.
Ironically, I became interested in writing about this topic after I created a Facebook group devoted to scams, since I had written a series of books on this topic, after I was unwittingly wrote for a company that created a book-to-film scam based on using a phony CEO from a real company to get clients to pay more and more for what I wrote, which the company marked up five or six times, and for a marketing campaign that went nowhere. I discovered the scam after talking to some victims who described how the company ripped them off; some lost $20,000 to $35,00. It was heartbreaking to hear their stories, which led me to write a book about this scam and the victims’ stories called The Big Con which was turned into the recently released documentary Conned: A True Story, featuring a half-dozen victims. Then, this experience led me to research and write about a series of scams and how to avoid them in I Was Scammed, which was turned into the film Con Artists Unveiled. And after I experienced an attempt to scam me, I wrote about the scammer who posed as a PayPal rep and tried to con me into spending nearly $10,000 on gift cards or lose all my money in the bank. But I foiled his plans by going to my bank, which closed my accounts, and I wrote about that experience in Scam Story. The three books are now published by American Leadership Books.
These books led me to create a Facebook group on scams to alert others about different scams and how to avoid them. But after the first 500 or so members joined, I discovered that virtually all the next individuals to join – about 3000 of them – were promoting recovery scams, claiming that they or their associates can help victims get back their money. Then, after my Facebook account and groups were stolen in an email replacement scam I wrote about in The Great Big Facebook Hack, also from American Leadership Books, I created a new Facebook group to replace that called Cons, Scams, and Frauds. Even so, after the first 50 or so members joined, the new members soon began pitching recovery scams, too. But even after I began blocking and banning the scammers and warned on the top of the site that anyone posting recovery offers would be BLOCKED and BANNED, the recovery posts kept coming. Presumably the scammers don’t bother to read these warnings.
So that experience with scams and recovery scammers has led me to investigate these especially dangerous scammers, who prey on people who have already been scammed. So their actions can be even more devastating, like more seriously injuring someone who is already injured and creating even worse pain.
Following is a discussion of how these recovery and refund scams work, how to avoid becoming a victim, and what to do if you experience such a scam.
How Recovery and Refund Scams Work
According to the Federal Trade Commission, here’s how these refund and recovery scams work.
The scammers target people who have already been a scam victim of any kind of scam, from paying for a fake product or service to investing in a fraudulent crypto scheme.
To get the names of previous scam victims, scammers can buy lists online in what’s called a “sucker list.” The lists include detailed information with the victim’s name, address, phone, number, the type of scam that victimized them, and how much money they paid. Such lists are bought, sold, and traded on the black market, along with other property taken from victims, including stolen social media accounts.
Another source of victims are the members of an online social media group devoted to scams and how to avoid them, such as “Cons, Scams, and Frauds,” the group I created that attracts many recovery scammers, along with victims or people interested in scams.
Once a scammer sights a likely victim, the scammer calls, emails, texts, or posts on the social media with the claim that they can get back the money, account, or unreceived prize or merchandise. Even if you don’t think you were scammed, the scammer can use the information they bought or acquired about you to make up a story about how you were defrauded in the past. So whatever the situation, they can fix things now.
Once you respond in any way, the scammer will seek to convince you to trust them. For example, the scammer may claim to be with a government agency, a consumer advocacy group, or a company devoted to recovering funds. Some scammers may even claim to be with the company that previously defrauded you and are now helping unhappy customers get refunds. Or sometimes they may claim to be with a government agency that has already obtained money for you, and you just have to file some complaint paperwork to get it back. They may even regale you with stories about other victims they have helped or point to testimonials on their website to back up their claims.
Then, having secured your trust, the scammers seek your money or personal information in various ways. One way is claiming that before they can recover your money, social media account, or merchandise, they need a payment or financial information from you. For example, they may call the upfront money a “retainer fee,” “processing fee,” “administrative charge,” “tax,” or “shipment and handling charge.” Or they may ask you to provide your “social security number, checking, debit, or other financial account number, so they can deposit a refund directly into your account.” Should you give them that information, they can take your money or take over your account.
How to Avoid Being a Victim
Here are some keys to avoid becoming a victim, recommended by the FTC:
Don’t respond to or trust calls, emails, or letters from someone who claims they can recover your money or an account you lost in a scam if you pay them a fee.
Don’t provide your bank account, credit card, password, or personal information to get a refund.
Don’t click a link or call a phone number in an email that is supposed to direct you to a customer service or government website. Instead, conduct your own search on the web or through Google for that person or organization and contact them directly.
If you are legitimately eligible for restitution you will usually be notified by mail, though if you receive such a letter, verify this information by going to the court or agency’s website or call them directly using information from that website. Don’t use the phone numbers or websites in the correspondence, since that could be from a scammer.
If any organizations or government agencies contact you, research that organization or agency online to make sure it’s legit, such as doing a search with the organization’s name combined with words like “complaint,” “scam”, or “review.” You can also check with your state attorney general to see if other people have complained about that organization or agency. You can also look up government agencies and call to confirm if they contacted you. But don’t call a number that you got from anyone who contacted you.
If you receive a check and are asked to pay anything back, such as for a commission, fee, or mistaken overpayment, don’t pay it. Commonly, the check will bounce after a few weeks when your bank detects it’s a fraud, and you’ll be out that money.
How You Can Get Your Money Back or Not and Report the Scammers
Often you can’t get back your money if you paid the scammer with certain types of nonrefundable funds, such as by sending gift cards, money orders, or wires. If you paid with a bank transfer, it’s up to your bank whether to issue a refund, which can depend on the amount and the case you make for being duped.
Generally, the local police won’t do anything about these cases, though they might take a report you can use for insurance purposes.
What you can do is to contact the Federal Trade Commission at ReportFraud.ftc.gov or at.cftc.gov/complaint. Or contact your state attorney general. If you notify your state and federal authorities, that can help the agencies track frauds, pursue the scammers, and warn others if they get a number of complaints about a particular scam.
Summing Up
In sum, scammers often contact individuals who have recently experienced financial fraud or account hacking, particularly on platforms like Facebook. They present themselves as experts or officials capable of retrieving lost funds or restoring access to compromised accounts.
In the process, these fraudsters skillfully extract sensitive personal information, including bank account details, passwords, and sometimes, remote access to the victim’s computer under the guise of “technical assistance.”
Some of these scammers are part of larger cybercrime networks, utilizing sophisticated techniques to evade detection. They operate from different parts of the world, making tracking and prosecution challenging. They are able to scam victims because they are skilled in social engineering, so they manipulate victims into trusting them and divulging confidential information.
Unfortunately, comprehensive global statistics on this type of scam are scarce, though the amounts lost are in the billions. For example, the Federal Trade Commission (FTC) in the U.S. reported losses exceeding $3.3 billion due to fraud in 2020, with a significant portion attributed to scams involving account recovery or financial restitution. And that’s only in the U.S. since these recovery and refund scams are worldwide.
These scams also present a challenge for law enforcement, since it can be difficult to track and apprehend the scammers, because they may be in other states or countries, move frequently, create fake websites and accounts, and disguise their identities. However, in some cases, international collaborations among law enforcement agencies have led to successful crackdowns which have been reported in the news.