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COMMENT
Over the last ten years or so, I've seen enough scams to last me a lifetime. They vary from the completely outlandish ("You've won $5 million in the Ohio State Lottery" - yeah, right!) to the almost believable. However, the simple fact is that they all promise more than they can deliver, and the vast majority are out-and-out frauds. Here is a quintet of indicators that should help you to identify these everyday cons: 1. They arrive by email After a week's holiday, I returned to work today to find hundreds of emails in my Inbox. However, the majority of these messages were utter tripe: offers to enlarge certain parts of my anatomy or shrink others; congratulatory messages from fake lottery administrators; letters from African dignitaries looking to move millions to Europe via my bank account and so on. My approach to these is to delete them without even bothering to read the details - in fact, my anti-spam program automatically does it for me. Let's be honest: do you really think that you're going to get rich with one email? No, I thought not, so don't click - just hit "Delete" instead! 2. They ask for money upfront One of the oldest tricks in the book is to offer someone a lot of money further down the line in return for a few quid now. For example, you can claim a hefty "prize", "inheritance" or other windfall by send a few hundred or thousand pounds today. Sadly, the only guarantee with these advance-fee frauds is that you'll lose your initial outlay - and attract the attention of other scammers looking to rip off gullible punters. Hand over money upfront at your peril! 3. They don't explain exactly how you make money A Ponzi scheme works by sucking in more and more punters, whose capital goes towards providing pretend "returns" to earlier investors. With these and other pyramid schemes, there's no obvious explanation of how this "extra" money is made. If it isn't obvious how the returns are being made and you can't see goods or other items being bought and sold, then it's almost 100% likely that you've fallen for a scam. In particular, watch out for betting syndicates and the like, as the only guarantee in the gambling business is that bookmakers always get richer! 4. They promise untold riches Millions of full-time workers in UK earn a gross salary of less than £25,000 a year for working close to two thousand hours a year. In other words, before tax and other deductions, most of us work for £12.50 or less an hour. So, when someone offers you the chance to earn large sums in a short time or for little effort, be suspicious. Earning, say, £25 or more per hour usually involves some skill, hard work, education, experience - or misconduct! 5. They guarantee returns of more than ½% a month Few investments are safer than cash and, at current savings rates, the best deposit accounts will earn you a little more than 5% a year before tax, or around 0.4% a month. Hence, it's not easy to find homes for your cash without sacrificing some of the security and safety that cash offers. That's why I'd be very wary of any scheme that guarantees an annual return of, say, 6% "without risk". I'm a big fan of the stock market, which, historically, has provided an average annual return of 11% since 1918, but with a lot of ups and downs along the way! For more advice on dodging scams, cons and swindles, both legal and illegal, read Ten Ways To Get Ripped Off and Double Your Money Today! More: Why let your credit card rip you off? Get a 0% card today! | Check out this simple, low-cost investment.