What Is Telemarketing Fraud?

Legitimate companies contact people by phone to offer products and services. However, scam calls and telemarketing fraud are more common than legitimate phone marketing. Unfortunately, it’s not always easy to recognize the difference between a true offer and a scam.

You have legal protections against telephone scams. To learn more about your legal rights regarding telemarketing scams, talk to a consumer protection attorney.

What Is Telemarketing Fraud?

Telemarketing fraud involves identity theft or financial fraud by contacting the victim on the telephone. This includes fraudulent selling, getting personal information, or convincing the victim to send money. Many people think they’re getting a legitimate product or investment, only to find out later they are scam victims.

Phone scams come in many different types, including:

• Advance fee fraud
• Pyramid schemes
• Sweepstakes scams
• Fake calls from charitable organizations
• Credit card fraud

According to the Federal Trade Commission (FTC), fraud involving phone calls has the highest per-person reported losses. The average American phone scam victim lost $1,480 in 2023.

Scammers are anonymous over the phone. Con artists can call from across town or another country. Scammers can also spoof caller ID to make it seem like they are calling from a government agency, financial institution, or law enforcement. You should be careful with any unsolicited phone calls.

How Can I Protect Against Telemarketing Fraud?

You can protect yourself and your family from telemarketing fraud in many ways. Don’t trust your caller ID—it isn’t always reliable. If you get a call that shows it’s from a law enforcement agency or charity, get their number so you can call them back. You can check to make sure the phone number matches the business’s official website.

If an offer sounds too good to be true, listen to your instincts. Don’t give in to high-pressure tactics. Threats and limited-time offers over the phone can indicate fraud. Take time to think about the call before you decide to buy something over the phone.

What Are Warning Signs of Telemarketing Scams?

Look for red flags that could indicate possible phone fraud. Possible warning signs of telemarketing schemes include:

Easy Money With No Risk

Fraudulent telemarketers often offer deals that can allow you to earn a large amount of money quickly and easily. It could seem like a legitimate method, such as a loan, credit card, or investment opportunity. But these offers are usually part of a scam that can cost you hundreds or even thousands of dollars.

Winning a Prize or Getting Something Free

A free offer may come with delivery fees, shipping, handling, or processing. Scammers will ask for your credit card number or personal information to process the prize. They’ll take your money, and you’ll never get your prize.

Wanting Payment by Gift Card or Wiring Money

Paying with a gift card, wiring money, or using their payment processing website is a sign of a scam. Paying with a gift card or by wire can make it impossible to get your money back. It also makes it more difficult to trace the scammers.

Asking for Personal Information

Don’t give out your personal or financial information over the phone. Your bank or credit card company shouldn’t ask for your online password on the phone. Don’t give out your Social Security number, checking account information, or credit card number by phone.

Are Robocalls Legal?

Robocalls are automated phone calls with a recording or machine instead of a live person. Getting a robocall when you haven’t given the company written permission is often illegal. Unfortunately, that doesn’t stop scammers and marketers from making these calls. Because the caller ID may not be real, it’s difficult to block these numbers or report the calls.

How Can I Report Telemarketing Fraud?

If you’re a victim of a phone scam, you may still be able to recover your money. Contact your credit card company or bank and report what happened. If you think the scammers might use your personal information to commit identity theft, put a freeze on your credit.

You can report phone scams to your state attorney general or the FTC at ReportFraud.ftc.gov.

How Can I Stop Unwanted Telemarketing Calls?

When you get unwanted telemarketing calls—hang up. Don’t listen to the recording, and don’t press any numbers. You can put yourself on the National Do Not Call Registry at donotcall.gov. Under federal law, you can register your phone to stop marketing calls and report unwanted calls. Consumers can get up to $500 for each violation of the Do Not Call Registry. A consumer protection lawyer can explain your legal options if you are a victim of telemarketing fraud. They can take legal action against telemarketing companies to stop harassment or get your money back. For more information about telemarketing fraud, contact a consumer protection lawyer.