It's a new year, but the same old scams

Sweepstakes, contest and foreign lottery scams
“Congratulations! You just won thousands of dollars!” All you have to do is pay the taxes, insurance, handling charges or some other bogus fee. You may be pressured to give a credit card number, send a check via overnight delivery or wire money right away. Don’t do it! You didn’t win anything and you’ll never see that money again.

Many prize letters now come with a fake check for a few thousand dollars. You’re told to cash the check and wire off the money required to claim your winnings. As with the overpayment scam, once the bank figures out the check is counterfeit, you’ll be required to repay that money.

• ConsumerMan tip: With a legitimate contest or sweepstakes you never have to buy something or pay anything to enter or claim your prize. If you owe taxes, you pay them directly to the IRS. Never wire money to claim a prize.
• More info: FTC: International Lottery Scams

Home repair scams
A shady contractor can do a lousy job or simply take your money and run. That’s why it’s so important to do your homework before you hire a contractor.

Check with the Better Business Bureau. Make sure the company is licensed (if required in your state) and bonded. Get a list of references and call them.

Look at other jobs they’ve done. Take the time to get several estimates. The goal is not to get the lowest price; it’s good work at a fair price.

• ConsumerMan tip: Never hire a contractor who just shows up at your door. Never pay for all of the work in advance. Unless the job involves something custom-made, I wouldn’t pay more than a third upfront. Get a written contract that spells out in detail the work to be done, the specific materials to be used and the payment schedule. Don’t make the final payment until the job is done and you are satisfied with the work.
• More info: FTC: Home sweet home improvement

Internet auction scams
Internet Auctions are very popular. But they remain a risky way to buy (and sell) things. Will you really get what’s advertised? Is the merchandise stolen or counterfeit?

According to a recent survey by Consumer Reports more than one in four people who used an online auction reported experiencing a scam or deceptive practice.

• ConsumerMan tip: Check the site’s fraud protection policy. Know exactly what you are bidding on and try to research its true value yourself. Find out as much as you can about the seller. Pay with a credit card or well-known escrow service. Don’t wire money to an unknown seller and think twice before sending a cashier’s check or money order. It’s always risky to pay before you get the merchandise.
• More Info: Consumer Reports: Watch that auction!

Also in msnbc.com business ConsumerMan: Gift of giving takes on whole new meaning ‘Reaching out’ and the other worst buzzwords of the year Your Career: Tips for job hunting during the holidays MotorHead: New Audi R8 is a refined land rocket   Video: Wall Street sees record-breaking profits

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