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Basics Beginner: Understanding and Avoiding Fraud and Scams

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1.
Telephone swindlers assume that people they call will want to be courteous to them on the phone.
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True. This courtesy is part of how they trap innocent people.
2.
Creating artificial demand for a stock and then selling it to make a quick profit is known as _______.
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Pump and dump. Pumping and dumping means creating artificial demand and then selling in order to gain from it.
3.
About how many seniors have been victimized by elder financial fraud?
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One in 5. About one in 5 Americans over 60 have been defrauded financially.
4.
Why might a scammer go to great lengths to detail the intricate aspects of an "opportunity"?
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Detail makes the opportunity look legitimate. The more detail, the more real it seems.
5.
Why are older people common targets for romance scammers?
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They usually have more assets than younger people. Older people can be prime targets because of their assets.
6.
How do pyramid schemes differ from legitimate sales opportunities?
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They offer payments to people only for recruiting new members. Legitimate sales opportunities involve selling actual products, while pyramid schemes do not involve paying people to sell actual products.
7.
In the world of cryptocurrency, what is a private key?
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A string of secret numbers used to sign transactions. A private key provides access to your cryptocurrency.
8.
Which of the following descriptions of a work-at-home job is most likely to be that of a scam?
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An assurance that anyone can do it. Of the choices, this one is the most likely to be from a scam.