Scammer’s favorite pastimes: “Phishing” and “Pharming”

They’re stealing identities and draining bank accounts. “Phishing” and “pharming,” two of the worst forms of Internet scams, are becoming more common and in some cases, even harder to detect.

“Phishing,” the more prevalent of the two fraud techniques, refers to scam e-mails that seem to come from banks, credit card companies, auction sites and other legitimate businesses. These “phishing” e-mails claim there is some problem with an account or shipment and the customer needs to verify his or her personal or account information. These scam e-mails include a link to a phony Web site that looks like the real thing. Unsuspecting customers click on the link, go to the phony Web site and enter their sensitive information — social security numbers, account numbers, etc. The information goes straight to the scammers, who can be located in other countries and tied to criminal gangs.

It’s called “phishing” because these criminals cast a wide net hoping even a tiny percentage will take the bait. They send their scam e-mails to millions of people knowing that only a small percentage will actually be customers of that bank and even fewer will respond. Still, it’s a winning proposition for thieves – some estimates say scammers stole between $2 and $3 billion last year.

Here are a few tips to avoid being caught in the “phishing” net:

Be suspicious — No legitimate bank, credit card company or financial institution will e-mail you to ask you to verify or update your account information. If it looks like an e-mail was sent by your bank, call to verify. Never click on a link sent in an e-mail asking for account information, passwords or other sensitive information.

Use a “bulk” e-mail folder — Some e-mail providers automatically send all e-mail suspected of being spam to a “bulk” folder. If an e-mail that looks to be from your bank shows up in your bulk mail folder, it’s probably phony.

Review your financial statements carefully — One way to catch fraud early is to check your bank and credit cards statements promptly and closely every month. Report any suspicious activity immediately.

“Pharming” is less common, but more sophisticated. It involves planting malicious software (sometimes called a “Trojan” virus) onto your computer without your knowledge. And you don’t even need to open a scam e-mail. Once you’re infected, even if you type in the correct address for popular Internet commerce or bank site, the planted software redirects you to an identical, but phony Web site. When you enter your information into this bogus site, the thieves have all they need to rip you off. “Pharming” can happen even if there is no malicious software on your computer. Scammers can also hack into the servers of Internet service providers and redirect customers to a bogus site without their knowledge.

While “pharming” is harder to detect, experts recommend a few steps:

Check the Internet address — Even if you typed in the address yourself, be sure to check what appears on your screen. An authentic, secure Web site should start with https not just http. Secure sites should also show a padlock symbol in the corner of your browser. Click on that symbol to verify the site’s address.

Look for other clues — Misspelled words, bad graphics and links that don’t work can all be indicators that a Web site is phony. Trust your instinct and don’t use a Web site if it doesn’t look right.

Keep your anti-virus and anti-spyware software up-to-date — Be sure it’s updated regularly, check often for spyware on your computer, and take advantage of other anti-fraud software as appropriate.

Just as you would never give out your personal information to someone who stopped you on the street, don’t give out personal information in response to unsolicited e-mails.

Member FDIC