Monday, 2 May 2011

Scams, Why They Work, and How To Avoid Them

I dare say most readers will at some stage have switched on the TV and watched a not-exactly-slim sales rep pitching some sort of diet plan on a shopping channel. Of course, nine out of ten people take one look, conclude straight away that the diet plan doesn’t work, and find something more sensible to do with their money. What fascinates me, however, is the other ten percent. The one out of ten viewers who can look at the diet plan, then look at the physique of the person selling it, and think: “Yeah, that looks like a reliable way to lose weight and get into shape – I’ll have some of that!”...

Dating services are a hotbed for scamming - particularly those which appear to be targeted specifically at only one gender. Obviously no women would join a service that only advertises to men - so where do they get the supply of women?... They don't. It's a scam.

What goes through those people’s minds? They must realise that the sales rep has at least had the opportunity to go on the wonder diet her/himself – if not been strictly ordered to do so on pain of death by the MD. So why do they think a sales rep with every commercial and personal motivation to successfully use a diet plan, is still actually bigger than they are?

I want to stress at this point that I’m not saying there's any need for everyone to look 'slim' – I’m saying there's a need for people to recognise that when someone who isn't slim is saying you should be slim, and trying to sell you something that makes you slim, the product is clearly a waste of money. You only need look at the prominence of the phrase "My personal trainer is fat" in Google's search suggestions to see how easily people can be taken in by regimes which plainly and obviously are useless. Yes, lots of people do buy this stuff. They believe what they're told, even when it directly contradicts everything their eyes can see.


WHY SCAMS WORK

So why do these scams work? Why do any scams work? Well, largely, it’s because people want something for nothing, and crucially, some don’t see any reason why they can’t get something for nothing. Whether it’s gain without the pain, a prize without the competition, or an inheritance from someone they’ve never heard of, there’ll always be someone who allows their own blind optimism to shut out any semblance of a reality check.

A key point here, and something which never ceases to surprise me about human beings, is that people so often fail to recognise that others have exactly the same basic desires and motivations as themselves.

People might, for example, be shocked when a politician lies for his own gain, or chooses not to reveal information which would make his life more difficult – even though they themselves have been lying perpetually for self-benefit, on a daily basis, since they were old enough to talk. They somehow believe that because a politician is a politician, or because an entrepreneur is an entrepreneur, then he/she is going be be totally different from other human beings, have no self-interest whatsoever, and be immune to the frequently irresistible motivation to lie. They think that if a faceless blow-broth says he’s giving away a million quid to someone he’s never met, out of the goodness of his heart, and has self-financed the printing and distribution of thousands of free scratchcards to make the whole thing more fun, he should be taken seriously. They themselves would never give away a fiver without the promise of something in return, and yet they believe that someone else can be so desperate to throw away a fortune, that he even pays to advertise the fact that he’s doing it! Believe me - if you're genuinely going to give away a fortune, you will not have to advertise!

The reality is that most people lie, for much of the time. Many employers require their staff to lie, and pretty much the entire service industry depends on staff telling people what they want to hear, even when it couldn’t be further from the truth. Politicians, commercial managers, psychics, weight-loss gurus – they’re all just people, with exactly the same self-serving motivations and human flaws as anyone else. They too want something for nothing, and they know that in many cases the easiest way to get it, is to lie.

Lying makes life much, much easier, and without it, life for many would be intolerably difficult. Avoiding scams, at the most fundamental level, is as simple as recognising that other people will lie, and do lie. That they lie a lot, that they’ve had many years of practice and so are very good at it, and that it doesn’t matter whether they’re in a call centre, in the House of Commons, or on TV – they will always prioritise their own best interests – not yours.


BUT SCAMMING IS ILLEGAL, ISN’T IT?

Making the law is one thing. Enforcing it is quite another. It would be impossible for the authorities to weed out every scam and prosecute it. I’d guess that the vast majority of petty scams here in Britain are known about by those with the power to stop them, but remain unchecked simply because there aren’t the resources to tackle them. Often, indeed, petty scamming helps the economy, so if there's no significant protest, why would the powers-that-be go out of their way to stamp it out? It should never be assumed that just because someone has a big, well known and slick-looking business, or is promoting something in a ‘reputable magazine’ or on TV, they can’t be proliferating a scam. They can, and frequently are.

I once worked for a massive ‘legitimate business’ which perpetually scammed its customers. I was one of the staff members perpetrating the scam. Fortunately, I was able to quit after a month, but most of my colleagues there couldn’t do that. I don’t believe they enjoyed scamming the public any more than I did, but for most, the choice was either carry on, or be out of work. It took years, and a banking crisis, before the matter would be properly investigated. The conclusion, of course, was that the tactics were unlawful. But that ruling was only reached after the scam got huge media exposure, bringing forward thousands of victims who, in combination, became a voice the powers-that-be could no longer ignore. Without that level of protest, slick scams are often successfully defended as ‘mistakes’ or ‘rogue activity unbeknown to the management’, and brushed under the carpet. Indeed, many scams are highly sophisticated systems which in one way or another motivate the victim not to complain (often because it's humiliating) – meaning that sufficient dissent to bring a prosecution is most unlikely. It’s not all as easy to debunk as a fat personal trainer.

As a conclusion to this brief take on scamming, I provide the link to Planet Botch’s 15-point Rip-off Detector.

Posted by: Bob Leggitt