Online Threat Alerts (OTA) - Alerting you to scams and frauds.

PayPal Penny Scam - Beware

The "penny scam" typically refers to two distinct fraudulent activities: a PayPal phishing scam where scammers send $0.01 to trigger a fake "reversal" request, or investment fraud involving low-priced "penny stocks." Both aim to steal personal information, money, or investments through deception.

1. PayPal/Digital Wallet

Scammers send small payments (e.g., $0.01) to users.

  • The Tactic: They include a message claiming they accidentally sent money and provide a fake support phone number or phishing link to "reverse" it.
  • The Goal: To trick users into calling, handing over account credentials, or allowing remote computer access.
  • Protection: Do not call the number. Report the message to the platform (e.g., phishing@paypal.com). Check your account directly through the official app, not via links in the message.

2. Investment Scams

This involves, as described in this DC.gov article, promoting low-priced, volatile stocks to investors.

  • Pump-and-Dump: Promoters hype a worthless stock to drive up the price, then sell their own shares at the peak, leaving others with heavy losses.
  • Warning Signs: Promises of high returns, "guaranteed" profits, and high-pressure, unsolicited calls or emails, says this source.
  • Protection: Research companies thoroughly, avoid acting on "hot tips," and use FINRA's BrokerCheck to verify brokers.
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