Scammers are fast to copy any service that emerges that enables online money transfers. As a result, there has been a recent rise in sugar daddy scams, which can leave victims destitute and broke.
Now that you know what the sugar daddy scam is, how it operates, and how to defend yourself, what is it?
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What Is a Sugar Daddy?
The sugar daddy fraud exploits an established framework. This is done by older, wealthier individuals who call themselves sugar moms or dads. These individuals seek camaraderie by utilizing their wealth.
These sugar daddies and sugar mommies frequently run upon younger individuals known as sugar babies who are in need of money. The sugar parent rewards the sugar kids with money, dates, or other financial incentives in exchange for the love and attention they give to their respective sugar daddy or sugar momma.
When done with good intentions, the relationship between the sugar daddy and their child is beneficial and there aren’t any frauds or abusive practices. However, con artists are now taking advantage of this system and figuring out ways to defraud individuals.
The Sugar Daddy Scam: What Is It?
Although there are many different ways to tackle sugar daddy fraud, they all follow the same general pattern and produce the same outcome.
The false sugar daddy deceives the sugar baby into thinking they have gotten or will get a huge sum of money in the con. Then the pretend sugar daddy demands some of his money back. When the bogus sugar daddy receives their payment, they leave and take the money they had falsely promised, leaving the sugar baby with nothing.
One of two approaches will often be used by the con artist to obtain the sugar baby’s money.
At first, they promise to pay out a significant sum of money but demand payment upfront. The second approach involves the con artist paying the sugar baby a sizable sum of money that eventually runs out, but not before the con artist demands some money back.
When the Scammer Demands an Upfront Payment from the Sugar Baby First
The first approach is the simpler to identify of the two. This is due to the fact that it makes use of widespread financial frauds, like Venmo-related schemes, that we have witnessed for years on other platforms.
The con artist starts by taking the identity of a sugar mum or dad. They then approach potential sugar babies who are on websites and social media.
The fraudster will send the recipient a message claiming to be willing to pay off any debts or purchase for them pricey items. The victim is led to believe that the con artist can solve their difficulties as a result.
The con artist then says there is a catch and that they are willing to assist the victim in getting out of the predicament they are in.
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For some reason, the sugar baby will need to make a payment to the con artist before they will transfer the funds. The motivation can vary from con artist to con artist. Some will try to gain an advantage by claiming that the token payment serves as “evidence of allegiance.” Some people will make an explanation about payment fees or other costs associated with transferring the money.
Of course, the initial payment is a scam and isn’t for anything. After receiving the money, the con artist disappears without giving the promised sum, leaving the victim with nothing.
An attempted PayPal sugar daddy fraud, for instance, was reported by Avast. The victim was informed by the fraudulent sugar daddy that he needed to send him money in order to validate his PayPal account before he could pass over the $1,500 payment. Fortunately, the victim was aware that it was a scam from the beginning and sent nothing, but it is a good illustration of how phony sugar daddies and sugar mommies operate.
When the Scammer Sends the Sugar Baby a Short-Term Payment
As it consistently deceives the user into believing they have been paid, this strategy is far riskier than the one described above. The issue is that after a while, the victim is left with nothing once more since the money has vanished.
One of two methods is used by con artists to produce this “temporary payment.” They can decide to pay the sugar baby using funds from a stolen credit card. When the credit card company learns that the card was stolen, they will take the money back and leave the victim with nothing, but the money does end up in the baby’s account.
They might also decide to employ a check that they are aware would bounce. Once the check is cashed, it will appear in the account, but the funds won’t actually “count” until they have cleared. If they don’t, the money returns to the account and disappears once more.
However, how is the con artist generating money off of the victim if they are using this temporary money to pay them? The point here is that a con artist has a brief window where the victim genuinely feels they have been paid before the money vanishes. They can take advantage of this opportunity and request some money back before it vanishes.
A con artist might, for instance, mail a victim $2,000 in checks to pay the victim’s debts. The con artist will then claim they need a gift as a mark of appreciation or that a big occasion is approaching. Then, usually in the form of gift cards, they will request a little repayment from the victim (say, $100).
Payments made with gift cards are a significant warning sign that you are a victim of fraud. Gift cards are simpler to mail and leave less of a paper trail than money transfers. For this reason, phone scammers always request payment through them.
If the sugar baby accepts, they transfer the money over, believing they still have access to the substantial sum of money the con artist sent their way as a backup. The cheques will, unfortunately, bounce, leaving the victim with $100 less than when they started.
There are instances of this happening in the real world if this seems impossible to imagine. According to ABC7 News, a 17-year-old kid was duped into becoming a Snapchat sugar baby after receiving a $4,000 and a $4,500 check from a sugar mother. They urged him to give $8,000 to a secondary source and keep $500 once he invited them inside.
Sadly, the checks bounced after the boy had donated the money. The boy’s money “evaporated” overnight, leaving him in debt, despite the fact that he had thought he had received it.
How to Recognize a Sugar Mommy or Sugar Daddy Scam
The sugar daddies and mommies themselves aren’t the issues in this situation. There are a few honest people out there who would want to spend money on others in exchange for gifts and dates, albeit they are uncommon.
Getting rid of those who don’t want to assist you at all is therefore more of an issue. These are the individuals who take advantage of the system to defraud desperate individuals out of even more money.
Beware of loyalty tests and fee requests with sugar babies
Be on high alert right away if a sugar mommy or sugar daddy demands payment upfront. Included in this are payments made to “demonstrate your loyalty” or to pay transaction costs.
It should not be your responsibility to send money to someone who has given you money in order to pay for something. Therefore, it is very likely that if someone does request a token payment before paying you, they are doing so in order to collect the money and go.
Never put all incoming money in your trust at once
If someone does send you money, wait before using it, especially if it was paid by check. Scammers are skilled at providing you with fictitious funds that could disappear at any time.
Therefore, give a large payment some time to settle before you act on it if you do get it from someone online. Give the check time to clear if they pay by check before you make a purchase. To make sure the money wasn’t transferred using a stolen credit card, if they transferred funds directly into your account, wait before using them.
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Sugar daddies and mommies, when they’re legitimate, can offer people financial support and a relationship. However, there are scammers keen to abuse the system, so keep your eyes out for these fake parental figures.
Whenever relationships are involved, scammers aren’t too far behind. Even on online dating sites, there are scams galore that can really ruin your desire to find love or companionship.