That's right, the telephone. According to a joint U.S. - Canada task force that delivered a report to President Clinton and Prime Minister Jean Chretien last November, citizens of those two countries lose at least $40 billion a year to telemarketing fraud. And some of their favorite targets are small business owners!

Like most criminals, phone scamsters tend to prey on the most vulnerable. Besides business owners and aspiring entrepreneurs, their favorite victims include elderly people, especially women and those living alone, but youth is no guarantee of protection from these high-tech thugs. A Louis Harris Survey conducted for the National Consumers League (which operates the National Fraud Information Center) found that 92% of adults in the U.S. reported receiving fraudulent telephone offers, and the Federal Bureau of Investigation pegs the number of illegal telephone sales operations in this country at about 14,000.

Armed only with a telephone, some crooks target business owners.

"One tip-off is pressure to make a decision right now," she says. "There are sometimes time limits involved with true special offers, but if the caller is unrelenting in trying to force you to make a decision on the spot, you should hang up the phone."

A telemarketer's insistent efforts to get you to send payment by private courier, wire transmission or overnight delivery--a common ploy among those hawking overpriced office supplies and selling "investments" of questionable worth--is another red flag. "These tactics are sometimes used to prevent you from changing your mind and to sidestep law enforcement authorities such as the U.S. Postal Inspection Service," Golodner says.

Timothy Healy is the FBI's supervisory special agent in charge of the bureau's national initiative on telemarketing fraud. He conceived a major sting operation called Operation Disconnect and worked the program undercover, getting to know telemarketing crooks "up close and personal." He suggests there are four steps you can take that will go a long way toward preventing you from becoming a victim.

"First, if it sounds too good to be true, it is," Healy says. "Second, if someone asks you for money up front for merchandise or services you have not received, be very leery. Third, do what you would normally do in making any purchase." By that he means taking simple steps such as comparison shopping. for example, if a telemarketer offers to sell you 25 pens for $500 and dangles the offer of a big sweepstakes prize, look beyond the offer. "If you think 25 pens for $500 is a good deal and would normally make that purchase, go ahead--but don't do it because of the prize you are being promised," he warns.

Healy's fourth rule of protection is one he added after the American Association of Retired Persons (AARP) recently completed a survey on telemarketing fraud. "When a telemarketer calls, have a plan," he advises. "I found in talking to victims that most of them didn't have such a plan or know how they were going to react."

Three years ago, Congress enacted the Telemarketing and consumer Fraud and Abuse Prevention Act and directed the Federal Trade Commission to promulgate the Telemarketing Sales Rule. Since then the FTC has been keeping track of the most common telemarketing scams and alerting the public when new ones appear. Three of the latest ploys "yaks" (as law enforcement officials call these crooks) have been running on unsuspecting marks are telemarketing travel fraud, the too-free telephone number scam and the magazine subscription scam.

Nine out of 10 people have received a fraudulent offer over the phone.

"Travel fraud usually begins with a postcard or certificate that seems to promise a free vacation," says Michelle Muth, an FTC spokeswomen. the wording is usually something like, "This certifies that you'll receive a world class Florida/Caribbean vacation offer for you and a friend." The key word there is "offer," which is the tip-off to the hidden charges to come. Suckers who call the phone number (usually toll-free) on the card are then subjected to a high-pressure sales pitch, often complete with oral misrepresentations and contradictory follow-up material.

The toll-free number scam is more insidious. Calls to numbers beginning with area code 800 or 888 are almost always free, but that "almost" can hit you right in the pocketbook. The FTC allows audio entertainment or information services to charge for those calls, but only if they ask you to pay for the service with a credit card or make other billing arrangements with you BEFORE they provide the service. Some scamsters ask you during the course of your call to "press 1" to be charged automatically. Others are more unscrupulous and simply charge you unlawfully through your regular phone bill for calls placed to the service.

Many legitimate telemarketers offer magazine subscriptions over the phone, but watch out for sales pitches touting "free," *quot;prepaid" or "special" subscription deals, Muth warns. "You could be tricked into paying hundreds of dollars for multi-year subscriptions that you nay not really want or could buy for less through other channels." Crooks often target business owners with a variation of this scheme that offers popular business magazine titles.

Tip-offs to this scam include postcards that don't say anything about magazine subscriptions but ask you to call a number about a prize or sweepstakes entry; salespeople who don't identify themselves as such and may try to convince you they represent major credit card companies.

A particularly vicious brand of telemarketing fraud is known as "reloading" or "double-scamming." Yaks circulate "sucker lists" of people who have fallen for some con in the past among themselves with the thought that they are most ripe for hitting again. Reloaders or double-scammers call these people claiming to represent a government agency or consumer advocacy group that can help them get their scammed money back. Of course--you guessed it--there is a modest "processing fee" involved. Once you pay it, your money's gone again, and so is the crook who took it.

The telephone isn't the only high-tech tool that con artists can use to pick your pocket. The Security and Exchange Commission's Office of Investor Education and Assistance warns that on-line investment frauds are emerging as a real problem on the internet. the three most common types are pyramid schemes, "risk-free" investment offers and the colorfully-named "pump and dump" scam.

Pyramid-schemers rely on new investors to pay off the old ones.

Pyramid schemes rely on an ever-growing number of new investors to provide profits to earlier investors. The first few people in often do make money (illegally), but the schemes quickly collapse under their own weight as new investors grow scarce. "Risk-free" investments on the internet involve the same kind of misrepresentation typical of the telemarketing variety. "Pump and dump" scamsters post messages claiming they have insider information on particular stock in an attempt to drive up the price. Once the price goes up, they dump the stock--which usually turns out to be worth much less than they sold it for.

Some really progressive crooks have figured out a way to combine both telemarketing and internet fraud. Charles Owens, former chief of the FBI's financial crimes section, related in testimony to Congress. His unit investigated a group that lured internet browsers to their site with the promise of a free download of pornographic material. Unbeknownst to victims, the Web site's server then disconnected them from their own internet service providers and hooked them up to an expensive 900 number. The victims didn't even know they'd been scammed until they got their next phone bill.