Question:  

How can we protect ourselves from financial fraudsters?

Answer: 

The bad guys tend to go where the money is, and these days the majority of financial fraud takes place online. Here are the top ten common scams and ways to avoid them.

1. Bank Accounts

You receive a call or email from someone claiming to be from a financial institution or federal/state agency (e.g., IRS, Federal Reserve, FBI) saying that your financial accounts are at risk of fraud. They instruct you to move your funds to a new account they provide to you, coach you on how to answer questions from your financial institution and instruct you not to tell anyone.

2. Payments 

Before paying a contractor for work at your home, investing in a company or purchasing a new property, a fraudster intercepts the email communication and replaces legitimate payment instructions with fraudulent ones. Red flags are last-minute changes to instructions, changes in the tone or word choice from prior emails, a new sender address and multiple payment requests. With this swindle, the email account belonging to you, the service provider or both has been compromised.

3. Computer Virus

The old computer virus calls from someone claiming to be from a major tech company. They offer to get rid of it by asking you to log into a website that lets the caller control your computer. The caller can then steal your ID information and can gain access to your accounts.

4. Grandchild/child

Your grandchild or child calls and frantically requests money to pay a kidnapper, a legal bill, or an emergency medical expense – and begs you not to tell anyone. But it’s not real: Fraudsters commonly pose as loved ones and, preying on your compassion, claim to need money urgently. Recent technology can even allow them to successfully imitate voices.

5. Charity donations

You donate to one charity and end up on every charity list. That’s because they sell your name, phone number and email to other nonprofit and commercial organizations with names similar to charities you support – but they exist solely to scam donations.

6. Lottery winner 

You get an unsolicited phone call or email saying you’ve won a large prize. All you need to do is send money to pay for shipping, taxes or other fees before the prize can be released to you. You send the money, but the fictional prize never arrives.

7. Timeshares

If you own a timeshare, you may get a call from someone claiming they’re authorized to sell it for you, for a fee. After paying, however, you never hear from them again.

8. Discount products/services scam

You get an unsolicited call or knock at the door offering a product or service for a discounted price (e.g., heart monitor, wheelchair, bathtub bench, home maintenance, tree trimming). You’re asked for a deposit or prepayment and the product never arrives or the work is never completed.

9. Missed payments

You’re approached by a “professional” who claims your home is under threat of foreclosure and offers to pay off your mortgage or taxes if you sign over the deed to the property. Or you receive a call from your electric company threatening to turn off services unless payment is made immediately.

10. Caregiver or sweethearts 

These predators claim to care deeply for you or your well-being and spend weeks or months gaining trust to gain access to your accounts and steal money or identity information. 

Here are additional tips to protect your identity and your accounts:

Don’t allow remote access to your computer.

Don’t click links in the body of suspicious emails or text messages, especially if they claim to come from your bank, credit card company, real estate agent or title company. Instead, log in to the company’s official website or call them directly to verify.

Don’t give your personal information to unknown third parties.

Work with financial institutions that use fraud protection to safeguard your credit card and banking information.

Don’t let strangers into your house. Instead, ask for a business card and say your spouse, kids or lawyer will be in touch.

Be wary of caregivers and suitors, especially if conversations center around finances or financial transactions.

Limit the purchases and donations you make by check, which may list your home address or other key data.

If you suspect you’ve been scammed or your identity has been compromised, report the incident to your advisor right away to help protect your accounts, and consult identitytheft.gov to see the Federal Trade Commission’s recommendations for critical next steps. Additionally, reporting cybercrime incidents to the FBI can help federal agencies respond quicker and more effectively to threats. Stay safe and plan accordingly.