Be on the lookout for financial scams

We all have reason to worry about becoming victims of increasingly sophisticated financial scams. Organized gangs and transnational crime enterprises are prolific, and they’re getting better at stealing our personal information and assets.

Millions of us are unknowingly scammed each year, with unrecoverable losses measured in the billions.¹ People of all ages are susceptible. Older individuals are a popular target, but teenagers and young adults often become victims because of their online shopping habits and job searches. Even members of Gen Z fall for fraudulent emails, text messages and phone calls.

Awareness of common scams can help ensure that you don’t fall for them. Criminals use multiple tactics to steal your identity and assets, including these.

The government impersonator scam

Beware of phone calls, text messages and emails that state you have an outstanding tax liability and will be arrested or your bank account frozen if you don’t pay the IRS immediately. They may know something about you, such as your name or Social Security number, but they’ll ask for additional personal financial information and use it to raid your bank account or get you to wire money or use a gift card.

This communication should raise an immediate red flag. The IRS will never threaten you or demand payment. Second, you’ll get a formal letter, not a call, text or email message.

The sweepstakes and lottery scam

You receive a call saying you won the lottery or sweepstakes and must send money to unlock the prize or pay taxes on the winnings. Don’t believe it. This is a common ploy that’s often followed up with an actual check you can deposit immediately. By the time you realize the check has bounced, the fraudster has collected and pocketed your money.

Phishing emails and texts

This communication may appear to be from a bank, retailer or other company you do business with (or would be likely to do business with). It asks you to verify your log-in or personal information or update your credit card; however, it’s just a scam designed to steal your personal identity and financial data.

Don’t click on the link but do visit the website of the bank or retailer — using the URL you know is legitimate — and look for any action that must be taken on your account. Chances are you’ll find nothing and realize you avoided a scam.

The computer support scam

This scam employs a pop-up message on your computer or phone saying your account has been compromised. Sometimes you’re given a support number to call. The “technician” who answers will ask for remote access to your device (which they’ll use to steal your personal information) or ask you to pay a repair fee. You may see a pop-up window that contains a fake anti-virus app that you’ll be asked to pay for, or notification about a virus that has infiltrated your computer and carries a removal fee. If you should see a pop-up that fits this description, it’s safest to ignore it. For protection, install an ad blocker to fight pop-ups and increase your computer’s firewall protection.

The grandparent scam

Criminals can capture a grandchild’s voice in a short 10-second phone call and use an imitation voice print to contact a grandparent asking for money. Typically, the young person is requesting a wire transfer to cover an emergency or pay ransom for a kidnapping. The grandparent, having a big heart, falls prey to the scheme.

One of the best ways to avoid being a victim is by confirming the caller’s identity. Ask them to repeat a codeword or passcode that you and your grandchild have put in place.

Your best defense is a good offense, so take time to learn more about identifying common scams and learn prevention tips at the Federal Trade Commission website. The site also accepts reports of fraud and identity theft and outlines action steps for victims.

This article was written by Joel Johnson from Forbes and was legally licensed through the DiveMarketplace by Industry Dive. Please direct all licensing questions to legal@industrydive.com.

1. "As Nationwide Fraud Losses Top $10 Billion in 2023, FTC Steps Up Efforts to Protect the Public." FTC, February 9, 2024.