Fraud Check-in: How to Avoid Financial Scams

Fraud Check-in: How to Avoid Financial Scams

By: Jim Wilcox

Financial scams are nothing new, but the rise of first email and then texting and social media gave new life to the age-old problem of fraud. In 2019 alone1, 14.4 million consumers were victims of identity fraud, and 33% of U.S. adults have experienced this type of scam. In addition to identity theft, scammers will also try to get you to send money for goods or services that never arrive. Being vigilant is always warranted when it comes to your finances, and there’s little telling where the latest scams will pop up. But there are some tell-tale signs of fraud that you can proactively look out for and spot before someone parts you from your money!

red pen writing on small notebook

Steer clear of these four popular financial scams.

1. Government “imposter” frauds: These schemes often start with a phone call, a letter, an email, a text message or a fax supposedly from a government agency, requiring an upfront payment or personal financial information, such as Social Security or account numbers. They might tell you that you owe taxes or fines or that you have an unpaid debt. They might even threaten you with a lawsuit or to arrest you if you don’t pay. Remember that if you provide personal information it can be used to commit fraud or be sold to identity thieves.

2. Fraudulent job offers: Criminals pose online or in classified advertisements as employers or recruiters offering enticing opportunities, such as working from home. But if you’re required to pay money in advance to “help secure the job” or you must provide a great deal of personal financial information for a “background check,” those are red flags of a potential fraud.

3. “Phishing” emails: Scam artists send emails pretending to be from financial institutions, popular merchants or other known entities, and they ask for personal information such as account numbers, Social Security numbers, dates of birth and other valuable details. The emails usually look legitimate because they include graphics copied from authentic websites.

4. Overpayment scams: This popular scam starts when a stranger sends a consumer or a business a check for something, such as an item being sold on the internet, but the check is for far more than the agreed-upon sales price. The scammer then tells the consumer to deposit the check and wire the difference to someone else who is supposedly owed money by the same check writer. In a few days, the check is discovered to be a counterfeit and the depositor may be held responsible for any money wired out of the account. Victims may end up owing thousands of dollars to the financial institution that wired the money, and sometimes they’ve also sent the merchandise to the fraud artists, too.

Here are a few precautions that will help keep your money safe this summer – and all year-round.

  • No matter how legitimate an offer or request may look or sound, don’t give your personal information, such as account information, credit and debit card numbers, Social Security numbers and passwords, to anyone unless you initiate the contact and know the other party is reputable.
  • Be cautious of unsolicited emails or text messages asking you to open an attachment or click on a link. This is a common way for cybercriminals to distribute malicious software. Be especially cautious of emails that have typos or other obvious mistakes.
  • Don’t cash or deposit any checks, cashier’s checks or money orders from strangers who ask you to wire any of that money back to them or an associate. If the check or money order proves to be a fake, the money you wired out of your account will be difficult to recover.
  • Monitor credit card bills and account statements for unauthorized purchases, withdrawals or anything else suspicious, and report them to your financial institution right away.
  • Periodically (at least once a year), review your credit reports for signs of identity theft, such as a new credit card or a loan you didn’t request.

The best advice I can give you is this: just say no. Don’t give out any information and if it seems too strange – or too good – to be true, that’s probably the case. When it comes to fraud, it’s important to stay vigilant. If you need help determining the legitimacy of an email or request for personal information, contact your financial institution. And if you suspect fraud, report it immediately.


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This information is for informational purposes only and is intended to provide general guidance and does not constitute legal, tax, or financial advice. Each person’s circumstances are different and may not apply to the specific information provided. You should seek the advice of a financial professional, tax consultant, and/or legal counsel to discuss your specific needs before making any financial or other commitments regarding the matters related to your condition are made.  

1 Retrieved from