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Five Common Financial Scams (and how to avoid them!)

Unless you live off the grid and unplugged from modern life, you’ve probably been targeted by a scam.

Today, scammers’ weapons of choice seem to be the phone and the internet (i.e., the things most of us rely on to run our lives). And their targets are… well, everyone.

The good news is that you don’t have to live in fear. There are things you can do to protect yourself.

Start by keeping your personal account information to yourself. Never share your account number, debit or credit card number and PIN, or online banking login info with anyone. Ever.

Here’s why: If you willingly provide your personal account information to someone who scams you, you are financially responsible for any potential loss or fraudulent activity on your account. Additionally, this could negatively affect your credit score and/or ability to open deposit accounts at other financial institutions. It’s all around bad news.

Protect yourself by keeping your eyes open and your financial information on lock down.

Additionally, steer clear of these five common types of fraud:

1. Fake Calls from the IRS
IRS scams seem to peek during tax season. Scammers may call you claiming to be from the Internal Revenue Service, insisting you owe money to the government and that you pay immediately – usually via a prepaid card or wire transfer.

Note that the IRS does not:

  • Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes.
  • Demand that you pay taxes without the opportunity to question or appeal the amount they say you owe. You should also be advised of your rights as a taxpayer.
  • Threaten to bring in local police, immigration officers or other law-enforcement to have you arrested for not paying. The IRS also cannot revoke your driver’s license, business licenses, or immigration status. Threats like these are common tactics scam artists use to trick victims into buying into their schemes.

But here’s the thing: According to the IRS website, the IRS does NOT call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, they will first mail a bill to any taxpayer who owes taxes. If you get a call like this, hang up and report it to the Federal Trade Commission.

2. Online Dating Scams
The Federal Trade Commission (FTC) reported that romance-related scams are among the costliest and most popular schemes targeting Americans. In 2018, online dating scams cost Americans $143 million, according to reports filed by the FTC. Just three years prior, losses in this same category were only $33 million. Yikes!

Here’s how it works… Let’s say you meet someone on a dating website who seems like the perfect partner. They may even have a very convincing online dating profile, and claim to fall in love with you at warp speed.

There’s just one catch: they don’t want to meet in person and / or they ask you for money – or worse, for your bank account information. This is a red flag—swipe left!

3. Email Phishing
No matter how sophisticated Spam filters get, scammers never stop trying to rip you off right in your inbox. If you receive unsolicited messages from a business or person you don’t know, you should automatically be suspicious, especially if they want you to click a link.

To make things worse, scammers are skilled at re-creating official logos and other details to make their scam email look like it’s the real deal. Bottom line? If you’re unsure if an email offer is legitimate, contact the company directly.

4. Shady e-commerce Websites
Pro tip: before you buy something on a website, always look for the “https” in the URL, and a lock icon in the address bar. This signifies that the site is secure. For extra protection, review the company at the Better Business Bureau’s website.

5. The “Can you hear me?” Scam
Have you ever answered a call only to hear someone ask, “Can you hear me?” When you respond, “Yes” a scammer records your voice, and then uses it as a voice signature to authorize fraudulent charges over the phone. It’s a good reminder to generally avoid incoming calls from blocked or unfamiliar numbers.

How to be scam-free

Here are some good rules to live by if you want to avoid being a victim:

  • Don’t share your personal account information with anyone
  • Don’t give/send money to someone you’ve never met
  • …And definitely don’t pay a stranger via wire transfer or pre-paid debit card (they’re untraceable)
  • Never share personal information with a person or company that sent you an unsolicited message
  • Never click on a link in an email from a person or company that sent you an unsolicited message
  • If an unsolicited email gives you that uneasy “scam-y” feeling, trust your gut
  • Avoid online purchases unless the transaction is secure
  • Use extreme caution when dealing with people you meet online
  • Be selective about what you share on social media (scammers can use these personal details to impersonate friends or family)

Where to report scams

If you’ve been victimized by a scam, you’re not alone. Scores of well-intentioned people are subject to fraud every year.

To report the crime, contact the following agencies:

I’m a UMe member and also a scam victim – what do I do?

If you’ve been a victim of one of these scams, we’re deeply sorry for any financial and emotional hardships you’re experiencing. We know this feels awful and we’re here for you.

Please let us know immediately if you think your UMe accounts have been compromised by calling us at (818) 238-2900

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