It is challenging to identify scammers to avoid falling for scams. Financial scams are on the rise each year with the holiday season being one of the most active times for criminal activity. In 2022, over 88,000 people over age 60 reported falling victim to online or phone scams in the United States. This resulted in $3.1 billion in total losses or an average of roughly $35,000 per victim. This marked an 84% increase in losses from 2021 and the trend is expected to continue over the coming years. (Source: Federal Bureau of Investigation’s Elder Fraud Report)
What are the 5 most common scams?
Government Impersonation Scams:
These scams often involve a scammer contacting you by phone, text message, or email. This scammer will claim to be from a government agency such as the IRS, Social Security, Medicare, or the FBI. Once they have your attention, they will often demand money or information while threatening fines, loss of benefits, or even arrest. These scammers often “spoof” email addresses and phone numbers of actual government agencies, making them difficult to identify. According to the FTC, “If you get a call or message like this, hang up or ignore it. It’s a scammer. Government agencies will never call, email, text, or message you on social media to ask for money or personal information. Only a scammer will do that.”
In these scams, you will be contacted and told that you won a prize, but there is a catch. In order to claim your prize, you may be asked to provide financial information or payment under the guise of taxes and other fees. Per the FTC, if someone asks that you pay to increase your odds of winning, asks for your banking or credit card information, or asks that you pay shipping or a processing fee, it is likely a scam. Real sweepstakes are free and winning is by chance.
Robocalls are automated calls that take advantage of technology to call thousands of phone numbers at one time. In addition, they often use local area codes to increase their chances of making contact. These calls may sound realistic. They may be someone claiming to be from your car “warranty department” or from Amazon checking on a large purchase that never happened. These scammers will attempt to solicit personal or financial information from you to remedy the fake problem. If you think it may be a scam, hang up and call the organization directly with the number on their website.
Computer Tech Support Scams:
Tech support scams prey on the less tech savvy. Scammers will call claiming you have a serious problem with your computer. They will ask you to pay for a solution to a problem that doesn’t exist. These scammers will ask to gain remote access to your computer to resolve the problem, where they will then try to log into your bank and other financial accounts as well as gather personal information.
The Grandparent Scam:
In this scam, a criminal will call a victim and say, “Hi Grandma/pa, do you know who this is?” Often times, the victim will guess the grandchild the caller sounds most like. The scammer will then say that they need help, and immediately pass the phone to another scammer posing as a lawyer or policeman demanding immediate payment. The “grandchild” scammer will often plead with the victim to not tell their parents, causing these scams to go unreported.
How can I avoid falling for scams?
Per the FTC, there are four signs to watch for that point to a scam. Scammers will pretend to be from an organization you know, say there is a problem or a prize, pressure you to act immediately, and/or tell you to pay in a specific way.
The FTC recommends taking the following steps to avoid falling for scams:
- Block unwanted calls / text messages.
- Do not give out your personal or financial information in response to a request you did not expect. If it is a real business, they will not call, email or text asking for your personal information.
- Resist the pressure to act immediately. If the business is real, they will give you time.
- Know how scammers tell you to pay. Cash, cryptocurrency, wire transfers, payment apps, and gift cards are red flags as they are harder to track. In addition, never deposit a check and then send money back to someone.
- Stop and talk to someone you trust. A family member or friend may be able to help identify a scam.
Author: Michael Gibb | President & CEO
Written: November 21, 2023