Top Financial Scams (and How To Avoid Them)

Financial scams are nothing new, but the people behind them are constantly coming up with fresh ideas. That’s why you should always stay aware of the latest trends — and, perhaps more importantly, know how to protect yourself.

Here’s a look at the most common scams and what you can do to avoid them.

Scam patterns in 2022

According to the Federal Trade Commission, 2022 was a bad year for financial trickery. Here’s a quick look at what happened:

• Impersonator scams were the most common, reaching $2.6 billion in losses. $660 million of that was specific to business imposters — a significant increase from $453 million in 2021.
• Investment scams represented the biggest loss overall at $3.8 billion. This amount more than doubled since last year.
• Bank transfers were the payment method with the most loss: $1.5 billion. Cryptocurrency was a close second at $1.4 billion.

There were general trends among these losses, too. For example, adults aged 20-29 lost money most frequently, but adults aged 70-79 lost more money per scam. Similarly, social media scams represented the biggest loss overall at $1.2 billion, but phone calls tended to steal more per person — a median of $1,400.

Looking ahead: How to protect yourself in 2023 and beyond

You should always look out for common scams like those reported in 2022. However, because digital criminals invent new tricks every day, it’s better to know how to recognize any scam than to memorize a certain list. Here are a few things to look for:

 Unsolicited contact

A text or phone call that you weren’t expecting can look legitimate, especially if it seems to have come from a trusted source like your bank. However, these can be attempts to steal login information, including one-time passwords or verification codes. Don’t respond to such messages; instead, contact the source through another channel to report the incident or request verification.

 Online sale scams

It’s easy to “sell” something that may not even exist — including pets, vehicles and electronics. Before you purchase anything online, do a reverse-image search on photographs in the listing to make sure they haven’t been pulled from another website. If possible, request to see the pet or item in person before payment. You should also understand the website’s return policies and fraud protections. 

Fakes

Fake barcodes on gift cards, fake QR codes, fake credit card scanners at the gas station — there are all kinds of ways for digital criminals to “fake” their way into your life. While it’s not always easy to identify these kinds of traps, be careful whenever you interact with anything that could have been tampered with. Look for stickers, glue, mismatched colors and other signs that you’re about to scan or use something that isn’t what it seems.

Crypto scams

Some crypto scams are more obvious than others. That’s because some of these tricks start out on entirely different topics. For example, a scammer might reach out to you on LinkedIn, pretending to want advice from someone experienced in your field; they might send a text that looks like it’s for someone else, then strike up a conversation; they might even meet you on a dating site. If conversations like these end up pressuring you toward crypto investments, the chances are high you’re chatting with a scammer.

Want to learn more about protecting yourself from financial scams? Contact a Vectra Bank professional today.