Financial scams have been around as long as money itself, and as we continue to see advancements in modern technology, we are seeing developments in the evolution of how scammers and fraudsters take advantage of innocent people. Due to the rise, across the board, in fraud cases in the United States, we want to take the opportunity to bring the best of our expertise to give you a step-by-step playbook on how to prepare yourself for when you get approached by a fraudster but also how to react to that fraudster in the moment. This playbook will guide you through the many different types of fraud, explain why so many intelligent and well-intentioned people fall for them, and provide a step-by-step action plan to help you steer clear of them.

The Grandparent/Parent Scam:

Identification: A fraudster calls an older individual claiming to be someone’s child (or often, grandchild) in distress, needing money for an emergency.

Why Individuals Fall for It: The scammer plays on the emotion of the victim, creates immediate panic, and makes the victim act quickly without second guessing or questioning the situation.

Prevention Playbook:

• Even though the situation may seem scary, resist the urge to act immediately.
• Never reveal the personal information of yourself or your family members.
• Keep calm and navigate the conversation without sharing any personal information.
• Always Verify. Even if it sounds like a very urgent situation, there is always time to call a family member to verify the information the fraudster is presenting.

In this type of scam, dialogue will often go something like this:

Fraudster: “Your grandson is in critical condition.”

Victim: “Which grandson?”

Fraudster: “Your youngest grandson.”

Victim: “Oh no! Brad??”

Notice how, in the above example, the fraudster was able to get the victim to offer the name of the grandson, Brad, without presenting it themselves. Fraudsters have psychological techniques they employ to make it easy to accidentally give away personal information that allows them to gather your personal information and commit fraud much more easily.

Romance Scams

Identification: A fraudster establishes a romantic relationship with the victim online and soon asks for money for an emergency, education, or to meet the victim in person.

Why Individuals Fall for It: Loneliness can be a huge contributing factor to why individuals fall for fraud. Genuine belief in a newfound connection can cloud the victim’s judgement.

Prevention Playbook:

• Be wary of anyone who insists on getting additional methods of communication such as a phone number or email.
• Never send money to someone that you haven’t met in person.
• Research your love interest. It’s not creepy to do a little bit of research on the person you’re chatting with. See if you can find additional social media profiles or, do a google reverse image search with their photo.
• Always talk to your family and friends about who you have online relationships with. Oftentimes, the victim is gradually lured in and it takes an outside 3^rd party to be able to properly identify the problem.
• Ask probing questions. Often asking “why?” when met with a request from someone you’ve never met can start to unwind the thread behind the fraudster’s attempt.

In today’s technology-fueled world, of course, there will be situations where you meet individuals for the first time online. According to a Stanford survey on online trends, the number of couples that have met online has gone up 1950% between 1995 and 2017; however, this has also created opportunities for fraudsters that we need to be wary of.

Lottery Scams

Identification: A call or email says that you’ve won a prize but that you must pay taxes or a fee upfront to win the prize.

Why Individuals Fall for It: The allure of sudden wealth is tempting!

Prevention Playbook:

• If it sounds too good to be true, it probably is.
• Research the supposed lottery or sweepstakes and don’t be afraid to call that organization directly to verify.
• If you did not apply or enter to win a prize, you will not receive an award.
• You should never have to pay to receive a prize.

While the allure of winning the lottery is tempting, you must stay vigilant to ensure that you use your best judgement when faced with this scam. Oftentimes, while it may seem like a huge win for you in the moment, thinking through carefully could lead you to uncover the scam. If you didn’t buy a lottery ticket, for instance, it’s not likely that you could have won the lottery.

Phishing Scams

Identification: Emails or messages that are from a reputable company, asking you to provide personal information for a work, business, or banking related topic.

Why Individuals Fall for It: Scammers have become very good at copying legitimate company email addresses very closely.

Prevention Playbook:

• Always check the email address of the sender. Corporate emails often are @[company name].com; however, many of the phishing scams have @[company name]-supporthelp.com or some other combination, to appear legitimate.
• Never open a link in an email until you have verified that the email is from a legitimate sender.
• Use multi-factor authentication on your accounts when you can to mitigate the damage done by a phishing fraudster if they do gain access to your account.
• Never download attachments from unknown sources.

While many email servers have been doing an increasingly good job at mitigating phishing attempts, it is still the individual’s responsibility to stay vigilant and help to prevent these.

Technology Support Scams

Identification: Caller claims to be from a well-known technology company and they will say there is a problem with your computer and request remote access.

Why Individuals Fall for It: No one wants to fall victim to fraud and most individuals know that having properly secure technology helps to prevent fraud scams.

Prevention Playbook:

• Remember that legitimate technology companies never make unsolicited calls.
• Never grant remote access to someone that you do not know.
• If you are called by a technology company to have your computer supported, hang up, and call that company’s customer support hotline directly to verify. If your computer does need support, they will still be able to help you.

In Summary

While there are many different fraud scams that you could fall victim to, the playbook to avoid the negative effects of fraud are simple and apply across multiple situations:

1. Always verify before trusting someone who has reached out to you.
2. Never make hasty decisions under pressure, it’s situational pressure that drives fraud.
3. Inform yourself about cases of fraud so you can prevent it from happening to you.
4. Always talk with friends and family about fraud prevention to create group accountability.

Be vigilant, be informed, and always play it safe. Your financial security is worth the extra caution. If you have additional questions about fraudulent activities in the area where you live or if you’re unsure if you are being targeted for fraud, you can always call your local HPB branch and a financial expert will help you to navigate the situation with the information you need to keep your personal and financial information safe.

Make sure to hit subscribe to stay up to date on future OnPoint posts from Hickory Point Bank!