People lost more than $667 million to imposters who pretended to be businesses, family members in an emergency, the government, or a romantic interest.

Federal Trade Commission

“Someone’s gonna tell you lies, cut you down in size, don’t do me like that.”

-Tom Petty and the Heartbreakers

Fraud is something that has been around forever. It is not always easy to detect, and today with technological changes taking place so fast, it seems increasingly more difficult to detect. Ben Carlson, the author of Don’t Fall For It: A Short History of Financial Scams, was on CNBC in January of 2020. discussing fraud. He brought up an interesting point that promted me to write this. He believes that the further we operate in a bull market, the more susceptible to scams people will be. This may be because in a bull market people are willing to take more risk, interest rates are low and people start to develop  FOMO (fear of missing out). To avoid fraud, he suggests avoiding financial advisors who use high-pressure sales tactics and  custody your assets. He also encourages people to be wary of overly complicated investments. These are great points to consider, but there are several more to be aware of that you may face on an everyday basis.

Be careful with emails. Preventing fraud in your email inbox may seem daunting, but my most simple advice is to try to never click on a link in an email without verifying its legitimacy. When you click on a malicious link, this gives hackers a way into your computer and possibly into your personal data. Make sure to verify the sender, look for spelling errors, hover over the link to see where it will take you, and ask yourself if it makes sense that you would be getting a link from this sender. If you are unsure, most experts recommend sending a separate email to the sender or call them to ask if they just sent you an email and if it is safe to click on the link.

Be extra careful with phone calls. According to the Federal Trade Commission (FTC), imposter scams over the phone was the number one fraud reported to Sentinel. People lost more than $667 million to imposters who pretended to be businesses, family members in an emergency, the government, or a romantic interest.1 Be extra cautious and don’t give out personal information on unexpected calls. If you are worried if something is genuine, you can always hang up and call the general number for that business or government agency to see if they need something from you or if the request is something they would usually ask. Also, if you get a robocall and hear a sales pitch, hang up. Finally, if something seems fishy, open an internet browser and search it. Many times, if you hear a scam, many others also have and have written about it on the internet. For example, if you searched “IRS call scam” you will likely be able to verifythat what you were hearing was a common scam.

Other considerations, according to the FTC. The FTC warns about paying in advance for things like debt relief, a job, taxes on a prize, etc.1 Most likely if you do this, they will take the money and disappear. Additionally, how a company expects you to pay can be a big warning sign. If you are asked to pay by wire, gift cards, or reloadable credit cards, beware.1 It is very difficult to get your money back from those types of scams, and most reputable firms you are working with will not request you pay via gift card or wire.

Every day, you need to be on your A-game. Scams can happen at any time. The best advice is to be vigilant and skeptical. It is better to be overly cautious than sorry. If you ever do feel like your information has been compromised, sign out of all devices, change email and other passwords, and enable multi-factor authentication. In fact, it is probably best to have multi-factor authentication set up for important sites anyways. If you would like to sign up for free scam alerts from the FTC, you can do that at: ftc.gov/scams.

  1. “10 Things You Can Do to Avoid Fraud.” Consumer Information, 10 Aug. 2018, www.consumer.ftc.gov/articles/0060-10-things-you-can-do-avoid-fraud.

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