Home Bankrate.com 4 Scary Money Scams That Target Your Financial Accounts

4 Scary Money Scams That Target Your Financial Accounts


Spooky season has begun a bit early this year. And we’re not just talking about the early decorators — there has been a rise in money scams since the onset of the coronavirus pandemic.

Scammers continue to prey on the fact that more Americans are at home and online. In fact, the Federal Trade Commission (FTC) shared that complaints have doubled during some weeks when compared to 2019 data. Currently, the FTC has received over 118,000 complaints related to COVID-19 between January and October 2020 with the most common fraud reports relating to online shopping, travel/vacations and health care.

This scary fact isn’t very shocking given the world’s current state, but that doesn’t make it any less frightening.

While this isn’t the type of news we like to hear, it’s essential to be aware of what’s going on to put you in a better position to protect your finances.

Faith Based Events

Beware of these money scams that target your financial accounts

1. Imposter scams

Scammers are sneaky and will try to get as close to you as possible, meaning scams aren’t limited to phone calls but could also come in the form of an email or even a text message.

“Bad actors [scammers] will call the victim and spoof the phone number so it appears as if your bank may be calling,” says Ryan Alexander, vice president of fraud protection management at Prove Identity. “They pretend to authenticate you over the phone by sending you a one-time passcode (OTP) as an SMS text message. The text message may truly be coming from your bank, but what you don’t realize is that text message was intended to reset your password, send money, or enroll you in services you’re not intending to use.”

This practice is referred to as social engineering, and it can be very convincing, Alexander says. It’s no wonder why the FTC reported this type of fraud as one of the most common during the pandemic.

2. Fake checks

This type of scam has been another one that the FTC has received an influx of complaints about during the pandemic. There’s a variety of scenarios that this could happen in, but a common one is centered around those who are trying to declutter or make some extra money by selling stuff online.

Whatever it is, be wary of who you’re selling to and how they’re paying. Fake checks are easy to make and hard to spot just on looks.

“You should never deposit a check from someone you have not met. If they ask for money in return, the chances that the item is counterfeit or in case of a transfer that the funds are stolen are extremely high,” says Mary Dishong-Vanetten, a corporate security officer at Tompkins Financial Corporation based in Harrisburg, Pennsylvania.

Instead of accepting checks, online sellers should opt for more secure payment methods such as peer-to-peer payment services or cold hard cash.

If you do happen to deposit a fake check, know that you will be responsible for anything that is deposited into your account and if the check is returned, you could end up owing the bank.

3. Zero percent or low-interest rate offers

Scammers have been capitalizing on the current low-rate environment to lure in potential victims by claiming to offer even lower rates on mortgages, credit cards or other loans through “special relationships” with your financial institutions. Before you get too excited, take a closer look at the message to see if it checks out. Even if it does seem real, be sure to give your bank a call to confirm.

These scams can come in the form of a call, text or email. Regardless of how you receive the offer, you should approach it with extreme skepticism.

The odds of your lender reaching out to make you aware of lower rates are very slim. Instead, you will likely have to be the one to inquire and that’s the safest way to go about it.

4. Prize, grants, or sweepstakes offers

If it seems too good to be true, odds are it is — especially when it comes to being randomly rewarded with money for no apparent reason.

These types of scams usually happen online or in your inbox and read something like: “You’ve been selected to receive $10,000, click here to claim your prize.”

While tempting and certainly desirable, it’s best to send these messages to your junk box. To learn more about these types of prize scams, head to the FTC site.

How to keep your accounts safe from sneaky tricks

If you receive a suspicious message from someone claiming to be your bank (or another type of account), you should proceed with caution.

A good rule to follow is always logging into your accounts through the institution’s official website or app, says Samantha Gorelick, a certified financial planner at Brunch & Budget based in New York City.

“Never click a link in an email or text message to login into your account, even if it appears as though the bank is the sender,” Gorelick adds.

Typically, your bank won’t reach out to you through these online channels without some sort of notice beforehand. And if the institution does, you should have some sort of two-factor authentication in place so that you can confirm both parties’ identities before proceeding.

A safe and secure way to do this is by setting up a verbal password or phrase that only you and your bank know. This way, you can confirm that the person on the other end is, indeed, your bank when calling.

Regardless, you should never hand over any personal information — especially written — unless it’s through a secure system and both identities have been confirmed.

Signs you’re probably trying to be scammed

Identifying a scam doesn’t have to be difficult. In fact, it can be as easy as ABC, says Alexander. By this, he means “always be curious” whenever someone is inquiring about your personal information.

Not only is it important to stay curious, but also watch for these telltale signs.

  • The caller refers to the company as “card services” rather than the company name.
  • The message or call is unprompted or unrelated.
  • Emails or texts are misspelled or have bad grammar, including the sender’s address.
  • The scammer acts in a demanding manner when asking for information.
  • There’s a sense of urgency or pressure behind the transaction.
  • In the case of online sales, the buyer offers to send a check in advance, sends a larger than expected amount and asks you to pay someone else with the “extra funds.”

What to do if you’ve fallen victim to a scam

If you believe you may have fallen victim to a money scam, here are a few actions you will want to take.

  • Contact your bank immediately: Alerting your bank is important so that it can keep a watchful eye for any fraudulent activity and also freeze any cards that may have been compromised.
  • File a fraud report with the 3 major credit reporting agencies (TransUnion, Equifax, Experian): While this isn’t foolproof, filing a report can help protect your credit score from further damage. To find their contact information, head to each agency’s respective website.
  • Let your local Consumer Protection Office know: This is important so that states can keep track of common types of scams happening to its residents.
  • File a complaint with the FTC: By filing a complaint with the FTC, you can help it keep better track of the types of scams that are happening to consumers.

When reporting the fraud, be honest with how much information you gave over as this will ensure that all the proper precautions are taken to protect yourself and your money.

You can never be too cautious when it comes to protecting your personal information and money. By staying curious and knowing the signs of a scam, you put yourself in a better position to avoid it altogether.

[vc_message message_box_style=”solid-icon” message_box_color=”blue”]Bankrate, posted on SouthFloridaReporter.com, Oct. 23, 2020[/vc_message]
Bankrate.com publishes original and objective content to help you make smarter financial decisions. Our award-winning reporters and editors provide expert advice on nearly every major financial decision you may encounter — from purchasing your first home, to selecting a new car, to saving for retirement.