While advancements in technology have certainly offered us more convenience and flexibility, they’ve also made fraudulent activity easier than ever. Fortunately, there are measures you can take to minimize your risk and exposure for becoming a target of fraud. And being aware of common financial fraud cases and how to report financial fraud can also help to navigate through any potential fraudulent situations you may experience.
How to Detect Fraud
Fraud can occur in various forms using several different methods, and it’s helpful to know what types of fraud to look out for to better protect yourself from becoming a victim of fraud. The Federal Trade Commission (FTC) keeps a running list of scam alerts, so you can always stay informed on reported scams and fraud scenarios that real people are encountering.
According to HG.org, the most common types of fraud violations typically involve the following:
- Postal Mail
- Credit Cards
- Banks
- Healthcare, Insurance, and Medicaid
- Bankruptcy
- Income Tax
- Unemployment Benefits
- Money Wiring
These scam artists often communicate through any means necessary, including phone, email, and text, and over the years, these scams have become more elaborate and believable, which is why they’ve become so dangerous. The FTC describes how scammers use technology to fake their caller ID information, pretending to be someone you trust, and warns consumers not to trust the name and number you see show up on your phone.
If you’re concerned or suspicious about a contact, the best rule of thumb is to take your time to assess the situation. If something seems too good to be true, it usually is just that. No legitimate organization will call you unexpectedly, prompt you for your personal or financial information, and/or require deposits or payments, especially using money wiring, online transfers, etc. Whether the potential scam is online or on the phone, use your best judgement. Always use caution when making payments and sharing your information.
4 Measures to Take to Protect Yourself Against Fraud
- Be a skeptic, and never give out your personal and financial information. If you weren’t expecting a call from your government agency, student loan company, giveaway, etc., don’t be so quick to give out your personal and financial information. Scammers take your personal information they manage to obtain from you and sell your information, steal your identity, or take your money from you. No matter what the situation is, you have time to decide and to research if it’s legitimate. Don’t hesitate to ask to contact them later.
- Monitor activity on your statements and credit report. Keep a continuous eye on your credit card and banking statements to ensure there aren’t any suspicious transactions. It’s important to understand that not all fraudulent transactions will be blatantly obvious with big amounts. Scammers are very clever and experience success in making smaller, harder-to-detect transactions. Be sure to confirm every purchase and transaction on your statements, no matter the amount. According to U.S. News, checking your accounts and statements online “can help you catch fraud on your current accounts. But you have to look at your credit reports to find out if someone has opened a new account in your name.” You can request a free copy of your credit report from one of the three major credit-reporting bureaus (i.e. Equifax, Experian, & TransUnion) every twelve months, so you can monitor activity linked to your credit.
- Update account log-in details routinely. Let’s face it—the last thing on your mind is probably updating your ATM debit card PIN or your online account usernames and passwords. However, this simple measure can really protect yourself from fraud. Update your login details, and avoid opting for passwords or PINs that include any personal information, such as dates and names. Try incorporating a variety of capital and lowercase letters, numbers and symbols for the strongest password protection, as they’re harder for criminals to hack.
- Properly dispose of sensitive information. Use caution when disposing of any documents or mail that may contain personal or financial information, such as your credit card number, account number, social security number, etc. Instead of throwing them into your recycling or garbage, which makes it easily accessible to steal information, invest in a quality shredder to dispose of your sensitive paperwork.
How to Report Financial Fraud
If you’ve experienced something suspicious or have been a victim of financial fraud, you should report it immediately. According to AdAware.com, “Unfortunately, not all victims of fraud get justice,” but reporting can help notify the proper authorities of existing fraudulent threats, so they can perform thorough investigations and warn others.
To report fraud, contact the FTC by calling 1-877-FTC-HELP (1-877-382-4357) or filing a complaint on their website. The FTC website offers a virtual complaint assistant that’s filled with helpful resources for identifying and reporting fraudulent activity, including information on reporting identity theft and international scams and registering for the National Do Not Call Registry.
Depending on your unique fraud situation, you may need to also notify your credit card companies, banks, credit-reporting bureaus, and any other necessary or involved agencies.
Trust Focus Financial to Have Your Back
If you’re worried about becoming a victim of fraud, it may help to work with an independent financial advisor who can offer professional guidance, expertise, and financial management strategies. At Focus Financial, we offer a variety of individual financial services that help you stay in control of your finances, from financial planning to retirement planning. To learn more about our financial services, contact Focus Financial today, and we’ll help find a financial advisor near you whom you can trust.
