There are financial 'tricksters' lurking everywhere: online, at the store ten feet away, over the phone—even inside your text messages. If that’s not frightening enough, the effects of financial-based fraud can be far-reaching, from unauthorized debt and damaged credit scores to out-of-pocket costs for restoring your identity and reinstating your accounts.
At Chambers Bank, we want to share some important facts and statistics about this growing criminal trend so you can better protect your personal information and know what to do if you suspect fraudulent activity.
Scams, Identity Theft, and Cybercrime, Oh My!
- Financial fraud can happen to anyone; it doesn’t just happen to people in certain age groups, professions, cultures, races, geographies, or genders. Sometimes, fraudsters target particular groups and then move on to the next as they change their tactics.
- Social engineering includes a wide range of criminal activities that share a common goal: to gather your personal information and steal your identity, resources, or assets in order to achieve financial gain. It can occur in person, over the phone, or through cleverly disguised fake emails, apps, advertisements, or websites.
- Have you heard of a bait & switch attack? This vicious tactic tricks you into thinking you’re clicking on a safe advertisement or downloading safe content when you’re actually being redirected to a malicious online spot that adds malware to your computer or compromises the computer’s operations in some way.
- Credit card fraud was the second-most reported identity theft type in 2020, according to the Federal Trade Commission (FTC). A person who commits credit card fraud can do so in a number of ways, such as stealing your physical card or the information on it, hacking your account, or opening a credit card in your name. If you receive unauthorized charges because of this crime type, your credit card balance may rise (or be maxed out) and damage your credit score, forcing you to fight the false charges and work hard to reinstate your previous credit score.
- You’ve probably heard of a Ponzi scheme or pyramid scheme before. These forms of investment fraud lure people in by promising extensive wealth potential and paying early investors with money gathered from later investors. At some point, people stop contributing and funds dry up—leaving investors with empty pockets.
- Things like bank statements, check stubs, tax-related documents, and credit card applications contain enough information to set you up for identity theft if the wrong person gets their hands on the information. Don’t throw papers like this in your garbage! Shred them.
- Phishing is the most common type of social engineering tactic in which a criminal imitates a trusted source and tricks you into handing over confidential data, passwords, or account information. It’s worth noting that a 2021 study by the cybersecurity firm Vade found that financial institutions represented the majority of impersonated companies in phishing attacks.
- One in every 50 U.S. children were targeted by identity theft in 2021, according to a report by Javelin Strategy & Research. This type of fraud happens when someone steals a child’s personal information to open credit card accounts or buy products or services using their name. With no credit history, years can pass before a child realizes their identity has been stolen.
- If you shop online for the holidays, be particularly watchful of the links you click on and the websites you visit. Online shopping scams often increase during the holiday season and are commonly carried out by phishing and bait & switch attacks.
- There’s a creepy little device called a credit card skimmer that a fraudster can use to steal data from your credit or debit card. After the fraudster illegally installs one on an ATM or other type of payment terminal, the skimmer can read the magnetic stripe on your card and your information can be used to buy goods or services, make fake cards, or steal your identity.
- Tax season is a prime time for financial fraud, so be vigilant with calls, texts, and emails from sources claiming to be the IRS or a tax preparation agency or company. The IRS doesn’t use texts to communicate tax information, nor will it email you to request financial information.
- In 2021, a study by Javelin Strategy & Research found that victims of traditional identity theft lost an average of $1,551 each, and it took an average of nine hours per victim to resolve issues related to the crime.
- Some of the most common phone scams include calls impersonating IRS agents, technical support personnel, charities, insurance agents, charity workers, and lottery or sweepstakes administrators.
- It’s easy for criminals to play on your emotions after a tragedy or natural disaster. Charity and disaster fraud happen when scam operations disguise themselves as helpful organizations and solicit you via emails, phone calls, social media posts, and more. Do your own research before giving out personal information or money.
- Public Wi-Fi is almost everywhere these days, and although it’s convenient, it comes with security risks you’ll want to pay attention to. A hacker can create a spoof Wi-Fi network that seems like the one you want to access or even set up a connection point between your device and the Wi-Fi access point you intend to use. Both actions can result in your passwords, credit card information, and personal data getting stolen. Bottom line: don’t make financial transactions when using public Wi-Fi.
Protecting Yourself from Financial Fraud
Although financial fraud seems pretty scary, there are a lot of actions you can take to protect yourself and your family from having your personal and account information stolen. Read through these great tips on one of our previous blogs, and if you have a Chambers debit card and a smartphone, don’t forget to utilize our free SecurLOCK Equip app to help keep your accounts secure. As always, please contact us any time if you’d like additional information about keeping your accounts secure and protecting your personal information.