Financial Fraud Alert – How to Protect Yourself and Family
One thing is certain, when normal activity gets disrupted due to some unforeseen event, whether a natural disaster or global pandemic, the crooks among us try to take advantage of the situation. With the Corona virus disrupting every aspect of our daily life and prompting massive stimulus and measures from state and federal agencies, there has been a dramatic increase in financial fraud scams. Many of the new frauds are centered around the stimulus checks or identity phishing using the guise of contact tracing or other health related requests. I recently heard of another variant of this which I wanted to make you aware of so you could identify and protect yourself.
Here is what happened.
- As part of a regular health routine a woman is required to get blood work done which she does through one of the large, independent lab companies.
- As expected she receives a bill from the lab company for a relatively small charge due to insurance reimbursement rules.
- She banks at a federal credit union and uses online bill pay so pays the bill – which she has done in the past using the same method – and assumes it is all settled.
- A week or so later she receives an email from what she believes is the federal credit union (the email looked very official with the logo and everything) informing her that the account number she used to pay the bill was incorrect, and to call a number in the email.
- She calls the number in the email and is told that it is all a big mistake and due to inconvenience she encountered they will give her a $100 prepaid debit card.
- In order to process said debit card there is a $2 processing fee and they need a credit card number to charge and they will get the debit card out right away.
- She gave them her bank debit card number but then started to feel uneasy and got off the phone with the scammer and called her bank. She told the fraud department the story and they told her that it was not one of their representatives, and they would not send out an email as described. They cancelled her debit card so no damage was done as it had only been about 10 or 15 minutes.
There are many variants of this type of scam and it sounds so easy to spot when it is all laid out in this manner. However, these scammers are very, very sophisticated and don’t assume that you or a family member would never fall victim if you are not vigilant. I have a personal experience where a very smart and financially sophisticated person that I know fell victim to one of these scams and was out about $10,000.
Some tips to protect yourself and family members:
- A great practice to get into is if you receive an email from a financial institution never call the number that is provided. Take a couple of minutes to look up the company’s number online or use the number from the back of your credit or debit card. Tell the customer support line what you received and if it is legitimate they can direct you to who you need to speak. With the above related scam it would have ended the whole thing right then.
- Similarly do not click on links provided in an unusual email, no matter how official it looks. Go online and login to your account using your credentials and see if there is a similar notice.
- Legitimate organizations do not call you and request information. If you receive one of these phone calls just say you will call back on the number you have and get off the phone. This goes for government organizations such as the IRS and the Social Security Administration.
- Very importantly, know that this could happen to anybody and we should not shame people who fall victim. Most of these frauds are not reported because people are embarrassed so the same method is used over and over again. Talk to your family and friends and be diligent yourself in protecting your financial life. You may have to have some difficult conversations as family members age about putting protections in place for them.
The AARP is a go to resource for those looking to learn more about financial fraud and ways to protect themselves and family members from being victims. If you have questions or would like to discuss your personal situation please do not hesitate to contact me.