Financial scams and identity theft can happen to anyone, at any time. It’s important to always be vigilant and pay close attention to your bank accounts, credit card balances, and credit score. While some scammers are easy to detect right away, others are very smart and will go to great lengths to convince you that they are affiliated with a government agency or a financial institution. Though not all financial scams result in identity theft, most identity theft cases do result in some sort of financial loss. The information below will help you learn how to spot a scam and what to do if you fall victim to one.

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How Will a Scammer Target Me?

There are many ways a scammer can access and steal your information, and some of them are more simple than you might think. However, the more you know about the warning signs of a scam, the better prepared you’ll be in the event that you become a target.

The Four P’s of a Scam

• Pretend
  Common organizations that scammers will pretend to be from include the Social Security Administration, the IRS or Medicare, though some scammers may use a fake company name that sounds official. Scammers are smart— they know how to change the phone number that appears on your caller ID to anything that they think will trick you into believing them.
• Problems and Prizes
  Often times, scammers present one of two very different scenarios— you’re either in trouble, or you’ve won something. If they choose the “problem” route, they may say that you are in trouble with the government, that you owe back taxes, that someone in your family has had an emergency, or that there is a virus on your computer. If they choose the “prize” route, they may say that you’ve won a raffle or a sweepstakes, but that you need to pay a fee to receive your winnings.
• Pressure
  Scammers may try to pressure you, or even threaten you, into giving up your personal information or sending them money. Claims that they’ll arrest you, sue you, deport you, or take away your driver’s license or business license are all common ways in which a scammer will try to pressure you.
• Pay
  If someone asks you to pay them in a specific way, it’s typically a scammer. Often, they’ll insist that you send them money via Western Union or MoneyGram, or purchase a gift card and give them the number on the back. Some scammers will even send you a fraudulent check (though it looks real) and ask you to deposit it, and then send them some of the money back. See more information about this particular scam below in the Common Scams section.

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Common Scams to Be Aware Of

• Social Security Scams
  Scammers pretend to be from the Social Security Administration in order to get your social security number and/or money.
• IRS Scams
  Scammers pretend to be from the IRS and claim that they are filing a lawsuit against you for back taxes.
• Phishing Scams
• Scammers use email or text messages to trick you into giving them your personal information.
• Fake Check/Overpayment Scams
  If you’re selling an item, a scammer will send you a counterfeit check in excess of the purchase price, saying it was a mistake or that it was to cover shipping and handling costs. The scammer will then ask you to send back the difference after you’ve deposited the check into your account. When you send back this difference, your bank may not learn for days that the check was fraudulent. By then, the scammer has your money, and you’ll have to repay the bank the amount of the check, plus you’ll lose any money you sent the scammer. Remember— just because a check clears does not mean it’s good!
• COVID-19 Scams
  Anyone who contacts you asking for your stimulus check, pitching a miracle treatment or cure for COVID-19, or claiming to be from the CDC or WHO and asking for personal financial information is a scammer.

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How to Avoid a Scam

• Block unwanted calls, text messages, and email addresses.
• If you didn’t initiate the conversation, DO NOT provide someone with your personal information, including your Social Security, bank account, or credit card numbers.
• Do not provide unknown people with your physical address.
• Resist any pressure to act immediately. Legitimate businesses will always give you time to make any decisions.
• Know that scammers will ask you to pay in unusual ways.
• Talk to someone you trust if you’re unsure.
• Trust your intuition. If something doesn’t feel right, chances are good that it probably isn’t.
• Report any suspicions of a scam to the Federal Trade Commission.

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What To Do If You Were Scammed

Scammers can be very convincing, even if you know the signs and what to watch for. In the event that you or someone you know falls victim to a scam, it’s important to know which steps to take based on the nature of the scam. For in-depth information, actionable next steps, and more, click here.

If your identity was stolen, call one of the three nationwide credit reporting companies and ask for a fraud alert on your credit report. The company you call must contact the other two so they can put fraud alerts on your files.

• Equifax: 1-800-525-6285
• Experian: 1-888-397-3742
• TransUnion: 1-800-680-7289

Additional Resources

https://www.consumer.ftc.gov/features/scam-alerts

https://www.consumer.ftc.gov/features/feature-0014-identity-theft

https://www.usa.gov/common-scams-frauds