Protecting Your Accounts From Fraud And Scams In North Dakota

Consumers are finding it more difficult to recognize fraud due to the prevalence of artificial intelligence and advanced technology.

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According to CNBC, the Federal Trade Commission reported that in the first three quarters of 2023, consumers in the United States lost over $7 billion due to fraud. In comparison to the same time in 2022, those numbers are up 5%.

"Fraud is at a crisis level in this country," stated Kathy Stokes, head of fraud prevention initiatives at AARP.

Organized gangs or multinational criminal businesses may be responsible for these types of crimes; their personnel follow specific scripts to attract victims. According to Stokes, "they have the money, they have the time, and they've got the playbook to get you into that heightened emotional state." "They're up against us."

Knowing the risks and talking to loved ones about them is the first and most important step in avoiding being a victim of a scam. Knowing about a particular scam makes people 80% less likely to fall for it and 40% less likely to lose money or personal information if they do fall for it, according to the FINRA Investor Education Foundation.

For your protection in the year 2024, we have compiled a list of the five most common financial scams and how to spot them.

Scams perpetrated by grandparents

Many forms of fraud begin with an imposter pretending to be someone the victim cares about in order to play on their emotions and acquire access to sensitive personal information.

The grandparent scam is evolving into a more sophisticated and harmful variant of impostor fraud because of technological advancements. It is possible for criminals to record your voice and subsequently create an imitation of your voice to pass themselves off as you.

Scammers may phone and pose as a loved one who is critically ill or in imminent danger, such as being arrested, and pleading for financial assistance. Con artists will often try to keep their victims in the dark by making up reasons why they can't talk to anyone—including friends, family, or the police—such as claiming a "gag order" applies to the case.

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A third accomplice may visit a grandparent's house in disguise as a courier in order to steal money from them.

If you want a loved one, grandparent, or other trusted adult to know it's you when you call them in an emergency, choose a "safe word" or "password" and share it with them.

Call or text the regular number you use to reach that person to verify they called you if you receive a call or text from someone posing as a loved one but using an unusual number.

Get other family members' approval before requesting any emergency funds. Scammers that ask you to remain quiet about their first contact via phone or text are trying to trick you.

Dating frauds

An increasingly prevalent tactic, romance scams involve posing as new romantic relationships in order to defraud unsuspecting victims out of their money. After criminals examine the information placed on social media or dating app profiles, the scam usually begins with private messages.

The new "love interest" may try to trick you into believing that someone they know is ill, injured, or even in prison once they've earned your trust. Someone may pose as a member of the military or someone who needs assistance with a critical delivery. Once they've lied, they'll demand payment or have something bought for them.

Gift cards and peer-to-peer services like Zelle and Venmo are common methods that scammers use to avoid detection and prosecution, according to Ted Rossman, a senior industry analyst at Bankrate. "If someone you don't know asks you for one of these payments, be very suspicious."

Offering assistance with cryptocurrency investments is another common form of online "love interest" deception. Although a lot of people fall for romantic scams that use gift cards to send money, the Federal Trade Commission reports that cryptocurrencies accounted for almost a third of the total cash losses in 2022.

To stay safe from romance scams, it's a good idea to consult trusted loved ones before getting too attached to someone new.

Avoid giving your sweetheart any sensitive information that could be used to access your accounts or steal your identity, such as a username, password, or one-time code.

You can be sure it's a scam if a stranger asks you to pay money for a parcel or to help them out while they're in danger, according to the FTC.

Scams involving cryptocurrency

The Federal Trade Commission estimates that investment-related scams will result in losses exceeding $3.8 billion in 2022, making them the most expensive form of financial fraud. There was a $5,000 median loss.

Due to the lack of regulatory oversight and the inability to reverse transactions, scammers have taken to using bitcoins as a payment method. In investment schemes, cryptocurrency plays a pivotal role in two ways: first, as the investment itself; and second, as irreversible payments.

Some crypto scams begin with an unexpected phone call from an "investment manager" offering an unrealistically high-quality tip or posing as a famous person and promising to multiply your money fourfold. Scammers may also pretend to be romantic interests, requesting money from you.

Avoid falling victim to bitcoin scammers by keeping your investing advice and online dating separate. It is a fraud if you meet someone on a dating app or website and they ask you to send them cryptocurrency or want to teach you how to invest in cryptocurrency.

Never give up your personal information or ask for payment by social media, email, or text message to an official government agency or business.

Never provide cryptocurrencies to someone who reaches out to you out of the blue and demands them.

Scandals in the workplace

Another major type of financial fraud is those involving businesses and jobs; as many businesses will be laying off employees in 2024, these schemes will most certainly persist.

The interview process with what seems like a respectable organization can be a tempting and difficult-to-detect trap for scammers. Next, this phony business will pretend to be an employer and will either send you an email asking for personal information or claim to be conducting a background check through a third party, both of which are false. They can easily access your bank account once they obtain your personal identification details.

Other forms of employment fraud may advertise programs that promise quick or easy money in exchange for your payment information, or they may advertise positions that require you to transfer funds to another account.

Staying Safe from Employment Scams:

Try searching for the recruiting company's or individual's name together with the terms "scam," "review," or "complaint." Read reviews to find out whether anyone else has fallen victim to the same scam.

Never, ever, ever click on a link in an unsolicited email, text, or social media message—regardless of how familiar the sender may seem.

Never, ever pay to secure employment. Scammers will ask for payment before they'll hire you or include cryptocurrency purchases in the job description.

Fake online tax accounts

Swindlers in this type of scam approach unsuspecting victims by pretending to be an impartial third party that can assist them in opening an account at IRS.gov in order to pay their taxes online. Scammers can utilize the taxpayer data in these accounts to submit a false tax return and collect the refund. Other forms of financial fraud or identity theft, such as applying for loans or credit lines, can also make use of the data.

The IRS website, IRS.gov, is the starting point for "any of the processes that you'd go through to set up an account, check on a refund, or just to look at payments that you've made," according to representative Eric Smith. "Be wary of anyone contacting you with the promise of assistance in creating an IRS account and transmitting any personal information you may have."

Preventing online tax fraud:

Create an Individual Taxpayer Online Account (IRS.gov) on your own. Forget about bringing in outside help for that.
Never keep sensitive money or account information in your inbox.
"If a criminal gets in there, they have a roadmap to everything," asserted Haywood Talcove, CEO of LexisNexis Risk Solutions' government group.

Inform your local authorities, the Federal Bureau of Investigations (FBI), the state attorney general's office in the jurisdiction where the fraud occurred, the American Association of Retired Persons (AARP), and the Federal Trade Commission (FTC) if you fall victim to a scam.