No one is immune to financial scams. A recent study by True Caller found that 59.49 million U.S. individuals lost money to phone scams in a single year. Scams are everywhere, making awareness critical.
These scams devastate families financially and emotionally. Losing rent money, food budget, or your emergency fund takes time to recover from psychologically.
Here are the most common financial scams and what to do if you've been targeted.
Stolen Identity
Identity theft involves stealing personal information—social security numbers, banking passwords—to impersonate you. Thieves use this data to open accounts in your name, move your money, and wreak havoc.
Many discover identity theft during a credit check. You might be denied for a car loan because fraudulent accounts opened in your name tanked your credit score. Fixing it is slow and tedious.
Telephone Scams
Telephone scammers have become sophisticated. They use texts and robocalls to lure you in, often connecting you to a real person working to get your money.
They're clever at using emotion to break down your defenses. The "grandparent" scam is especially cruel: a scammer poses as a grandchild in trouble, asking for emergency funds for surgery or escape from a foreign country.
Another common ploy: they call claiming your home is being foreclosed, demanding immediate payment to stop the auction. Banks typically send multiple alerts before this happens, but skilled scammers trigger real anxiety about your home, and people fall for it.
Banking Scams
Banking scams target your accounts. Scammers pose as bank reps, claiming they need to verify your account or that it's been compromised. They request your login information to "protect" you. Once they have access, they drain your account.
IRS Impersonation Scams
Scammers pretend to be IRS representatives via phone, letter, email, or text. They claim you owe back taxes and threaten police dispatch if you don't pay immediately—usually via prepaid debit card or wire transfer.
The threat of legal action triggers panic and compliance.
Disaster-Related Scams
During crises, scammers profit by going door-to-door or calling with claims of grant funds. They ask for personal information like social security and bank details, sometimes using your data to fraudulently bill federal healthcare entities.
After hurricanes, imposters pose as FEMA workers to steal personal information. Others pose as FEMA contractors or estimators, offering to repair homes but requesting deposits upfront for materials.
Legitimate FEMA representatives never solicit money from disaster victims. If you're approached by someone claiming to be FEMA, contact them immediately to report it.
Technology Scams
Tech support scams are increasingly common. Fraudsters trigger pop-ups on your computer or send texts/emails claiming you have malware. They pose as representatives from major computer companies and offer to help.
Once you let them in, they gain remote access and can invade your banking and investment accounts, stealing sensitive data.
If you've sent money or given credit card info to a scammer, act immediately:
- Contact your card issuer or bank to report fraud
- Freeze your credit with the three major agencies (Transunion, Equifax, Experian) so no new accounts can be opened in your name
- Report the calls, emails, or texts to the FTC
Start a conversation with us to discuss protecting your financial plan and assets.
