Financial Scams: 6 Ways to Protect Yourself and Your Loved Ones

More than 1.4 million fraud reports were filed in 2018 according to the Federal Trade Commission (FTC). In those reports, 25% of people said they lost money and the total amount of losses reported was approximately $1.48 billion. 

I recently listened in on the AARP webinar “How to Protect Your Loved Ones from Fraud”. Don’t let the fact that AARP hosted this event lead you to believe that seniors are only people susceptible to financial scams. In the FTC report mentioned above, younger people reported losing money more often than older people. The bottom-line is financial fraud can happen to anyone. 

During the webinar, the speakers shared several practical takeaways about protecting against financial scams that we could all use. 

1. Stay current with the news. Last year’s scams might not be this year’s scams. A good case in point is the phone call scam that’s supposed to be from the Social Security Administration. This scam is so prevalent that the Social Security Administration is issuing warnings about it. Both the FTC and AARP have fraud alert resources on their website so you can stay informed about the latest tactics from scammers.
2. Heighten your awareness about financial scammers. During the AARP webinar, they discussed the psyche of a scammer and reminded us that scammers are looking for individuals who are vulnerable, trusting, and are perceived to have wealth or valuable items. This doesn’t mean we can’t be nice. It does mean we need to pay attention to the world around us.  
3. Screen your phone calls. Protecting ourselves from financial scams would be easy if they identified themselves on our phone’s caller ID. Unfortunately, they do not. It’s sad to say but it could be in our best interests to send calls to voicemail if we don’t recognize the caller. If you choose to do that, let close friends and family know this is your standard operating procedure so they don’t worry if you don’t answer right away. 
4. Practice good technology usage. Today’s technology advances are wonderful but that doesn’t mean we should abandon the principles of good technology usage. For instance, having strong passwords for our accounts – especially ones where we have financial information stored – is essential. Also, making sure that the software on our devices is up to date. Outdated software could expose devices to malware or security breaches, which can lead to identity theft. 
5. Research the credentials of financial advisors. It can make a lot of good financial sense to tap into the expertise of bankers, accountants, and financial advisors. Sharing your financial status with others is sensitive and personal. Knowing that your financial advisors are bound by a professional code of ethics is key. Individuals in the financial services industry should be prepared to discuss with you their experience and credentials. 
6. Monitor your credit report. Don’t forget that the Fair Credit Reporting Act (FCRA) requires each of the nationwide credit reporting companies to provide you with a FREE copy of your credit report every twelve months. Other organizations use this information to evaluate your credit, insurance, employment, and housing. Even if you’re not planning to make a major purchase, make sure the information is accurate. 

My big takeaway from the AARP webinar was that these activities are things I should be doing anyway. We should stay current with the news. We should use technology, including our phones, in a safe and secure way. And we should check out the credentials of the people we work with. 

Consider this article to be a reminder of the things you should be doing to protect yourself from possible financial scams and fraud. Maybe you want to share this list with a loved one, so they remember to do these things as well. It’s easy to get settled into a routine and not be as diligent with keeping your software up to date. Or you ran the free credit report a few years ago but haven’t done it lately. Well, now’s the time to get back on track. No one wants to be the victim of a financial scam or fraud.

Image captured by Sharlyn Lauby while exploring the streets of Las Vegas, NV