Financial fraud and scams are something we seem to hear about too often these days. Because technology is an integral part of our lives, the risk of financial fraud and scams is high. It’s sometimes difficult to keep up with how to best protect ourselves, and our loved ones.
Here are five tips that may help you prevent fraud or scams from happening and information about how we help our own clients.
1. Educate Yourself and Loved Ones on Common Scams
Scammers often exploit a lack of knowledge about financial risks. A group that is especially vulnerable are older adults. Scams targeting individuals aged 60 and older—sometimes called elder fraud—caused over $3.4 billion in losses in 2023, up approximately 11% from 2022.
The first step in preventing scams is awareness. Things like imposter scams, phishing emails and calls, lottery or prize scams, and romance scams, where one exploits an emotional connection to gain financial support, are all common tactics used by scammers. Take time to understand each of these scams and what they look like. Talk to older adults in your life so you can all recognize the warning signs.
2. Practice Skepticism
When approached by unfamiliar individuals or unsolicited messages, always pause and verify. Scammers often create a sense of urgency to push victims into making hasty decisions. A good practice is to verify the legitimacy of the request before taking any action. For example:
- Hang up on unsolicited phone calls and independently verify if a request or offer is legitimate.
- Do not click on links or open attachments in emails or text messages from unknown sources.
- Contact family members or trusted friends before sending money to anyone claiming to be in distress.
3. Beef up Your Digital Security Practices
It’s a good idea to practice basic online safety including using strong unique passwords, avoiding public wi-fi for financial transactions, keeping devices updated with latest security patches and being cautious of sharing personal information on social media. Although those Facebook quizzes may be fun – they’re often a way to unknowingly share personal information! Consider enabling multi-factor authentication whenever possible. You can reference more ways to secure your online information in our Essential Steps After a Data Breach article.
4. Take Your Name Off Solicitation Lists
Sometimes it’s hard to understand if a phone call or unknown text message is a scam or just an annoying sales call. One easy way to reduce the number of sales pitches you receive is to take your name off telemarketing and junk mail lists. Here are two resources to cut down the clutter:
- Telemarketing Calls – www.donotcall.gov
- Credit Card Offers – www.optoutprescreen.com
5. Encourage Open Communication
Many fraud victims can feel embarrassed or ashamed if something does happen. This is when it is even more important to speak up and report what has happened. Not reporting the incident can allow the scams to continue. Encourage open and honest communication with your loved ones about financial decisions and any suspicious activity you encounter – including talking with your financial planner.
How We Help Clients Prevent Fraud and Scams
At Johnson Bixby, our Client Services Team takes proactive steps to help our clients safeguard their accounts from fraud:
- We remind clients to regularly review bank accounts and credit card statements for fraudulent or suspicious activity.
- We encourage clients to shred documents that contain personal information to prevent identity theft.
- We advise clients not to click on links from unsolicited emails, which can often lead to scams.
- We remind clients not to give out personal information over the phone or online to unknown persons or unverified websites.
Steps We Take if a Client Falls Victim
If one of our clients falls victim to fraud, we take immediate action:
- We and the client are notified if there are any changes to their investment accounts, such as bank information, address changes, or beneficiary changes.
- We suggest that the client change their passwords to prevent further access to their accounts.
- We recommend the client notify their bank, as they may need to open a new account.
- We discuss with the client the option of enrolling in credit monitoring for an additional layer of oversight.
- Our financial planners can help assess whether freezing their credit is a good idea, though it’s not always the best solution for everyone.
- We reassure the client that it is difficult for hackers or scammers to gain access to their investment accounts or make unauthorized changes.
Taking proactive steps is one of the best ways to safeguard your personal information and financial well-being. As a financial planning team, your security and well-being are one of our top concerns. If you have questions, please don’t hesitate to reach out.
Sources:
https://www.fbi.gov/news/stories/elder-fraud-in-focus
https://www.fbi.gov/how-we-can-help-you/scams-and-safety/common-frauds-and-scams/elder-fraud
https://www.finra.org/sites/default/files/2020-12/fighting-fraud-101-smart-tips-for-investors.pdf
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