How to avoid fraudsters pretending to be your bank


Date: 17 January 2022

Phishing for credit card details

Financial scams are increasingly common these days. According to data released by the American Bankers Association, in 2018, deposit account fraud losses topped $25 billion, and this amount continues to grow year on year.

Scammers use different techniques to trick people into gaining their sensitive and financial information such as bank account details and the relevant password. Here are the most common bank scams that you must be aware of:

1. Phishing scams

Phishing is an old technique used by scammers to trick individuals. The classic phishing scam involves scammers sending legitimate-looking emails or texts or setting up fake websites to lure people in. According to the FBI, Americans lost more than $57 million alone in 2019 to such scams.

To fall victim, you need only click a single fake link to complete an action and confirm personal information. Some phishing messages also claim to help you with loans and funds.

2. Fake cheque scams

There are multiple ways in which a cheque scam can take place. One of the most common methods involves you receiving an unwanted or unexpected cheque. Often they will look like a refund for overpayment or a rebate cheque. If you receive such a cheque, inspect it thoroughly by reading the fine print on the front and the back. There's a possibility that you are approving a legally binding contract by signing and cashing it.

Scammers widely use such tactics to get you tied in to authorized loans or memberships involving long-term commitments that can prove heavy on your pockets.

3. Unauthorised or automatic withdrawals

You might be already using automatic withdrawals or payments to pay bills, automate your savings, and for other legitimate reasons. Scammers like to use these features too, but for far more nefarious of reasons.

Scammers call to individuals or send them a postcard indicating that they have qualified for a special offer or have won a prize. They ask you to share the cheque numbers written at the bottom as a way to verify that you qualify for this offer.

Once the scammer has these details, they place an on-demand draft on your behalf. This draft is processed like a cheque but does not require your signature. This draft will allow the bank to transfer money from your account to the scam accounts. You will only notice this deduction if you keep an eye on your daily bank transactions. If not, you might not notice this scam until much later.

4. Overpayment scams

You can become a victim of these scams if you sell products or services online. It starts with the scammer paying you via a money order or a counterfeit cheque and paying you more than what is owed. The scammer then asks you to deposit the money in the bank and wire the difference back.

Sadly, since the cheque is fake, you will have to pay a 'bounced cheque' fee and you will not get the funds you have sent by wire back. You will also lose any value associated with the products you have to send them in the meantime.

How to protect yourself from scams

As long as people continue to fall for scams, they will be around - even if the techniques change as the technology evolves and people become more aware. By taking following the basic tips below, you can avoid such traps:

  • Use a VPN and antivirus software to protect yourself from online scams. These tools add an extra layer of protection, making your information more secure and less likely to be hacked.
  • Read online reviews into antivirus software and VPNs like this NordVPN review to understand how beneficial they are for preventing data breaches and other scams.
  • Avoid giving goods, services or cash to people in exchange for a cheque until the cheque has cleared unless you know the person well.
  • Before making any commitment or taking any action, always read the fine print of any correspondence you receive. If the offer looks too good to be true or looks suspicious, then it probably is.
  • Don't share your personal information - especially via call or text. It might provide scammers with the data they need to access your financial accounts. Never share your credit card number, password or account number until you know that the person is making a legitimate request.

By following these simple steps, you can safeguard yourself against most scams that might otherwise cost you a small fortune. 

Copyright 2022. Article brought to you in cooperation with the PR Consultancy.

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