Credit card and financial fraud can affect anyone, though there are strategies that may help minimize your risk. Educate yourself on the common scams and ways to potentially protect yourself from being a victim of financial fraud.
Unfortunately, data breaches that put our identities at risk or scams designed to steal our money have become far too common in this day and age, especially in the remote work-from-home environment that many people find themselves in due to the recent COVID-19 pandemic. Often, the elderly are the primary target of financial fraud, but the truth is, fraudsters take advantage of anyone who is in a more vulnerable state. And today, with so many people staying home and utilizing more online services, fraudsters have adapted to target those who might temporarily be in a more vulnerable state.
So how can you help protect yourself and your loved ones? Consider going on the offensive—educate yourself about the more common financial scams. That way, if you’re ever approached, you’ll hopefully recognize the warning signs and be able to respond accordingly, before any money is lost.
With the increased likelihood your personal information is floating around on the dark web, it’s only natural to focus your attention on identity theft and trying to prevent thieves from using your credit cards, accessing your bank accounts, or stealing your tax refund. But financial fraud can take many forms, including:
Here are some of the more common financial scams. Keep in mind that criminals are constantly changing their tactics to stay ahead of the law.
Firm imposter scam: Fraudsters are taking advantage of more people telecommuting and doing more business online to impersonate firm associates. They might create a fake online presence and seek to obtain the customer’s personal information, including account information, or trick them into making investments or transferring funds. A red flag is if they encourage you NOT to contact the firm due to “long wait times”.
IRS scam: Historically, this one has been a very common scam. A person calls pretending to be from the IRS and accuses you of owing money. They then threaten to have you arrested if you don’t pay immediately with prepaid gift cards.
Lottery scam: Fraudsters tell you you’ve won a large sum of money and that to collect the prize, all you have to do is pay upfront processing fees or taxes. The caller is initially friendly but may become threatening or aggressive if you say you’re not interested.
Sweetheart/romance scam: This Internet-based scam uses fake profiles on dating sites and in social media to target you, establish a romantic relationship, and then make pleas for financial assistance to drain your resources. If successful, this scam may progress into outright blackmail because the perpetrator knows you don’t want friends and loved ones to find out what happened.
Foreign letter fraud: You receive a letter or e-mail with the “opportunity” to share in a percentage of the money the sender is trying to get out of their country. You’re encouraged to send money and/or bank information for ease of transfer.
Grandparent/relative scam: You receive a phone call from someone claiming to be a family member who’s in desperate need of money. The scammers often rely on information found on social media to try and defraud you.
Awareness is just the first step in helping keep you and your loved ones safe from financial fraud. Caution and diligence are also key. Consider these tips to help avoid scams and identity theft:
If you fall for a scam, immediately place a fraud alert on your credit report and notify the appropriate banks, brokerage firms, and credit card companies to help prevent future fraudulent activity. Then gather and document all the conversations and/or correspondence you’ve had regarding the theft. Contact the local authorities and give them copies of the documentation. Depending on the type of scam, file a complaint with the Federal Trade Commission (FTC), U.S. Postal Service, or the Social Security Administration.
And don’t be too hard on yourself. As mentioned earlier, financial fraud can happen to anyone. Instead, focus on moving forward and creating a plan to help protect yourself and your assets in the future.
If you suspect your TD Ameritrade account(s) have been compromised, or if you receive an email that appears to come from us asking for personal information or claiming to know the status of your account, please contact us. We can provide assistance, including help with closing your account and opening a new one, should this be necessary.
If you’re a current TD Ameritrade client and would like to take this opportunity to add trusted contact information to your account, call us at 800-669-3900.
for thinkMoney ®
Financial Communications Society 2016
for Ticker Tape
Content Marketing Awards 2016
Content intended for educational/informational purposes only. Not investment advice, or a recommendation of any security, strategy, or account type.
Be sure to understand all risks involved with each strategy, including commission costs, before attempting to place any trade. Clients must consider all relevant risk factors, including their own personal financial situations, before trading.
The Trusted Contact requirement does not apply to “Institutional Accounts” as defined by FINRA 4512. Per FINRA 4512, an “institutional account” shall mean the account of: (1) a bank, savings and loan association, insurance company or registered investment company; (2) an investment adviser registered either with the SEC under Section 203 of the Investment Advisers Act or with a state securities commission (or any agency or office performing like functions); or (3) any other person (whether a natural person, corporation, partnership, trust or otherwise) with total assets of at least $50 million.
Market volatility, volume, and system availability may delay account access and trade executions.
Past performance of a security or strategy does not guarantee future results or success.
Options are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses. Options trading subject to TD Ameritrade review and approval. Please read Characteristics and Risks of Standardized Options before investing in options.
Supporting documentation for any claims, comparisons, statistics, or other technical data will be supplied upon request.
This is not an offer or solicitation in any jurisdiction where we are not authorized to do business or where such offer or solicitation would be contrary to the local laws and regulations of that jurisdiction, including, but not limited to persons residing in Australia, Canada, Hong Kong, Japan, Saudi Arabia, Singapore, UK, and the countries of the European Union.
TD Ameritrade, Inc., member FINRA/SIPC, a subsidiary of The Charles Schwab Corporation. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. © 2021 Charles Schwab & Co. Inc. All rights reserved.