Identifying Scam Tactics and Financial Abuse

By: Mackenzie Blakeslee, Vice President & Director of Financial Planning

By: Rylee Fann, Financial Planning Intern

Have you or a loved one ever been the victim of a scam? According to data from Bankrate, 1 in 3 US adults have experienced fraud or financial scams in the past year. Fraud and scams can come in many forms, which is why it’s so important to learn how to recognize early signs in order to avoid losing money.

February is often a month centered on love, appreciation, and gratitude for the people who care for us. While help is often given with good intentions, unfortunately, some scams or fraud can come from individuals that we believe to have our best interest at heart. Scams or financial abuse may sound like something out of a dramatic courtroom scene, involving strangers or criminals, and while that is sometimes the case, it can also happen in subtle, everyday ways that are easy to overlook. At its core, financial abuse involves one person exerting power and control over another. This can occur in any type of relationship, including with friends, family members, or romantic partners.

A major form of financial abuse is exploitation. As technology and online communication have advanced, scammers have adapted quickly. Exploitation can take the form of an online romantic relationship in which the other person repeatedly requests money for emergencies or “needs,” often accompanied by threats that harm will come to them, you, or your loved ones if funds are not sent. Even if there aren’t threats involved, they may promise to send you a valuable asset after you send them money.

Elder fraud is a way scammers can infiltrate assets of older individuals. Scammers will sometimes call individuals to tell them their grandson or granddaughter or another person they care about is in jail or in trouble and needs money. As the use of AI is on the rise, scammers can make a voiceover of a loved one in which they call you asking for money or a favor, and it sounds exactly like your loved one. Elder fraud can also come in the form of claiming the individual won the lottery, offering to assist with tech support for non-existent computer issues, and even through a romance scam where criminals pose as a potential romantic partner.

Cryptocurrency Investment Fraud is becoming more prevalent. It can include social media schemes where scammers reach out via different platforms, scammers texting pretending they misdialed a number, or even creating a fake dating profile on dating sites. In some cases, scammers accuse people of committing a crime they did not commit and asking for the transfer of cryptocurrency, and if the victim doesn’t, threatening to report or turn them into the authorities.

There are many ways scammers can try to get their hands on money or assets. It is important to understand the warning signs and what to do about the situation.

Warning Signs 

• Urgency – If the matter seems like it cannot wait, it is important to verify before taking action

• Grammar and Generic Greetings – If the communication is written and it is fraught with bad grammar or misspelling or has a generic greeting, you should question the legitimacy.

• Email Domain – If the email address is not from a person or organization you recognize, it could be fraudulent. Even if the name of the sender is someone you know, check the actual email address by hovering over the name to ensure it’s from a domain you recognize.

• Requests for Personal Data – If the person on the phone, email, text, etc is asking for personal data such as your address, Social Security Number, date of birth, Medicare number or any other personal information, do not give it to them until you’ve verified they are who they say they are.

• Too Good to be True – If something is too good to be true, it is likely just that and could be a sign of fraud.