Banking scams are a persistent threat, necessitating vigilance and proactive measures to ensure financial safety. Individuals can protect their finances and personal information by staying informed about common scams and diligently verifying transactions. Below is a brief overview of prevalent scams faced by consumers this year, along with prevention tips.
Check Fraud
Check fraud typically involves criminals illegally obtaining checks and “washing” them to remove the original ink. The scammer then has blank checks to use, stealing money from victims’ accounts. For instance, a grandparent may mail a $20 check for their grandchild’s birthday. A criminal can intercept this check, erase the ink, and rewrite it to deposit $5,000 into their account. To mitigate this risk, constantly monitor your bank statements for unfamiliar transactions, use pens with permanent ink, and deposit checks directly at a Post Office or near a mailbox’s collection time.
“Pig Butchering”
In ‘pig-butchering’ schemes, scammers manipulate victims online to build trust and persuade them to invest in fraudulent cryptocurrency schemes. Victims may continue to make payments before realizing they’ve been defrauded, resulting in significant financial losses. To avoid such scams, refrain from sharing personal or financial details on social media, maintain private profiles, and educate yourself on common scam tactics like love bombing (excessive expressions of affection or interest to manipulate the victim’s emotions) and urgency creation (creating a sense of urgency to pressure the victim into making a quick decision) to recognize and resist manipulation.
Phishing
Phishing scams aim to obtain sensitive information, such as usernames, passwords, and credit card details, by pretending to be trustworthy entities in electronic communications. Protect yourself from phishing by verifying the legitimacy of emails, messages, or calls before sharing personal information or clicking on links. Be cautious of requests for sensitive details through insecure channels like email or text, and enable two-factor authentication for enhanced online banking security.
Tips to Safeguard Your Finances
To protect your finances, regularly monitor your accounts for unusual activity and promptly report any suspicious transactions to minimize potential losses. Setting up transaction alerts and using secure banking channels for online transactions are also recommended. Additionally, staying educated about common scam tactics and remaining vigilant against phishing attempts and fraudulent activities is crucial.
By following these guidelines and staying informed, you can significantly reduce the risk of falling victim to scams and ensure the safety of your financial assets.
We want to thank the Wisconsin Bankers Association and the Wisconsin Bankers Foundation for providing valuable information that has been instrumental in raising awareness and helping consumers protect themselves against scams.
If you are a Legacy client and have questions, please do not hesitate to contact your Legacy advisor. If you are not a Legacy client and are interested in learning more about our approach to personalized wealth management, please contact us at 920.967.5020 or connect@lptrust.com.
This newsletter is provided for informational purposes only.
It is not intended as legal, accounting, or financial planning advice.
