14 Strategies to Protect Yourself From Fraud
When you’ve worked hard for your money, you don’t want to lose it to a scam. People who experience financial fraud may feel helpless and defenseless—as if the whole world is out to get them.
The good news is you can take several steps to significantly reduce the risk of becoming a victim of financial fraud. Read this guide for top tips on how to prevent financial fraud from affecting you and your loved ones.
How to Prevent Financial Fraud
Financial fraud can unfortunately happen to anyone these days. Scammers and hackers use increasingly sophisticated tricks, allowing them to exploit even cautious individuals.
However, implementing the following tips can greatly reduce your risk of becoming their next victim:
1. Be Aware
Scammers might call or leave voice messages posing as authority figures attempting to get your private data. You won’t likely hear or see the scammer as they are “phishing” for your usernames and passwords without you knowing it.
2. Ask Questions
If something feels suspicious, it probably is. A scammer may appear on your doorstep, call, email, or engage you in a chat messaging service. Watch out for red flags and don’t be afraid to ask questions. End the interaction as soon as you feel uncomfortable.
3. Don’t Easily Give Out Sensitive Information
Your credit union has likely sent you a message saying, “We will never ask for your account details on the phone or via email.” As such, consider it a huge red flag if someone asks for these details during a conversation. Hang up the phone or cease online communication immediately.
Always verify the identity of anyone who contacts you asking for personal details. This is a crucial step to protect yourself from fraud and ensure your personal and financial information remains secure.
4. Don’t Open Unsolicited Emails
Emails and pop-ups on websites can contain viruses that will infect your computer with malware. They’re also a common way for scammers to ask for your personal information in a format that looks genuine.
If an email comes from an unknown source, don’t open it. If you think it looks legitimate and open it but then realize it’s probably a scam—don’t click on any links! Then immediately report the email as SPAM.
5. Don’t Fill Out Unfamiliar Forms
If you’re on a website applying for a service or making a purchase and it asks you for more than the usual information—stop. Close out of the site and search for the organization’s name. You may find other people who have already reported being victims of the same scam.
6. Don’t Answer Unfamiliar Phone Numbers
Nowadays, we have caller ID to show which of our trusted contacts is calling. If you’re unsure whether a number is legitimate, let the phone call go to voicemail. You can always call back if it turns out to be genuine.
7. Report Missing Cards, IDs, Suspicious Activity
Contact us if your card is lost or stolen and report all suspicious transactions on your statements.
Also report any suspicious emails, calls, or contacts. You can do this online at the Federal Trade Commission website or by calling 1-877-IDTHEFT.
8. Don’t Be Afraid to Ask for Help
If you suspect you may be a victim of financial fraud, contact a Freedom Credit Union member service representative at 215-612-5900. The sooner you do so, the quicker we can take swift action to protect your account and personal information.
9. Monitor Accounts Regularly
Regularly reviewing your account statements is a critical method to avoid fraud and to keep your finances safe. Even small, unrecognized transactions can indicate identity theft or unauthorized access.
To stay informed, consider setting up notifications for transactions exceeding a specific limit. Quick identification of irregular activities enables faster resolution and minimizes potential damage.
10. Shred Sensitive Documents
Destroying sensitive documents is crucial for protecting your personal information. Items like bank statements, credit card offers, and old bills contain data that identity thieves can exploit.
Make it a habit to shred these types of documents to ensure no one can retrieve your information from the trash. Shredding personal documents before disposal helps in protecting yourself from fraud.
11. Review Credit Reports
Regular checks of your credit reports are essential for your financial well-being. These reports can uncover irregularities like unrecognized accounts or unfamiliar debts, signaling potential fraud.
Federal law entitles you to a free annual copy of your credit report from each credit reporting company. Spotting discrepancies early can protect you from long-term financial harm and credit score issues.
Freedom CU offers FICO service through our online and mobile banking app. This free service allows you to track your credit score monthly, keeping a better handle on your finances and credit health.
12. Freeze Cards Immediately
If you notice unusual activity on your accounts, immediately freezing your cards is a crucial first step in protecting your accounts because it will halt new purchases, cash advances, and balance transfers. Simply call the credit card issuer to request a freeze or block your card immediately through Online/Mobile banking.
13. Set Up Fraud Alerts
Implementing fraud notifications with credit reporting agencies is a proactive step against identity theft. These notifications inform you of any new or suspicious activity on your credit report.
Most agencies offer this service for free, which can serve as an initial defense against identity fraud. Fraud notifications are typically active for a year but you can renew annually to maintain continuous protection.
14. Freeze Your Credit Reports
Freezing your credit reports is a powerful tool when you suspect fraudulent activities.
Essentially, it creates a roadblock for identity thieves who attempt to use your information. To freeze your credit, contact the three major credit bureaus—Equifax, Experian, and TransUnion —either online or by phone.
The process is usually free and does not affect your credit score. Act immediately if someone compromises your personal information or if you lose sensitive documents.
Remember to lift the freeze before applying for new credit.
Common Scams to Watch Out for to Prevent Financial Fraud
There are many ways a scammer could catch you off guard. Here are some common scams and different types of fraud you should be aware of:
- Banking Scams: Be cautious of unsolicited communication from someone claiming to be from a financial institution. Never give out personal information, especially if they contact you first.
Always verify the legitimacy of the person who is calling you. You can call your credit union directly using the number on their official website or your credit union member statements.
- COVID-19 Fraud: Avoid unsolicited communications offering vaccine information or stimulus checks. Do not share personal or financial information in response. Only trust information from official government or health organization websites.
- Unemployment Fraud: If you receive unsolicited contact about unemployment benefits, do not respond. Instead, reach out directly to your state’s unemployment office for information about benefits.
- Telephone Scams: Be skeptical of unsolicited calls offering products, investments, or opportunities that seem too good to be true. Hang up and do not provide personal information.
- Census Scam: Only provide household information through official census channels. Be cautious of unsolicited requests for personal information claiming to be part of a census. If in doubt, verify through official government census websites.
- Government Grant Scams: Be careful if someone contacts you saying they will give you free government money. Do not give out your personal information or pay fees in exchange for the offered money.
These types of offers are most often scams. Genuine government grants do not require fees or personal information upfront.
- Investment Scams, Ponzi Schemes, and Pyramid Schemes: Be cautious of investment opportunities promising high returns with low risk. Do thorough research and consider seeking advice from a financial advisor before investing.
- Charity Scams: Verify the legitimacy of a charity before donating. Research the organization and use official websites to make donations. Be careful if you get requests for donations from an organization that you haven’t contacted first.
Be particularly skeptical if the organization wants you to donate using gift cards or wire transfers. These hard-to-trace payment methods are red flags for scams.
- Lottery and Sweepstakes Scams: Be wary of claims that you’ve won a prize in a contest you did not enter. Never pay money or provide personal information to claim a prize.
- IRS Scams: Be aware that the IRS will not threaten immediate arrest or demand payment over the phone. If you receive such calls, hang up. Contact the IRS directly through their official contact information if you have concerns.
- Credit Card Skimming: Inspect card readers, especially at ATMs or gas stations, for any signs of tampering. Scammers can easily grab your credit card numbers by using a fake terminal. It’s important to use contactless payments (i.e. tapping rather than inserting your card) when possible to reduce the risk.
- Online Shopping Scams: Only shop on reputable websites. Be cautious of deals that seem too good to be true when visiting unfamiliar sites. Use secure payment methods and avoid direct money transfers to individuals.
Check for the lock icon which should appear to the left of the site’s URL—this indicates that it’s a secure shopping site.
- Social Media Scams: Be cautious of fake giveaways or friends asking for money on social media. Verify the authenticity of any request by contacting your friend through another method or researching the offer.
- Romance Scams: Be careful with online relationships, especially if someone asks for money. Never send money or personal information to someone you have not met in person. Trust your instincts and seek advice if you’re unsure.
Frequently Asked Questions
Below you’ll find a few frequently asked questions on how to protect yourself or a family member from fraud:
What are some effective methods for financial fraud prevention?
It is crucial to regularly monitor both your member statement and your credit card statements for any unauthorized transactions.
Always verify the source of any requests for personal or financial information, especially if they seem unsolicited or suspicious. Additionally, use strong, unique passwords for your online accounts and change them periodically.
Can you provide guidance regarding how to avoid financial fraud?
Avoiding fraud involves being vigilant and cautious with your personal and financial information. Do not share sensitive details like your social security number or bank account information.
Be wary of unsolicited calls, emails, or messages that ask for personal information or money. Above all else, always double-check their authenticity before interacting.
The Bottom Line on Preventing Financial Fraud
If you still have concerns about how to prevent fraud, one of the best things you can do is keep a close eye on all your financial activity.
Here are a few additional tips to keep your information secure:
- Make all necessary changes to your contact information (name, email, address and phone number) directly through Online/Mobile banking. This will eliminate the need to give any of your personal information over the phone or via email.
- Log in to Online/Mobile banking regularly to verify your contact information and review recent financial activity. If you notice anything suspicious, contact us immediately.
- Ensure that your account is set up for Alerts, which can easily be set up and managed through Online/Mobile banking.
Banking with a trusted credit union is a great way to stay safe in the fast-moving world of scamming and financial fraud.
Stay Safe Financially With Freedom CU
At Freedom Credit Union, we understand the challenges of navigating financial security in an ever-changing digital landscape. Our dedicated team supports and guides you in strengthening your financial defense.
We provide the tools and resources necessary for fraud prevention to keep your finances secure and your mind at ease. Trust us to be your partner in protecting what you’ve worked hard to earn.
Click below to learn how to protect yourself and your loved ones even further from becoming the next victims of a scammer.