Foiling the Financial Fraudsters

When it comes to financial scams, it’s easy to assume that the only victims are the ones we hear about so often in the media—the “little old ladies” who are tricked by nefarious call center workers in distant lands urging them to send what little money they have. 

But the fact is, financial fraudsters are working overtime to target those of us with significant assets. 

Just because you’re “good with money” or careful in who you deal with when it comes to finances doesn’t mean you won’t be pursued by financial scammers. 

You’re a target 

You may be more susceptible to their efforts than you realize or care to admit. One of our biggest biases is overconfidence in our abilities. Consider the many rich and respected individuals who famously fell for Bernie Madoff’s Ponzi scheme. 

Be on guard 

The good news is that you can take steps to better protect yourself from financial scams and fraud. A good first step is to get a handle on the many ways the crooks are trying to get at you and your money. 

1. Phishing and ransomware attacks - A type of online scam, phishing occurs when scammers impersonate a legitimate company using legitimate-looking emails or texts. Ransomware is a type of malicious software that encrypts your files in a way that makes them inaccessible to you. 

2. Wire transfer fraud - This occurs when criminals fool you into wiring money to them. Often, they do so by presenting themselves (via an email or a text) as a trusted individual or organization, such as a family member, a business partner or even a charity. 

3. Account takeovers - This is a type of identity theft in which scammers get unauthorized access to an online account—for example, by setting up a legit-sounding public Wi-Fi network and using it to capture usernames, passwords and payment information. 

4. Card-not-present fraud - Using stolen credit card data to buy items online (or by phone or mail) has become increasingly common, along with the rise in both online shopping and working remotely. 

5. Tax scams - One scam that directly targets people with a high net worth involves getting excessively high valuations for their art in order to get bigger income tax deductions.

Avoid getting scammed 

1. Check your “basics.” - Secure your home network, use strong passwords and multifactor identification, and install anti-malware and other internet-security programs. 

2. Slow down and use caution - Many financial criminals demand that potential victims act quickly, creating a false sense of urgency to their pitch. That means one key move is to resist the urge to take immediate action, giving you time to dig deeper. Communicate this expectation to your financial  professionals. 

3. Verify requests independently - Say you get an unsolicited email (or text or call) from your financial  institution, the IRS, tech support, etc. demanding that you take action immediately. Rather than click on the link provided to you, call or email the person or company directly to determine whether the communication is legitimate 

4. Root out impersonators - Would-be online fraudsters often create fake accounts on social media that they use to gather intel they can use against you. Alert the companies if you see that someone has set up a profile claiming to be you. 

5. Separate your personal life from your business life - Entrepreneurs should consider using different email addresses for family communications and business communications. This can help prevent a hack in one area of your life from spilling over into the other. 

6. Check in on your finances - Review your financial statements for odd or unfamiliar transactions or any unauthorized activity. The same goes for credit reports and other statements that involve your wealth. 

7. Ask for help if you need it - Don’t fall into that trap: If you think you’re getting taken or are on that path, enlist the help of the authorities, trusted advisors or others to review the situation and offer potential next steps. 

8. Consider hiring experts - Fraud prevention firms catering to the affluent can build bespoke strategies designed to wall you off from financial fraud. 

Note how many of the tactics to avoid getting scammed involve personal behaviors rather than high-end technology. Using both together can be more impactful, but it’s important to remember that keeping financial criminals at bay can depend greatly on the actions you take. 

Please call our team to learn how to safeguard your assets from “financial fraudsters” at 561-361-8140 or email us at lew@lawlessedwardswarren.com. 

ACKNOWLEDGEMENT: Representatives of AIC/AAS do not provide tax or legal advice. Please consult your tax advisor or attorney  regarding your situation. All information is believed to be from reliable sources; however, we make no representation as to its  completeness or accuracy. Representatives offer products and services using the following business names: Lawless, Edwards & Warren  – insurance and financial services | Ameritas Investment Company, LLC (AIC), Member FINRA/SIPIC – securities and investments |  Ameritas Advisory Services, LLC (AAS) – investment advisory services. AIC and AAS are not affiliated with Lawless, Edwards & Warren.