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When it comes to fraud prevention, knowledge is the key

FINANCIAL ABUSE AND FRAUD AWARENESS

COMMON FINANCIAL SCAMS. Although this is not an exhaustive list, the following are many common financial fraud schemes popular with criminals today.

1. Power of Attorney Fraud. The perpetrator obtains a Power of Attorney, which specifies that legal rights are given to manage the funds in the victim’s accounts. Once the rights are given, the perpetrator uses the funds for personal gain. 
2. Caretaker/Personal Aide Fraud. Someone in a position to care for an elderly person is given access to their funds and uses them for personal gain. Please be wary of a caretaker or companion who takes too much of an interest in your financial affairs. Consult with trusted family or friends before allowing a companion or home health aide access to your finances or safe deposit box.
3. International Lottery Fraud. Scam operators use telephone and direct mail to notify victims that they have won a lottery. To show good faith, the perpetrator may send the victims a check. The victim is then instructed to deposit the check and immediately send the money, via wire, back to the “lottery committee” to cover taxes, attorney’s fees, and exchange rate differences. The perpetrator will create a sense of urgency, compelling the victim to send the money before the check, which is counterfeit, is returned. The victim is typically instructed to pay taxes, attorney’s fees, and exchange rate differences in order to receive the rest of the prize. 
4. Fake Prizes. A perpetrator claims the victim has won a nonexistent prize and either asks the person to send a check to pay the taxes or obtains the credit card or checking account number to pay for shipping and handling charges. 
5. Internet Sales or Online Auction Fraud. The perpetrator agrees to buy an item for sale over the Internet or in an online auction. The seller is told that he or she will be sent an official check (e.g., cashier’s check) via overnight mail. When the check arrives, it is several hundred or thousand dollars more than the agreed-upon selling price. The seller is instructed to deposit the check and refund the overpayment. The official check is later returned as a counterfeit but the refund has already been sent. The seller is left with a loss, potentially of both the merchandise and the refund.  
6. Social Security or IRS scam. The victim receives a call telling them they owe money to the Social Security Administration or the Internal Revenue Service or that their social security number has been suspended because of suspicious activity, or because it’s been involved in a crime. Sometimes, the scammer wants you to confirm your social security number to reactivate it. Sometimes, the scammer will say your bank account is about to be seized or that you need to pay money to avoid arrest. Your Social Security number will not be suspended, nor will your bank accounts be seized in this manner. You don’t have to verify your social security number to anyone who calls out of the blue. Neither the Social Security Administration nor the Internal Revenue Service will ever call to threaten you or tell you to wire money, send cash, or put money on gift cards.
7. Advance Fee Fraud or “419” Fraud.  Named after the relevant section of the Nigerian Criminal Code, this fraud involves a multitude of schemes and scams involving mail, e-mail, fax and telephone promises that the victims will receive a percentage for their assistance in the scheme proposed in the correspondence.   
8. Pigeon Drop. The victim puts up “good faith” money in the false hope of sharing the proceeds of an apparently large sum of cash or item(s) of worth which are “found” in the presence of the victim.   
9. Romance Scam. Perpetrator develops a relationship with a vulnerable person, either online or in person. Intentions are not honest, but rather, to gain access to the victim’s funds. Use caution with new friends who show interest in or demonstrate need for your money.
10. Grandparent Scam. The perpetrator calls an elderly person pretending to be a grandchild in trouble, asking for money. Often the caller will create a sense of urgency and beg the elderly person not to tell anyone, particularly the caller’s parents. Check in with your loved ones first, at the contact information you have on file for them, before sending any money.
11. Financial Institution Examiner Fraud. The victim believes that he or she is assisting authorities to gain evidence leading to the apprehension of a financial institution employee or examiner that is committing a crime. The victim is asked to provide cash to bait the crooked employee. The cash is then seized as evidence by the “authorities” to be returned to the victim after the case.   
12. Inheritance Scams. Victims receive mail from an “estate locator” or “research specialist” purporting an unclaimed inheritance, refund or escheatment. The victim is lured into sharing personal information or sending a fee to receive information about how to obtain the purported asset.   
13. Financial Institution Employee Fraud. The perpetrator calls the victim pretending to be a security officer from the victim’s financial institution. The perpetrator advises the victim that there is a system problem or internal investigation being conducted. The victim is asked to provide his or her Social Security number for “verification purposes” before the conversation continues. The number is then used for identity theft or other illegal activity.   
14. Government Grant Scams. Victims are called with the claim that the government has chosen their family to receive a grant. In order to receive the money, victims must provide their checking account number and/or other personal information. The perpetrator may electronically debit the victim’s account for a processing fee, but the grant money is never received.   
15. Phishing/Vishing/Smishing. Emails, phone calls or text messages are used to entice victims to supply personal information (i.e., account numbers, login IDs, passwords, and other verifiable information) that can then be exploited for fraudulent purposes, including identity theft.
16. Spoofing. An unauthorized website mimics a legitimate website for the purpose of deceiving consumers. Consumers are lured to the site and asked to log in, thereby providing the perpetrator with authentication information that the perpetrator can use at the victim’s legitimate financial institution’s website to perform unauthorized transactions. Spoofing can also be used to gain access to the login information of real estate agents and brokers, which leads to the mortgage closing scam.
17. Mortgage Closing Scam. After obtaining the login information of a real estate agent or broker through a spoofing scam, or simply purchasing the login credentials from hackers on the dark web, the scammer can log in to the agent’s email and monitor communication between agent and buyer until the buyer is ready to make the down payment. Before the agent sends the wire instructions, the scammer uses wire instructions from a previous transaction, found in the agent’s emails, and alters the account number to the scammer’s own overseas account. Then the scammer sends the instructions by email to the buyer from the agent’s email address and the buyer thinks they are receiving a legitimate email from their trusted agent. Always double check payment instructions by calling the source of the instructions, at the phone number you have on file, to verify the information.
18. Stop Foreclosure Scam. The perpetrator claims to be able to instantly stop foreclosure proceedings on the victim’s real property. The scam often involves the victim deeding the property to the perpetrator who says that the victim will be allowed to rent the property until some predetermined future date when the victim’s credit will have been repaired, and the property will be deeded back to the victim without cost. Alternatively, the perpetrator may offer the victim a loan to bridge his or her delinquent payments, perhaps even with cash back. Once the paperwork is reviewed, the victim finds that his or her property was deeded to the perpetrator. A new loan may have been taken out with an inflated property value with cash back to the perpetrator, who now owns the property. The property very quickly falls back into foreclosure and the victim/tenant is evicted.
     

  If you believe you have been the victim of a scam, contact your branch, local law enforcement and the Federal Trade Commission at ftc.gov/complaint

Please see the National Credit Union Administration (NCUA) link below for an extensive list of scams and great resources to combat them!

NCUA Fraud Prevention Center

Scams targeting older adults are on the rise and are all too often successful. For information relating specifically to these type of scams, please see the NCUA link below.

NCUA Fraud Prevention for Older Adults🎈

Listen to our Elder Scams and Fraud Webinar

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