Don’t Get Fooled: How to Outsmart Financial Scams and Fraud

This post was written in partnership with the Safety Positive Foundation, a nonprofit organization promoting personal safety in the blind community.

Imagine this: you receive an email that looks exactly like it’s from your bank. The logo, the language, even the sender’s address seem legitimate. It says your account is locked, and you need to click a link to fix it. Panic sets in. You click.

Before you know it, you’ve handed over your login details to a scammer.

Sound familiar? You’re not alone. Financial scams are more sophisticated than ever, but here’s the good news: by knowing what to look for and what to do, you can protect yourself. Here are some of the sneaky tactics scammers use—and how to fight back.

Phishing Emails, Sketchy Texts, and Scammy Calls: Know the Signs

Scammers often cast a wide net, hoping someone will bite. Here’s how you can spot trouble before it reels you in:

Phishy Emails

• Watch the language: “Dear Valued Customer” instead of your name? Probably fake. Genuine companies know who you are.
• Panic tactics: “Your account will be closed in 24 hours!” Scammers want you scared so you won’t think twice.
• Fishy links: Hover over links (don’t click!). If it leads to something bizarre like “amaz0n-secure-login.biz,” stop right there.

For more on recognizing phishing emails, check out the Federal Trade Commission’s guide on phishing.

Texts That Trick

• Ever gotten a “Congratulations! You’ve won a $500 gift card” text? Delete it. Real prizes don’t come from random messages, especially when they ask for personal info.

Learn more about text message scams from the Federal Communications Commission.

Fake Phone Calls

Scammers pretending to be from your bank, the IRS, or tech support will:

• Pressure you to act NOW.
• Ask for personal details like passwords or Social Security numbers.
• Demand payment via gift cards or wire transfers (huge red flag!).

Pro Tip: If something feels off, hang up and call the organization directly using a number from their official website.

The Federal Trade Commission offers tips on handling scam calls.

Investment Opportunities: Too Good to Be True? It Probably Is

“Double your money in a week—guaranteed!” Sounds tempting, right? Scammers know how to sell a dream, but here’s how to wake up before it becomes a nightmare:

• Check credentials: Verify the seller with the Securities and Exchange Commission (SEC).
• Pressure to invest: Legitimate investments don’t rush you to hand over cash.
• Secretive pitches: If the details are vague or overly complicated, walk away.
• Promises of guaranteed returns: No investment is risk-free. Anyone claiming otherwise is likely lying.

Quick Tip: Use tools like FINRA’s BrokerCheck to vet financial professionals before investing.

Got Scammed? Don’t Panic—Here’s What to Do

Mistakes happen. The sooner you act, the better your chances of minimizing damage.

1. Freeze the funds: If you’ve sent money, contact your bank immediately. They may be able to stop the transaction.
2. Report it:
   • File a complaint with the Federal Trade Commission (FTC) at reportfraud.ftc.gov.
   • Report phishing attempts to the Anti-Phishing Working Group at reportphishing@apwg.org.
   • For investment scams, reach out to the SEC.
3. Secure your accounts: Change your passwords and enable two-factor authentication (2FA) wherever possible.
4. Monitor your credit: Check your credit report for unauthorized activity. You can place a fraud alert with major credit bureaus like Experian, TransUnion, or Equifax.

Tax Scams: Don’t Let Them Cheat You Out of Your Refund

Tax season is prime time for scammers pretending to be the IRS. They might call, email, or text, claiming you owe back taxes or that there’s an issue with your refund. Here’s how to spot the fakes:

• The IRS doesn’t call first: They’ll send letters if there’s a real issue.
• No threats or gift card payments: The IRS won’t demand immediate payment or threaten to arrest you.
• Email = fake: The IRS doesn’t contact taxpayers via email or text.

For more information, visit the IRS’s page on tax scams.

Keep Your Tax Info Safe

Preventing tax fraud starts with safeguarding your information. Try these tips:

• Go digital securely: Use reputable tax preparation software with encryption.
• Shred it!: Old tax documents are a goldmine for identity thieves. Don’t just toss them—shred them.
• Guard your Social Security Number (SSN): Only share it when absolutely necessary and double-check who’s asking.

The Federal Trade Commission provides guidance on protecting your identity.

Suspect Tax Identity Theft? Take These Steps

If someone files a fraudulent tax return in your name, it can feel overwhelming. Here’s what to do:

1. Confirm the problem: If your return is rejected, or the IRS sends you a notice about a suspicious return, you might be a victim.
2. Notify the IRS:
   • File IRS Form 14039 (Identity Theft Affidavit).
   • Call the IRS Identity Theft Hotline: 1-800-908-4490.
3. Alert the FTC: Report the issue at IdentityTheft.gov.
4. Monitor your accounts: Keep an eye on your bank and credit for unusual activity.

A Few Extra Tips to Stay Scam-Free

• Trust your gut: If something feels wrong, it probably is.
• Stay informed: Scams evolve. Check resources like the Consumer Financial Protection Bureau for updates.
• Educate your circle: Share what you know with friends and family. Knowledge is power!

What’s Your Scam Story?

Have you spotted a scam or fallen victim? Sharing your story might help someone else avoid the same trap. Let’s chat in the comments!

Together, we can make scams less successful and keep more money—and peace of mind—where it belongs: with you.