How to Resist Fraud

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How to Resist Fraud

Frauds are all around us, and they evolve with the times. However, when it comes to protecting yourself, there are some actions that can help you resist them.

Investment fraud

People who sell investments must be licensed by their state securities regulator. Contact your state securities regulator to find out whether a salesperson—and the investment being sold to you—is actually registered. If you already have a broker, read your statements carefully for any unauthorized trades, unexplained fees, or anything suspicious. Also, find out where the investment is trading and verify any claims made about it.

Pyramid schemes and work-at-home scams

If you suspect one of these, research the company online to see if there are any warnings about it: type the company’s name into a search engine along with the word complaints. Check with the Better Business Bureau (www.bbb.org). And check with the Federal Trade Commission here.

Tips for all suspicious opportunities

• Always be skeptical of any investment claiming a high yield and/or low risk.
• Beware if the promoters are claiming that the investment is secret or confidential or limited to only a few people. Secrecy and exclusivity are common tipoffs to scams.
• Beware if the opportunity is vague about how it works or who is involved.
• Verify the opportunity by researching it as well as you can. Consult a broker or an investment advisor or an attorney if you can.
• For charity calls, find out what percentage of the earnings goes to actually helping people.
• Don’t buy from unfamiliar companies.
• Request that written material on the offer be mailed to you.
• Insist on investigating the company and the offer through the Better Business Bureau, the National Consumers League (www.fraud.org/), or other watchdog groups.
• Get the salesperson’s name, phone number, address, and business license number, and then verify all these.
• Don’t pay in advance for any services if offered by cold-callers.
• Don’t let the salesperson send a courier to your home to pick up payment.
• Never give out your credit card numbers, Social Security number, bank account numbers, date of birth, or card expiration dates to unknown callers.
• Resist any pressure to act quickly or make decisions right now.
• Don’t wire money based on a request made over the phone … especially overseas.
• Don’t sign blank insurance claim forms.
• If the business does not have a street address, or if the finder is never available, be wary.
• Be cautious with non-disclosure agreements that are added to money-transfer contracts. These are designed to prevent you from discussing the deal with other people.
• Do not agree to transfer money on behalf of someone else.
• Finally, if you’re on the phone, feel free to just hang up!

Manage your digital footprint

It is important to manage your financial digital footprint. That term refers to the trail of information you leave behind on the Internet from your online activity. Consider your social media posts and emails, your online shopping, and your subscriptions. These are examples of active footprints. There are also passive footprints, which happen when information is collected about you without you knowing it, for example, how often you visit a website. Cybercriminals can exploit your digital information for identity theft and other crimes. But that’s not all. Depending on what the information is, your reputation could be harmed. You could be denied a job. Colleges could reject your application. And family members could also be targeted.

Being wiser about what you post, and cleaning up negative things online, can benefit your financial digital footprint. Some actions you could take include:

• Deleting cookies regularly
• Look yourself up on search engines
• Review and change your privacy settings
• Use a virtual private network when using public Wi-Fi
• Limit the information you share online
• Use 2-factor authentication and a password manager

How to protect your passwords

Taking all these measures can cut down on fraud, but another way to keep out criminals is through better password protection. There are many ways to do this. Always strengthen your passwords to make them as unhackable as possible. Change them regularly, and avoid using the same password for multiple purposes. Try using two-factor authentication (2FA) to create one-time, temporary passwords. You can use an authenticator app, a phone, or your email program to do this. Finally, an option to try is a password manager. This is an application that securely creates and manages passwords for your online accounts. You don’t need to remember all your passwords yourself when you use one. With all these possibilities in mind, you can choose an effective way to keep your accounts safe.