Spot and Stop Common Financial Scams: A Quick & Practical Guide
Simple steps to recognize fraud and protect your money & personal information
Financial scams are one of the costliest forms of misinformation. In 2024 alone, Americans lost an estimated $12.5 billion to fraud, up sharply from prior years. Scammers are constantly inventing new tricks as our digital ecosystem evolves, but the general strategy in their playbook is to exploit your trust, fear, or urgency to steal money or personal information.
Among the most common scams are phishing emails, fake debt collection calls, IRS and government impersonation schemes, and fraudulent text messages aimed at stealing money or personal information. The good news is that there are a few key tips that can protect you and those close to you.
Phishing Emails
How it works: You get an email that looks like it’s from your bank, Netflix, PayPal, or another trusted brand. It claims your account is on hold, there’s suspicious activity, or you’re due a refund. There’s a link or attachment, but it’s a trap to steal your login info or infect your device.
Red flags:
✅ Generic greeting (“Dear Customer”)
✅ Urgent or threatening tone (“Your account will be closed today”)
✅ Requests for passwords or personal info
✅ Suspicious links or attachments
How to protect yourself:
Don’t click links or open files in unsolicited emails.
Visit the company’s website directly if you want to check your account.
Enable spam filters, keep software updated, and use two-factor or multi-factor authentication (2FA/MFA).
Fake Debt Collection Scams
How it works: You get a phone call or message saying you owe a past-due debt. The caller may pose as a law firm, court, or government office, and threaten lawsuits or arrest unless you pay immediately (often via gift cards or wire transfers).
Red flags:
✅ Threats of arrest or legal action
✅ No written notice or documentation of the debt
✅ Demands for immediate payment through unconventional methods
✅ You don’t recognize the debt
How to protect yourself:
Ask for a written debt validation notice (they’re legally required to provide it).
Check your credit report to confirm if the debt is real.
Never pay on the spot or with gift cards.
Report aggressive or suspicious calls to the FTC.
IRS and Government Impersonation Scams
How it works: A scammer claims to be from the IRS, Social Security, Medicare, FBI, or local police. They say you owe back taxes, your Social Security number has been suspended, or you’re under investigation and demand payment or personal details immediately.
Red flags:
✅ Unsolicited calls, texts, or emails with threats
✅ Demand for instant payment (especially with gift cards or wire transfers)
✅ Requests for personal information like SSNs or bank details
✅ Caller ID or emails that look official but are fake
How to protect yourself:
Hang up and call the agency using a number from its official website.
Remember: the IRS and Social Security do not demand payment over the phone or threaten arrest.
Don’t trust caller ID or email appearance alone since they can be spoofed.
Fraudulent Text Messages
How it works: You get a text from a bank, delivery service, or government agency with a warning or exciting offer, plus a link. Clicking it leads to phishing sites or malware. Some recent scams include the “Bank fraud alerts” asking you to confirm a charge, and the fake texts about an unpaid toll.
Red flags:
✅ Unsolicited messages with urgent language
✅ Links that look odd or shortened (bit.ly, tinyurl)
✅ Promises of prizes, refunds, or jobs
✅ Requests for account credentials or one-time passwords (OTPs)
How to protect yourself:
Don’t click on links or respond to texts from unknown senders.
Verify messages by contacting the company directly (via official numbers or websites).
Forward suspicious texts to 7726 (SPAM) to help block them.
Use your phone’s spam-blocking tools.
Final Takeaways
Slow down. Scammers want you to panic & make rash decisions, so don’t fall for it!
Never send money or share sensitive information without verifying the request.
Keep your devices updated, use strong passwords and 2FA/MFA, and be skeptical of unsolicited contact.
Report scams to ReportFraud.ftc.gov, ic3.gov (for online fraud), or TIGTA.gov (for IRS scams).