Source: 2019-20 Consumer Sentinel Report
Banking and finance scams are designed to deceive people into giving over sensitive banking information like PINs and credit card information or even facilitating remote access to your home computer to access your online banking via saved passwords.
Many scam events are designed to steal money, making banks and financial institutions the primary end target. However, banking scams can often be part of broader scams like identity theft, brand or government impersonation, or even 'tech support' scams.
Some of the most common banking and finance fraud events involve credit cards, debit cards, and mortgage payments.
Credit cards are used as the primary transaction tool for online shopping and the majority of in-store transactions. Most people will be familiar with the experience of lost, stolen, or compromised credit cards. Huge volumes of stolen credit card numbers are for sale on the dark web.
Credit card details are vulnerable in many ways:
Home loans and mortgages are the largest single transaction that a customer will perform with the bank. As such, they provide an opportunity for scammers to try and intercept communications and get the settlement funds diverted to their own "escrow" accounts.
Debit cards that are linked to savings accounts pose a massive financial risk. If you only have a single savings account and use a debit card for transactions with this account, the loss or compromise of a debit card (in the same way that credit cards are compromised) can expose your entire savings.
Direct attempts to defraud banks are widespread and mainly involve loans for things that don't exist, loans for items that have been overvalued, or loans for things that other banks have already loaned money for.
There are many sophisticated and terrifying techniques that people use to defraud banks. Examples include a couple featured on American Greed, whose plan was to use multiple banks to finance mortgages of the same value on the same property at the same time—all without any of the banks knowing each other's financing agreements.
Over $50 million in loans was stolen from local banks.
Many people who are involved in this type of fraud live by John Paul Getty's maxim:
John Paul Getty
If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem.
Scammers often use the overpayment technique in online transactions on auction websites where they act as a purchaser to send a check for more than the agreed sale price. They wait for you to notify them of the error, and they ask for a quick return of the overpayment.
When you go to cash their check, the bank will take a few days and realize their check is fake or canceled, but you have already sent the money.
Scammers impersonate well-known banks, such as Citibank and Chase, to trick you into giving up your sensitive information—learn how to beat these scams.
A call from your bank isn't always legitimate—imposters pretend to represent your bank to steal your information and money.
Scammers have turned their phishing attempts to members or credit unions by sending out fake emails hoping to get their hands on valuable personal data.
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Escrow services are supposed to keep your money safe, but in this Craigslist scam, these escrow sites will do more damage than good.
If a buyer on Craigslist insists on only using PayPal to transfer money to you, be careful not to click on any links that they send you or you receive via email from PayPal.
Beware of buyers on Craigslist who only want to pay for your item with a cashier's check, then overpay you for your items—they're trying to steal money from you.
Pumping gas can seem like a basic task—a simple necessity that you need to do every week. What you may not be aware of is gas pumps are a prime target for scammers.
After falling victim to credit card fraud, it's important to act quickly and monitor your statement as well as your credit report.
The ultimate goal of scams is to steal your money, so it's common for thieves to impersonate your bank or credit union. So, how do you tell who's really contacting you?
With more than 2 million fake websites online, it's important to report any you come across to help the authorities shut them down and protect others from falling for scams.
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