With the advancements in technology, scammers have become more adept at deceiving Americans and causing them financial losses. However, there are measures you can take to safeguard your money and personal information.
Based on the latest data from the Federal Trade Commission, consumer losses due to fraud in 2022 reached a staggering $8.8 billion, marking a 30 percent increase from the previous year. Among the various scams, investment fraud, particularly cryptocurrency schemes, accounted for the largest losses, surpassing $3.8 billion and doubling the figure from 2021.
Interestingly, younger adults aged 20-29 reported frequent monetary losses compared to older adults aged 70-79. Nevertheless, when older adults did fall victim to scams, the financial impact was more significant. This is because retirees often possess valuable assets like savings, pensions, life insurance policies, or property that scammers specifically target.
The digital era has provided scammers with various avenues to reach their targets, including social media, text messages, phone calls, and emails. Additionally, the proliferation of online payment platforms, apps, and marketplaces has created more opportunities for fraud. Although their methods may vary, many scammers rely on similar tactics and strategies.
According to Kathy Stokes, director of fraud prevention for the AARP’s Fraud Watch Network, scammers deliberately manipulate individuals by putting them in a heightened emotional state. This emotional state impairs clear thinking, making it easier for scammers to exploit their targets. Stokes explains that scammers often induce feelings of fear, panic, or excitement, such as falsely claiming that the target has won a substantial sum of money.
Financial therapist Amanda Clayman, who collaborates with digital payment network Zelle on fraud-related matters, advises individuals to pause for an extra three seconds when faced with urgent demands. Urgency is often a red flag that suggests the need for caution and further verification.
Experts assert that being aware of common scams can provide significant protection. Scammers frequently target vulnerable individuals through robocalls, particularly seniors, people with disabilities, and those burdened by debt. James Lee, chief operating officer at the Identity Theft Resource Center, advises immediately hanging up if receiving an unsolicited robocall or text pressuring the recipient to make a purchase, wire money, or click on suspicious links. Instead, Lee advises calling the company or institution directly using their verified phone number.
Scammers commonly impersonate authority figures, such as tax or debt collectors, to deceive their victims. They may even pose as loved ones seeking immediate financial assistance for bail, legal fees, or medical bills. Another prevalent scam, known as “romance scams,” preys on lonely and isolated individuals for extended periods, sometimes lasting years.
Lee emphasizes the importance of taking a breath, verifying, and avoiding clicking on unfamiliar links in texts or emails. Instead, individuals should visit the official website directly or call the provided number listed on the legitimate site. Although this may require a few extra seconds, it could potentially save substantial sums of money.
There are some signs to watch out for, such as unrecognized senders, unusual wording, or noticeable spelling errors, which should raise extra caution. In 2022 alone, consumers suffered losses exceeding $326 million due to scam texts, as reported by the Federal Trade Commission.
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