How to Protect Yourself From Financial Fraud and Scams
October 22, 2021
How to Protect Yourself From Financial Fraud and Scams
October 22, 2021
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The Internet has changed almost everything about how we do business, bank, pay bills, and shop. It has also opened a whole world of possibilities for hackers and scammers to take advantage of people and steal identities and money. According to Experian, about one in 20 Americans is the victim of identity theft/fraud each year for a total of $17 billion lost in 2019. Criminals frequently use fear tactics to shut down your sense of perspective, rationality, and skepticism, making you quickly fall into their con. They prey on desperation and stress. But keep in mind: there are many ways to protect yourself online. Here are some of our favorite cybersecurity tips.
Ransomware can be installed on your computer through a software vulnerability or coding problem. Employees clicking a phishing link or opening attachments with malware or entering credentials into a compromised website can allow hackers to access a back door into your company’s or personal network.
Use a secured Wi-Fi network at home and try to avoid public networks. You can purchase virtual private network (VPN) services if you frequently travel, which encrypts the data you send via a public network. Keep your computer software and apps up to date. Companies often identify software bugs, requiring updates, and outdated software can make it easier for scammers to infiltrate your devices. You may be able to set your software to update automatically through your settings. Installing anti-virus software can give you an added layer of protection.
Use long passwords that would be hard for a hacker to guess. Don’t use personal details, names, dates, or other common password strings (e.g., abc123). Believe it or not, much of your personal information is accessible on the Internet, which means a hacker could do a little research on you and use the data to start guessing passwords. Use a variety of passwords and change them often. A reputable password manager can help you store your account passwords. Set up multifactor authentication when possible. This requires both your password and one other verification method, usually a code sent via text or call. Microsoft reported that doing this can prevent 99.9% of attacks on your accounts—a staggering statistic for such a simple action!
Be careful what you share online—especially on social media. As crazy as it sounds, people have actually shared photos of their credit cards with all the necessary information to access the card’s funds visible—a scammer’s dream. Don’t share your passwords via email or text, and be cautious about sharing personal information that someone could easily use against you.
Back up your files to a separate drive or to cloud storage. If your computer is hacked and/or you lose access to your systems, you can still access your files. Shred documents that contain personal information, including bills, account statements, and credit cards offers.
Be cautious of clicking links—only click links you recognize as legitimate. Always check the sender’s email address before responding or look for other clues that this is a legitimate link. For example, if you know your manager uses an iPhone and you receive an email with ‘Sent From My Android’ at the bottom, reach out to verify with the sender before clicking anything or opening attachments. Phishing attempts and other email scams will often come from email addresses that contain gibberish or misspellings. If you click on something that seems malicious, let your IT department know immediately. Hackers need dwell time— the time between when hackers gain access to a network and when they can complete anything malicious—to understand what they’ve gained access to. It is important for your IT team to minimize dwell time, so early notification is essential.
Within reason, opt to use credit cards instead of debit cards when paying online. Credit cards often have greater security and fraud protection if your card is compromised. Debit cards are directly tied to your bank account, so if a hacker gains access to your information, they can wipe out your account. Even though it’s tempting and makes shopping a breeze, saving your payment information onto your computer or in a website’s profile can allow hackers to steal the information if they find a vulnerability. Monitor your credit score and report often, watching for sudden or unexpected changes to catch security breaches (i.e., someone applied for a credit card using your information). Also, keep an eye on your bank and credit card accounts for unexpected activity. For example, incorrect or unauthorized changes to your account information (e.g., updated address or email) and missing account statements are signs that your account may be compromised.
Ask your financial institutions and any financial professionals you work with (advisor, CPA, etc.) what precautions they take to protect your data and accounts. Any reputable company will be able to provide you with its security policy.
Beware of anything that seems too good to be true or has a sense of urgency. These types of scams prey on the fear of missing out, fear, and anxiety. Anything that has a ticking clock attached or pressures to click should raise red flags. If you’re unsure if something is legit, reach out to the company or financial institution directly via their customer support line to check.
Remember, scammers and hackers will often have some accurate information about you (e.g., they know where you bank or a type of credit card you have) to make their email or offer seem more legit. This information is often accessible from data breaches (e.g., Equifax), making your personal data available for sale. Use the Internet and your applications with a certain degree of suspicion and scrutiny—even more so if you receive a phone call or email from a would-be scammer. Don’t click anything if you receive something digitally or hang up the call and go directly to the source (the financial institution, government agency, etc.) to investigate. Better to spend a little extra time investigating than days and weeks (or longer) recovering from a digital attack.
If you’re suspicious of something you’ve received or a victim of a scam, enlist the help of someone who is not emotionally or financially invested in this potential “scam” to evaluate its validity and help you navigate the aftermath and find solutions. Don’t go it alone! The embarrassment that comes from falling for a scam enables the scammers to keep doing it to others. Tell people about your experience and report it to the government! The Federal Trade Commission has many online security resources and information available for free here. You can report identity theft and get help with your recovery plan on the FTC’s website at https://www.identitytheft.gov/#/.
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Athene. (n.d.). 5 cybersecurity safety tips. https://www.athene.com/smart-strategies/finances/5-cybersecurity-safety-tips.html
Executech. (2017, April). 12 Easy Cybersecurity Tips to Better Protect Your Data. https://www.executech.com/insight/following-easy-digital-security-tips/
Janoff, Corey. (2020, December 8). 10 Ways to Prevent Identity Theft. Finity Group, LLC. https://thefinitygroup.com/blog/10-ways-to-prevent-identity-theft
Littlejohn, Brian. (2021, September 8). 5 Cybersecurity Best Practices Investors Should Embrace in 2021. The Street. https://www.thestreet.com/retirement-daily/lifestyle/5-cybersecurity-best-practices-investors-should-embrace-in-2021
Powers, Martine. (2021, July 12). How to not get scammed. Washington Post Reports.
Sato, Gayle. (2021, January 24). How Common Is Identity Theft? Experian. https://www.experian.com/blogs/ask-experian/how-common-is-identity-theft/