FINANCIAL PLANNING TIDBITS: A HEALTHY DEFENSE AGAINST FRAUD
SUMMARY
Anecdotes and news stories about fraud, identity theft, and scams seem to increase each year despite preventative efforts. Nonetheless, there are a variety of things you can do to protect yourself.
Too Good to Be True Usually Is
Nothing can give you a chill quite like realizing that something in your account isn’t right—the balance may seem off, or perhaps your account activity shows a charge you don’t recognize. While security technology has improved over the years, fraud, scams, and schemes have also grown more sophisticated.
Choosing strong passwords, changing them frequently, and authorizing multi-factor authentication (such as requiring a code to be sent to your cell phone to access your accounts) are all good ways to head off threats. Keeping your security software updated and backing up your data can also prevent disaster. Here are a few more cybersecurity tips to prevent and quickly identify fraud in your accounts or on your computer and phone when you’re shopping, surfing, or reading your emails.
Check your account activity regularly. Catching fraud early is critical, and keeping track of any transactions or charges against your accounts is an easy way to quickly identify when it’s happening. The sooner you catch fraud, the easier it is to unwind. Your Raymond James or Charles Schwab statements come out monthly, but you can also review activity in your accounts at any time by logging into your Raymond James Client Access or Schwab Alliance profiles.
Make sure the website is legitimate. If you navigate to a website, make sure it is secured and the correct website for the business. This includes any “pop-up” windows that may appear on a legitimate site. Sometimes scams will disguise themselves as ads or offers from an official site even after you’ve vetted it, and if you click on them, they will redirect you away from the main site to one run by the scammers.
Credit cards might be safer. If you’re paying for something online, it can be safer to use a credit card rather than providing direct checking, debit, or bank ACH information to the seller, especially if you’re not familiar with them.
Be leery of any mentions of past business with a large company. Sometimes scammers will claim to be Fedex or UPS in an email to inform you that your package has been detained and you will need to click on a link to unlock it. In other cases, scammers will try to trick you by offering a gift or prize for being a “loyal customer of Amazon.” The odds that you’ve used Fedex or UPS or shopped at Amazon in the recent past are fairly high, so the scammer already has a generic cover of legitimacy. Any shipping issues should be handled directly with the shipper through a verified channel, and, generally speaking, if you receive a deal too good to pass up (for example, “Free, just pay shipping!” or “You’ve been chosen!”), it’s probably not actually a deal.
Always check the sender’s email address, not just the sender’s name. In email applications, users will often be indicated by a name (Amazon, John Smith, etc.). The problem with relying on this is that any user, including those with malicious intent, can change how their name shows up on an email. The important thing to check is the email address, which some mail applications will let you do without opening the email just by hovering your cursor over the sender’s name. For example, Wal-Mart will never send you a notice from a Gmail account. Likewise, even if you do business with CVS, they probably won’t email you from news@popularia.com.
Read the fine print. If you do end up accepting an offer, purchasing a product, or signing up for something for which you at any time provide your payment details, make sure to carefully read the fine print and terms and conditions. Sometimes, scammers will offer something to you for free if you pay for shipping, but the fine print will indicate that you are also signing up for a monthly “membership” or fees. We’ve seen these fees be anywhere from $50/mo to over $100/mo. Furthermore, because your payment indicated acceptance of these charges, it may be difficult if not impossible to get them refunded once you discover the scam.
Don’t act on any message immediately. One way scammers trick people is by insisting that something must be handled in that moment, before the victim even fully understands the situation. For example, in the bail scam, a scammer will claim a loved one (often determined through social media) has been arrested and needs a cash bailout to drop the charges, creating a sense of urgency. They claim to be police officers and will even go so far as to give a fake police badge number. In other scams, they may claim to be from organizations like the IRS or Social Security. If you believe a message really does hold weight, always confirm by calling the loved one supposedly affected or the actual organization at an independently verified phone number, not one provided by the caller or emailer. Note that in most cases, government bodies will contact you only by U.S. mail, not by email or phone, and will never ask for personal information, demand payment, or threaten arrest.
Never click on a link in an email or text message from an unknown sender. Links can carry malware, including ransomware and spyware that can lock down your phone or computer or even scan the files on that device.
Never download an attachment or picture in an email or text message from an unknown sender. As with links, these can carry dangerous malware.
Never give out personal information to someone you don’t know. That information can be your birthdate, Social Security number, or even your Medicare number. Even if someone claims to be acting in an official capacity, you can decline to answer and instead reach out directly to the institution at an independently verified phone number.
If you think you have fallen victim to a scam or fraud, notify us at Day Hagan immediately, as well as your other financial institutions. You will also want to change your passwords, especially for online accounts that have payment history, personal data, or account information.
While cybersecurity at different organizations and institutions has greatly improved and a variety of fraud and identity monitoring services are available for hire, your best defense comes from being alert and discerning. Feel free to forward this safety reminder to anyone who may benefit from it.
Natalie Brown, CFP®
Director of Client Services & Financial Planning
Day Hagan Private Wealth
—Written 01.26.2023.
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Disclosure: The data and analysis contained herein are provided “as is” and without warranty of any kind, either express or implied. Day Hagan Private Wealth (DHPW), any of its affiliates or employees, or any third-party data provider, shall not have any liability for any loss sustained by anyone who has relied on the information contained in any Day Hagan Private Wealth literature or marketing materials. All opinions expressed herein are subject to change without notice, and you should always obtain current information and perform due diligence before investing.
Investment advisory services offered through Donald L. Hagan, LLC, a SEC registered investment advisory firm. Accounts held at Raymond James and Associates, Inc. (member FINRA, SIPC) and Charles Schwab & Co., Inc. (member FINRA, SIPC). Day Hagan Asset Management and Day Hagan Private Wealth are both dbas of Donald L. Hagan, LLC.