Top Financial Scams to Watch Out for in FY24

As experts in the field of finance and consumer protection, we have analyzed the landscape of financial scams and identified the top scams that you need to be aware of in 2024. With the rise of artificial intelligence tools and sophisticated technology, scammers have become more cunning and resourceful, making it increasingly difficult for consumers to spot and avoid fraudulent schemes. In this article, we will delve into five prominent financial scams, providing you with valuable insights and practical tips to protect yourself and your loved ones. Together, we can combat these scams and safeguard our financial well-being.

Grandparent Scams: Preying on Emotions

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Playing on people’s emotions and targeting personal relationships, grandparent scams have become a prevalent form of fraud. Scammers utilize advanced technology to capture voice recordings and create fake versions of your voice, aiming to impersonate you. They may call pretending to be a family member in immediate jeopardy, such as claiming to have been arrested or being seriously ill, and urgently request money. To isolate their victims, scammers often concoct reasons why victims cannot consult with friends, family, or law enforcement, emphasizing the need for secrecy.

How to Avoid Grandparent Scams

  • Never answer emails or phone calls from unknown persons.
  • Establish a “safe word” or “password” with your family members to verify your identity during emergency situations.
  • If you receive a call or text from someone claiming to be a loved one but using an unfamiliar number, contact the usual number you use to reach that person to confirm their call.
  • Confirm emergency financial requests with other family members, and never keep the initial call or text a secret.

 Romance Scams: Love Turns Sour

Romance scams capitalize on the vulnerability of those seeking love and companionship online. Scammers initiate contact through private messages on social media or dating apps, carefully reviewing the information shared on these accounts. Once they gain your trust, scammers create elaborate stories involving sick relatives, financial troubles, or military service, compelling you to send them money or make purchases on their behalf. They often request payment methods that are difficult to trace and reverse, such as gift cards or peer-to-peer services like Venmo and Zelle.

How to Avoid Romance Scams

  • Discuss your new love interest with friends or family members and pay attention to any concerns they may have.
  • Refrain from sharing personal information, usernames, passwords, or one-time codes that can be used to access your accounts or steal your identity.
  • Be cautious if someone you’ve recently met asks you to send money or receive packages on their behalf.
  • If it sounds too good to be true, it probably is. Trust your instincts and remain skeptical.

 

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Cryptocurrency Scams: Investing in Illusions

Cryptocurrency scams have seen a significant rise as scammers exploit the allure of digital assets and investment opportunities. With investment-related scams accounting for massive financial losses, scammers leverage the unregulated nature of cryptocurrencies to their advantage. These fraudsters may pose as investment managers offering lucrative opportunities or even impersonate celebrities promising substantial returns. Cryptocurrencies make it challenging to reverse payments and lack the same legal protections as traditional forms of payment.

How to Avoid Cryptocurrency Scams

  • Do not mix online dating and investment advice. If someone on a dating site or app tries to convince you to invest in crypto, it is likely a scam.
  • Legitimate entities will not ask you to send money or make payments through cryptocurrency via email, text, or social media.
  • Refuse demands for cryptocurrency payments from individuals who unexpectedly contact you.
  • Stay informed about crypto scams by following reputable financial news sources.

 Employment Scams: The Illusion of Opportunity

As the job market fluctuates, scammers take advantage of individuals seeking employment by offering enticing but deceitful opportunities. These fraudulent schemes often involve fake companies conducting convincing interviews, followed by requests for personal information or background check fees. Once scammers obtain your personal identity information, they can easily infiltrate your bank accounts or engage in further fraudulent activities. In desperate times, it’s crucial to remain vigilant and skeptical of seemingly too-good-to-be-true job offers.

How to Avoid Employment Scams

  • Conduct thorough research on the company or person offering you a job. Search for keywords like “scam,” “review,” or “complaint” to see if others have reported fraudulent activities.
  • Do not click on links from unexpected messages, emails, or social media messages, even if they appear to originate from a reputable company.
  • Never pay a fee upfront for a job or purchase cryptocurrency as part of a job requirement. Genuine employers will not demand such payments.

 

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 Online Account Tax Scam: A Trap Behind a Facade

In this particular scam, fraudsters impersonate third parties offering assistance in creating an online account at IRS.gov for tax payments. By obtaining taxpayer information, scammers can file fraudulent tax returns and claim refunds. This stolen information can also be exploited for identity theft or other forms of financial fraud. To ensure your financial security, it is crucial to be aware of the official channels and processes involved in dealing with taxes.

How to Avoid Online Account Tax Scams

  • Begin any tax-related processes at the official IRS website (IRS.gov). Beware of third-party “helpers” who approach you with unsolicited offers to create an online account.
  • Be cautious about sharing sensitive taxpayer information and refrain from offering it to unknown or unverified sources.
  • If in doubt, contact the IRS directly through their official channels.

 

By familiarizing yourself with these prevalent financial scams and implementing the recommended protective measures, you can significantly reduce your vulnerability to fraudulent activities. Awareness, skepticism, and open communication with loved ones are key to safeguarding your finances in an increasingly complex digital world.

 

Source:cnbc.com

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