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How to Protect Yourself Against Online Fraud

Personal finance • April 8, 2020 • Ashley Boucher

What you’ll learn

  • Types of online fraud, including fraud related to COVID-19
  • How to protect yourself from online fraud
  • What to do if you think you’re a victim of online fraud

Social distancing and new recommendations for families to stay home means more people are turning to remote technologies to stay connected. We’re shopping even more online, using online conference tools like Zoom to stay connected, and, consequently, potentially making ourselves more vulnerable to online fraud.

If you’re spending more time online lately, you may find yourself sharing important or sensitive information, like your credit card number, birthdate, location, or even your social security number or bank account information.

Here’s what you need to know about online fraud, and how to protect yourself:

Common Types of Fraud

There are a series of ways cybercriminals will try to scam you. Perhaps the most common type of fraud is referred to as phishing: when criminals try to lure you into providing your financial and personal information into deceitful websites, email thread, or other electronic communication. The criminal will disguise themselves as a credible entity or even a family member.

Here are common types of phishing fraud:

  • Identity theft – Cybercriminals look to steal personal information in order to assume their identity. This can result in significant financial damage and legal trouble. They’ll use your private information, like your social security number, address, credit card information, etc., to assume your digital identity.
  • Credit card fraud – Online shoppers may be particularly vulnerable to credit card fraud, where users are tricked into submitting their card information to fraudulent websites – giving access to criminals who use the information to make purchases.
  • Auction Fraud – This fraud is based around shopping, and paying for, an item that you don’t receive, or one that’s different from what was advertised.
  • Investment Fraud - Scammers pretend to be privy to financial knowledge and information that would make an investment highly lucrative. In reality, there’s no investment to be made, and the cybercriminal is just after your payment information.
  • Sweepstakes Scam – Scammers send emails saying a fee is needed to claim a lottery or sweepstakes, but the prize isn’t real.

Beware of COVID-19 Related Scams

It’s an unfortunate fact of life that cybercriminals use times of uncertainty to set traps and steal data. The COVID-19 pandemic provides a few opportunities for these criminals to take advantage of uncertainty and fear.

The Better Business Bureau recently released a warning to consumers about text messaging scams that demand bank account or social security information in order to receive a stimulus check, for example. And, with the wave of employees turning to remote work, there are reports of pop-up alert scams and viruses disguised as technical solutions.

Consumers should also beware of any emails with promises to protect you from COVID-19. There are reports of scammers distributing malware through these emails. The idea is that COVID-19 subject lines will entice people to open them in hopes of new information, but it’s just another attempt at online fraud.

How to avoid online scams

Being aware of the potential for online fraud is the first step. Remind yourself that times of vulnerability for the public are considered primetime for fraud by cybercriminals.

To help protect yourself, look out for the following key indicators:

  1. Think before you click. Whether it’s an email, text message, or website, consider the source. Ask questions like: “Would mom really send me this email?”; “Would my mortgage company really ask for my social security number at this point?” or “Is this the bank mobile site I usually go to? Does it look the same?”
  2. Check the URL. If it begins with “https”, it means the site is secure, and your private data should be protected. If you’re still unsure, check the WHOIS website to see who is responsible for a domain name or an IP address.
  3. Review contact information. If you’re unclear on whether the website you’re on or email you’re reading is valid, check the contact information including the phone number and address. Call the number and see who answers. If you think you’re calling your bank, and it’s a busy tone instead, you may be dealing with an attempt of fraud. If you receive an email from someone or a company, check their email address. If it looks odd or doesn’t match will previous emails you’ve received from them, odds are it’s a scam.
  4. Search for other report of scam. If you type the company name and “scam” into a search engine, you might find reports of other scam attempts. If you don’t see any, it’s possible the scam is new, or that it’s not scam at all.
  5. Take your time. Scammers will want you to hurry up. They’ll demand you wire money immediately, and they may even threaten you. Any reputable organization will not make these types of demands, so don’t hurry through any transaction. Take your time, research the request, and reach out to a family member or even your local officials if you have questions.

What to do if you think you’re being scammed online

If you think you’ve mistakenly fallen into fraudulent activity, or may be victim of online fraud, you should report the scam to your state consumer protection office. If you’ve lost money or other items as the result of online fraud, you should also report it to the local police. You may also consider notifying your bank, cancelling your credit card, and taking other actions to stop any further financial damage.

Ashley is a Sallie Mae employee and a graduate of Immaculata University. A mom of two young girls, her favorite dinner topic is the Free Application for Federal Student Aid (FAFSA).

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