The Fraud Pandemic

Can you believe it’s been three weeks since we last talked about scams in this Blog? It’s something I post about a lot (here, here and here, for example.) Even with states phased into reopening, Americans are working from home and using their computers much more frequently. Fraudsters know this and are on the hunt for easy prey. On that note, it’s time to talk about some common red flags to watch out for.

Common scams

• Work at Home Job Listing

• Secret Shoppers

• Romance Scam

• Unemployment Benefits

• Counterfeit Checks

Scams are so successful because the ploy seems plausible. There are plenty of authentic work-from-home positions, secret shoppers do exist, and online or in-app dating is one of the most popular ways to connect. How do you know what’s real and what’s not? Let’s dig into some specifics.

Work at Home Job Listing

The current working at home world that we are finding ourselves in has, by most accounts, been touted as wildly successful. It’s likely that more US employers will continue to offer this option post-COVID-19. With an influx of remote job opportunities, job searchers will need to remain diligent to determine whether the listing is legit. How?

1.       Skip the listings that ask you to provide your bank account information up-front.

2.       Were you contacted via social media or random email? Best to avoid these. Avoid

3.       Does the listing look too good to be true? It probably is. Even on real job boards, there are fake listings posted. Take a look at the grammar, the sender’s information, the job description, and other pertinent information. Remember, a legitimate hiring manager is going to communicate professionally. We’ve all seen a written job description written, so you know what to look for. If it looks odd, I would think twice before applying.

4.       This should go without saying, but if you receive a check in the mail for a work-at-home opportunity, it’s definitely not real. Trust me, as much as I would love to open my mailbox to find free money, it’s just not legitimate.

Secret Shoppers

As a teenager, I worked in a certain royalty-themed, fast-food establishment. It was common for my front-line colleagues to talk about which customer they suspected was a secret shopper. It happens a lot – someone goes into the restaurant, orders food, and evaluates the restaurant and its staff. The shopper reports back to their employer and is reimbursed. Some of the tasks offer additional compensation, but it is not as frequent. You can find secret shoppers outside of the restaurant environment – in retail and hospitality, mainly.

Credit unions and banks are governed by strict federal regulations. They have regular audits and exams. We don’t employ anyone to test cashing a check, wiring money, or receiving a cashier’s check. If you do receive a random check (with or without instructions), don’t deposit it – it’s probably counterfeit. More on that in a minute.

Romance Scams

One version of this scam is so well-known that they made a movie and a television series about it. The scammer poses on a dating site and lures in their victim. This scam commonly targets elderly or widowed individuals. Once they develop a relationship, the scammer spins a tale saying they need money. Not wanting to disappoint their newfound love, the victim sends them the money. This scam is particularly dangerous because it is a “long con”. The scammer has time to cultivate the relationship, and they will often make multiple requests for money. An alternate version of this scheme asks the victim to accept funds and resend them via an instant money transfer service or with the purchase of gift cards.

Unemployment Benefits Scam

During the pandemic, millions of Americans became unemployed. Scammers are using this as a way to steal. One of the most common methods scammers use is sending phishing emails. These emails appear to help unemployed individuals collect benefits. Once you provide your information, they use it to fraudulently apply in your name and direct funds to an account that they control, or they partner with a mule - more on that in a minute.

1.       Pay special attention to unsolicited emails, especially if they contain links or attachments. Don’t open anything in a suspicious email.

2.       Hover over the sender’s email to verify that the sender is who they say they are.

3.       Be overly cautious of unofficial email domains. You can learn more about email domains in this post.

4.       State and federal offices are swamped with calls and claims. If you receive a phone call or text from someone claiming to be an official who wants to help you file for benefits, you know it’s a scam.

Counterfeit Checks

There are a host of scams that involve counterfeit checks. In general, if you receive a check in the mail from someone you do not know or expect, do not cash it. Scammers create fake checks hoping their victim deposits it into their account. Usually, these checks come with instructions to deposit the check, withdraw some for yourself, and send the rest to a “business” or individual. Not only will the check not clear, but when it bounces, the victim is on the hook to pay the negative amount and any fees that may accrue.

Do you notice a common thread in each of these scenarios? They are all Money Mule Scams. A mule is someone who moves money for the scammer. Sound like an episode of Ozark? Unfortunately, it’s not fiction, and it happens all the time. Be sure to protect yourself from financial fraud with the following steps:

• Check your credit report

You are entitled to one free annual credit report from each bureau. You can learn more by clicking this link.

• Sign up for Fraud Alerts and Purchase Alerts

Banks, credit unions, and credit card companies may offer their own purchase alert services. If they are free, take advantage of them!

Don’t forget to leave a comment below, or email me directly.

Krista Kyte is a personal finance blogger and personal banker with over 17 years of experience in the financial industry. Krista is passionate about helping our members understand their financial situations. She writes tips that will help consumers reach and maintain financial security, and start living the life they’ve always wanted.