Protect Yourself From Financial Fraud
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How To Protect Yourself From Financial Fraud

Updated on April 06, 2020 01:26 pm
Financial Fraud

Have you ever been scammed before? Have you ever lost your savings due to fraudsters? If you haven?t experienced any of these, you are either wise or lucky enough not to be a victim of one. However, even the smartest of people become victims of identity theft. If you are not careful enough and keep your personal information lying around for the world to see, you are probably the best candidate for the scammers. 

In the wake of the Coronavirus outbreak and economic slowdown, we can expect to see more phishing and investment scams resurfacing, similar to those in the 2008 financial crisis. Fraudsters promise them a cure and protection from the virus. The FDA has since released information to be aware of fraudulent Coronavirus tests, vaccines, and treatments debunking all the ?quick-fix? claims. There has also been a surge in consumer fraud in the name of donations and investment opportunities impersonating organizations like the World Health Organisation. Remember, "If it sounds too good to be true, it probably is a scam."

The Federal Trade Commission (FTC) tracks consumer fraud and identity theft complaints that have been filed with federal, state and local law enforcement agencies and private organizations under their Consumer Sentinel Network.


FTC received a total of 3 million identity theft and fraud complaints in 2018. Here are a few quick takeaways:

  • 1.4 million were related to fraud
  • 25 % of the total fraud-related complaints reported money lost
  • Consumers reported a cumulative loss of about $1.48 billion to fraud
  • The median amount of consumers lost in the fraud cases was $375. 
  • And 15 % of the total complaints were related to identity theft.

What Is Identity Theft?

Identity theft is a crime for the unauthorized collection of personal information by an imposter such as SSN, Driver?s License, Passport, or any other personally identifiable information to open credit cards and bank accounts, rent vehicles, get jobs, set up mobile service and so on. The victim of this kind of crime whose identity is used by the fraudster for conducting the illegal activity will suffer from paying the bill and charges and lose money.  Approximately 9 million Americans have their identities stolen each year and the majority of identity thefts happen electronically or online.

How do fraudsters access your bank and card information?

Fraudsters are everywhere and the credit card is the main reason for fraud. Even if you don?t lose your card, there are various techniques fraudsters use to steal your card information so be alert whenever you use your card when traveling, e-shopping, or simply when you are using your card in your local area.

  • Skimming ? Fraudsters attach data skimming devices in the card reader slot to copy information from the magnetic strip when one swipes the card and they also attach cameras near the machine to get the PIN.
  • Card trapping ? When you insert your card in the machine, there is a barb that retains the card and the card is retrieved later when you leave the machine to seek help.
  • Shoulder surfing ? Be careful of bystanders who pretend to do something or try to help you how to use your card but actually they are trying to steal your PIN.
  • PIN on your card ? If you lose your card with PIN written on it and forget it in the ATM kiosk, dishonest people can easily steal money from your account.
  • Online transactions ? Be cautious whenever you shop online because this can cause identity theft and unauthorized transactions.
  • Pharming ? In this kind of scam, fraudsters reroute you to a fake website that seems similar to the original and when you transact and make payment via credit or debit card, the fraudsters will steal your card details.
  • Keystroke logging ? While surfing the net, you unintentionally download software which allows the fraudster to trace your keystrokes and steal passwords or credit card and net banking details.
  • Public Wi-Fi ? Be careful when using public Wi-Fi as this makes for a good hacking opportunity for thieves to steal your card details.
  • Malware ? Malicious software that can damage computer systems at ATMs or bank servers and allows fraudsters to access confidential card data.
  • Merchant or point-of-sale theft?? Whenever you use your card for payment, your card is taken by the salesperson for swiping and the information from the magnetic strip is copied to be used later for illegal transactions.
  • Phishing & vishing?? Phishing scam involves identity theft through spam emails which looks genuine, while vishing involves a mobile phone using messages or SMS which tricks you into revealing your password, PIN or account number.
  • SIM swipe fraud?? In this scam, the fraudster contacts your mobile operator with fake identity proof and gets a duplicate SIM card. The operator deactivates your original SIM and the thief generates a one-time password (OTP) on the phone to conduct online transactions.
  • Unsafe apps?? Be cautious when you download unknown apps because these apps can gain access to your banking information.
  • Lost or stolen cards, interception ? Transactions are carried out using stolen cards like those intercepted from mail before they reach the owner from the card issuer.? Fraudsters can also fish out information like PINs and passwords from the trash.
  • How to Protect Yourself from Identity Theft

    1. Always use passwords in your devices like phones, computers, and all your financial accounts.
    2. Use passwords that are mixed up and try to keep different passwords or always change your passwords regularly.
    3. Avoid clicking suspicious or unknown links and messages in your email and messages.
    4. Do not share your personal information with anyone or do not write it anywhere where anyone can see and use it.
    5. Protect your documents with personal information and keep them in safe places.
    6. Unless you are traveling, do not carry too many IDS nor cards.
    7. Monitor your credit score regularly.
    8. Always check your bank statements for any suspicious transactions.
    9. Use a paper shredder to destroy your personal and financial documents.
    10. Never leave your debit or credit card receipts anywhere.

    How safe are online money transfers?

    In the report on fraud by payment method by Consumer Sentinel Network, wire transfers and Internet/Mobile accounted for a total loss of $423M and $40M respectively. 


    Tips to protect yourself?

    Here are the tips to protect yourself from fraud while sending money online:

    1. Ensure that your devices for sending money are up to date to protect your data from malware and other software viruses that can steal your bank details.
    2.  Send money online to trusted online companies. Money transfer services like Wise, Xoom, Remit2India, Western Union, Remitly, InstaReM, etc are some of the popular online players and trusted by millions of migrants to send money from the US, UK, and Canada. Every money transfer company featured on CompareRemit is safe and secure. 
    3. Always use strong passwords combined with special characters and numbers.
    4. Ensure that there?s a transaction guarantor or security like 3D Secure or Verified-by-Visa when you are linking your bank account details to the remittance website.
    5. Double-check the details which you have entered before you confirm a transaction.
    6. Avoid using public wifi when sending money online.
    7. Do not borrow or use other people?s devices or computers when you send money.
    8. If you are sending money from a rental place, ensure to log-out after you transact and clear the browsing history.
    9. Make sure no one is behind you when you are entering your credentials online.
    10. Never ever share your online login details with anyone.
    11. Avoid sending money to someone you have never met.
    12. Avoid sharing too much information on social media.

    In order to protect yourself from scammers and identity fraud, be cautious and be alert all the time. If you are someone who sends money online regularly, here is the list of hassle-free ways of sending money. Use our free comparison tool to compare the prices, the speed of delivery and exchange rates easily. Most of all, the featured online money transfer services are one hundred percent safe and secure and trusted by migrants abroad.

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