Protect yourself from financial scams

The unfortunate truth is that there are people out there who want to trick you into giving them your hard-earned money—and those people often prey on seniors. Scams are becoming so sophisticated that it can be difficult to identify them right away, so it’s important to be vigilant. Take your time, do your research, and refuse to be bullied into making any financial transactions until you feel completely comfortable and safe doing so.

Tips to avoid financial scams

  1. Understand how your country’s tax agency communicates. The IRS, the CRA, and HMRC each communicate with taxpayers in very specific ways, and only request very specific information. It’s important to do your research depending upon what country you live in, but in general, tax agencies will not request personal banking information, credit card numbers, passport numbers, or social insurance numbers; they will not leave threatening messages; and they will not include links in emails that you are encouraged to click. If you receive any kind of communication from your tax agency that seems unusual, visit their website directly (by keying in the URL yourself, not by clicking on links in any emails) or call the agency directly (using a number from their website) to verify that the communication you received is not part of a scam.
  2. Be wary of “emergency calls.” There are different versions of the emergency call scam, but they all involve a relative claiming to be in urgent need of money. Sometimes the scammer will do some research to find the names of your family members, other times they will simply say, “Hi Grandma/Grandpa, do you know who this is?” and wait for you to supply the name before carrying on with the scam. If the story is suspicious, the voice doesn’t sound quite right, and the person on the phone can’t verify their identity by answering personal questions that would be hard to know the answers to if they weren’t your actual relative, do not comply with their request.
  3. Research charities. There are thousands of legitimate, registered charities in need of donations, but there are also scam artists who create fake charities that do nothing more than use your donations for personal gain. Once again, do your research before parting with your hard-earned money. Visit the Federal Trade Commission for more information on how to verify the authenticity of a charity.
  4. Don’t click on any links in unsolicited emails. Even if the email appears to be from a trusted organization, never click on any links contained in the body of the email. Called phishing scams, these are fraudulent attempts to get sensitive information such as usernames, passwords, and credit card details by luring you to a fake website that looks remarkably real. If you’re unsure, always contact the company in question using a phone number or website that you know is real. Phishing scams can also be perpetrated via text or phone call. In all cases, their end goal is to steal your identity and/or your money, and possibly to gain access to your computer.
  5. Never give out PIN numbers, passwords, or your user ID. Reputable companies will never, ever ask for this information from you, so don’t be bullied into providing it. If someone does ask, it’s a huge red flag that something’s not right.

It’s unfortunate that you have to be suspicious, but being wary is one of the best ways to help prevent yourself from becoming a victim. It truly is better to be safe than sorry, so don’t hesitate to do as much research as possible if you are ever presented with a situation that just doesn’t seem quite right. Trust your gut, no matter what.

For more scams commonly used on seniors, visit National Council on Aging, and for more information on how to protect yourself from financial scams visit Regions, and Investopedia.

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