How To Protect Yourself From Bank Scams

A bank is not just a place for you to store your cash. You can also pay your bills, withdraw money and deposit checks.

Never give out your personal information to anyone even if you believe they are from your bank. This includes passwords, social security numbers and account numbers. This is particularly true if a text message or phone call seems suspicious. And if you are a victim of a scam, contact immediately

Sweepstakes Fraud

Sweepstakes scams, lottery scams and prize frauds are among the oldest and commonest types of fraud. These scams can be perpetrated via email, phone calls, or direct mail. Victims receive a letter or call stating they’ve won a contest that was never actually entered. The fraudster will then ask for a fee or tax to claim a bogus prize. The money can be requested via a credit card, wire transfer or even a personal check. Fraudsters may also try to steal the victim’s bank account details.


The perpetrators could appear to be from a legitimate sweepstakes company or government agency. They can even fake the name and title of their company to make it more convincing. For example, a phony agency might be called the “National Lottery Administration” or “National Sweepstakes Bureau.” It’s important to keep in mind that real sweepstakes do not require winners to pay fees or taxes to cash in their prize.

BBB’s Scam Tracker shows that sweepstakes/lottery/prize fraud is prevalent worldwide. It’s especially alarming that the vast majority of sweepstakes scams target seniors, and many of them cause victims to lose tens of thousands of dollars. In some cases the victims are depressed enough by the loss to commit suicide.

Victims of sweepstakes and lottery scams rarely file a complaint, so these crimes continue to affect people for months or even years. As a result, these scams can drain the victim’s bank accounts and leave them financially devastated. The victim might not be able afford to pay for other forms of help, such as housing, food and medical care. The fraudsters can also use the victims’ personal information to sell it to other telemarketers.

Phone Scams

Unwanted phone calls can not only be annoying, they can also cost you a lot of money. Whether they involve an appeal for charitable causes or false claims of being related to the government, scammers use fear and urgency to convince people to make quick payments over the phone.

One type of phone fraud involves a phony software company claiming that there is an issue with your computer, and requesting remote access to it at home or in the office. The criminal can then commit crimes such as identity theft. A bogus survey asking you to answer questions regarding your shopping or banking behavior is another common scam. These surveys can be conducted via email, text message or telephone. Fraudsters sell or use the information for other purposes. Some people lost their entire savings due to these bogus studies.

In addition, phone scams can involve bogus investments. They can claim that they are selling shares in a land bank, wine estate, carbon credits, or rare metals. Many fraudsters will also claim that they are offering pension liberation. This is a new type of investment which allows people to withdraw a portion of their retirement funds earlier.

These scams are also available in the form a fake email or letter claiming to come from your bank or another financial institution. This scammer may ask you for your account number, Social Security Number or other personal details, which is a warning sign. If you receive a similar request, hang up the phone and look for the institution’s number on your account statement, in the phone book, or the agency’s web site.

Federal Agency Scams

Scammers are using the New York Fed to trick people into sending them money or personal details as part of an advance fee scam. These scams often ask victims to send money up front to receive more later. They also may request account details such as names, passwords, and bank accounts. The release of this information can lead to an identity theft.

Fraudsters can also use photos and badges of Fed employees, as well as logos for the Federal Reserve, and other government agencies to create a website which appears to be genuine. The scammers will then encourage their victims to file official looking forms to report fraud and even pay taxes on prize winnings. They will ask you to pay via prepaid debit card, cryptocurrency, wire transfer or money orders. These methods are difficult to trace, which makes it easier for fraudsters steal money and personal data from victims and remain hidden from law enforcement.

Scammers pretend to be a federal agency such as Social Security Administration, IRS, Medicare or non-existent National Sweepstakes Bureau. They will call, send a text message or email and pose as if they are from that agency. They will threaten arrest or other unpleasant consequences if the person does not take immediate action, such as sending cash or giving them a Green Dot card, wire transfer or bitcoin deposit. Scammers also use fake agency name and other techniques such as throwaway mobile phones or spoofed numbers to hide their identity and evade the authorities. Remember, federal agencies will not contact you by phone, text or e-mail to ask for money or personal information. If you receive such a call, hang up and report it to FTC’s Consumer Sentinel Network.

Automatic Withdrawal Scams

Automatic withdrawal scams occur when a person’s bank account is debited without their knowledge or consent. Fraudsters usually obtain the victim’s bank account number through fraudulent telemarketers, or by hacking their personal information from unsecured websites. The scammers may then set up a number of unauthorized withdrawals on the victim’s account. The scammers then tell the victims that they must send them money to pay off their debts, qualify for a free trial or collect a prize.

All three can reduce the number who fall victim to these scams: the government, banks and consumers. The first step in preventing these scams is to increase awareness through public service announcements and information on government websites. The government could also enforce laws that punish companies that make unauthorized withdrawals.

Financial monitoring and alerts is the second line against these scams. These tools can help you identify suspicious activity on your bank account, credit card account and other financial information to report it to the relevant authorities. You should always verify the legitimacy of any communication that requires you to share financial information through a website by checking for a padlock icon in the address bar, a “https” before the URL and a green padlock on the login page.

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