How to safeguard you and your money against consumer fraud
Fraud can strike anyone, especially in today’s digital-first world. Learn practical steps to help protect your personal and financial information so you can stay in control of your money.
Key takeaways
Be cautious when sharing sensitive information and avoid engaging with suspicious emails or links.
Regularly check your bank and credit activity and report any unusual transactions immediately.
Use complex passwords and enable two-factor authentication for extra security.
Device updates and antivirus software help protect against cyber threats.
Quick action can limit damage if fraud occurs. Report issues fast, place a fraud alert or freeze on your credit, and notify the FTC when needed.
Criminals are working overtime to separate you from your money. From identity theft and credit card fraud to online shopping schemes and scams, the threats never stop. But there are strategies to reduce your fraud risk.
Consumer fraud is when deceptive, unfair, or false business practices lead to a financial or personal loss. And it’s a big problem. The Federal Trade Commission (FTC) received over 2.4 million reports of fraud in 2022, resulting in losses of more than $8.8 billion.
You can’t always prevent fraud, but there are steps you can take to safeguard you, your money, and your information. Here are five ways to protect yourself.
1. Guard your information
Protecting your personal information is the first line of defense against fraud. Criminals want your personal information and data, including your Social Security and driver’s license numbers, credit card details, passwords, and any other identifying information that will help them commit their crimes. When you’re asked for this type of personal information, especially over the phone, ask why it’s needed and how it will be protected.
Scammers use tactics such as phishing, fraudulent links, social engineering, and more to exploit your trust and trick you into giving up your information. Think twice before sharing any information online, over the phone, or in an email. Only give out confidential information to a trusted and verified source and don’t click on email links asking for your information.
If an offer sounds too good to be true, it probably is. Be wary of unsolicited emails, calls, or messages offering incredible deals or prizes. They are often baits used by fraudsters to lure unsuspecting victims.
2. Monitor your accounts
Regularly checking your online banking and credit card account activity can help detect fraudulent activity early. Report any unexpected transactions, transfers, and withdrawals to your financial institution immediately. Your bank or credit union may send you an automatic alert by email or text if fraudulent activity is suspected. Verify that the message is from your financial institution and act quickly to resolve any issues.
It’s important to protect the cell phone and primary email account you use for financial accounts. If someone is trying to breach your account and tries to reset your password, the notifications will generally go to your cell phone or email of record. Make sure the password for your primary email account isn’t used on any other account you have.
It’s also a good idea to check your credit reports regularly to ensure there are no unauthorized accounts opened in your name or other surprises. By law, each of the three major credit bureaus (Equifax, Experian, and TransUnion) are required to give you a free credit report every 12 months if you ask for it.
3. Manage your passwords
Creating strong and unique passwords for each of your accounts can help reduce the risk of your accounts being compromised. Consider a password that’s at least 12 characters long and uses a mix of alphanumeric characters, symbols, and upper- and lower-case letters. In general, avoid using common words and phrases.
Two-factor authentication, where available, requires information in addition to a password to log in to your account. That could be a passcode sent to you by email or text, or your fingerprint or other biometric identification.
4. Keep your computer and mobile devices secure
It can be risky to ignore reminders to make updates to operating systems, browsers, and apps. Developers use these updates, in part, to address security issues, including new vulnerabilities and threats.
Installing antivirus software can detect and quarantine malicious software before it can do harm. Once installed, be sure to update it regularly.
And finally, be cautious when downloading new apps or files, especially from unfamiliar sources. Download only from trusted platforms and check the reviews and ratings before installation.
5. React quickly
If you fall victim to fraud, act quickly. Contact your financial institution immediately to help stop further unauthorized transactions. Immediate reporting can also enable law enforcement agencies to start their investigations promptly, increasing the chances of catching the fraudsters.
You can also initiate a fraud alert or credit freeze on your accounts to make it difficult or impossible to open any new accounts in your name. A fraud alert notifies potential creditors to verify your identity before opening any new accounts in your name, while a credit freeze restricts access to your credit reports.
The FTC accepts complaints about businesses, individuals, and other entities who have possibly committed fraud. When you file a report with the FTC, your experience will be used to identify patterns of fraud and develop strategies to combat them. Reacting quickly not only protects you but also contributes to the larger fight against consumer fraud.
Staying safe
Preventing fraud is always easier than dealing with the financial and emotional fallout it causes. Learning how you can help stop fraud and adopting careful practices can significantly reduce your vulnerability. To reduce your chances of being a victim of fraud, stay vigilant, scrutinize every unusual activity, and never offer personal details to unverified sources.