Just in the past week, two friends notified me they had been party to a money scam or potential money-related email hack. Going back further in time, there are numerous instances where a client or friend has made it known they were, regrettably, on the losing side of a money-related scam.
Look no further than this week’s news on a larger scale: due to recent, repeated money-request scams via the online payments network Zelle, major banks and financial institutions including JP Morgan, Bank of America, Capital One, and PNC Financial announced talks to reimburse scammed Zelle customers (Zelle is an online payments network in which various major banks participate).
All of these events prove that money-related scams are no longer isolated incidents.
One of the most typical scams (and one that happened last week to a friend) involves a regular person, like you or me, receiving an email or a phone call – in this case a phone call – from a fraudster posing as a friend or “authorized person.” The (fake) situation involves either someone in desperate need or an urgent situation needing cash immediately.
Email hacks and scams are even more frequent and can be slightly easier than phone calls to detect due to grammar, punctuation, or spelling errors – but very difficult not to respond to!
Unfortunately, fraudsters have advanced to phone calls demanding that gift cards be purchased immediately and then sent or delivered immediately to a specific place. In last week’s situation, the scammer on the phone said he was about to “transfer the call to [my friend’s] bank” (!) which was entirely untrue upon my friend immediately hanging up and contacting the real bank after hours.
Even intelligent people can accidentally find themselves in the midst of these gift card scams or urgent calls for money from what seems to be the IRS, the FTC (Federal Trade Commission), or Social Security. (The US Social Security Administration says they will never call asking for a wire transfer or gift cards.*)
Scam artists probably always will exist – for example, the founder of the now bankrupt FTX cryptocurrency exchange. Even one of the world’s largest money management firms, BlackRock, was scammed by the FTX guy.
We have become programmed to respond immediately to emails – and even scary, urgent phone calls especially those that appear to be from friends, family, or work colleagues. Terse emails and stern voices, both fake and real, are easy to respond to instantly. Be aware and be cautious!
Basic advice:
- Easier said than done, question ALL urgent requests for money even from close friends or family.
- Especially in the flurry of the Christmas and holiday season, Beware. In 10 seconds, an abrupt response to a fake email or fake urgent gift card situation can turn into an expensive and non-reimbursable mistake, or worse.
- Even the most truly urgent situations can almost always be addressed after hanging up immediately and making one or more verification phone calls to separately question the urgency of the matter.