Financial Education 101: Avoid Online Scams

Financial Education 101: Avoid Online Scams

Online scams have been prevalent since the dawn of the internet age. In 2021 alone, more than 2.8 million Americans fell victim to fraud tactics such as imposter and online shopping scams, fake prizes, sweepstakes, lotteries, hoax internet services, and sketchy business and job opportunities.

While scammers operate all year round, some become more active during certain times, such as Black Friday, back-to-school sales, and Chinese New Year. Scammers even took the COVID-19 pandemic as an opportunity to offer fake home protection products, government grants, credit applications, and investment opportunities.

While you cannot control how scammers do their business, you can protect yourself from becoming their next victim.


How to Distinguish Scams

Learning about scammers’ tactics is vital to avoid them. Here are common scamming methods you should watch out for.


  1. They pretend to be someone of authority or someone you know

    Scammers often pretend to be someone from the government, bank, online payment websites or apps, or an organization you are part of to extort information or money. They use special tools to create a fake e-mail address or phone number to run their scheme.

    Some scammers would even hack your social media account or the account of someone you know to post malicious content, blackmail people for money, and more.

  2. They claim there are problems with your account

    Using a fake e-mail address or phone number, scammers would then claim problems with your bank account or payment information. Others would also say they have noticed suspicious activity or login attempts in your accounts.

    They would make you click on a link to resolve the issues or ask for your personal information to verify your identity.

  3. They pressure you to provide specific information

    Scammers would make limited offers or pretend your bank account or service subscription is in trouble to pressure you into giving you personal information. They would use your data to drain your bank account, take out loans, hack your social media accounts, or resume their schemes pretending to be you.

    Remember that genuine product or service offers do not require your immediate response. Moreover, banks would not call to ask for personal information. They would only do so if you inquire about and avail of their products and services.

  4. They ask for wire transfers

    While convenient, wire transfers are nearly irreversible. You cannot get your money back unless the receiver agrees to resend it. You would have to call your bank to recall or cancel the transfer, which would require at least two to four business days to process.

    Scammers ask for wire transfers for this reason. They will pretend to be someone you know or part of the government or your company to ask for money.

  5. They make offers that are too good to be true

    Scammers know that financially strained people would fall for attractive offers such as sweepstakes winnings, all-expenses-paid trips, tax refunds, and contest prizes. As such, they would pretend to market these offers via e-mail or phone to extort information or money from you.

    Some scammers would even offer business opportunities that require small initial payments. They know that once you have your foot in the door, you will have difficulty getting out of it.


How to Protect Yourself From Scams

Prevention is always better than cure regarding data privacy and cybersecurity. Here are six ways you can protect yourself from scammers.

  1. Back up your data

    Backing up data is one of the safest and most basic ways to protect yourself from scammers. The kinds of data you should back include:

    • Documents, music, pictures, and other personal files on your computer
    • Internet browser bookmarks
    • E-mails
    • Apps and programs

Back up your data in external hard drives or the cloud at least once a day if you update them regularly. You can also schedule backups If you cannot do them manually.

  1. Strengthen your passwords

    Scammers can easily obtain your password if it is too short or predictable. As such, add uppercase letters, unique characters, and numbers to your password to strengthen it. The longer and more random the character combination, the better.

    Avoid using the same password across multiple accounts, especially on sensitive sites such as online banking and shopping apps. Recycling passwords makes it easier for hackers to access your bank and social media accounts. Additionally, change your passwords every few months to secure your accounts and data.

    Lastly, use multifactor authentication (MFA) methods such as one-time passwords, face recognition, security badges, and other types of MFA across your devices to secure your accounts and data.

  2. Secure your devices

    Install firewalls and anti-spam and anti-spyware software on your computer to block cyber-attacks, phishing e-mails, and other scams. Regularly update these programs to ensure they work efficiently.

    Smartphones are also prone to malware attacks due to malicious apps, e-mail attachments, and text messages. Only download apps from official app stores to prevent your phone from being infected. Install antivirus and anti-malware apps, enable “USB restricted mode” when charging your phone in public, and auto-erase your passwords to further protect your device from hackers.

  3. Avoid clicking suspicious links or attachments

    Avoid immediately clicking links in random chats, e-mails, or text messages, as they could give scammers access to your device and data. Watch out for e-mail attachments with “.exe,” “.vbs,” or “.scr” at the end of the file name, as clicking them may activate malicious programs and viruses.

    Check the sender’s e-mail address to verify the legitimacy of the e-mail. It is likely a scam if the sender’s e-mail address is spelled differently from the address of the organization or person they are impersonating. Be wary of e-mail addresses that contain a random combination of letters and numbers.

    You can also call the company or person the e-mail is supposedly from to confirm. Check for contact information on their website or social media, as the details attached to the e-mail could be from the scammer.

  4. Avoid accessing banking apps using public WiFi

    Do not access social networking, online banking, and shopping websites using public WiFi networks, as they are typically insecure and vulnerable to hacking. However, if you need internet access while in a coffee shop, mall, or airport, use a virtual private network (VPN) to encrypt your data.

    Ask the establishment’s staff for the legitimate credentials of their WiFi network to ensure you do not use bogus networks. You could also use your mobile phone’s data instead of public WiFi if you need to access sensitive sites.

  5. Review privacy and security settings on social media

    Social media sites like Facebook now have advanced privacy and security settings to protect users from hackers. For instance, you can enable login alerts and two-factor authentication on Facebook to ensure only you have access to your account. You can also control who can find and add you on the site to prevent cyber criminals from approaching you.

    Tweak your social media settings to your security preferences to secure your account from hackers. Avoid sharing sensitive information online; malicious actors can use it to commit fraud.

You Deserve a Safe Space Online

Scammers are getting more innovative and more unpredictable daily. While you cannot control their motives, you can at least protect yourself with the tips above. Learning about scams and the measures to prevent them is the key to securing your data and money in the long run.

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