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Fraud & Security Center for Deposits
- Check Deposit Scams
Banks are reporting customers are falling for a new form of fraud known as a money mule scam. People are recruited through Facebook or social media through what appear to be work-at-home jobs or other opportunities where they are lured as a money transfer agent (middle man). Victims of these scams are told they will receive a check to deposit into their account with instructions on withdrawing the funds and forwarding money to a designated contact person. The victim is told they will receive a percentage of the proceeds as commission.
The checks are then returned typically after the victim has already withdrawn the funds, leaving a negative balance and multiple fees. Most people who fall victim to this scam do not have the funds to cover their negative balance.
Glasford Bank as always, takes great precaution in preventing against schemes such as these but everyone should be aware that fraudsters come up with new schemes each and every day. If it does not feel right, odds are it isn’t! Please alert us to any such potential scams that you may feel are being perpetrated by contacting us as soon as possible 309-389-2551 with as many details as possible. Stay alert and protect yourself!
- Sweetheart Scam
One of the biggest scam we have seen at the bank are scammers taking advantage of people looking for romantic partners, often via dating websites, apps or social media by pretending to be prospective companions. They play on emotional triggers to get you to provide money, gifts or personal details. We have seen a rise in these social engineering type scams also known as catfishing. They start with a simple friend request, wink or swipe and usually end in heartbreak and lost money.
Scammers typically create fake online profiles designed to lure you in with a fictional name or steal the identity of a real person. They pose as military personnel, aid workers or professionals from the United States who are working abroad in countries such as Nigeria.
These romance scammers will express strong emotions for you in a relatively short period of time and may suggest you move the relationship to a private channel, such as phone, email or instant messaging. They will go to great lengths to gain your interest and trust, such as showering you with loving words, sharing ‘personal information’ and even sending you gifts. They may take months to build this romance with you and even pretend to book flights to visit you, but never actually come.
Once they have gained your trust and your defenses are down, they will ask you (either subtly or directly) for money, gifts or your bank account and credit card details. The scammer will pretend to need the money for some sort of personal emergency or to come visit you because they cannot afford the travel costs.
In some cases, you may be asked to cash a check they have sent you, keep a portion of the money for you and mail the rest to someone else. The check they sent then is returned as NSF, the check you sent has been cashed and you are out the money.
Sometimes the scammer will tell you about a large amount items they need to transfer out of the country they are in but they need your money to cover taxes or fees. After you send the money and they leave the country they are in they become detained in another country and ask you to pay their fines or fees. You may even be contacted by a “lawyer” claiming to need money for court costs and legal fees to release them. This will keep going and going without them ever arriving in the states to meet you.
In the end you could lose thousands of dollars all in the name of love. The money you send to scammers is almost always impossible to recover. Be cautious of anyone you meet online and look for these warning signs:
- You meet someone online and after just a few interactions they profess strong feelings for you.
- Their profile on the internet dating website or their Facebook page is not consistent with what they tell you. For example, their profile picture looks different to their description of themselves.
- Their messages are written poorly and they do not speak English well.
- After gaining your trust – often waiting weeks or months– they tell you an elaborate story and ask for money, gifts, your bank account or credit card information.
- If you don’t send money right away, their messages and calls become more desperate, persistent or direct. If you do send money, they continue to ask you to send more.
- They don’t keep their promises and always have an excuse for why they can't travel to meet you and why they always need more money.
If you think you have been scammed block the person on social media and report them to the website, app or social media site where the scammer first approached you. If you have provided your bank account or credit card details, contact your bank or credit card company immediately.
- When Small Charges Can Signal a Big Crime
Most people looking at their bank statements would probably notice if their credit or debit card were used without their approval to purchase a big ticket item, and they would quickly call their bank or card issuer to report the error or fraudulent transaction. But consumers are less likely to be suspicious of very small charges, including those less than a dollar ... which is why criminals like to make them.
Small transactions can be signs that someone has learned your account information and is using it to commit a crime," said Michael Benardo, manager of the FDIC's Cyber Fraud and Financial Crimes Section. "That’s why it’s important to be on the lookout for fraudulent transactions, no matter how small."
He added, "When thieves fraudulently obtain someone else’s credit or debit card information and create a counterfeit card, they might test it out with a small transaction — like buying a pack of gum or a soda — to make sure the counterfeit card works before using it to make a big purchase. If this test goes unnoticed by the true account holder, thieves will use the card to buy something expensive that they want or that they can easily sell for cash."
In one example, the Federal Trade Commission alleged that a group of individuals stole nearly $10 million by making charges to more than a million credit and debit cards that went unnoticed by most of cardholders because the transactions ranged from 20 cents to $10.
Even a small deposit in your checking or savings account that you weren’t expecting could be a sign that criminals have learned your account information and are trying to link your account to theirs so they can fraudulently withdraw money, perhaps your entire balance. Note: Be aware that if you ask to link your accounts at two different financial institutions, such as when setting up automatic transfers for investment or payment purposes, many banks and other payment providers may make test charges or deposits of less than $1 to verify that the proper arrangements have been made.
What can consumers to do protect themselves? Be on the lookout for small transactions you don’t think you’ve conducted or authorized. "The best way to catch this kind of fraud is to regularly and thoroughly review your bank and credit card statements to look for transactions that you didn’t initiate," Benardo said. "If you have online access to your bank and credit card accounts, it is a good idea to check them regularly, perhaps weekly, for suspicious activity."
Immediately contact your bank or credit card issuer if you see a transaction that you didn’t authorize and ask for it to be reversed. Debit card users in particular should promptly report an unauthorized transaction. While federal protections for credit cards cap losses from fraudulent charges at $50, a consumer’s liability limit for a debit card could be up to $500 or more if you don’t notify your bank within two business days after discovering the theft.
Also ask your bank or credit card issuer about additional precautions it could take to prevent fraud on your account. "For a period of time, it might monitor your account more closely for fraudulent transactions," Benardo said. "Or, it may determine that the best course of action is to close your current account and issue you a new card with a new account number."
Article Provided by FDIC, Consumer News. To learn more about how to keep your credit and debit cards safe from fraud, visit FDIC Consumer News.
- How Older Adults Can Steer Clear of Scam Artists
Anyone can be a victim of financial fraud, but older adults are particularly at risk. Among the reasons: Scam artists and thieves know that many senior citizens have accumulated money and other assets throughout the years. Those who commit elder fraud range from loved ones — family members, friends or caregivers — to complete strangers. Here are practical tips on how to protect yourself or someone else:
Remember the red flags of a fraud. Some of the classic warning signs include:
- An unsolicited phone call, e-mail or other request that you pay a large amount of money before receiving the goods or services;
- An unexpected e-mail or call requesting your bank account number, perhaps one asking you for the information printed at the bottom of one of your checks;
- An offer that seems too good to be true, like an investment “guaranteeing” a return that’s way above the competition;
- Someone expressing a new or unusual interest in your finances;
- Pressure to send funds quickly by wire transfer or
- The other party insists on secrecy.
Research a new financial advisor before investing money or paying for services. Though the vast majority of brokers, financial planners and other professionals are honest and reputable, some commit fraud. Before committing to working with a financial advisor, confirm that he or she is properly registered or licensed and has a clean record.
Be careful who you give the legal authority to access or manage your money. One way older adults prepare for the possible future need to have someone else make financial decisions and transact business for them is by having a legal document called a power of attorney (POA). An attorney can help you decide the right type of POA for your needs. “Only give POA authority to someone you trust and who understands your wishes and preferences,” suggested Luke W. Reynolds, Chief of the FDIC’s Outreach and Program Development Section. “Also consider adding oversight, such as by requiring two people you trust to agree on decisions within a reasonable time frame or having a third party review transactions that have been made.”
If you decide to use a POA, contact your bank and other financial institutions to confirm they will accept the document you plan to use. They may have their own form and require that customers use that.
Protect your personal information. Never provide Social Security numbers, bank account information, PINs, passwords and other sensitive information in response to an unsolicited call, fax, letter, e-mail or text message, no matter how genuine the situation may appear.
Sign up for direct deposit. “Direct deposit into your bank account is the fastest and safest way to receive money or other payments, such as your pension or an income tax refund,” Reynolds said.
Noting a recent scam that has resulted in thefts of benefit payments, Reynolds added, “Check to make sure the full deposit you are entitled to arrives in your bank account when you expect it. An unexpected letter from the Social Security Administration or another agency indicating your direct deposit information has been changed is a sign of fraud, and you should independently look up that organization’s contact information and notify it immediately.”
Closely monitor credit card bills and bank statements. Look at your statements as soon as they arrive and report unauthorized purchases, withdrawals or anything suspicious, regardless of how small or large the dollar amount.
Immediately report a fraud or theft to someone you trust as well as the proper authorities. Many older people make the mistake of not telling loved ones or not contacting the police or other law enforcement agencies when they’ve been victimized. Perhaps some are embarrassed to admit that they were “misled” and lost money. Others have fears of losing their independence. “As difficult as this may be, reporting the incident is the only opportunity you have to recover some or all of your loss,” suggested Irma Matias, an FDIC Community Affairs Specialist. “By telling your story you also could prevent the perpetrators from taking advantage of others.”
Learn more about common frauds and how to respond to them visit FDIC Consumer News at www.fdic.gov/consumernews.
- Protecting Your Plastic from High-Tech Criminals
While many consumers still like to use paper money and coins, more and more people are pulling out credit or debit cards to make purchases. And, as the popularity of payment cards has grown, so has the number of criminals trying to steal very valuable details, including the cardholder’s name and the card’s account number and expiration date, which are printed on the card itself as well as encoded (for machine readability) in the magnetic stripe or a computer chip.
“No matter how your card information is stored, it is in high demand by criminals who would like to retrieve that data to create a counterfeit version of your card or use the information to make purchases online or over the phone,” said Michael Benardo, manager of the FDIC’s Cyber Fraud and Financial Crimes Section.
If you’re ever the victim or target of credit or debit card theft or fraud, catching it fast and reporting it to your card issuer are key to resolving the situation. And while federal laws and industry practices protect consumers in these situations, there are important differences depending on the type of card.
In general, under the Truth in Lending Act, your cap for liability for unauthorized charges on a credit card is $50. But under the Electronic Fund Transfer Act, if your debit card or ATM card is lost or stolen or you notice an unauthorized purchase or other transfer using your checking or savings account, your maximum liability is limited to $50 only if you notify your bank within two business days. If you wait more than two business days, your debit/ATM card losses under the law could go up to $500, or perhaps much more. With either card, though, industry practices may further limit your losses, so check with your card issuer.
What else can you do to keep thieves away from your cards…and your money?
Never give out your payment card numbers in response to an unsolicited e-mail, text message or phone call, no matter who the source supposedly is. An “urgent” e-mail or phone call appearing to be from a well-known organization is likely a scam attempting to trick you into divulging your card information. It’s called “phishing,” a high-tech variation of the concept of “fishing” for account information. If they get confidential details, the criminals can use the information to make counterfeit cards and run up charges on your accounts.
Take precautions at the checkout counter, ATM and gas pump. “Be on the lookout for credit and debit card reading devices that look suspicious, such as a plastic sleeve inside a card slot,” Benardo said. “Crooks are getting very good at attaching their own devices over legitimate card readers and gathering account information from the cards that consumers swipe through those readers.”
Also be alert when you hand your payment card to an employee at a restaurant or retail establishment. For example, if he or she swipes your card through two devices instead of one, that second device could be recording your account information to make a fraudulent card. Report that situation to a manager and your card issuer.
To help combat payment card fraud, many card issuers have turned to the technology known as radio frequency identification (RFID). This uses wireless radio signals to identify people or objects from a distance. It is also being used with items such as highway toll passes, subway fare cards and pay-at-the-pump cards to add convenience and speed up many routine transactions. While some news reports indicate that payment cards with RFID chips may be more vulnerable to fraud than traditional cards with magnetic stripes on the back, Benardo said that’s not the case.
“Today an RFID card is nearly impossible to breach because the chip in it creates an encrypted signal that is extremely difficult to hack or compromise,” he said. “If you have questions or concerns about a payment card that is RFID-enabled, ask your bank about the precautions it takes to safeguard your card information.”
Closely monitor your bank statements and credit card bills. “Look at your account statements as soon as they arrive in your mailbox or electronic inbox and report a discrepancy or anything suspicious, such as an unauthorized withdrawal,” advised FDIC attorney Richard M. Schwartz. “While federal and state laws limit your losses if you’re a victim of fraud or theft, your protections may be stronger the quicker you report the problem.” These days, it’s also easy to monitor your accounts using online banking or even your mobile phone.
Also, don’t assume that a small unauthorized transaction isn’t worth reporting to your bank. Some thieves are making low-dollar withdrawals or charges in hopes those will go unnoticed by the account holders. In one recent example, a federal court temporarily halted an operation that allegedly debited hundreds of thousands of consumers’ bank accounts and billed their credit cards for more than $25 million—in small charges— without their consent.
And, contact your institution if your bank statement or credit card bill doesn’t arrive when you normally expect it because that could be a sign that an identity thief has stolen your mail and/or account information to commit fraud in your name.
Periodically review your credit reports for warning signs of fraudulent activity. Credit reports, which are prepared by companies called credit bureaus (or consumer reporting agencies), summarize a consumer’s history of paying debts and other bills. But if a credit report shows a credit card, loan or lease you never signed up for, this could indicate you are a victim of ID theft.
You are entitled to at least one free credit report every 12 months from each of the nation’s three major credit bureaus. To maximize your protection against fraud, some experts suggest spreading out your requests throughout the year, such as by getting one free report every four months instead of all three at the same time. To request your free report, go to www.AnnualCreditReport.com or call toll-free 1-877-322-8228.
Article provided by: FDIC Consumer News. Visit www.fdic.gov/consumernews for more information.