Summary
Learn how to spot and avoid online scams, including imposter scams, investment scams, phishing, vishing and smishing. Lisa Schifferle from the Consumer Financial Protection Bureau joins Sean to discuss the alarming scale of scamming in America. The Federal Trade Commission says it received 2.6 million fraud reports in 2023. Scammers try to convince you that they are someone trustworthy. They pretend to be the bank, the credit card company, the insurance company, and the IRS. Sara Pyles: "I already don't trust Amazon, so there's no way I'm going to click a random link in a text that they send me" "I assume that you've experienced this as well. Scamming is a huge industry and this is an international issue" Smart Money talks to David Pyles about his experience with a Bitcoin scam. Pyles says he was approached by a woman on Facebook asking for money. Pyle says he didn't know it was a scam until he started chatting with the woman. This woman messaged you and said, "Hey, maybe there's a way to make some money" She was offering an easy way to get access to the money you can get from a cryptocurrency. She was very slick on how she went about it. What I've since found after doing some research on this is that pretty much almost any mining opportunity that you run into is a scam. And that's where I found out that there were problems. Everything's great until you try to remove money. At first, it seemed really cool, and it's like, I'm making a lot of money on this. At which point you get that dawning realization, oh crap. I lost $180,000, $200,000 on that scam alone. This was almost brilliant. I hate to give them that kind of credit, but. I didn't buy into it, but if we're going to live our dreams, then we have to make a lot of money. The father of two was scammed out of $481,000. He says he learned two lessons from the experience. Don't invest with people you only know from the internet. Sean's story might seem extreme, but it is important to reiterate that it's not unique. Even if you aren't exposed to the cryptocurrency world, there are so many other ways that scammers can get to you. There are 5.2 million reports to Consumer Sentinel in 2022, and about 26% of those reported a loss. While fraud reports overall were down slightly, the dollar loss continued to rise. People reported losing nearly $8.8 billion to fraud in 2022. Technology is one of the main tools for scammers, especially in investment scams and luring people in. Scammers are increasingly using cryptocurrency and also social media as tools. It used to be by gift cards, wire transfer, but cryptocurrency is increasing. No one thinks that they're going to fall for a scam, but like you mentioned earlier, everyone is vulnerable to them. I'd like to hear what sort of mindset people should have to best protect themselves from these ever sophisticated scams. Many people think scams mostly affect older adults, but reports to the FTC's Consumer Sentinel actually tell a very different story, which is that anyone can be scammed. People in their 20s reported losing money to fraud in 43% of reports, while people in their 70s reported lost money in only about 23%. An imposter scam is where the scammer pretends to be someone who they are not. An investment scam is when someone is trying to get you to invest or put money into something. Don't click on any links in unsolicited texts or emails. They can download malware and lead you to scam sites. Funny words that have very unfunny consequences. What are among the most common forms of smishing that you're familiar with? We've heard a lot of increase of that wrong number type of text. There's another type of scam that has a name that's more gruesome than funny. If you've paid a scammer, it's important to contact your financial institution or wire transfer company. If you paid by gift card, contact a gift card company right away. Then it'simportant to report the scams to reportfraud.ftc.gov. Lisa Schifferle: People need to exercise vigilance to avoid falling victim to a scam. She says talking about scams is really important. If you hear about a scam in your area, warn other people because you may know about scams. I think the wisest move for people is to be skeptical of any inbound communication. Double and triple check anyone that you're going to send money to and talk with your loved ones about the scams that you’re seeing. This episode was produced by Tess Vigeland. We are not financial or investment advisors. This Nerdy info is provided for general educational and entertainment purposes.
