How to protect yourself from financial phone scams

Financial scams are a tale as old as time, but as technology evolves, the methods scammers use to steal personal information and commit fraud have evolved with it. If you bank online, knowing how to spot a potential scam and how to protect yourself is more important than ever. Thankfully, it’s entirely possible to protect yourself by taking some precautions. Here’s how you can protect yourself from financial phone scams.

What is a financial phone scam?

While scams exist in all varieties, financial scams are some of the most nefarious. With more and more people banking online, the opportunity and risk for scammers are higher than ever. A scammer no longer has to impersonate your identity at a physical bank branch; they simply need your login information and a few other personal details to wreak havoc on your finances.

To obtain this information, scammers will contact potential victims, impersonating their credit union/bank member care center asking to give up their personal information. This could happen over a call, text or through a malicious link. Knowing how to spot and tell the difference between a legitimate contact attempt and a scam is the most valuable skill to learn in avoiding these scams.

The warning signs of a potential scam

You are asked to share personal information

If you receive a call or text asking you to share security or login info, do not comply with the request without confirming the identity of the person who contacted you. Alliant (and many other financial institutions) will not call or text you to ask for this information under any circumstances. Likewise, we never ask for a member’s entire Social Security Number, only the last four digits, to verify identity during interactions the member initiated by contacting us first.

One common emerging scam is the two-factor authentication (2FA) scam. If you have 2FA enabled to log in to your accounts, scammers can only gain access with the second authentication factor (such as confirming a login via a code to your phone or email). Like other login information, you should never share this code with anyone.

If someone calls and asks you for any of this information, it’s best to hang up and call the financial institution the caller claimed to be from directly. Then, you can verify whether they truly did contact you or not. Keep in mind that scammers can spoof any number they want using free software, so simply comparing their number to the official contact number isn’t enough. Looking up the phone number through an institution’s official website (not a text or email you received) will ensure you contact the correct source.

You receive a suspicious link

Fake links in text messages and emails are among the top ways scammers attempt to get your personal information. It’s a good practice to always be cautious before clicking on a link. Here are ways to help distinguish whether a link is legitimate.

Spelling errors or typos

Scammers will often create fake websites that look similar to the actual website they claim to be. Since every URL is unique, they can’t use the same URL as the actual site. To get around this, these fake websites often have a URL that has a minor typo in it that is very easy to miss. For example, alliantcreditunion.org might become aliantcreditunion.org. Did you catch the difference?

Be extra cautious of short URLs

While short URLs can be a useful tool, they can also be an easy opportunity to sneak a scam past you. A short URL hides the true destination of a link so scammers can pretend they’re something they’re not. If you see a short URL, it’s a good idea to check where it leads. URL shorteners each have their way of previewing the full URL. For example, you can preview bit.ly URLs by adding a “+” at the end of the shortened URL. You can also use a URL checker, such as unshorten.it, to check a short URL’s legitimacy.

You’re asked to wire money

Wire transfers have plenty of legitimate purposes but are also commonly used by scammers. It’s a good idea to be skeptical of any requests to initiate a wire transfer until you’ve confirmed the identity of whoever is making the request. Unfortunately, after you complete a wire transfer, there is no way for any financial institution to guarantee the recovery of money.

What to do first if you’ve fallen victim to a financial scam

While we hope this never happens, many people will become victims of a financial phone scam. If you find yourself in this situation, take these crucial steps immediately to prevent further damage from being done. Please note that this is not a comprehensive list, and additional action may be needed depending on the situation.

Report the scam right away

Financial institutions take fraud and identity theft seriously and are always looking for suspicious activity. However, being proactive and contacting your financial institution immediately if you suspect suspicious behavior may inform them of the situation sooner and allow them to take swift action to protect your accounts and information.

It’s also strongly recommended to submit a police report, as this will help you if a credit bureau or financial institution needs to investigate the situation. This step also helps law enforcement agencies educate others and remove scammers.

Carefully monitor your accounts for suspicious activity

It’s impossible to know precisely when scammers will use the information they stole from you. While taking the previous steps will hopefully stop your accounts from being used maliciously, you should keep a close eye on them in case unauthorized activity occurs. Catching issues early on dramatically increases your chances of having the damage undone.

Gather any documents you may have of the financial scam

In the case your account is stolen, evidence is vital. Be sure to screenshot any written conversation with the scammer, any documentation showing transactions related to the crime (such as bank statements), and any action you’ve taken through the reporting process.

Change your login information

If a scammer gains access to your account or personal information, you should assume your accounts are all compromised. If you’ve contacted your financial institutions, they may have already required you to change your username and password. Otherwise, you should go and change these for yourself. Remember to use a strong password that combines upper and lowercase letters, numbers and special characters.

Knowing people are out there who are trying to steal your financial information can be nerve-wracking, but with these steps, you can feel in control and prepared to protect yourself from financial phone scams. And always remember, most financial institutions, Alliant especially, will not contact you under any circumstances for your private information.

Want more security tips? Check out these articles:

What victims of fraud should do first

8 things to do now to make your accounts more secure

Learn how to avoid phishing email or text scams

Ben Heinze is a marketing content specialist with a passion for financial education. Instilled with a strong sense of frugality from a young age, he views money as a means to building the life you want, rather than an end in itself. From reading Money Mentor, he hopes you discover new ways money can be used to build your ideal life - whatever that may look like.