Experts Explained How To Spot a Scam Like I’m 12 — Here’s What I Learned
Written by
J. Arky
Edited by
Rebekah Evans
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In the modern era, personal finance scams come in all shapes and sizes, some in remaining old fashion by way of being in person while the majority have migrated to online. For those growing up in the digital age and even some who were alive prior to the internet, identifying the difference between a financial offer with legitimate and fraudulent attributes can be a difficult task.
GOBankingRates reached out to some experts in the money protection space and asked them to explain how to spot a scam as if describing it to a 12-year-old child — below is what they offered.
The Rushing Red Flag
According to Danai Antoniou, former fraud expert at the U.K. challenger bank Monzo and current co-founder and chief scientist at Gradient Labs, scammers love to tell you to that a transaction or offer must be completed as soon as possible, such as transfer money, provide a code or give personal information.
“They purposely put pressure on you to get scared and do not have time to think,” Antoniou said. “However, real banks and companies never ask you to make a decision ‘right now.’ If you’re ever in doubt, hang up and contact your bank yourself.”
Lynette Owens, vice president of global consumer education and marketing at Trend Micro added that scammers often employ high-pressure tactics, creating a false sense of urgency to push you into making hasty decisions.
“You may receive messages involving compromised accounts, owing money to the IRS or notices that a loved one is in trouble,” Owens explained. “They might impersonate trusted entities, such as government agencies or well-known companies, to lend credibility to their demands.”
The ‘Too Amazing’ Test
In Antoniou’s professional experience, if you are being told you won something even though you have not participated in anything and offers you an expensive item almost for free, it’s most likely a trap to take your money as opposed to rewarding you with more.
“Scammers deliberately make such ‘tempting offers’ to get you to click on a link or send them your personal information,” Antoniou explained, urging consumers to ask themselves: does that kind of thing even happen in real life? Because if it sounds too good to be true, it is probably a fake.
Payment With Gift Cards and Cryptocurrency
As the internet gets bigger and bigger and the way we pay for things evolves, one important rule of thumb to remember, per Owens’ advice, is that legitimate organizations will never demand payments in gift cards or cryptocurrency.
Owens outlined that if you are being asked to go to a store, buy cards and read them the codes over the phone or to transfer crypto to a wallet they control, it’s almost certainly a scam.
“The best advice is to hang up, stop texting and call the real organization directly using a phone number from their official website to confirm your communications,” Owens said, adding that anyone who has been targeted should report it to the FTC (Federal Trade Commission).
Small Test Charges Alert
Antoniou cautioned that we should all be frequently checking to see if strange small card payments and transactions are happening in our accounts.
“Scammers often make small ‘test’ charges first, like less than one dollar, to see if the card works before stealing more,” Antoniou added. “If you notice suspicious small spending that you don’t recognize, call a bank right away. This could be the first sign that your information has been stolen.”
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