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Top financial scams of 2024

March 08, 2024 | 3 min read

In this article

  • Phishing & smishing: When scammers copy legit brands or people and send fake emails/texts for info or money.
  • Urgent tricks: They rush with "limited-time" offers or fake alerts to make you act fast.
  • Stay safe: Watch for sketchy emails, check sites, don't click strange links, avoid sharing stuff, use good security.
  • OTP scam & AI fraud: Scammers pretend to be banks, use AI when calling.

From phishing attacks to artificial intelligence (AI) fraud, there are many ways financial scammers can trick you into revealing your sensitive information. By using some practical fraud prevention tips and resources, you can help safeguard your financial well-being. Learn about the top banking scams to watch out for in 2024 and the steps you can take to protect yourself below.

Phishing and smishing

Phishing involves scammers sending fraudulent emails that appear to be from reputable sources like banks or retailers. The goal is to trick individuals into revealing personal information or clicking on malicious links. Smishing, on the other hand, refers to SMS phishing where scammers use text messages or common messaging apps to deceive people. They may ask you to click on a link that leads to a fake website or install malware on your phone.

Scammers target emotions to create a sense of urgency, using messages like urgent bank alert texts, fake brand communications, prize-winning notifications or bogus survey links. They aim to make recipients act quickly, often with "limited-time" offers or alarming messages about their accounts that require immediate action.

Preventing phishing attacks

To mitigate phishing attacks, follow these steps:

  1. Be cautious of unexpected emails or messages requesting sensitive information or containing suspicious links.
  2. Verify the authenticity of websites by checking for secure connections (https://) before entering any personal data. Bonus tip! A secure URL always begins with “https” instead of “http”. The “s” stands for “secure” which means the website is using an extra layer of security.
  3. Avoid clicking on unknown links in emails or messages; instead, manually enter the website address or use trusted bookmarks.
  4. Never share sensitive data like passwords, Social Security numbers or credit card details via email or unfamiliar websites.
  5. Install reputable security software and keep it updated to protect against phishing attempts.

OTP bot scam

An OTP bot scam is a fraud scheme where scammers use fake or malicious OTP (One-Time Password) bots to deceive individuals and steal their personal information. These scams typically occur through messaging platforms or social media channels.

In an OTP bot scam, fraudsters may pose as legitimate service providers or organizations (like your bank) and send you a message that says there’s been suspicious activity on your account and requests you verify your identity by entering a one-time password (OTP). They provide the OTP in the text and a link to what appears to be a legitimate website. If you click the link to the website and enter the OTP, the scammers gain access to your sensitive information such as passwords, two-factor authentication codes, credit card details or other personal data, which they then exploit for various illicit purposes, including identity theft and financial fraud.

AI fraud

AI fraud refers to the use of artificial intelligence technologies by scammers to perpetrate fraudulent activities or deceive people. Two common forms of AI fraud are AI-powered social engineering scams and AI-generated synthetic media.

AI-powered social engineering:  Scammers utilize AI technologies like chatbots to create realistic personas that engage with people online, aiming to manipulate them into sharing sensitive information. For instance, scammers may compromise an individual's friend's social media account and use an AI-powered bot to engage in realistic conversations, eventually convincing the person to share personal information under the guise of an urgent situation or legitimate request.

AI-generated synthetic media:  Fraudsters can use AI algorithms to create realistic synthetic media, such as deepfake videos or audio recordings, for fraudulent purposes. They may imitate the voice of someone the individual knows, seeking to convince them to provide money or sensitive information. To avoid falling victim to AI voice-cloning scams, refrain from answering calls from unknown numbers, never disclose personal data, and don't let callers pressure you into immediate decisions or actions. When in doubt, hang up and contact the person or business directly.

Staying informed about financial scams is essential for safeguarding your financial well-being. These scams not only lead to financial losses but also cause emotional distress. By arming yourself with knowledge, practicing caution and utilizing available fraud prevention resources, you can minimize the risks and protect your finances and emotional well-being in the face of common scams.

To report scams and fraud, visit the  United States Federal Trade Commission website.

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