The material presented here is for educational purposes only, and is not intended to be used as financial, investment, or legal advice.
Mail Fraud: What to Know After Opening a Letter
We’re continuing our fraud prevention series with information on how to avoid becoming a victim of mail fraud. Letters can easily look legitimate with a fancy letterhead, bank logo and personal information listed. With that in mind, we encourage you learn about the types of letter scams that exist so you can spot fake letter. For your protection, we also provide do’s and don’ts, tips to protect yourself and what to look out for.
Response-Required Bank Notification
Scammers send a letter urgently alerting the recipient that unless they provide personal information (like a date of birth) that’s missing, incomplete or inaccurate, the financial institution will restrict or close accounts.
What You Should Do
- Don’t ignore little things that seem odd, like a return envelope that required postage and wasn’t self-addressed.
- First call your credit union using the phone numbers on their website, for example, instead of the number listed on the letter. Never reveal personal information before verifying that the letter sent was or wasn’t fraudulent.
- Always question any letter requests that demand personal information ASAP, threaten to close accounts or emphasize how time sensitive this “important matter” is.
Mortgage Payment Transfer Update
A written update is mailed to notify homeowners that a company has assumed loan management and requests sending payments to this new mortgage servicer. After sending payments to the fictitious company/scammer, homeowners are late on their real payments, lost money, got dinged on their credit score and could potentially face foreclosure.
Fraud Prevention Tips
- Know that your current financial institution will first notify you by letter that your mortgage has been transferred to a new loan servicing company. Then you can expect a follow-up letter from the new servicer that includes specific details about the transfer and change in payments.
- A letter missing your loan number is a major red flag.
- For confirmation, it’s best practice to contact your original lender anytime you receive a notification that your mortgage has been sold to a new lender.
It’s hard to decipher fake letters from legitimate ones from the IRS because the IRS does officially communicate issues with taxpayers via letters. That’s why scammers seek out to confuse you by sending fake letters that may:
- Threaten a lien or levy because you owe funds to a fake, nonexistent agency
- Issue a warrant due to unpaid tax obligations
- Warn you could be arrested or deported for not paying immediately
Learn more about what a fraudulent attempt looks like in detail from the U.S. Department of Treasury.
- An IRS seal on the letter sealed in a government envelope
- A notice or letter number in the top right-hand corner
- Your truncated tax ID number and tax year/years in question
- IRS contact information (typically a 1-800 number)
- Information about your rights as a taxpayer
- Payment options and how to pay a balance
A letter arrives informing you that you can claim a large inheritance from a deceased wealthy benefactor who doesn’t have a will/beneficiaries, or from a distant relative. Because of purported government, tax or banking regulations, the scammer will demand personal information and payment for fees, like bank account details, in order for you to access the fortune. To make the scam convincing, you may be asked to sign fake legal documents and speak with an imposter lawyer, banker or tax official to help facilitate the transaction’s legalities and finances.
To Protect Yourself, Never
- Provide documents with personal information, bank account details or credit card numbers
- Pay fees or charges, especially though a money order, wire transfer or gift card
- Act quickly; anytime you’re offered a large sum of money, there’s a high probability that it’s a get-rich scheme
“You Won” Mail
Congratulations! It’s your lucky day! With this scam, a con artist says that you’ve won a cash prize, vacation sweepstakes or lottery. The catch is that to claim the prize, you must deposit money upfront.
- Legitimate sweepstakes are free. It’s illegal to ask for some kind of payment to participate in a contest or redeem a prize.
- It’s legally required for telemarketers to provide disclaimers, terms and conditions for accepting the winnings.
- As always, never send payment for “taxes” or “processing fees” and never give away any personal financial information.
- It’s most likely a scam if you never entered to win or if it’s a foreign contest.
Now that you’ve learned about mail scams, you can prevent fraud from happening to you! So next time you open a bank, mortgage, IRS, inheritance or sweepstakes letter, take few moments to look for anything unusual and verify the legitimacy of the letter by getting confirmation from the right contact.