It’s times like these that excite scammers.
Stock market indexes are down, and you worry your investment account won’t return what you need to live a financially peaceful retirement.
Not to worry. Criminal enterprises are ready to persuade you that they have a guaranteed way for you to invest and earn big money without any risk.
Rising inflation makes con artists jump for joy because they know frightened investors are more likely to fall for scams involving gold, cryptocurrencies, foreign currencies or fake investment opportunities.
Anxious about rising oil prices?
You don’t need to answer that, because swindlers know you are. And they will — if they haven’t already — call or contact you via your social media accounts. They will send you emails or text messages about where to find cheaper gas prices, or how to invest to take advantage of rising prices at the pump.
Data from the Federal Trade Commission shows that consumers reported fraud losses of more than $5.8 billion in 2021, an increase of more than 70 percent from a year earlier.
For one week of every year — it’s March 6 to 12 this year — state, federal and local law enforcement agencies and consumer groups focus heavily on fraud as part of National Consumer Protection Week. They plan talks, webinars and blog posts with warnings and tips on how to avoid scams.
It’s a valiant effort to save folks from fraudsters, but it’s like killing cockroaches. The criminals, often with evolving scripts shaped by current events, are nearly impossible to eradicate, because they’ve found a suitable environment to thrive — social media platforms.
Recently, a scammer created an Instagram account to impersonate me. (It’s since been deleted.) Some of my friends were sent private messages that started with, “How are you doing.”
When a friend responded asking how I was doing, she received this message: “I’m doing fine as well and extremely happy really busy online looking for a project to invest my Melinda gate Grant Money on. I wonder if you have heard about the news yet?”
She wasn’t 100 percent sure the message was authentic, so she sent me an email. Had she not blocked the account, the request for money would have followed. The fake account meant I had to post a warning on Instagram.
The Identity Theft Resource Center said it’s seen a sharp increase in Instagram account takeovers. In some cases, people are locked out of their Instagram account, which allows the criminals to post links to bogus bitcoin investments. They then boast about the money they’ve made investing in bitcoin, luring people into the scam.
I can easily see how people fall for many of these scams. They believe they are communicating with someone they trust.
The financial losses where contact was made through a social media platform are staggering and rising. People reported losing $796 million to fraud initiated on social media in 2021, according to the FTC. That’s up from $257 million in 2020. Victims said the con started with a message, post or ad.
“Reports make clear that social media is a tool for scammers in investment scams, particularly those involving bogus cryptocurrency investments,” the FTC said, noting that the platforms have seen a massive surge in consumer complaints.
The FTC has great resources to help you avoid being victimized. Go to ftc.gov and subscribe to consumer alerts, or search for “National Consumer Protection Week” to find upcoming events on Twitter and Facebook. You’ll find information on how to report a scam or file a complaint at nasaa.org, the site for the North American Securities Administrators Association, which represents state and provincial securities regulators in the United States, Canada and Mexico.
I teach a monthly financial workshop at my church. For the rest of this year, each time we meet, I’m highlighting various scams. I’m concerned about the many people who will be taken in by charlatans capitalizing on the crisis in Ukraine. The losses for some can be financially devastating. Things are so bad that we all have to make it a habit to talk about, post and warn our family and friends. This is going to take a village.
It’s not enough to say, “If it looks too good to be true, it probably is,” when the pitch appears to be from someone a person trusts.
If you get a direct message and the greeting is general, such as “How are you?” or something similar, suspect it right away. And please never send money to anyone who reaches out to you via social media, even if it appears to be a desperate friend or family member. Scammers can easily steal a photo and bio information and create a fake account. They can hijack a person’s email account so it looks real. They can steal just enough personal information to make their con appear legit.
If you want to help Ukrainians, take the time to check out a charitable appeal.
To avoid a scam using the conflict in Ukraine or any other current event, start with the premise that every direct message, link, email or text is fake and work from there. This should be your default response to any contact you did not initiate.
Trust nothing. Verify everything.
Paranoia is your protection from losing your hard-earned money.