Most fraud succeeds by rushing someone into moving money before they've had time to think it through. A caller or message creates a sudden emergency and asks you to act right away. As I often remind clients, the worst time to make an important decision is when we are at our most emotional. Scammers count on that reaction, using fear or urgency to push us toward a decision before we have time to slow down and verify what is happening. The good news is that a few simple steps, set up ahead of time, can help protect you from the most common schemes. Here are the steps I share with clients, along with a free guide you can download and keep on hand.
4 Steps That Make the Biggest Difference
1. Use a Password Manager
A password manager creates a different long password for every account and remembers each one for you, so you only have to know one master password. This helps when a website or retailer has a data breach, since criminals often try stolen passwords on banking and email sites. With a unique password for each account, a breach at one company is more likely to stay limited to that one account. Many phones and web browsers include a built-in password manager, and standalone apps are also widely available.
2. Turn On Two-Step Sign-In
Two-step sign-in, also called two-factor or multifactor authentication, asks for a second confirmation after you enter your password. It helps protect your account even if your password is stolen. An authenticator app on your phone offers more protection than a code sent by text message, since a criminal who takes over your phone number can receive your texts. Start with your email account, because password reset links for your other accounts are sent there, and then add two-step sign-in to each of your financial accounts.
3. Freeze Your Credit
A credit freeze restricts access to your credit report, which makes it much harder for anyone to open a new card or loan in your name. It's free and leaves your credit score unchanged. Your existing cards and loans continue to work as usual. You'll place a freeze separately with each of the major credit bureaus, and when you apply for new credit, you can lift it online or by phone within an hour. Ask for a freeze by name, since similar-sounding credit locks may come with monthly fees. Parents can also freeze credit for children under 16.
4. Agree on a Family Code Word
Criminals can now use short audio clips to imitate a loved one's voice and call with an urgent request for money. The FBI recommends a secret word or phrase that family members can use to confirm who they're talking to. Pick a word that only your family knows and share it in person. If a call says a relative needs money right away, ask for the word before you do anything else.
A Request to Move Money to Keep It Safe Is a Sign of Fraud
Scammers often pose as your bank's fraud department, a government agency, a well-known company or even law enforcement. Caller ID can be faked, so a call that appears to come from your bank may still be a scam. The caller may say your accounts are at risk and ask you to protect your savings with a wire, cryptocurrency, gift cards, gold or cash handed to a courier. Your bank has its own tools to help protect your money in the accounts where it already sits, so treat any request like this as a signal to stop. If you hear one, it's entirely appropriate to end the call and contact your bank directly using the number on the back of your card or on a recent statement.
4 Signs to Stop and Think
When you notice any of these signs, pause and check before you act. Emotions tend to favor speed over accuracy, which is exactly why urgency is such an effective tool for scammers. Giving yourself time to verify the situation can help you make a better decision.
1. Sudden Urgency
Be cautious of any situation that appears suddenly and has to be settled right now, such as a message saying your account will close today or a call about a relative who needs bail money tonight.
2. An Unusual Way to Pay
Requests for gift cards, cryptocurrency, gold, cash at the door or a wire to an unfamiliar account are all warning signs. Legitimate businesses and government agencies bill through ordinary channels, such as a mailed statement or your usual online account.
3. A Request for Secrecy
A request to keep something from your spouse, your children, your advisor or your bank is a warning sign. Scammers sometimes even coach people on what to tell a bank teller about a large withdrawal. When anyone asks for secrecy, bring the people closest to you into the conversation right away.
4. A Request for Remote Access
If someone wants access to your computer to fix a problem you're hearing about for the first time, that could be a scam. These requests often arrive through a pop-up warning or an unexpected call. Close the window or end the call, then contact the company using a phone number you look up yourself.
If It Happens, Move Fast
Scams are sophisticated, and they happen to careful, well-informed people every day. If you think you've shared personal information or sent money to a scammer, quick action can help limit the harm, especially with wire transfers.
- Contact your financial institution. Ask them to recall the wire and open a written fraud claim.
- Call us. We can work with you to add verification steps that help protect your accounts.
- File a report at IC3.gov. A prompt report can help the FBI work with banks to freeze funds.
- Freeze your credit and reset your passwords. Use a device you know is secure, since the one involved in the scam may be compromised.
Resources to Keep on Hand
These resources can help guide you through reporting and recovery.
- IdentityTheft.gov, run by the Federal Trade Commission, builds a step-by-step recovery plan for your situation.
- IC3.gov is the FBI's Internet Crime Complaint Center for reporting internet crime and wire fraud.
- ReportFraud.ftc.gov lets you report a scam to the Federal Trade Commission.
- The National Elder Fraud Hotline at 833-372-8311 helps adults 60 and older and the family members who support them.
Download the Guide
We've summarized these steps in a two-page guide, Protect Your Identity. Protect Your Finances. If you receive a call or message about your taxes or investments and want to confirm if it's legitimate, our team is glad to help you.