Debt Issues: How to Deal With Being the Victim of Financial Fraud

It’s the stuff that Facebook memes are made of. You know, the meme about an email received from a Nigerian prince promising you fame and more importantly, riches if you could only just send $100 to pay for the shipping on your big check. Fraud seems ridiculous when looked at in this context.

However, financial fraud is no joke, as a man in Ohio recently discovered. For him, what looked like a legitimate job offer eventually turned into a scam that threw him deeply into debt – $47,000 in debt to be exact. In the game of debt and war, financial scammers are getting the upper hand. For those of you trying to dig yourself out of debt, knowing how to avoid fraud can be every bit as important as keeping a budget.

Avoiding Sending Money to People You Don’t Know

One of the easiest ways for scammers to get to you and your bank account is by asking you to send them money. That’s actually what happened to the Ohio man featured at in the beginning paragraphs of this post. He answered a job ad. His new company bosses asked him to buy goods with his credit card and then ship them out on the company’s behalf. At first, he received reimbursements for his purchases but eventually, the company’s website went by the wayside and he got left with a nearly $50K bill.

According to the Better Business Bureau (BBB), sending money to unknown entities as one of the most common ways that people get scammed. If anyone you don’t know asks you to send money, don’t send it. This is typical of financial scammers.

Be aware as well that scammers may pressure you into sending money to them. That should also be a big red flag to you. Very often, you’ll be asked to take action immediately. Most legitimate companies will give you time to think things over.

Research Them

The Federal Trade Commission (FTC) suggests that people do Internet searches of companies and people when they feel doubtful. You can look for company reviews or use search terms, like “IRS call” or “job scams.” This may tell you whether that job that seems too good to be true actually is.

Other Scam Indicators

Free trial offers, robocalls, and bogus numbers on your caller ID can all be signs that you’re dealing with a scammer. In the case of robocalls, you can actually take action immediately: These types of calls are illegal. Very often, the products or services they’re peddling don’t even exist. If you can get a phone number, report it to your local consumer protection office or the local attorney general.

Or when in doubt, you can sign up for a scam alert through the FTC at http://www.ftc.gov/scams.

Preventing Scams

Aside from following the advice already written above, there are some other steps you can take to avoid becoming the victim of a scam. Working with a business in your local area can cut down on the threat of being scammed. Brick-and-mortar stores usually ask or ID and are careful with your personal information.

Additionally, be cognizant of what you share on social media. That information in the wrong hands can compromise your online security. It also goes without saying that you should never offer up your passwords or critical information to people you don’t know. As well, take steps to make it more difficult for scammers to attack you in the digital world. Create very long passwords that include letters, numbers, and characters. And don’t use common passwords, like “admin” or your birthday. You also need to avoid using the same password for all of your accounts.

Damage Control

If, like the gentleman in Ohio, you discover that you have been scammed and you are now more deeply in debt, you must take immediate action. Although you may not be thinking about getting the police involved, you should, according to CreditCards.com. Although a police officer may not chase down the bad guy, so to speak, it is important to call because credit card theft is a form of identity theft. Filing a report leaves a trail behind in case the thief goes on to steal other assets from you or accesses your other accounts.

This can also help you establish a credit freeze with the credit bureaus so no one can establish new credit in your name. Additionally, it isn’t likely that you’re the only victim of this perpetrator. Adding your information to the information that the police already has can help them track the person down.

Aside from this, you’ll want to report unauthorized charges to your card to your credit card company or bank. To head this disaster off at the pass, you want to check your card statements often. Or if you find yourself the victim of a job scam, report it to your card company. Be sure to include your police report information. Usually, you’re not liable for the charge while it’s being disputed.

Go to the Right Place for Help

Finally, you want to direct the focus of your “anti-scam” campaign at the right government agency, according to Consumer Reports. Start your search at usa.gov/stop-scams-frauds. You’ll probably be directed to the FTC first, but double check. Your case may involve another agency, like the IRS if it involves taxes on some way. (For example, someone may have stolen your tax return.)

You may also need to work with your credit card company or bank to get yourself out of the debt as a result of being scammed. Again, this is where filing a police report can help you. Both of these business entities should have a fraud division, and in many cases, if there has been any kind of unusual activity on your accounts at all, your bank or credit card company may automatically block the transaction as a matter of course.

In any case, your best defense is to be prepared and to remember that if something is too good to be true, it probably is. Don’t add to your debt load by inadvertently taking on fraudulent debt. If you do, it can take months and sometimes years, to undo the damage caused by such a mistake.

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