Financial scams are an everyday threat. With the advent of the coronavirus, we now have even more scams to worry about. Like the virus itself, these scams are quickly spreading and affecting millions. As of October 13th, the Federal Trade Commission (FTC) recorded about 220,000 consumer complaints related to Coronavirus and stimulus payments, with more than half of them involving fraud or identity theft. More than $159 million has been reported lost, with a median loss of $303.

Fake Cures/Remedies

The FTC and the U.S. Food and Drug Administration (FDA) have issued many warnings to companies selling unsanctioned products they claim can prevent or even cure COVID-19. There have even been websites that have shut down as a result of promoting these types of claims.

According to the FBI, some scammers are promoting bogus COVID-19 antibody tests hoping to capture personal information for identity theft and/or health insurance scams.

Another ploy being used is claiming to sell supplies like surgical masks, test kits, and popular cleaning agents via social media ads, text messages, or robocalls.

Stimulus Payment Thieves

With the recent injection of stimulus payments to the public, there have been many schemes designed to steal these government payments.

Most of the scams involve fake checks being sent in the mail, impersonators calling via phone, or phishing scams sent out via text messages, email, and social media platforms. Scammers create fake checks for an amount more than what you are supposed to receive. Victims are notified that they were overpaid and that they need to send money back via cash, money transfer, or gift cards.  When the fake check bounces, the victim is out of that money and any other money sent to the fraudsters. Phishing is when scammers digitally try to trick you by claiming to be someone you trust.  They attempt to obtain personal and financial information such as banking information, login information, Social Security number, etc. They then try to use this information to steal your money and commit other forms of fraud.

Telephone Fraudsters

With the increase in economic instability, scammers are also impersonating banks and lenders, claiming they can help with bills, student loans, and credit card debt. They are purporting to be the IRS or other government agency, claiming you owe them money or have information regarding your stimulus check. The IRS doesn’t call or text. They will send communication via mail. If you want to track your payment, the best way to do this is by visiting the “Get My Payment” IRS tool.”

No matter what fake story they tell, the objective is the same; to steal your personal information and money. Scams may come through phone calls from real people, robocalls, or text messages. Callers will try to persuade with false opportunities to buy products and receive money via fake-free grants and lotteries.

The FTC and the Justice Department issued an alert about phishing texts and phone calls that are supposedly from contact tracers, warning you of possible exposure to someone with COVID-19. The scam texts include a link that once clicked will download malware to your device. Doing this could import a program that uses your internet connection to spread more malware or gain access to your personal files looking for passwords and other information for identity theft purposes.

If you receive a scam call:

Investment Scams

The U.S. Securities and Exchange Commission (SEC) is warning investors about fraudsters peddling investments in companies with products that they claim can prevent or cure COVID-19. They tell you if you buy those investments now, their price will skyrocket. The scammers have already bought the stocks for a lesser amount, and as the buzz increases and the stock price goes up, they dump the stock, leaving the other investors with the losses.

If you have been a victim of an investment scam:

Charity Scams

You may see charities that you don’t recognize asking for donations in the wake of COVID-19. Verify all charities on the IRS tax exemption site. Cybercrime Support Network has a recovery page that lists action steps to take after donating to a fraudulent charity.

Unemployment Benefit Scams

As of mid-September, more than 25.5 million Americans are currently collecting unemployment, according to the Department of Labor. This rise in unemployment benefits, coupled with extra federal money being supplied to those in need, has caught the attention of fraudsters. They oftentimes pretend to be someone helping file for unemployment benefits and then steal personal information. According to federal authorities, there have even been international organized crime ring plots to file fraudulent unemployment claims hoping they will collect the weekly payout from states.

We are living in a time where anxiety and stress levels are high, resources are limited, and uncertainty is a constant companion. This is the perfect environment for con artists and fraudsters to operate in. So, keep your guard up, protect your information, and report any suspicious activity or attempts to scam you or someone you know to the proper authorities.

 

Sources: FTC/ FCC/ FBI/SEC/USA.gov/CNBC

© Geier Asset Management, Inc. September 2020. Dan Mules, CPA is a Client Manager and Tax Planning Professional for Geier Asset Management, Inc., a Registered Investment Advisor. The articles & opinions expressed in this material were gathered from a variety of sources, but are reviewed by Geier Asset Management, Inc. prior to its dissemination. All sources are believed to be reliable but do not constitute specific investment advice. The views expressed are those of the firm as of September 2020 and are subject to change. These opinions are not intended to be a forecast of future events, a guarantee of results, or investment advice. Any advice given is general in nature and investors must consider their own individual circumstances. In all cases, please contact your investment professional before making any investment choices. Geier Asset Management, Inc. is not responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.