Technology has made financial transactions as easy as pressing a button on your phone. You can send or request money through mobile apps in seconds. And you can open new accounts like credit cards, personal loans, and even mortgages entirely online. But while technology has made financial transactions simpler, it also has opened a door through which your money can flow into the wrong hands. And that door is guarded by sophisticated scammers and fraudsters.
In fact, Americans lost a record $10 billion to fraud in 2023, according to the latest data by the
Federal Trade Commission. And as we approach the finish line of tax season, scammers are racing to capture unsuspecting victims.
More than 2.4 million people in the United States have been targeted by IRS impersonators, according to
Equifax. And that has resulted in a loss of $72.8 million. The U.S. Treasury inspector general for tax administration has called these operations “the largest, most pervasive impersonation scam in the history of the IRS.”
However, there are a few steps you can take to avoid all kinds of money scams.
Beware of Giving Out Your Personal Information
Many cases of fraud are tied to imposter or spoofer scams. This happens when a scammer contacts you via phone, text, or email and pretends to be someone else. It could be someone impersonating a bank representative or an IRS agent, for instance.Their message may claim there’s “fraudulent activity” on your account and they’d need your username and password or PIN to rectify the situation. Or it may be someone saying they’re an IRS agent there to let you know that you need to provide your banking information to get your refund.
If anyone asks for your sensitive personal information, it should raise an immediate red flag. Bank employees don’t ever ask for sensitive information like passwords and PINs. And the IRS only communicates via postal mail.
Of course, these are just a few staged scenarios involving impersonators. The possibilities are endless. But here are other instances where you may be asked to provide banking and financial information, which should raise red flags.
- Someone failed to deliver a package.
- An online romantic interest needs financial help.
- You need to submit personal information like account and routing numbers to finalize a job application.
- A company is providing a refund for overpayment.
Whatever the case may be, you should always stop and think when someone asks for your personal information. Delete the text, hang up the phone, close the email, and never click on any links. Go directly to the source such as the official site of your bank or the company in question.
Watch Out for Email Phishing Scams
Phishing is the process of tricking a consumer into willingly giving away sensitive information like bank account numbers, Social Security numbers, and important PINs. But while the scam can be easily detected via text or phone, it may not be so clear online. This is because scammers use technology to create emails or web pages that look like they are legitimately from a bank, the IRS, or a company you do business with.
You may receive an email claiming there’s been fraudulent activity in your bank or e-commerce account and they need your information to fix the issue. But asking for personal information or sending links to update accounts via email is not usually how legitimate organizations communicate. These types of emails should raise concerns.
Avoid clicking any links as they may contain spyware or malware. These are malicious programs designed to steal your information or infect your device.
You should close and delete suspicious emails. Then go directly to the website in question, such as your online banking site.
Set Up a Strong Online Defense
Scammers don’t always trick you into giving away your banking information and other important details. Sometimes, they get in through the backdoor. But there are some precautions you can take.Create strong passwords. A strong password should be eight or more characters. And it should contain a mix of capital and lowercase letters, numbers, and symbols.
Set your phone to automatic update. Ongoing updates can protect against the latest threats.
Multifactor authentication: This is a process that requires two or more credential entries to provide access to an account. It could come in the form of a code sent by email and phone, for example.
Back up data. You can back up important files on an external drive or on the cloud for added security.
Use security software. You can invest in a reliable security-protection software on your computer, phone, and tablet.
What to Do If You’ve Been a Victim of Fraud?
If you believe you’ve been a victim of fraud, call your bank or other financial institution immediately to report fraudulent activity. You could also report the incident to the Federal Trade Commission (
FTC). You should also update passwords.
The Bottom Line
To avoid money scams, never give away sensitive information like your passwords, PIN numbers, and Social Security number—even if the person asking for it seems legitimate. Instead, go directly to the source and see if there’s any real need for action. You can also protect yourself online by creating strong passwords, regularly updating your devices, and setting multifactor authentication on your accounts.
The Epoch Times copyright © 2025. The views and opinions expressed are those of the authors. They are meant for general informational purposes only and should not be construed or interpreted as a recommendation or solicitation. The Epoch Times does not provide investment, tax, legal, financial planning, estate planning, or any other personal finance advice. The Epoch Times holds no liability for the accuracy or timeliness of the information provided.
