Also be on the lookout for weather/climate disaster-related fraud.
Our most recent edition of First Line of Defense, offered by CUES in partnership with TRC Interactive, Inc., brings updates on weather/climate disaster fraud and a reminder that everyone–regardless of age–can fall victim to fraud.
The Federal Trade Commission reports that scam victims are getting younger, and their losses are getting bigger. Adults over 60 were less likely than younger consumers to lose money to scammers, but their losses were bigger when they did. Adults over 60 were also more likely to report losing money to certain types of scams.
Last year was a record-setting year from weather/climate disaster events, according to the National Oceanic and Atmospheric Administration. The United States saw more than 18 weather/climate-related disaster events and losss of more than $1 billion through Oct. 2, 2021. Those 18 disaster events outdid the average of seven per year from 1980 to 2020.
With the rise in disaster events, credit union staff should be on the lookout for disaster-related fraud, including:
- Clean-up and repair scams. Members may fall victim to requests for up-front payment in return for promises of quick clean-up and repair. Members and staff alike should be wary of paying by wire transfer, gift card, cryptocurrency, or cash. Instead, insist on using a check or credit card.
- Imposter scams. A fraudster pretends to be someone you can trust, such as a government official, safety inspector or utility worker. Then, the scammer tries to convince you to send money or provide personal information, such as financial account numbers. Use these tips to help your members and staff avoid imposter scams:
- Ask for identification and verify credentials.
- Remember that government officials, safety inspectors and utility workers will not ask you for money or your financial information.
- Keep in mind that the Federal Emergency Management Administration does not charge application fees.
- Job scams. Fraudsters take advantage of unemployment after a disaster by advertising in the same places that real employers and job placement firms do. The fraudsters may lie about applicants’ chances of getting a job or even ask them to pay to apply. To help members and staff avoid job scams, use reliable resources, like the U.S. Department of Labor and local career search services, to ensure the validity of job offers.
- Rental listing scams. Scammers may try to take advantage of disaster victims as they search for new housing accommodations. These scammers will ask for security deposits or rent upfront, before renters meet with them or sign a lease.
- Charity scams. Charity scammers create fake organizations that do little to no work and, instead, pocket the money they collect for personal use. These kinds of scams come in many forms, including emails, social media posts, crowdfunding platforms and phone calls. Here are some ways your team members can advise people about how to avoid charity scams.
- Be wary of organizations that seem to pop up overnight, especially following a disaster.
- Search for the charity's name online. Has it been reported as a scam?
- Only donate to charities you know and trust.
- Keep an eye out for organizations with names that are similar to those of reputable organizations.
- Verify a charity's legitimacy on accredited websites such as Charity Navigator, Charity Watch or the Better Business Bureau's Wise Giving Alliance.
- If you receive an unsolicited email requesting donations, don't click on links or open any attachments.
- Never donate via gift card or wire transfer. Paying by check or credit card is safer.
Laura Lynch is products and services manager for CUES. First Line of Defense is an interactive training platform for front-line staff. Each quarter, First Line of Defense sends subscribers 10 challenges that ask staff to determine if member transactions are legitimate or fraudulent. The simulated interactions include documents used in transactions, such as checks, driver’s licenses, account history screens and signatures on file. Once staff complete the challenges, they see in dollars and cents the potential loss to your credit union and members when scams aren’t caught. Book a demonstration with CUES staff.