How to Protect Yourself from Financial Scams and Fraud

Financial scams are becoming increasingly sophisticated, costing Americans billions of dollars each year. Knowing how to recognize and avoid them is essential for protecting your finances.

If an offer seems too good to be true, it probably is. Guaranteed high returns with no risk don't exist in legitimate investing. Scammers prey on people's desire for easy money.

Never share personal financial information via unsolicited calls or emails. Legitimate banks and lenders won't ask for your password, PIN, or full Social Security number through these channels.

Watch out for pressure tactics. Scammers create urgency to prevent you from thinking clearly. Phrases like "act now" or "limited time offer" are red flags.

Verify before you trust. If someone claims to be from your bank or a government agency, hang up and call the official number directly. Don't use any number they provide.

Be cautious of advance fee requests. Legitimate lenders don't ask for payment before disbursing a loan. If someone wants money upfront to "unlock" your loan, it's a scam.

Monitor your accounts regularly. Set up alerts for transactions and review your statements monthly. The sooner you catch fraud, the easier it is to address.

Report suspected scams to the FTC at ReportFraud.ftc.gov. Your report helps authorities track and shut down fraudulent operations.