Top 10 Financial Scams & How to Avoid Them

Don’t be the victim of a financial scam.

The Top 10 Common Financial Scams and How to Avoid Being a Victim

We’ve all received those calls or emails requesting that you send your personal information, such as your credit card number, bank account information or your social security number, because “your account is in jeopardy”.  While scams are often easy to identify but the more frequent (and honestly most devastating) financial scams aren’t always by a stranger. Far too often, the perpetrator is someone close to the victim such as their adult child, grandchild, or other family member. 

The United States Senate has a Special Committee on Aging, which maintains a toll-free Fraud Hotline. According to their website,, the top ten types of scams reported to this hotline are:

1.      IRS impersonation scams. This type of scam accuses victims of owing back taxes and the corresponding penalties. The caller identifies themselves as an IRS agent or employee and may threaten home foreclosure, arrest, or another devastating punishment should the victim not make immediate payment by certified check, credit card, prepaid gift cards, or electronic wire transfer. 

2.      Robocalls and unsolicited phone calls: Robocalling is the process of using equipment to mechanically dial phone numbers in sequence. Unsolicited phone calls are calls from agencies that the victim has no connection with. These callers are often seeking donations or offering services, but those funds are never utilized the way they say they will be.

3.      Sweepstake or Lottery scam: Scammers using a sweepstake or lottery scam will contact victims by phone, email, or mail to notify them that they have won or have been entered to win a prize. They instruct the victim that they will be required to pay a fee or tax to receive the prize. They are then asked to either wire money or purchase large amounts of gift cards.

4.      “Can you hear me?” scams: The caller of these types of scams often begin the conversation by saying, “hello, hello, can you hear me?” or “Are you there”, prompting the victim to answer “yes”. The scammer attempts to record the victims’ voice and obtain a voice signature to authorize unwanted charges on items like utility bills, phone bills or even stolen credit cards. 

5.      Grandparent scams: Imposters call an elderly individual pretending to be the victims’ grandchild or claim to be helping their grandchild with an emergency, such as to pay a hospital bill or getting the grandchild out of jail. They play on the victims’ emotions and trick them into sending money to the scammer. The fake grandchild will beg the grandparent not to tell anyone.

6.      Computer Tech support scams: This basic scam involves the perpetrator gaining the victims’ trust by pretending to be associated with a well-known technology company stating that the victims’ computer has been identified as being infected by a virus. A screen pop-up and locked computer can also be used in this scam. The victim is then required to pay for the virus removal.

7.      Romance scams: As more Americans turn to on-line dating, con artists are following suit. Typically, the scammer contacts the victim online through a chatroom, dating site, social media site, or e-mail. They often call and chat on the phone to prove that they are real. After gaining their trust, the scammer convinces the victim to send money for a variety of things such as travel money, medical bills, visas or other official documents, or losses from a temporary financial set back.

8.      Phishing emails:  This type of scam looks like the requests are from a company that the victim knows and/or trusts such as a bank, credit card company, or online store. They request the victims’ personal information such as log-ins and passwords to verify your account and as that you update your credit card information. 

9.      Government Grant scams: These types of scams can be hidden as grant opportunities or financial aid assistance services; problems with student loan processing; debt collectors; diploma mills; and other unaccredited educational institutions. 

10.  Elder financial abuse: Unlike the other scams, elder financial abuse is carried out by a relative or acquaintance of the victim. This family member, friend, caregiver, or other trusted individual will gain control of the victims’ money, assets and/or credit. Women and individuals with cognitive impairment are often at higher risk for this type of abuse.

While some of these scams may seem obvious, others are fairly convincing. Before ever divulging personal information or financial details, always check the authenticity of the telephone number, email address, or website that you are being contacted from and never give out personal information over the phone to someone you do not know. If you suspect that you are being targeted by a scam, contact your local law enforcement agency for assistance. They often are aware of the most common and current scams. Some things to look for to identify a potential scam are listed below.

1.      Criminals spoof caller ID numbers and make it appear they are calling from a government agency or familiar company. Beware of disguised caller identification number, including area codes such as 876, 202, 509, 206 and 306.

2.      Misspelled words or altered logos on e-mails or websites.

3.      Government agencies asking for a prepaid gift card or money gram.

4.      Bills received for services you did not request or obtain.

5.      A grant, or other type of financial assistance opportunity, that did not require an application process.

6.      A threat or punishment that requires payment.

7.      Free travel or other prizes that have high monetary value.

You may be embarrassed to talk about being a victim of a scam, but ignoring the situation will only make it worse. The criminal may continue to harass you and/or victimize other individuals. Your local law enforcement agency, your local adult protective services, or the Federal Trade Commission can help you. You can also report suspected scams to the United States Special Committee on aging Fraud Hotline at 1-855-303-9470