Studies show that increasing financial pressures are directly tied to an increase in fraud. You know the saying, “desperate times call for desperate measures” so would-be fraudsters are more inclined to take the risk and rationalize their bad behavior during tough times.
Many economists predict a recession is coming in 2023 but no one knows when it will be or how long it will last. One thing is for sure, scammers will ramp up activity when we are most vulnerable, so we will all have to be extra cautious. Here are some common scams of which you should be aware.
Fake Websites
The cost-of-living crisis is driving consumers to more unfamiliar websites as they search for the lowest price for their favorite products. Fraudsters steal designs, layouts, and logos to trick buyers into thinking they are working with a trusted website. Look for a padlock and HTTPS in the URL bar. Watch for typos, missing addresses/phone numbers, no return policy, and low-resolution images.
Debt-Relief Offers
Scammers will try to take advantage of people having a hard time making payments. Don’t trust someone who contacts you and says, “We can help you get out of debt.” If you need help, contact your financial institution or credit card issuer directly.
Employment Scams
Fraudsters will prey on people looking for a job with fake offers. These opportunities will typically be easy, work-from-home jobs with big paychecks. Red flags are if they ask for your Social Security number before hiring you, request payment to get the job, or make a job offer without an interview/screening.
Fake Government Scams
These are already common but will ramp up even more. This may come in the form of fake tax relief offers, demand for taxes owed, student loan forgiveness, increase Social Security offers, or suspension of benefits. The government will not initiate contact by phone, text, or email so do not respond to these requests.
Ponzi Schemes
Does the Bernie Madoff Ponzi scheme ring a bell? Ponzi schemes promise to invest your money and generate high returns but instead of investing the money, they keep most of it and only use some of it to pay investors. The scheme collapses when investors want their money but there’s not enough to make the payouts. If the investment sounds “too good to be true,” it probably is!
Lottery Scams
If you get a call, email, or letter with a promise of big prizes after you pay a fee, wire money, or share your credit card information, that’s a big red flag. Immediately, hang up, press delete, or shred the request – it’s a scam!
Staying informed about the latest scans can help you avoid them. In addition, if it sounds too good to be true, it probably is too good to be true. Following this rule is a great way to steer clear of scammers in a recession.