10 Fraud Prevention Tips to Stay Ahead of the Scammers

Hard-working families lose billions annually to scammers, and the need to take firm fraud prevention measures has never been more urgent.

The Federal Trade Commission (FTC) fielded approximately 2.6 million fraud complaints last year alone. With criminals using a variety of tools, community members have to take action and stay alert to avoid becoming victims. We hope these 10 fraud prevention tips help you stay ahead of scammers.

What is Identity Theft?

Identity theft crimes involve the unauthorized use of someone’s personal information. Fraudsters may leverage a driver’s license, Social Security number, passport, birth certificate, and other documents to open checking accounts and credit cards and even take out loans. In some scenarios, they buy products and sell them on the black market. In others, your personal identity information may be sold on the Dark Web. Below is a list of the more common types of identity theft crimes.

Types of Identity Theft

Medical: Medical Identity Theft is when someone uses your personal or financial information to obtain medical care, health insurance coverage, prescriptions, or medical equipment.

Financial:  Financial Identity Theft is when someone uses your personal information to access your bank account, credit card, or social security number for financial gain, such as stealing money, making purchases, or opening a new account in your name.  This is the most common form of identity theft.  Read our blog: “Fraud Activity on Your Bank Account?  Could It Be a Scammer?” for more information.

Account Takeover: Account Takeover is a type of fraud that can occur when you’ve become the victim of Financial Identity theft. It is when cybercriminals take control of your online account.  Visit our website to learn more about Account Takeover Fraud: What it is. How to avoid it from happening to you.  What do you do if you suspect that you have been a victim?

Child: Child Identity Theft occurs when someone takes a child’s personal information (social security number, name, address, and date of birth) and uses it to obtain services or benefits such as health care coverage, government assistance, or to open an account, apply for a loan, or sign up for utilities. Click here for more information on how to protect your child.

Senior: Senior Identity Theft occurs when a scammer uses a senior individual's personal information to make unauthorized purchases, open accounts, or receive benefits.

Estate: Estate Identity Theft occurs when a thief uses the personal information of a deceased person to steal money or open accounts.

Mail: Mail Identity Theft occurs when someone unlawfully acquires your personal information through mail theft. This may include stealing checks from your mail or using the personal information contained in your mail to commit identity theft.  Learn how to protect your mail in our blog:  Fraud Prevention Essentials: How to Protect Your Mail and Money from Scammers. 

Employment:  Employment Identity Theft occurs when someone uses your information to get a job or pass a background check.  

It’s also possible for criminals to use synthetic identity theft to pose as someone else. With enough information, they can assume your identity and live under your name. Any crimes an impostor commits could become the victim’s responsibility to resolve.

Identity Theft Bodyguard

The Bureau of Justice Statistics estimates that approximately 30 million Americans have been victimized by identity theft. Some people suffer thousands of dollars in losses. Others see entire bank accounts drained, and phony credit cards crush their once-healthy credit history. Taking practical fraud protection steps is in everyone’s best interest to ensure that you don’t join millions of identity theft victims.

Fraud Prevention Tips

Fraud prevention measures are designed to deter scammers in real life and online. Putting solid roadblocks in an identity thief’s way will likely prompt the criminal to look elsewhere for easier targets. You can take these fraud prevention steps to protect your personal identity information right now.

1. Secure Personal Information

Place items such as Social Security cards, birth certificates, death certificates, and passports in a safe or lockbox. These documents allow fraudsters to open and access accounts with impunity. It’s also prudent to keep financial statements in a secure location.

2. Shred Documents

Any official document or financial record with an account number or personal identification information should be shredded or destroyed. Never put this paperwork in the trash because criminals do rifle through bins.

3. Use Strong Passwords and Enable Two-Factor Authentication

There are three easy ways to deter cybercriminals. Never give out your password. Use a capital letter, symbol, and a number to ensure password strength. Don’t forget to utilize two-factor authentication as a fallback defense. Two-factor authentication works by sending a code to a secondary device that hackers cannot control.

4. Monitor Financial Accounts Regularly

Nothing substitutes due diligence. Checking and double-checking credit cards and bank statements regularly ranks among the best ways to detect suspicious activity. If you notice any unauthorized charges, contact the financial institution or credit card company immediately. You may need to file a fraud complaint with the FTC and local law enforcement.

For more fraud prevention tips, click on the Free Checklists Guide below.  

Stay Informed and Stay Safe! Download our Free Checklists: Identity Theft Defense: 3 Critical Checklists to Prevent, Report, and Recover from Fraud

5. Freeze Credit Reports

If you are denied a loan or credit card due to an unusually low FICO score, you may already be the victim of identity theft. Gather the information needed to demonstrate you are the real person associated with the credit reports handled by Equifax, Experian, and TransUnion. Request an immediate freeze to ensure no further fraud occurs. To get more information on how to request a credit freeze, explore our free guide, "Identity Theft Defense: 3 Critical Checklists to Prevent, Report, and Repair from Fraud."

6. Be Wary of Public Wi-Fi

When you use public Wi-Fi, you may be allowing online scammers to access your device. If allowed, they can quickly steal your personal identity information and drain your financial accounts. The additional cost of unlimited data for a hot spot on your phone may be a good fraud prevention investment. These and other virtual private networks allow users to forego public Wi-Fi offered at cafés and other businesses.

7. Update Security Software

Electronic devices require regular software updates for your protection. When you see requests, allowing the update to run as soon as possible is essential. In many cases, these are necessary security patches designed to prevent widespread breaches. Update the software and anti-virus programs on an ongoing basis.

8. Monitor Credit Reports Regularly

One of the best ways to be sure no one is using your identity data is to go online and request a credit report from the three reporting bureaus on the Annual Credit Report website. You can request a free credit report from Equifax, Experian, and TransUnion every 12 months. Check out our website for more information.

Taking this proactive measure allows you to scrutinize the transactions and blemishes on your credit score. Look for unauthorized transactions and accounts that you did not open. 

9. Be Cautious with Personal Information and Beware of Phishing Scams

The convenience of purchasing items online opens the door to schemes used by cybercriminals. Hackers will do anything to gain access to credit cards, bank accounts, and individual identity information to exploit or sell it on the Dark Web.

They get personal information by deploying phishing schemes that motivate people to respond to electronic messages. Some ask for emergency digital payments. Others request usernames and passwords. Lastly, emails and text messages prompt people to download a file laced with malware or go to a website that infects their devices. It’s imperative not to share your full name, address, driver’s license, medical insurance, Social Security number, credit card, bank account information, or anything that can be used to develop an identity theft profile. Never click on a link or open a file or attachment unless you are sure it’s legitimate and free of malicious software.

10. Educate Yourself

Hackers and fraudsters who steal physical documents and private information continue to invent clever schemes to benefit from your success. That’s why it is crucial to stay ahead of felons by learning about the latest scams and implementing security measures. We hope you use these fraud prevention tips and continue to protect yourself and your family from fraud. 

Middlesex Has the Resources to Help

At Middlesex Federal, we take fraud and identity theft seriously. Explore our resources to find more information on how to prevent, report, and recover from identity theft and other types of fraud.

To get more information on fraud prevention strategies, explore our free guide, "Identity Theft Defense: 3 Critical Checklists to Prevent, Report, and Repair from Fraud."