By Sonya Sellmeyer, Consumer Advocacy Officer for the Iowa Insurance Division
April is recognized as financial literacy month to remind us of the importance of money management. Learning how to plan, earn, and save for retirement are vital components in any financial literacy program, but you must also know how to shield your savings from scammers.
New data from the Federal Trade Commission (FTC) shows consumers lost nearly $8.8 billion in 2022 to fraud which is up 30% from 2021. The top frauds were imposter scams, online shopping, prizes/sweepstakes/lotteries, investments, and job opportunities. Victims lost $3.8 billion to investment scams alone, up from $1.8 billion in 2021.
In Iowa, romance scams are being reported at an alarming rate. Scammers are preying on Iowans by way of online games with a private chat option, dating websites, random text messages, emails, or phone calls, social media via a direct message or as a friend request, and even spoofed social media accounts of friends and family where your “friend” claims to win a prize that is now available to you. According to the FTC in 2021, one of every four victims was approached on social media.
After contact is made by a scammer, they will ask the victim to move off the original platform to continue the discussion usually via text message, attempt to gain your trust with sweet talk, and then ask for money. The request may involve cryptocurrency or other investments, or money to pay for medical expenses or a plane ticket. If you find yourself in this situation, stop! Call a trusted friend or family member before sending money to someone you don’t know. Verify the person offering you an investment by double-checking all investment and insurance professionals before doing business, or call the Iowa Insurance Division.
Here are some tips to help protect yourself:
- Knowing basic financial literacy concepts may prevent victimization by a scammer. According to the FINRA Foundation, consumers with strong financial literacy skills were less likely to be scammed. The IID’s Save4Later and SmartHER Money websites are a great place to start the financial literacy journey.
- Use good online habits such as checking your privacy settings on all social media accounts to make sure you are only sharing what you want to share, being careful what you click on, using unique passwords, opting out of targeted ads, and not responding to unsolicited offers. If you get a message from a friend on social media regarding an opportunity, call them before engaging further.
- Never provide your personal information such as bank account numbers, social security, or Medicare numbers to someone you don’t know or meet on social media.
- Ensure websites are legitimate and secure. Beware of misspelled words or grammatical errors.
- Be cautious of profiles with few friends and little content, and don’t accept a friend request from someone you don’t know.
- Never click on pop-up messages or unsolicited private messages.
Fraud threatens the financial security of all Iowans. Become an Iowa Fraud Fighter and learn how to help protect yourself and your loved ones from scams.