Don’t fall prey to these 4 common bank scams

Bank scams are nothing new, but they are growing. According to the American Bankers Association, deposit account fraud losses topped $25 billion in 2018 – and that figure is likely still growing. The dizzying variety of scams is ever-evolving, too, so it’s important to periodically refresh your understanding of the most common banking scams, and how to avoid them.

Here are some popular financial fraud tactics.


Phishing is nothing new, but the tactics scammers use to extract sensitive personal and banking information are. The classic phishing scam involves impersonators sending legitimate-looking texts or emails (or using legitimate-looking websites) to obtain your confidential banking information or passwords, ID or Social Security numbers, address, or other identifying personal information. In recent years, phishing scams have become more elaborate, involving emails that look almost identical to those from your bank, or websites that purport to help you in some way. And in the time of Covid, some offer help with obtaining stimulus funds or loans.

Fake check scams

Check scams come in a few varieties. A common scam involves receiving an unexpected check. When you cash it, you inadvertently make purchases or sign up for a loan. Another involves sending you a counterfeit check, which you’re asked to deposit and wire part of the money back to the scammer. You’re then on the hook for the entire amount of the counterfeit check. Be particularly aware of fake Covid stimulus checks, or people claiming to be assisting you with obtaining, cashing, or managing stimulus money.

Unauthorized or automatic withdrawals

Be careful authorizing one-time automatic withdrawals, as these can inadvertently become regular withdrawals from your accounts. Read the fine print on any automatic withdrawal authorizations to ensure they won’t become ongoing, or that you can cancel them at any time. Additionally, apply all of your common-sense money safety discipline to withdrawal or deposit authorizations, as the information you provide for automatic deposits can also be used by scammers to withdraw funds without your consent. Verify any and all deposit or withdrawal agreements in detail, and ensure the people or institutions you’re dealing with are those you know firsthand.

Financial advisor or personal banker scams

Many scammers pose as credit counselors, financial advisors, or bankers purporting to need your personal or financial information to help you. Before trusting any unsolicited offers, do your homework. Contact your bank or brokerage to verify the legitimacy of any offer, or the Consumer Financial Protection Bureau if you don’t recognize the entity that’s contacting you.

Source: CNBC / Featured image by freepik

Joseph Tanner

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