In an era of rapidly evolving technology and artificial intelligence (AI), financial scams are becoming increasingly sophisticated. A Bankrate Financial Fraud survey revealed that close to one in three adults in the U.S. have experienced financial fraud in the past 12 months.

Theresa Fadel, vice president of Fraud & Business Enablement at Desert Financial Credit Union, knows all about fraudulent banking scenarios, but she’s also armed with the knowledge of how consumers and businesses can remain on guard and protected. 

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The most common types of financial scams

Unfortunately, threat actors keep pace with technological advancement, becoming more savvy in their attempts to gain access to financial information. 

Some of the ways fraudulent players try to pry their way into banking accounts include:

  • Phishing: Emails and texts ask for usernames, passwords, account details and other personal information to gain access to banking accounts. “Phishing has been around forever,” Fadel says, and can come in the form of, “‘Hey, you have a package pending, or you owe these toll fees, or we need [your personal information] for your vehicle warranty.”
  • Impersonation scams: Fadel describes this fraudulent scheme as a variant of phishing. “People pretend to be your bank or law enforcement,” she notes, “to gain access to your personal information and finances.” 
  • Spoofing: “Spoofing is where technology is used by fraudsters to look like someone trusted is calling from a familiar phone number or organization,” Fadel explains. 
  • Social engineering: Imposters use psychological manipulation to trick vulnerable people into giving them information that can compromise their financial well-being. 
  • Deepfakes: Deepfake technology uses AI to generate fake videos, audio and images that appear realistic. “This technology can be used to represent respectable and reputable people to trick individuals into disclosing important information,” Fadel says. 

“One big thing to watch for is a sense of urgency from the perpetrator,” Fadel adds. “Be sure to slow down and think things through, especially if you are being ‘coached’ to not say something to family, friends or a financial institution.”

Financial fraud threat protection

Financial fraud perpetrators may have a myriad of tricks to infiltrate financial information, but there are (thankfully) many protective measures to stop them. Awareness is one of the strongest lines of defense against scam artists.

“We have a Desert Financial website dedicated to fraud prevention (desertfinancial.com/fraud),” Fadel says. “There’s a link to blogs on different scams that people can read up on.”

Desert Financial also hosts workshops and sends quarterly updates and messages, warning members of the latest scams. 

It’s extremely important for individuals and businesses to know that a financial institution will never call asking for personal information, authorization codes (sent to you via text), usernames or passwords. 

Since scammers are advanced in their technological capabilities, they can call or text from phone numbers that appear legitimate. Instead of releasing any personal information to an unknown caller, Fadel advises looking up your bank’s phone number and contacting them directly.

Other ways to safeguard against financial scams:

  • Do not use the same password repeatedly (for any accounts)
  • Do not give passwords to unknown callers, texters or email contacts 
  • Do not click on any links from organizations or people in texts or emails without vetting the legitimacy of the sender
  • Businesses should educate their employees on the latest fraud schemes, protect all electronics with secure passwords and establish multi-factor authentication
  • Individuals should never negotiate with someone asking for a check to be cashed (usually offering to let you keep a percentage of the money)

Fadel closes with this: “Really leverage the [protection] tools that are available, whether it’s setting up alerts or not reusing a password. We have to be diligent in not making it easy for the fraudsters.”