Experts Explain How to Spot a Scam—Here’s What I Learned

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Today, recognizing scams in personal finance can be a challenge for all ages. Whether scams are in-person or predominantly online, understanding these deceptive practices is crucial. For those who grew up with technology and even those who didn’t, learning how to identify scams is vital.

To make sense of these schemes, GOBankingRates consulted with experts in financial security. They shared insights on how to spot a scam, explained as if you were a young person. Here’s what they taught us.

Recognizing Urgency as a Red Flag

Scammers often create a sense of urgency. Danai Antoniou, formerly with Monzo and now with Gradient Labs, cautions about tactics demanding immediate action, like money transfers or providing sensitive details.

“By pressuring you, scammers aim to prevent clear thinking,” Antoniou explains. Legitimate companies will not demand immediate decisions. If unsure, pause and contact the institution directly.

Lynette Owens from Trend Micro adds that scams often mimic emergencies, misleading you into rushed responses. Messages about compromised accounts or impersonating respected agencies can be ploys to gain your trust.

Evaluating Offers That Seem Too Good to Be True

Beware of offers that are unexpectedly generous. Antoniou notes that any prize you didn’t compete for or an offer that seems disproportionately favorable is likely deceitful. Scammers use enticing offers to gather personal information.

When faced with these too-good-to-be-true scenarios, ask yourself if such opportunities really happen. Most often, they are fraudulent.

Understanding Unusual Payment Methods

Owens emphasizes that genuine organizations won’t request gift cards or cryptocurrency for payments. If asked to buy cards or transfer crypto, it’s almost certainly a scam.

If approached, disengage and verify by contacting the company through their official website. Report any suspicious encounters to the FTC to safeguard others.

Be Wary of Small, Strange Transactions

Regularly review your accounts for unusual charges, suggests Antoniou. Scammers might start with small charges to test a card’s validity before larger thefts. Noticing unexplained minor transactions should prompt immediate action to protect your funds.

“Scammers might test the waters with minimal charges. Alert your bank if you spot these,” Antoniou advises.

By staying informed and vigilant, anyone can navigate the complexities of financial security today.

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