5 Financial Scams to Watch Out for in the Digital Age

April 15, 2024

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Over the past five years, consumers around the globe have lost $37.4 billion to internet-related scams, according to the latest FBI data.

The FBI found losses from investment scams were the most reported than any other crime type in 2023. Losses increased 38% to $4.57 billion last year from $3.31 billion in 2022, where a large portion of the losses were attributed to cryptocurrency fraud.

Read on to learn more about five types of scams and how you could avoid them.

1. AI deep fakes

Deep fakes – where generative AI is used to mimic a person’s likeness in appearance or voice – have become a worrying trend with the proliferation of AI technology.

According to McAfee, a global computer security software company, scammers could clone voices of friends and family from a mere three seconds of audio. They’ll usually try to convince you that someone you know is in an emergency and that you need to send money right away.

The scammer may be armed with personal information they’ve found about you to make the story more convincing. They tend to try and keep you on the phone, asking you not to hang up or claim that they don’t have their phone with them if you’re trying to call them back directly.

Verify who’s calling or texting you, especially if you don’t recognize the number. Even if you recognize the voice, hang up and call the person directly. Set a secret word that only loved ones would know to use in a real emergency.

2. Celebrity imposter

There have been reports of imposters using deep fake tools to mimic famous personalities, usually with promises of “giveaways” or to market an obscure investment opportunity on social media to lure people to invest.

Be wary of any giveaway offer on social media, especially from unverified social media accounts.

Research the company behind the opportunity and check the reviews. If a celebrity contacts you asking for money, unless you’re their agent, you can be sure that’s a scam.

3. Government impersonator

Last year, consumers lost $1.3 billion to scammers impersonating government workers and tech support.

In these types of scams, impersonators would pretend to be from a government agency such as Social Security or the Internal Revenue Service (IRS), often urging you to act right away to avoid arrest or suspension of benefits.

For instance, they may call to claim the victim will lose their Medicare benefits if they don’t pay a new fee, according to Federal Trade Commission (FTC) complaints.

Always be wary of being pressured to do something urgent. Words like: “Act now!” “Do not hang up!” “Do this, or you’ll be arrested” are used to pressure the victim to act without thinking. It’s best to hang up and call the official government agency before acting on dubious instructions.

Know that the government will never call, email, text or message you on social media to ask for money or personal information.

4. Tech and customer support impersonator

You may get a text message, email, or a pop-up box online telling you about a problem with your computer or an online order. These scammers often claim to be from well-known companies that you may have used.

Chances are, the problem with your computer or your online order doesn’t exist, but the impersonator will try to keep you on the phone, convincing you to act on their instructions.

Do not download files if asked, and don’t give out personal information including your date of birth, Social Security number and credit card details. Make sure you don’t screenshare or enter your bank account, even if the caller urges you to do so. Tell them you’ll call them back on their official tech/customer support line. If they hesitate and urge you to stay on the phone, it’s most likely a scam. Hang up and report this to the company directly.

5. Cryptocurrency scams

Cryptocurrency scams typically involves an “investment opportunity” that appear to guarantee high returns with zero-risk from cryptocurrency trading or mining platform. Victims may be lured by pop-up websites offering cryptocurrency trading and mining opportunities or even by online social groups such as for mothers and parents.

Cryptocurrency accounts are not backed by a government like traditional FDIC-backed bank accounts. If something happens to your cryptocurrency accounts or funds, the government may not have an obligation to help get your money back.

Here’s a good rule of thumb to keep in mind: If it sounds too good to be true, it usually is. There is no such thing as a zero-risk investment.

As financial scams get more sophisticated, spending some extra time to research what you’re getting into may save you from walking into a trap.

This article is for informational purposes only and is not a substitute for individualized professional advice. Articles on this website were commissioned and approved by Marcus by Goldman Sachs®, but may not reflect the institutional opinions of The Goldman Sachs Group, Inc., Goldman Sachs Bank USA, Goldman Sachs & Co. LLC or any of their affiliates, subsidiaries or divisions.