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Safeguarding Your Finances: Top Five Strategies to Prevent Fraud

By NYLAG Coordinating Senior Financial Counselor Katie Krumpter

In this fast-paced world, where everything is at our fingertips, it’s easy to think we are not susceptible to fraud. However, the reality is very different. The Federal Trade Commission’s (FTC) Consumer Sentinel Network revealed that New Yorkers lost a staggering 394.2 million dollars in 2022. 1  This report indicates that identity theft is the number one incident reported by over 60,000 individuals, followed by other credit report issues and imposter scams 

As we commemorate International Fraud Awareness Week, it is also important to be aware that fraud, as well as other business practices, have also historically disproportionately impacted communities of color as compared to white communities.2 Some practices include targeting these populations with deceptive or misleading advertising, using fine-print disclaimers in English on materials designed for non-English speakers, and charging fees for otherwise free services in immigration and student loans.

Below are some of the top five strategies you can implement to prevent fraud:

1. Do not share your Social Security number, account numbers or financial institution login information with any individual. Always be careful which organizations you do choose to share this information with and make sure they have a legitimate use for it as well as the necessary security to safeguard your information. 

2. Turn on two factor authentication for all your bank and credit card accounts, if available. These accounts should also have the strongest (non-repeated) password possible.

 3. Use a password manager such as Bitwarden, 1Password, Zoho Vault or Dashlane. Keep in mind, there are free versions and paid versions of each of these and each has pros and cons. You can look at reviews at: Wired Best Password Managers or PC Magazine Best Password Managers 

 4.  Do NOT reply or respond to “urgent” text messages or emails related to your bank account or social security number or student loan. This is almost always an attempt at phishing – a way to get personally identifying information from you. If you are worried that this is a legitimate warning, call your bank, Social Security Administration, the Department of Education or your student loan servicer directly. Get that contact information directly from their site (DO NOT click any links or use a phone number listed in those texts or emails).  

5. Do NOT be pressured into paying in some unusual way: bitcoin, gift cards, prepaid credit cards. No legitimate organization will require you to pay in anything other than dollars. They also won’t ask you to use Zelle or Venmo.

Still have questions?

If you are concerned about the legitimacy of anyone who has contacted you, do not give them any personal information! Instead, contact the institution they are representing directly. If you need support, talking to a financial counselor may be helpful. Financial counseling can help you figure out what to do if you are a victim of fraud or refer you to additional help from reliable sources. Connect with a NYLAG financial counselor.  

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