How to Spot—and Avoid—Common Financial Scams

September 11, 2025

Fraudsters are getting more sophisticated. With new technology at their disposal, scams have become harder to detect, and more people are losing money as a result. While the number of reported fraud attempts has stayed relatively steady, the percentage of victims who actually lose funds has climbed—showing just how convincing these schemes can be.

One of the most common scams today is impostor fraud, where criminals pose as trusted institutions—often a bank or investment firm—in an attempt to steal your money or personal information. But this is just one tactic among many.

The good news? With awareness and caution, you can reduce your risk of becoming a victim.

Red Flags to Watch For

Scammers often rely on urgency, fear, or promises that feel “too good to be true.” Consider these warning signs:

●     Unsolicited messages asking you to take immediate action with your accounts.

●     Pressure to provide sensitive information like passwords or security codes.

●     Requests to pay using cryptocurrency, gift cards, or wire transfers.

●     “Overpayment” schemes that ask you to refund money you never actually received.

●     Offers of guaranteed investment returns with little or no risk.

If you encounter these scenarios, stop and verify independently before acting.

3 Common Scams to Know

1. Impostor Scams

A call or text may appear to come from your financial institution. The caller claims there’s suspicious activity on your account and asks you to confirm your identity by providing a security code. In reality, they’re trying to reset your password and take over your account.

Protect yourself: Never share security codes unless you initiated the contact using an official phone number, app, or website. Caller ID can be faked, so always verify through trusted channels.

2. Confidence and Romance Scams

Fraudsters build trust by posing as a friend, family member, or romantic interest. Over time, they use emotional manipulation to convince victims to send money or share sensitive information.

Protect yourself:

●     Be cautious if someone you’ve never met in person asks for financial help.

●     Agree on a family “safe word” to quickly verify identities.

●     Talk to trusted friends or family if you’re unsure. Scammers thrive when they can isolate their targets.

3. Social Media Shopping and Investment Scams

Fraud can start with an ad or message on social platforms. Some scams involve fake online stores, while others promote “can’t-miss” investment opportunities, often in cryptocurrency.

Protect yourself:

●     Be skeptical of unsolicited investment offers, especially those promising huge returns with no risk.

●     Research companies independently—don’t rely on links in ads or emails.

●     Avoid downloading unfamiliar apps or visiting websites shared by strangers.

Staying One Step Ahead

Scammers count on quick reactions. By pausing, verifying, and applying a healthy dose of skepticism, you can protect yourself against many fraudulent schemes.

●     Slow down if you feel pressured to act quickly.

●     Use official websites or contact numbers to verify requests.

●     Be mindful of what you share on social media.

●     Report suspected fraud to the proper authorities, such as the FBI’s Internet Crime Complaint Center.

Remember: If something feels off, trust your instincts. Taking a moment to step back can make the difference between avoiding a scam and becoming its next victim.

Sources:

https://www.fidelity.com/viewpoints/personal-finance/preventing-identity-theft

Disclosure:

This information is an overview and should not be considered as specific guidance or recommendations for any individual or business.

This material is provided as a courtesy and for educational purposes only.

These are the views of the author, not the named Representative or Advisory Services Network, LLC, and should not be construed as investment advice. Neither the named Representative nor Advisory Services Network, LLC gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your Financial Advisor for further information.