Consumer fraud has probably been around since humans first exchanged money, but it’s really taken off in recent years. This is partly due to the COVID-19 pandemic, which led to a rise in online and peer-to-peer payments. Scammers are also making greater use of AI and other advanced technologies, especially on social media.
For some perspective, one in four people who reported losing money to fraud since 2021 said it started on social media, according to a recent report from the Federal Trade Commission. Those reported losses totaled $2.7 billion — much higher than any other method of contact. Even worse, the FTC says the vast majority of frauds aren’t reported, so this figure reflects just a small fraction of the public harm.
It’s not just social media. There’s also been a rise in scams involving phone calls, emails and texts. The problem has become so widespread that 85% of consumers expect businesses to respond to fraud concerns so they don’t have to rely solely on government or law enforcement agencies, according to a 2023 report from Experian.
You can expect more of the same in 2024 — which means it’s more important than ever to have your guard up. Here’s a look at ways fraudsters are expected to scam people:
1. Peer-to-Peer App Scams
With the increasing popularity of peer-to-peer payment apps, scammers have taken note and are always finding new and clever ways to attempt to separate you from your hard-earned money. The first thing you should do is make sure you’re using a secure peer-to-peer payment app like Cash App.
Cash App, owned by Block Inc., is a mobile-based payment app that offers a range of financial services. In addition to letting users transfer money, handle bank transactions, make investments and pay with its Cash App Card debit card, Cash App provides security through features like its Security Lock and two-factor authentication.
2. Phishing
This is the most common online scam and is used to trick victims into revealing sensitive information, such as passwords, bank account numbers, credit card details or Social Security numbers. Phishing scams often arrive in the form of emails or text messages that appear to be from legitimate sources, such as government agencies or banks.
3. Messages About Suspicious Activity
Some scammers impersonate your bank to alert you about so-called suspicious activity on your account and direct you to send money to yourself or the bank’s address to reverse a transaction or to verify that the account is not frozen, according to the American Bankers Association.
Be wary of these types of messages and always confirm directly with your bank before taking any suggested action.
4. Fake Charities
These scams often originate on social media, with criminals posting fake ads asking you to donate to a worthy cause. The ads usually include stolen images and stories to create a sense of urgency and make the appeals more realistic.
5. Fraud-Department Scams
Some scams involve criminals posing as fraud department personnel at retailers or other merchants and asking you to confirm information such as your bank account username and password, credit card data or Social Security number. The aim is to create a peer-to-peer account with your information, steal your identity or gain access to your accounts.
6. Fake Products or Services
As the American Bankers Association noted, scammers posing as legitimate businesses might request a peer-to-peer payment for a product, service or offer that doesn’t exist.
7. ‘Accidental’ Payments
In this scam, the fraudster “accidentally” sends you money on a peer-to-peer service and asks you to send the money back. Typically, the initial payment either wasn’t real or was sent from an already compromised account. Scammers will then keep the money you sent them and dispute the original payment to be reimbursed twice. If you send money back to the scammer, the peer-to-peer service could still hold you responsible and deduct funds from your account.
To protect yourself from peer-to-peer and other consumer scams, first make sure you’re using a trusted app, like Cash App. The best thing you can do is never send money to someone you don’t know and trust. Never share personal, bank or credit card information unless you are 100% certain the person or entity asking for it is legitimate. With the rise of AI scams, it can be hard to determine who is legitimate because fraudsters are so adept at impersonating real people.
How Cash App Helps You Fight Back Against Scammers
With the convenience of financial transactions at our fingertips, it’s essential to safeguard yourself from scams. Cash App employs cutting-edge encryption and fraud-detection technology that protects your data and money when using the platform.
Even with these advanced security features, the app can still be targeted by scammers who exploit user trust. Follow these tips to avoid Cash App scams and protect your hard-earned money.
- Turn on notifications and enable Security Lock to keep your account more secure.
- Keep your information safe. Never provide sensitive information to anyone.
- Verify and double-check all recipient information before sending any payment to confirm you’re sending money to the correct person.
- Don’t send money to someone promising you something in the future.
- Don’t send money to a love interest you haven’t met in person.
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