Imposter Fraud

Imposter scams are the second most prevalent type of financial fraud.  They come in many varieties but operate the same way – a scammer pretends to be someone you trust to convince you to send them money.

Perhaps you’ve heard of the grandchild scheme.  Like many fraud attempts, this one usually happens late at night or during the weekend.

• You get a call from a person impersonating your grandson or granddaughter. They tell you they are in a foreign country, in a great deal of trouble and to please, please help them out by sending bail money or ransom money.  And don’t tell Mom and Dad!
• The imposter can make the story sound good because he/she knows what your grandchild calls you and can correctly identify other family members. It must be your grandchild, right?
• Wrong! The scammer has studied social media accounts and learned those details.  With current technology that can easily mimic your relative’s voice.

Here’s what to do in these situations.

1. First, resist the impulse to send money immediately. Hang up.
2. Then call or message the relative who supposedly called you. Use the number that you have saved, NOT the number that the call came from. Check out the story you were just told.
3. Call someone else in your family or circle of friends, even if the caller told you to keep the call a secret. Do this especially if you can’t reach the family member who is supposed to be in trouble.  Discuss the circumstances and determine if you think action is needed.

If you believe that sending money is the right thing to do, make sure to either wire the funds or mail a cashier’s check.  These methods are much more traceable than gift cards, reloadable debit cards, or cryptocurrency.  In fact, if you are told to use cards or crypto, it’s almost certainly a scam.

My family has developed an unguessable code word that is familiar to us but not to anyone outside the family.  In we ever receive such a call, we’ll ask the caller for the password.  No word?  It’s a scam.

People who lose money in imposter scams rarely get it back.  That’s because the call can originate any place in the world.  USA law enforcement officials have no authority in those locations and foreign governments are often not eager to help.  In fact, many fraudsters are employed by enemy countries whose leaders like taking advantage of Americans.

Don’t panic if you receive a similar call.  Slow down. Take a breath. Verify first.  

(Portions of this post were excerpted from the Federal Trade Commission’s website.)