6 Wallet Scams to Avoid and How Fidelity Says Protect Your Money

Understanding the Most Common Scams and How to Protect Yourself

Every year, Americans face a growing threat from various types of fraud. According to the Federal Trade Commission (FTC), consumers lost over $12.5 billion to scams in the last year alone. These losses are not just numbers—they represent real financial pain for individuals and families across the country. The most common types of fraud include investment scams, imposter scams, and those that begin through phone calls or social media platforms.

Imposter Scams: A Growing Threat

Imposter scams involve fraudsters posing as trustworthy entities, such as banks, government agencies, or even family members, to trick victims into giving away personal information or sending money. In 2024, these scams caused over $789 million in losses. The FTC also reported a significant increase in reports from older adults who lost large sums—sometimes their entire life savings—to these schemes.

To protect yourself from imposter scams:

• Ignore unexpected calls, texts, or emails asking for personal details.
• Contact your bank or financial institution directly using official channels.
• Never confirm sensitive information or share passwords.
• Avoid entering security codes unless you initiated the request through an official source.
• Only use verified apps or websites when signing in.

Remote Access Scams: Don’t Let Scammers Take Control

Remote access scams occur when scammers convince you to grant them control of your computer. This can lead to identity theft, financial fraud, or even the loss of important data. For example, earlier this year, a fake Social Security statement email was used to trick users into installing remote access tools like ScreenConnect.

To avoid falling victim to remote access scams:

• Never give remote access, passwords, or security codes to unsolicited callers.
• Avoid clicking on links or attachments from unknown senders.
• Hang up if someone asks you to download software or grant access.
• Be cautious of anyone urging you to keep the conversation secret.
• Keep your security software updated and run regular scans.
• Back up your data regularly and use strong account protection measures.

Confidence and Romance Scams: Emotional Manipulation

Scammers often target people in romantic relationships, exploiting emotional trust to gain access to money or personal information. According to the FBI’s Internet Crime Report, confidence and romance scams affected over 7,626 victims aged 60 and older in 2024, resulting in $389 million in losses.

To protect yourself from these scams:

• Don’t send money or gifts to someone you haven’t met in person.
• Watch for red flags like fast declarations of love or requests for money.
• Take your time and ask questions to verify the relationship.
• Discuss the new relationship with trusted friends or family members.
• If targeted, report the scam to the FBI’s Internet Crime Complaint Center.

Charity Fraud: Beware of Fake Causes

Charity fraud involves scammers pretending to be legitimate charities to collect donations. One recent case involved a TikToker who raised nearly $1 million for a non-existent charity over three years. Donors sent money through Venmo, PayPal, and CashApp, which were then deposited into her personal accounts.

To avoid charity fraud:

• Research charities using trusted sources like the BBB Wise Giving Alliance or Charity Navigator.
• Go directly to official charity websites by typing the URL into your browser.
• Be cautious of unsolicited donation requests.

Investment and Social Media Scams: Too Good to Be True

The FTC has highlighted investment fraud and online shopping scams as major threats. These scams often start on social media, offering deals that seem too good to be true. Online shopping scams were the second most commonly reported, while investment-related scams ranked fourth.

To stay safe from these scams:

• Be wary of unsolicited investment offers.
• Watch out for scammers trying to move the conversation off the original platform.
• Avoid anyone promising high returns with no risk.
• Verify emails from investment companies by contacting them directly.
• Don’t follow ads; search for the company’s official website yourself.
• Research unfamiliar companies using terms like “scam” or “complaints.”

Tax Refund Fraud: Identity Theft at Its Worst

Tax refund fraud is a form of identity theft where scammers use your personal information to file false tax returns and claim your refund. Recently, a new IRS imposter scam targeted college students and staff, using phishing emails to steal sensitive data.

To protect yourself from tax refund fraud:

• File your taxes early to reduce the risk of fraud.
• If your return is rejected due to a duplicate filing, submit IRS Form 14039.
• Remember that the IRS will only contact you by mail.
• Ignore calls, texts, or emails claiming to be from the IRS.
• Use IRS Identity Theft Central for guidance and consider an Identity Protection PIN.
• Check your state’s identity theft resources and continue filing and paying your taxes.

By staying informed and taking proactive steps, you can significantly reduce the risk of becoming a victim of fraud. Always remain vigilant and never hesitate to report suspicious activity.