According to the Stanford Center on Longevity’s Financial Security Division, Americans lose $50 billion a year to financial fraud. Here’s what you should do if it happens to you or someone you care about. We often read about people being tricked on the internet into paying substantial sums of money for the ability to trade online but end up falling victim to a financial scam. Usually, our first thought is that this kind of misfortune can’t possibly happen to us. Well, let’s begin by bursting that bubble: Financial scam victims come from all different sectors, age groups, countries, and socioeconomic levels. That’s why you shouldn’t feel ashamed if it happened to you. The people behind these scams are masterminds at extorting money. There are a few things you need to do as soon as you’ve realized you’ve been cheated – with an emphasis on ‘as soon as’, since the longer you wait, the harder it might be to retrieve what’s justly yours.
Are You a Potential Scam Victim – Here’s What You Need To Do ASAP!
Contrary to popular belief, financial scams do not only affect the most vulnerable or naive among us. Investment fraud victims were more likely than investors, in general, to have a four-year college degree and earn more than $50,000 per year, according to a 2017 survey by the AARP’s Fraud Watch Network. To take one prominent example, the victims of Bernard Madoff’s Ponzi scam included a slew of people you’d think would know better. Professional con artists are just that: professionals and they are quite skilled at what they do, whether it’s penny stock scams, credit repair scams, COVID-19 scams, or whatever the current variation is. Despite the fact that there is a wealth of information on how to recognize and prevent scams here on Investopedia and on the websites of government agencies that deal with the issue on a daily basis, many individuals are still duped. What should you do if you find yourself among them?
- Listen to your suspicions
It could be an indication that something is wrong if the individual you’ve been interacting with stops returning your calls. If you aren’t receiving regular account statements, or if your statements indicate unexplained losses or constant returns despite market fluctuations, these could also be indicators. When it comes to withdrawals, if you get the runaround, your money could be long gone.
- Cancel your credit card payments
Well, the first step would actually be not to panic. Fund recovery is possible if you act quickly. After you’ve realized something’s wrong, immediately cancel any further payments you have to the scamming company. We’d even recommend going as far as canceling your credit card entirely since as long as the scammer has your card details, you’re not out of stormy waters.
The logic behind this step is double: first, obviously, to stop the scammer’s ability to take any more money from you, and second, to initiate a process of tracking the scammer down. Once your credit card company gets the report that a dishonest deal has been made, they can keep track of the scammer’s billing details – which will make tracking them down easier later on.
- Delete the account
This may seem obvious, but you’d be surprised how many scam victims forget to take this important measure. While deleting your account on the scamming website may not necessarily stop future billing, it will indicate to the scammer that you’re on to them, and that it would be best if they discontinue their dishonest activities.
This is also important for any future possible court hearings, which may be obligatory in the process of refunding your money. Once you have some sort of proof that you officially approached the scamming company and requested they stop taking your money, you may have a better case for the judge to hear (especially if, despite that request, the scamming company continued to bill you).
- Report to local authorities
You’d be astonished at how many scam victims keep their losses to themselves, and the excuses they provide. Only 35% of financial fraud victims reported the occurrence to authorities, according to a 2015 poll by the FINRA Investor Education Foundation. Respondents to the survey cited four primary reasons for their apprehension: 48 percent said it wouldn’t make a difference, 35 percent said they just wanted to get it over with, 29 percent said they were humiliated, and 26 percent said they didn’t know where to turn. Investment fraud victims should not only report the crime but also inform as many agencies as possible, according to Gerri Walsh, president of the FINRA Investor Education Foundation. Investors can use the FINRA Investor Complaint Center to report problems with brokerage firms and brokers, as well as links to register complaints with the Securities and Exchange Commission, the Commodity Futures Trading Commission, and the National Futures Association.
The Federal Trade Commission (FTC), your local FBI office, your state attorney general, and your state’s securities regulators may also be of assistance, depending on the nature of your complaint. The North American Securities Administrators Association (NASAA) website has contact information for that last group. You should also seek legal advice from a private attorney, especially if your loss was significant.
Be wary of any unsolicited attempts to assist you in recovering your funds. Con artists that specialize in fraud recovery swim with scammers like pilot fish with sharks, swooping in to rip extra bites out of what’s left of your money. Be extra aware of anyone who requests payment in advance, as this is an illegal practice in and of itself, according to the FTC.
After you’ve taken all measures possible to ensure no more billing is done on the scammer’s side, you need to start acting legally against them by filing a formal complaint. Your nearest police station is the first stop, where you’ll probably be asked to fill out a complaint form. Make sure you keep a copy of that form, it may come in handy in the process of retrieving your money.
But reporting to authorities does not only mean going to the police. Many countries have special bodies which deal with online frauds, like consumer rights bureaus or cyber defense authorities. The more complaints you file, the better your chances are regarding future legal steps. Moreover, your interest should be not only your money but also to stop any further scamming by the company – and that’s a step in that direction.
- Make careful notes and save the evidence
“Write down your tale as soon as you realize you’ve been duped,” Walsh advises. “Investigations can take a long time, and even if you think you’ll recall, your memory may be hazy in two years.” Keep copies of all account statements, as well as canceled checks, e-mails, and other relevant documents. For example, canceled checks could aid investigators in determining where the money was put. Whatever you do, don’t invest any additional money in a deal you’ve been suspicious of. You would think you’d never do something like that, but Walsh claims it occurs all the time. Keep in mind that these are masters of persuasion.
- Consult our experts
Now that we have all of the bureaucracy off of the table, it’s time to see how you can actively snatch your money back from the crooks. This may be a long and exhausting process since these crooks are not new to the trade and know-how to avoid you and your claims at all costs. Sadly, trusting police investigations alone is usually not enough. You need to take action against the scammer, and the ASAP rule stands here as well.
That’s where our experts come into play. We’re here to listen to your complaint and see if, and how, we can help. Bring all of the relevant paperwork to a free consultation meeting and we’ll get the wheels rolling if our offer suits you. You can also try and go at this on your own, but beware: We’re talking about a long and tiring investigation that might lead to a long and tiring legal process. Our experts have the experience needed to make it as quick and simple as possible – and the approximately $10 million we’ve already recovered is testimony to that.
- Don’t blame yourself
Even if you overlooked what now appear to be glaring red flags, you aren’t the first and, unfortunately, you won’t be the last to do so. “Knowing you’re being conned is quite difficult at the moment,” Walsh says. As a result, don’t be too hard on yourself. Keep in mind that you are not a criminal. The criminal is the criminal, and the criminal is the criminal.
- Remain grounded and in control
Unfortunately, your chances of obtaining all of your money back are slim, even if you deal with a fund recovery service like ours. If you report it, you have a chance of getting something back, however, if you don’t report it at all, you will almost certainly get nothing. As with other sorts of thefts, you may be eligible for a tax deductible. What to do is explained in IRS Publication 547, Casualties, Disasters, and Thefts. It’s worth noting that some of the unique tax restrictions implemented in the wake of the Bernie Madoff crisis now apply to Ponzi scheme victims.
Lost money to online fraud? We will recover your funds !
Actions to Take If You Paid a Con Artist in One of Many Ways…
⛶ Did you use a credit card or a debit card to make your purchase?
Contact the credit card or debit card’s issuing business or bank. Inform them that the charge was bogus. Request that they reverse the transaction and refund your money. Has a scammer taken money from your bank account without your permission? Notify your bank that an unlawful debit or withdrawal has occurred. Request that they reverse the transaction and refund your money.
⛶ Did you use a gift card to make your purchase?
Make contact with the gift card’s issuer. Inform them that it was used in a fraud and request a refund. Both the gift card and the gift card receipt should be kept.
⛶ Did you use a service like Western Union or MoneyGram to send a wire transfer?
Make contact with the wire transfer service. Inform them that the transfer was fraudulent. Request that they reverse the wire transfer and return your funds. MoneyGram can be reached at 1-800-666-3947, while Western Union can be reached at 1-800-325-6000.
⛶ Did you use your bank to send a wire transfer?
Report the unauthorized transfer to your bank. Inquire whether they may cancel the wire transfer and refund your funds.
⛶ Did you use a money transfer app to send money?
Report a fraudulent transaction to the money transfer app’s company and ask if the payment may be reversed. Report the fraud to your credit card company or bank if the app was linked to a credit card or debit card. Inquire if the fee can be reversed.
⛶ Did you make your payment in cryptocurrency?
Inform the company you used to transmit the money that the transaction was fraudulent. If feasible, request that the transaction be reversed.
⛶ Have you sent any cash?
If you sent it via US mail, call the US Postal Inspection Service at 877-876-2455 and request that the package be intercepted. Visit USPS Package Intercept: The Basics to learn more about this process. If you use another delivery provider, get in touch with them right away.
⛶ Have you ever given your Social Security number to a scammer?
To find out what steps you should take, including how to check your credit, go to IdentityTheft.gov.
⛶ Have you ever given your username and password to a scammer?
Make a strong new password. If you use the same password elsewhere, you should change it as well. It was a sham transaction, according to them. If feasible, request that the transaction be reversed.
The easiest method to deal with investment scams is, of course, to avoid them in the first place. Still, if you’re snared by one, report it immediately, both for your own safety and the safety of others. At the very least, you’ll feel good about helping to put a con artist out of business for a while. You’re not alone! Millions around the world have already reported that they are victims of these bad people. You should not, in any way, hesitate about getting your money back just because you’re ashamed it has happened to you. We’re also here to listen throughout the process if you’re having doubts or need someone to talk to – and you can also share your story with family and friends. Moral support is important here, don’t underestimate it.