Scammers Have Their Eyes on Your Money

With the multiple stimulus checks paid out over the past year, consumers and businesses have had a fresh pile of money to flood the system with. In the coming months, scammers will likely have their eyes on it.

According to the Federal Trade Commission, more than 380,000 fraud complaints have been submitted since the pandemic started, with consumers reportedly being bilked out of nearly $366 million. The government agency said coronavirus-related scams peaked in the spring as fears of the virus first began to spread in the U.S.

With all this in mind, it’s an especially important time for consumers to be on the lookout for scams. Here are a few of the bigger ones to be aware of.

• Payday loans

Stimulus or not, many Americans are still in financial straits. At the same time, the regulation of payday loans was rolled back earlier last year by the Consumer Financial Protection Bureau, which has made it easier for payday lenders to prey on the most financially vulnerable.

Despite the rollback, consumers need to know that though payday loans may seem appealing by providing quick access to funds, they also come with exorbitant interest rates that can make it very difficult to pay back, while also potentially causing severe damage to the consumer’s credit rating (which can make it harder to get approved for more loans in the future and hinder job prospects).

• Robocalls

Phone scammers have taken robocalls up a notch during the pandemic. In response, agencies like the World Health Organization and Federal Communications Commission have issued warnings about robocall scams and text message scams targeting both consumers and small businesses during the pandemic.

These scams can involve anything from offering false information about the virus, to selling home testing kits, to offering fake government assistance. One call claims to be from the U.S. Department of Health, warning of an outbreak “in your area.”

Consumers should know to never share personal or financial information over the phone with suspicious, unverified callers and not to open any suspicious text links from unknown numbers.

• Stimulus scams

When the first round of stimulus checks went out in April and May, government agencies warned of a variety of scams, typically in the form of fake government emails or phone calls, which tried to phish for information by posing as the IRS or claimed payment was required in order to receive funds.

Now that consumers are set to receive a new $1400 stimulus check, another round of stimulus scam calls will surely come with it. It’s important to remember the IRS–the agency tasked with sending out checks–will never contact you by phone, email, text, or social media. Consumers should only use the IRS website to submit information to the agency.

• Online shopping scams

Most people should know to only buy from verified sellers on established websites. If ordering off a website like Amazon (NASDAQ: AMZN), Etsy (NASDAQ: ETSY), or eBay (NASDAQ: EBAY), check the seller’s reviews to make sure they are legitimate. If ordering off a store’s website, make sure the company is real and check the return policy.

Consumers should also be aware of package delivery scams, where a scammer will send a fake tracking link for your package. These links may prompt you to enter personal information or call a number because of a problem with your delivery, and can also install malware on your device.

• Peer-to-peer payment scams

As a result of the pandemic, consumer adoption of peer-to-peer mobile payment apps like PayPal’s (NASDAQ: PYPL) Venmo, Square’s (NYSE: SQ) Cash App, and Zelle is growing.

These platforms are all easy to use and provide consumers with a quick and safe way to send and receive money from people they know and trust. However, their user-friendliness also makes them popular with scammers soliciting transfers, in which getting your money back can be extremely difficult.

Be cautious of anybody you don’t know requesting money via one of these mobile apps. This includes seemingly well-meaning people asking for charitable donations, such as anybody running a COVID-19 relief fund. If you’re sending money to an organization, verify how to do so using a payment app. If you’re sending money to a person, make sure to verify their information and that they are trustworthy.