How to Identify and Avoid Impostor Fraud

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Impostor scams are exactly what they sound like — crooks pose as someone (or something) else to try to convince you to send them money. This is by far the most common form of fraud reported to the Federal Trade Commission (FTC). The agency logged 382,211 complaints about impostor scams in the first nine months of 2018, more than for the next six fraud types combined. Victims of impostor fraud reported losses of nearly $356 million over that period.

The scam generally starts with an unsolicited phone call, email, text or social media message. Con artists impersonate people and organizations you would ordinarily trust, or at least hear out, such as:

Whatever the pose, the message will be urgent: A bill is overdue. An account has been compromised. A computer is infected. A cause needs your support. A loved one is in trouble. Some impostors pretend to be bearing good news — you’ve won a lottery, say, or a government grant. Resolving the problem or claiming the prize is a simple matter of making an immediate payment (preferably by gift card or wire transfer) or providing personal data such as a Social Security or bank account number.

Most impostor scams are quick hits — the goal is to cajole or frighten you into making a rash decision, then disappear. But some crooks create entire fake personas on dating sites or social media and then invest weeks in cultivating relationships online. The method is different, but the end is the same: The impostor will eventually ask for money, for a reason that sounds plausible and by a method that’s probably not traceable.

Warning Signs

  • You receive an unsolicited call or email claiming you owe money to a business, utility or the government, and risk dire consequences such as arrest or an account being frozen if you don’t pay immediately.
  • A caller says you’ve won a prize or qualify for a grant, but you must pay an upfront fee to collect it.
  • A caller claiming to be from a tech company or internet service provider says he's detected a virus or malware on your computer.
  • You receive a call or text message from someone who claims to be your grandchild or another close relation and to need money for an emergency.
  • The person contacting you asks for payment by wire transfer, gift card, prepaid debit card or cash. Scammers favor these methods because they are hard to track.

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