Scammers have used the pandemic to their advantage and are far from finished, said Frank Abagnale, the man whose life was portrayed in the movie "Catch Me If You Can."
Abagnale knows a thing or two about fraud. As viewers may recall from the 2002 film, Abagnale, played by Leonardo DiCaprio, was still a teenager when he began orchestrating millions of dollars worth of scams, forging checks and assuming other identities, including a pilot and a doctor. Since then, he has taught federal agents, law enforcement officers and financial institutions in fraud prevention seminars. AARP hired Abagnale last year to write a book called "Scam Me If You Can" to help Americans fight criminals' attempts to steal their identities and get them out of their savings.
In his research, Abagnale found that while millennials are more likely to be cheated on, seniors tend to lose more money – because they have it to lose, he said. There is also a list of common human victim scams, including those involving federal agencies, online romances, sweepstakes, and “emergencies” with family members. The pandemic and the chaos it has created has fueled the flames for this scam, which will continue as the world tries to move past the coronavirus, he said.
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In all fraud situations, there are always ways to determine if something is wrong. "No matter how subtle the fraud was or how amateur the fraud was, there were two red flags," he said.
The first: Asking for Money Immediately – In these scenarios, the person on the other side of the phone, email, or text message needs to provide your credit card or bank account number at that very moment.
The second: Especially in the love plans in which the two get to know each other and often online or on the phone, scammers try to build a relationship with their victims and then say that they cannot meet in person because of an operation or financial dilemma. "If people learned these red flags, they would see them emerge," Abagnale said. "But people are basically honest and because they're honest they don't have a deceptive mind."
For example, be careful if the Caller ID for a call says the FBI, Medicare, or the police are calling. Identity thieves can easily tamper with the caller ID to indicate that an agency is calling and they can tell that there is a problem that needs to be addressed immediately. A police department is not going to tell you to pay bail online or try to prevent you from going to the local district to deal with the situation, Abagnale said.
Abagnale spoke to MarketWatch about other ways scammers have become more sophisticated and how Americans – especially the elderly – can protect themselves.
Market observation: Do you think the pandemic has spurred an increase in fraud – or could potentially lead to more fraud?
Frank Abagnale: The pandemic has resulted in a 400% increase in fraud. Scammers follow the headlines so anything in the headlines becomes a scam. I don't think we saw half of it. We will see scams with the COVID-19 vaccine. There are so many apps out there that we are in a pandemic affected environment and the threat level is increasing. I think we are going to see a lot of people trying to sell vaccines or telling you if you pay a fee you will get the vaccine sooner. Of course, everyone works from home and on the computer. So there are more goals than they would normally need to pursue.
Usually scammers are out to make money, make a profit, or sell you something, but there are plenty of malicious scams out there that are just trying to harm other people. And of course there's the fact that you can do these things from thousands of miles away while sitting with your laptop and a cup of coffee in hand. You never see the victim, the victim never sees you. Years ago we had impostors who stood for stewards. You have won your trust. They dealt one on one with you. They were well dressed, they were well spoken, they had great vocabulary and personality, and they were liked. And they had a little bit of emotional engagement with you and sometimes there was a little bit of compassion where they said I'm not going to steal all of that person's money, just some of that person's money. Today you are dealing with someone in Russia, North Korea, China, India and Jamaica. They never see their victims. There is no compassion. They just want to steal everything they can from you.
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MW: In the face of COVID, what are the latest ways scammers are trying to take advantage of their potential victims? There are so many platforms like social media, text messaging, phone calls, etc.
Abagnale: Understand that no government agency will ask you for personal information by phone or email. This is rule # 1. If you receive this type of email or phone call, hang up the phone knowing from the start that it was a scam. Every time a red flag comes up, you will be asked for your social security number, date of birth, address or the location of your bank.
I'm not on any kind of social media. Identity thieves only need two or three pieces of information. The two most important ones are where you were born and what your date of birth is. If you tell me this on social media, the rest of it will be easy for me to steal your identity.
During the pandemic, you need to watch out for people trying to sell you medicines and things to use during the pandemic, as you see advertised on TV, radio and in newspapers. If you didn't request that call or email, you have no idea who is on the other end of that line. 99% of all email attacks depend on the victim to take action.
I live by three simple rules: prevention, verification and education. Prevention, because once you lose your money, you never get your money back. Review – You need to review everything, even if someone recommends a financial advisor. I need to review this person before entrusting them with my money and savings. It's unfortunate, but everything needs to be checked. And finally, education is the most powerful tool. If I can explain this scam to you and how it works, that is the most important thing.
MW: How can people – especially older people – protect themselves?
Abagnale: AARP has a fraud call center in Denver called the Fraud Watch Network. You can call this number if you think you have been scammed or if you think you have already been scammed and don't know what steps to take next. You can be 18 years old, not an AARP member, it's there. Your attorney general in each state also has great people in their consumer departments who can answer these questions for you. I've found in my career that if you call the attorney general and get him to do something than calling the police, you're more likely to get a response. They can answer questions for you, such as: B. Whether you should send money to a charity. People never use all of the services that banks offer, such as B. Account and Security Alerts, Business Update Alerts, and Balance Alerts. They will notify you on your phone when someone tries to write a check, transfer money from your account, or use your credit card. Most of the time, these services are only free for banking transactions.
And finally, this is the best advice I give to anyone and use myself – I don't have a debit card, I just use a credit card. Every day of my life If I buy something online and it breaks and the seller refuses to take it back, my credit card will take care of it. If I buy something and it doesn't show up, my credit card will take care of it. When you use a debit card, every time you pull it out, you expose the money in your bank account. You can use it 20 times a day for 20 years, but you will never add a point to your score. In all investigations during the hacks at Target, Home Depot, TJ Maxx – after the breach when interviewing people, some said they used their credit card and a few days later it was canceled and FedEx sent them a new one. Another person using a debit card had to wait three months while the investigation was still ongoing to get their money back. I just use my credit card to remove personal liability. I understand that some people are not good at money management and need to use a debit card, but if you want to manage it well and increase your score and make sure you are out of money, the best security device in the world is a personal credit card. And as you get cash, I ask the bank for an ATM card – not an ATM debit card.
Especially with seniors, I urge them to freeze their loans.
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MW: What role should family and friends play in helping older people protect themselves?
Abagnale: Always make sure to search and remind them that these scams are taking place. Just like my book, people read it and it tells you every scam. A year later something happens and you can say I think I read about it, pulled out the book and saw how it works. AARP has many resources and you do not need to be a member. There are tools to educate people. But it is very important that loved ones are aware of these things.
People are basically honest. You may not believe that people do these things, but unfortunately they do. If you make it easy for someone to steal from you, it is unfortunate, but there is a chance that someone will. So don't make it easy for yourself.