Tips on how to steer clear of retirement account fraud.

In the classic G.I. Joe cartoons, episodes often concluded with G.I. Joe imparting knowledge to a group of children, emphasizing the importance of awareness by saying, “And knowing is half the battle!” This saying holds true in various circumstances, especially when it comes to scams. Being informed about common scam tactics makes it simpler to recognize and avoid falling victim to them.

If you are no longer working or preparing for retirement, these suggestions can assist you in understanding what to watch out for and steer clear of typical fraud attempts that target your retirement savings in a 401(k) account. IRA Individual Retirement Account (IRA) or similar investment accounts.

Phone and text

Scammers view their actions as a game of numbers, casting out numerous traps in the hopes that someone will fall for them. The concerning part is that they can carry out these deceitful schemes from the convenience of their own homes, using only a smartphone.

Below are three popular scams where you might receive either a phone call or a text message.

IRS scam

In this fraudulent scheme, an individual pretending to be from the IRS reaches out to you. They might inform you that there is an error on a tax document or that you failed to disclose a part of your retirement earnings.

No matter what they claim, the main goal is to obtain your personal information in order to either steal your identity or access your retirement savings. For instance, they might mention having your Social Security number and ask you to confirm it to ensure they are speaking to the correct individual.

Scam involving fraudulent package delivery.

This type of scam is very common and you may have encountered it before. You might receive a message from a person who says they are from UPS, FedEx, or a different courier company. The message states that there is an issue with delivering a package and asks you to confirm your details. They often provide a link in the message that directs you to a website.

By clicking the link, the scammer will install malicious software on your phone or prompt you to input sensitive details such as a username or password. With this information, they will attempt to access your retirement account.

Scam involving receiving calls or messages from an unknown person who has dialed the wrong number.

The scam involving the wrong number relies on individuals either feeling isolated enough to interact with the scammer or too courteous to ignore the message and mark it as spam. When you inform them that they have dialed the wrong number, they try to initiate a conversation.

Consider it a long-term deception, as these fraudsters typically invest days or even weeks in building a false friendship with you. Subsequently, they will attempt to persuade you to send money or disclose sensitive details that can be exploited to drain your retirement savings. bank account .

Ways to prevent falling victim to these fraudulent schemes:

• Be aware that the IRS will never reach out to you through phone or text to make threats or request information. Avoid interacting with them.
• Do not respond to any text messages from individuals you are not familiar with.
• Avoid clicking on links that are sent by individuals whom you are not familiar with or do not trust. This caution also applies to links shared through text messages or emails.

Technology

Fraudsters can use advanced technology to deceive you and steal your retirement funds.

Fraudulent scheme involving individuals pretending to be technical support representatives to deceive and exploit victims.

A tech support scam occurs when someone reaches out to you claiming there is a problem with your computer. It can be particularly deceptive for individuals who are not knowledgeable about technology. For instance, a person might phone you and pretend to be from the tech support team at your financial firm, seeking assistance in gaining access to your device. internet-based investment account Alternatively, you might encounter a notification that appears on your screen while browsing the internet, alerting you to a malware infection.

In order to solve the issue, you are asked to share personal information. Scammers exploit this information to gain access to your retirement savings. If they are uncertain about the brokerage firm where your retirement account is held, they will engage in conversation with you hoping that you will reveal the name of the brokerage.

Social media fraud

Fraudsters can gain unauthorized access to an account or make a new account that seems to be owned by one of your acquaintances. Since it is possible for anyone to be on the receiving end of an online chat, scammers might invest a significant amount of effort in persuading you of their true identity.

Once scammers think they have gained your trust, they might request money under the pretense of needing assistance to resolve a problem. They target retirees assuming they have accumulated a substantial amount of savings.

AI scam

Scammers can take advantage of artificial intelligence (AI) to deceive individuals into believing that they are being contacted by someone familiar to them. One common scheme includes impostors pretending to be a grandchild in need of help.

When soliciting money, you may feel pressured to comply, especially if the scammer provides an audio or video recording, which could be manipulated using AI technology.

Ways to prevent falling for these fraudulent schemes:

• Be cautious of individuals who make contact with you.
• Always refrain from disclosing personal details, especially information related to your retirement funds.
• Avoid sending money through methods that are hard to track, such as gift cards or cryptocurrency.
• Notify the police of any interactions that seem menacing.

After putting in effort to earn your money, you should not have to face scammers. Nevertheless, as they exist, it is wise to have a strategy in place to protect yourself before they attempt to reach out to you.