Financial fraud comes in many forms; from mortgage scams, investment fraud, credit card fraud, predatory lending, tax fraud, to Ponzi schemes. Many times a person does not know or realize they were hit with fraud until it is too late. The Financial Fraud Research Center reports that each year over 30 million Consumers are defrauded in one form or another, leading many to financial, emotional and/or social destruction. The estimated cost for such fraud is well over $50 billion a year, and due to the fact that many consumers fail to report when they have been defrauded, fraud increases every year.
Anyone can be a victim of financial fraud
Although there is no set profile of a scam victim, research has shown that consumers between the age of 40 and over are usually the main target for scam artist. It is no surprise that consumers between the age of 65 to 74 are at the greatest risk of becoming victims of scams and financial fraud, and are the least likely to report that they have been defrauded. Research has also shown that men are more than likely to be victims of investment and/or business opportunity fraud, while women are shown to be more susceptible to lottery fraud. In one survey of financial fraud victims, it was shown that victims are twice as likely to hold a college degree and have financial literacy at above average levels, be optimistic and open to ideas, not afraid to make financial decisions, and more than likely to be male between the ages of 55 and 65.
Over the last 10 years, consumers have been hit hard in their financial pocketbooks, and to add to the burden, there has been a steep increase in taxes, food, clothes, health care costs, education, and the list could go on and on. In tough economic times many look for ways to increase their financial situation for the better, but unfortunately these are the exact conditions that fraudsters use to impose their scams on unwilling victims.
Red flag alert
There is no sure way of knowing but with proper precautions, double-checking on everything, and never acting on just instincts you can be pretty sure you will not fall victim to a scam. In other words, do not believe or trust what anybody throws at you, not even a relative, take the time to education yourself about any financial matters, and dig deep and wide before making any decision that could hurt you financially.
A few things to keep in mind when making any decisions regarding your financial future:
- Think before you act.
- Check for licenses and legitimacy
- Think twice if risk is involved, as it could it break you financially if it fails
- Don't let anyone or anything rush you into a decision, if the offer is legitimate, it should be good at any time.
- Never invest on a promise, promises can be broken.
