Financial scams can happen to anyone. Fraudsters may contact you by phone, email, text message or social media, and they often impersonate organizations or people you know and trust. Scams can be difficult to recognize, especially when fraudsters create a sense of urgency or use personal information to make their messages seem legitimate. The good news is that knowing what to look for can help you protect yourself.
Common signs of a financial scam
Scams take many forms, but they often share some common warning signs.
Be cautious if someone:
- Pressures you to act immediately
- Asks for your password, PIN or security code
- Requests personal or financial information unexpectedly
- Asks you to send money by gift card, cryptocurrency, wire transfer or another unusual method
- Tells you to move money to "protect" it
- Sends you a link and asks you to log in or verify your account
- Claims you've won a prize you didn't enter
- Promises unusually high or guaranteed investment returns
- Uses threats, intimidation or fear to make you act
- Asks you to keep the transaction secret
If something feels unusual, stop before you act.
Common types of financial scams
Fraudsters continually develop new approaches, but several types of scams are particularly common.
Phishing scams
Phishing messages are designed to look like they come from a legitimate organization, business or person. A message might claim that there's a problem with your account, a payment or a delivery and ask you to click a link or provide information.
Don't use links in unexpected messages to access your financial accounts. Instead, visit the organization's official website or use the phone number you normally use to contact them.
Text message scams
Fraudulent text messages may claim that you've received a refund, owe money, have a delivery problem or need to verify an account. Be especially cautious when an unexpected text asks you to click a link or provide personal information.
Impersonation scams
A fraudster may pretend to be from your financial institution, a government agency, a business, the police or even a family member. The caller may know some information about you, which can make the request seem legitimate. Don't assume a caller is genuine simply because they know your name or other personal details.
Romance scams
Romance scams often begin through social media, dating platforms or online communities. After establishing a relationship and building trust, the fraudster may ask for money or financial assistance. Be particularly cautious if someone you've met online asks you to send money, invest on their behalf or provide access to your financial accounts.
Investment scams
Investment scams can involve promises of unusually high returns, guaranteed profits or exclusive investment opportunities. Fraudsters may use professional-looking websites, fake testimonials or social media advertisements to appear legitimate. Before investing, independently verify the person and organization offering the investment. Don't rely solely on information provided by the person contacting you.
Family and emergency scams
A fraudster may pretend to be a family member or someone close to you who urgently needs money. They may claim to have been involved in an accident, arrested or stranded somewhere. Don't let urgency prevent you from verifying the story. Contact the person directly using a phone number you already have rather than replying to the unexpected message.
Protect yourself before you respond
A few simple habits can reduce your risk of becoming a victim of fraud.
Stop and verify
If someone unexpectedly contacts you about your money or personal information, don't feel pressured to respond immediately. End the conversation and contact the organization using a trusted phone number or website.
Never share your passwords or PINs
Your financial institution should never need you to disclose your online banking password or PIN. Never share security codes sent to your phone or email unless you are certain why they are being requested and who you're dealing with.
Be careful with links
Don't click links in unexpected emails or text messages, particularly if they ask you to log in, make a payment or provide personal information. Instead, navigate to the organization's official website yourself.
Use strong security practices
Use unique passwords and enable multi-factor authentication wherever it is available. Keep your operating system, apps and security software up to date.
Monitor your accounts
Regularly review your bank and credit card accounts for transactions you don't recognize. The sooner you identify suspicious activity, the sooner you can take action.
Talk to someone
If you're unsure whether something is a scam, ask someone you trust before sending money or information. You can also contact your financial institution using an official phone number and ask for guidance.
There is no shame in asking.
What if you've already responded to a scam?
If you've sent money, provided personal information, shared a password or believe someone has accessed your account, act quickly. Contact your financial institution using its official contact information and explain what happened.
Depending on the situation, you may also need to:
- Change compromised passwords.
- Contact your credit card provider.
- Monitor your financial accounts for suspicious activity.
- Contact the Canadian Anti-Fraud Centre.
- Report the incident to your local police service if appropriate.
- Monitor your credit report if you believe your identity has been compromised.
Don't be embarrassed or afraid to report a scam. Fraudsters are skilled at manipulating people, and being targeted doesn't mean you were careless.
What your financial institution will and won't ask for
It's important to understand how your financial institution communicates with you. For example, YNCU states that its financial advisors will not ask members for their passwords or PINs. If you're uncertain whether a communication is legitimate, don't respond to it. Contact YNCU through a trusted channel and ask whether the communication was genuine.
Stay informed about new scams
Scams evolve constantly. Fraudsters adapt their tactics to current events, new technologies and the ways people communicate. For current information about fraud trends and reporting, consult the Canada Anti-Fraud Centre and other official Canadian sources. Learning to recognize the warning signs is one of the best ways to protect yourself — but if something does go wrong, remember that you're not alone. Contact your financial institution as soon as possible and take action.
This article is for general educational purposes only and does not constitute financial, legal, cybersecurity or other professional advice.
