Beware of These Recent Scams

To protect yourself, it’s important to be familiar with trending scams — keep reading to learn about the latest.

Never share your online banking User ID or password. Patelco will NEVER contact you and ask for it — and there’s no reason anyone else needs it, ever.”

Tax season scams

It’s tax season — and your accountant and the IRS aren’t the only ones with an eye on your taxes. Scammers are on the lookout too! This sounds scary, but you can protect yourself by learning about common tax season scams. Here’s what to look for:

Phishing

Scammers pretend to be tax professionals (or the IRS) and send emails or text messages with links. Don’t click on links sent by people you don’t know.

If you get a tax email you believe is fraudulent, forward it to phishing@irs.gov.

Gift card scams

Gift cards remain a popular way for scammers to steal because they’re like cash: once someone has the gift card information, it’s nearly impossible to get back. Scammers are calling claiming to be the IRS, reaching out to collect back taxes or fines. They’ll ask you to buy gift cards and then take the card information for themselves.

Hang up and report the scam — the IRS will never ask for payment via gift card.

Refund bait and switch

If criminals have your sensitive personal information, such as Social Security number or tax forms they stole from the mail, they may file a fraudulent return on your behalf. Once the funds hit your account, the scammers will impersonate someone from the IRS and call you demanding the return of the money. They will ask you to deposit it into a different account or send a check to an address.

If you receive an unexpected tax bill or refund, file a complaint with the FTC, contact the IRS at 800.908.4490 and ask the major credit bureaus to put a “fraud alert” on your file.

Dishonest tax preparers

Unfortunately, there are scam artists posing as tax professionals. They offer to do your taxes, collect a fee upfront, and then ghost you. Only hire professionals with a valid license – check online here.

There’re also dishonest tax preparers inflating your tax return to pocket some of the refund. Criminal tax preparers will inaccurately file your taxes in order to receive a higher refund. They will pocket some of the refund for themselves. If you’re using a tax preparer, always double check their work and the amount they received from your tax filing.

Student loan scams

Americans lost an astounding $5 billion to student loan fraud in 2022.¹ As students graduate high school and look to college in the fall, scammers are busier than ever. And if you’re one of the millions of Americans with existing student loans, beware that scammers are also looking to target you regarding relief and refinancing.

Many of the scams – for both new loans and for relief or consolidation of existing loans – involve payment of fees up front. Other scammers pose as organizations simply to steal your personal information.

Here’s four ways to protect yourself from student loan scams:

• Watch out for fees. While borrowing fees exist, they are included in the principal of legitimate loans, and will come up when you take the loan out. If someone is asking you to pay fees now, out of pocket, in order to refinance your loan, make a new loan, service an existing loan, apply for debt relief, or fill out a FAFSA form, it’s probably a scammer.


• Don’t give out your Federal Student Aid (FSA) ID or password. No one should be asking you for your FSA ID and password. You will use it to log in to legitimate government websites (like https://studentaid.gov/), but if someone is asking you for it on the phone, via text, via email, or in person, you’re dealing with a scammer. Be cautious when revealing other private information.


• Resist pressure to act immediately. Most student loan scams – and many scams in general – have something in common: pressure to act immediately.


• Do your research. Speaking of being pressured to act immediately, one reason for this is that scammers don’t want you to take the time to research the name of their company or organization. Many scammers have created sophisticated, professional-looking websites and social media profiles. But don’t trust a website or social media profile by itself.


• Instead, research any person or business who contacts you. A simple search engine search of their name plus “reviews” or “scam” may reveal whether you’re dealing with a legitimate organization or not. Additionally, don’t accept as accurate any official-sounding language like “partner of the Department of Education” or “pandemic grant.”

The bottom line: if someone reaches out to you about a student loan, or if you see an advertisement on social media, do your research and think carefully before providing personal information or money.

Digital payments fraud

Our Patelco members have told us how much they love digital payments (like Venmo, PayPal, and other popular platforms) for being an easy and secure way to send money to people they know and trust. But because scammers may pose as people or businesses you know, it’s important to protect yourself — and your money.

Whether you’ve used digital payments before or are new to it, follow these tips to help you pay it safe.

• Only use digital payments to send money to people you know and trust
• Never share your online banking User ID or password. Patelco will NEVER contact you and ask for it — and there’s no reason anyone else needs it, ever.
• Never do a “test” transfer with any third-party payment service. Recent fraud uses someone pretending to be from Patelco asking you to do a “test” transaction or transfer. Patelco will NEVER ask you to do a test transfer, ever.
• Never use digital payment to make utility bill or credit card payments. A scammer may pretend to be a utility company or wireless carrier asking you to send a payment with a digital platform. Most digital payment platforms cannot currently be used to pay utility or credit card bills.
• Don’t send money back to someone who “accidentally” sent you money via digital payment. Scammers will send money from stolen accounts and then ask the recipient to send the money back — but the money sent back is your real money, while the money that you “accidentally” received is stolen.

If someone reaches out to you and says that they sent you money accidentally, tell them to reach out to their bank or credit union to resolve it. Never send the money back to them.

Social media artist scams

Fraudsters are increasingly active on social media. If someone you don’t know contacts you on Instagram or another platform and offers to pay you, the money is probably coming from a stolen financial account, especially if they ask you to transfer part of the payment back to them (or to another person). If the true owner of the stolen account reports the loss, you may be on the hook for the funds deposited into your account, plus whatever amount you send to the scammer, which may not be recoverable. Be wary of Instagram and social media scams like these:

• The artist scam: A so-called artist will DM you to say one of your photos inspired them and they want permission to create art based on your photo. The scammer will claim to work for a wealthy client whose assistant will use a payment app like Venmo to pay you. The catch? They’ll want you to send them a cut from the client’s payment. The funds you receive will be stolen – but the money you send will be deducted from your own account.
• The influencer scam: With lots of Instagram followers and likes, some influencer accounts may seem incredibly popular — but they’re only there to deceive you. If an account features an eye-catching profile picture and promotes investment opportunities or financial services, it’s probably fake or hijacked by scammers.
• The sponsorship scam: Instead of pretending to be an influencer, some fraudsters will imitate legitimate brands in hopes of scamming you. Watch for DMs from fake brand accounts, offers to pay you for advertisements, or the chance to sign up as an ambassador — it’s just another attempt at stealing your personal information or money.

Fake debt collector scams

In this scam, fraudsters threaten legal action to pressure you to pay a fake debt. In late 2022, the Federal Trade Commission (FTC) returned more than $1 million to victims of just such scams.

To protect yourself from similar scams:

• Understand your finances. Keep records of past and current debts, so you won’t get fooled by a fake debt.
• Request a “debt validation letter.” This requires the debt collection agency to prove they’re legally collecting a debt you owe.
• Regularly review your credit report so you stay aware of the status of all your accounts.
• Know your rights, including those covered under the Fair Debt Collection Practices Act.

Romance scams

It’s easy to fall for a romance scam set up on a dating app or social media. The fraudster creates a fake profile to start sending sweet messages and big proclamations to their target. Once they have your trust and affection, the asks begin. They’ll ask for money to come see you (but won’t actually come), for unexpected expenses, or for a family emergency. What will you get in return? A lower account balance.

Here’s how to protect yourself if you think you’re dealing with a romance scammer:

• Stop communication immediately.
• Don’t send money or gifts to anyone you haven’t met in person.
• Do a reverse image search of their profile image using a search engine. Is it a stock image or a photo stolen from somewhere else?
• Never send revealing photos of yourself — these can be used for blackmail.
• Talk to your trusted friends or family about your new love interest. Do they have concerns?

Want to learn more about the different types of romance scams, and how to identify and avoid them? Watch a video with one of our Patelco experts below!