Impersonating banks ranks as the most frequently reported category of text message scam.
The Federal Trade Commission (FTC) has recently unveiled that the most frequently reported text message scam involves bank impersonations.
In 2022, reports of bank impersonation scams via text messages surged to 20 times the number recorded in 2019. According to the FTC, consumers reported losses exceeding $330 million due to text message scams in 2022. It's crucial to note that losses incurred from bank fraud or scams are not covered by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).
While banks provide a secure environment for your funds, there are several fundamental yet essential steps you can take to prevent falling victim to a text message scam impersonating your financial institution. Here's a guide on safeguarding your money from text message scams involving bank impersonation:
Avoid Acting Under Pressure
Text message scammers often strive to create a sense of urgency, pushing you to take immediate action to prevent financial loss. They might send urgent messages prompting you to call a number or click on a link due to alleged suspicious activity.
"Any form of pressure tactic is illegitimate — that doesn't represent your actual bank," emphasizes Paul Benda, the Senior Vice President of Operational Risk and Cybersecurity at the American Bankers Association. When it comes to financial decisions, it's vital to avoid taking actions under the influence of fear, stress, or pressure.
Refrain from Clicking on Links in Unsolicited Texts
If you receive an unexpected text message, exercise caution, especially if it seems to originate from your bank.
According to a recent survey conducted by security experts at Security.org, 66% of respondents reported receiving suspicious texts from unfamiliar senders, with approximately 20% admitting to clicking on links sent by strangers. This is not advisable. "Approach any unsolicited communication with a high level of caution," advises Benda.
In 2022, major banks were popular targets for scammers seeking to impersonate financial institutions. The Federal Trade Commission (FTC) reported that the most prevalent scam text messages frequently masqueraded as large banks, including Bank of America, Wells Fargo, Chase, and Citibank.
Avoid Dialing Phone Numbers from Texts
Just as you should exercise caution with clicking on links from unknown sources, refrain from clicking on or dialing phone numbers received in text messages. Instead, locate the official phone number for your bank through its official website or mobile app. Initiate contact using the verified phone number to ensure you're communicating with a legitimate representative. This step is crucial in confirming the validity of the issue.
Tremaine Wills, a financial advisor and founder of Mind Over Money, a financial literacy company in Newport News, Virginia, underscores the importance of making the right phone call: "Making that phone call can be the difference between getting scammed versus not getting scammed."
One specific type of text scam led to a median loss of $3,000 in 2022, according to the FTC. This involved a text from an individual impersonating your bank, prompting you to reply with a "Yes" or "No" to validate or deny a suspicious transaction. Upon your response, the scammer would call you under the pretext of providing assistance. Their ultimate objective was either to illicitly transfer funds out of your account or obtain sensitive information, such as your Social Security number.
Steps to Take If You've Fallen Victim to a Text Scam
In the event that you've fallen victim to a text scam impersonating your bank, several critical actions are necessary.
Firstly, inform your bank about the incident and seek their assistance in preventing further unauthorized withdrawals from your account. Following that, report the scam to local law enforcement. These initial steps are vital to potentially recover any funds wrongfully taken from your account.
Lastly, file a complaint with the FTC at ReportFraud.ftc.gov and/or report the incident to the Federal Bureau of Investigation’s Internet Crime Complaint Center. The FTC also advises forwarding suspicious text messages to 7726, a service that helps wireless providers identify and intercept similar fraudulent messages. Additionally, you can report and block suspicious text messages within your messaging app.
Maintaining a solid understanding of your account activity is a crucial aspect of safeguarding your finances from scams.
"Establish a routine to stay informed about your account transactions," emphasizes Wills. If you're not fully aware of your account's activities, you might become more susceptible to feeling alarmed by a text message purporting to be from your bank, she advises.
%20(1)-Photoroom.png)