It is a sad reality that, after being the target of an online scam, the nightmare does not end there. Even after recovering the financial funds you have lost to an online scam, the possibility of becoming a victim is high.

In this article, we will see how scammer strategies do not really end after ripping off victims involved in a scam.

Understanding the Dark Side of Scams

When an individual falls victim to an online fraudulent activity, the chances of becoming a victim of another scam remain high. It is due to the fact that scammers when they prey upon an individual, collect all the sensitive data that the scammer can abuse in the future.

These scammers then sell the data collected on the dark web, where another scammer or hacker might find it interesting. As a result, the nightmare for the individual does not end there. A victim might identify unauthorized entry and also a bank account that the individual has not opened up. Thus, after an online scam, the individual might become a victim of identity theft.

Types of Financial Fraud

We live in a digital world where it has become a boon and a bane. With the ease with which we can access and apply for any financial services by sitting at home, scammers and hackers prey on individuals by staying inside their homes.

Phishing

Con artists will randomly send emails, texts, and messages with the hope that someone falls prey to such a scheme. Just as a fisherman uses bait to catch fish, these con artists use bait to catch potential victims, and they do this by working on the emotions of their prey.

The message generally portrays a sense of urgency because the penalties can be staggering. The body of the message also has a link provided that directs these potential victims to a website that will be a replica of either a utility, financial institute, entertainment, or government department. These websites can fool any untrained eye.

The individual, in sheer horror, will fill in all the sensitive data that they may not share with anyone else.

Since the website is fake, it will send in all the sensitive data to these con artists, who will either initiate fraud or sell it on the dark web.

Advance Fee Fraud

Scammers will send messages on social media platforms, messaging apps, and emails to potential victims. The body of the message states that someone rich has died and is leaving behind a substantial amount of money, and the attorney has randomly chosen you.

These con artists will request that you pay an advance fee to process the paperwork. They will ask for all the sensitive data that you might not share with anyone. Once the victim sends in the money demanded, these scammers will frequently ask for more money in one way or another.

Money laundering

Alternatively, the message would be sent by a rich person who wants to escape their home country and have a substantial amount of money. Since their government wants to confiscate their money, they need your help to transfer their financial holdings into your bank account. They make a fake promise to pay a part of their money to you as a gesture of gratitude.

It might also come from a drug lord or a warlord paying a token of their money for laundering their dirty money.

There are two outcomes: they want your bank details, and firstly, they will either hack into your bank account or steal all your financial holdings. Second, they might use your bank to launder their dirty money. If the government authorities find that you have been aiding these antisocial elements in laundering their dirty money, you will be held accountable and can face incarceration.

Lottery Winnings

You might receive an email, text, or message suggesting that you have won a lottery and that you are required to pay a sum of money to claim the sweepstake.

However, once you pay the money, scammers will frequently keep asking for money under the guise of processing fees.

Insurance Fraud

Scammers will take the sensitive information and try to reap benefits that they are not entitled to. Such types of fraud are committed under all circumstances by these scammers.

Credit Card Scam

One of the most popular types of scams is the crest card scam. Scammers will either physically steal the credit card or buy these details of the dark web to commit such frauds.

Wire Transfer

Wire transfers are quite popular with scammers and hackers. The fact that the money once transferred cannot be reversed makes it ideal for these con artists to frequently use it to rip off many.

Tax Fraud

Impersonating as an Internal Revenue Service or IRS agent, they hound their victims into giving in substantial amounts of money under the pretext that the individual has evaded tax.

Tactics Employed by Scammers

Scammers employ tactics of financial fraud through various methods to lure in their unsuspected potential victims.

Manipulation Techniques

Scammers are successful in carrying out their nefarious schemes as they instill emotion in their victims to get the desired result, like caving into their demands.

Scammers will always use a fake sense of urgency and fear of facing a heavy penalty, lifetime incarceration, or both. Since most people are law-abiding citizens, they know the consequences of messing with the law. Thus, these are the only factors that instill fear and guilt, making scammers easy prey on their victims.

Technology Exploitation

Technology is advancing rapidly and is very cheap to buy. There are several developers who develop nefarious apps and sell them on the dark web. These apps are cheap to buy, and con artists find them affordable as they can con many and make substantial amounts of money.

The internet is also cheap, and anyone with a decent amount of connectivity, along with electronic hardware and software, can target anyone around the globe.

Target Selection

As per the Federal Trade Commission, scammers can target anyone throughout society. It has been found that citizens between the ages of 18 and 59 were more likely to fall for scams that involved bogus investments or fake job opportunities.

Those over 60 were more likely to fall for a lottery or sweepstakes fraud. Thus, it can be inferred that the younger generation exposed to social media content was more aware of scams and fraudulent activity that are common in society compared to seniors.

Although the younger generation does fall for bogus investment, shopping, and job opportunities, they are successful in recognizing scams compared to the older generation.

Any scam that these con artists pull finally ends up being a financial scam. Be it a romance scam, charity scam, investment scam, and so forth, it ends up with the victim parting with most of their wealth.

The impact of each scam that the individuals find themselves in depends upon how close and how desperate they were that they were so convinced of these con artists that ended up in a betrayal of trust.

Case Studies

Several types of scams take place daily; it is when the gag is up that they get reported in the media. Although the younger generation is tech-savvy, they get their daily dose of awareness on social media platforms. Several more scams take place but are not reported on prominent news channels that are aired on cable TV.

The older generation relies on news outlets like cable TV or newspapers. There is a huge percentage of the senior population that avoids these news outlets altogether.

Again, the possibility of facing shame and getting ridiculed by society prevents them from coming up and lodging a complaint with the authorities regarding the scam they fell for.

Real-Life Examples of Financial Fraud

Bernard Madoff, a fraudulent financial advisor, would have pulled off the one-of-a-kind Ponzi scam that would have gone unnoticed had it not been for the economic downturn.

Bernard Madoff, a successful financial advisor, had a large clientele; in 1960, he founded a penny brokerage. As the clientele increased, the firm eventually grew into Bernard L. Madoff Investment Securities.

He was a con artist, and he would pay off his investors with the money pooled from new investors. Since most of his clientele were already rich, they seldom required money. Thus, it was easier for Bernard Madoff to pull off his Ponzi scheme.

In 2008, due to the financial crisis affecting the globe, his investors started to ask for their withdrawals. As the financial market was experiencing a downturn, there were not many who wanted to invest in the firm. As a result, his gag was out in the open.

Warning Signs

As we discussed any scam, a con artist pulls off an investment scam. As we are slowly progressing toward the future, cryptocurrency, another financial asset, is gaining popularity throughout the globe. Although more than a decade old, these cryptocurrencies have also gained popularity among scammers.

No matter what the situation is, there are always prominent warning signs of scams. We have listed below what is quite common in any scam. Should you ever come across any business opportunity, you can use these tips to verify the authenticity and legitimacy of said business proposal.

• The caller claims that the investment scheme is a once-in-a-lifetime opportunity.
• The entire conversation revolves around how much money you would make instead of explaining how the business model works.
• Uses heavy financial and other technical jargon to sound impressive rather than what they mean.
• The business model stresses how little or no risk is involved, but a substantial amount of money would be made.
• The caller avoids giving you any time to think about the business opportunity that has been presented in front of you.
• The caller engages in coercive and high-pressure sales tactics and wants you to sign the deal right away.

Reporting and Legal Action

As we have discussed, once you fall victim to a scam, you could end up in another scam due to identity theft. It can be sheer bad luck that you got scammed, but there is no need to get frustrated, as you can take legal recourse and claim your stolen financial funds.

You must break all communication with the scammer and gather all the necessary evidence to make your case strong.

Before you go ahead, you need to document the entire incident that led to your realization that you were a victim of an elaborate scam. You need to also include any correspondence, screenshots, recommended trading platforms, the website of the scammer, physical address, and contact details provided by the scammer. You must also not forget to mention the client service number.

You must also include your bank account number, credit card, and scammer's wire account. If it's a crypto scam, then your crypto account details and the scammer's crypto wallet details should also be mentioned.

After recollecting the entire incident, write it down, and now you are good to go and file a complaint with the concerned authorities.

• Go to your local law enforcement agency and report the incident.
• Inform the Commodity Futures Trading Commission (CFTC), the Securities and Exchange Commission (SEC), and the Federal Trade Commission (FTC).
• If you belong to another country, then please go to the concerned government department and explain to them the situation that led you to realize that you were scammed.
• Lastly, inform IC3, or the Internet Crime Complaint Center, about your situation and file a complaint.

Once you have completed all the formalities listed above, you now need to inform your bank regarding the scam incident and lodge a complaint with them.

Ask for your free report from the credit bureau agency. Go through all the entries and look out for unauthorized entries and unauthorized new bank accounts. Report to all the other rating agencies regarding the scam that took place. Request to put a freeze on the accounts until the investigation is over.

You have another alternative with you for a speedy recovery of your stolen financial assets. You can contact us at Financial Money Recovery. Our expertise lies in recovering the stolen financial assets of our clients.

Conclusion

In this digitized world, it is easy to fall victim to an elaborate scam. However, there are ways to identity theft prevention. You could avoid posting all your details on social media platforms since scammers are known to stalk their potential victims.

Avoid sharing your sensitive details with someone you have just met, be it for a business opportunity or a romantic interest.