Recommendation to Prevent Financial Scam

Recommendation to Prevent Financial Scam

Name

Professor

Course

Date

Recommendation to Prevent Financial Scam

In the United States financial scams is among the leading form of cybercrime being tackled and that has also proved quite difficult to handle because of several factors. The most targeted individuals are often the senior citizens because most do not really understand technology which is often used. However, even the rest of the population may still fall into the hands of scammers. The scammers tend to use love and a mixture of fear making their targets comply and send them money. Some of these financial scams are often Ponzi investment schemes that lure people into investing their money with the hope that they will be able to gain huge dividends from the investments. There have been several investment schemes that have failed and but these schemes have been repeatedly used to swindle people off their hard earned money. There are a few things that can be done in order to prevent these financial scams.

The first recommendation is public education. Public awareness relates to routine activities theory in that people have opportunity to commit crimes thus victims should not place themselves in the situation. People need to understand how most of these financial scams works. For example, the Ponzi schemes, there several red flags that may help one identify if a said investment is a scam. The first red flag is abnormally high returns, if something is too good to be true it probably is. Although we all want money, an investment and the returns needs to have a correlation. A guaranteed return, if a person guarantees a return of your investment one needs to be skeptical as no investment is ever guaranteed. Another red flag is need for more investors thus if one asks you to get more investors or you are promised a reward for bringing in more investors then it is highly likely that it is a financial Ponzi scheme.

Aside from Ponzi schemes people should also be educated on other ways that fraudsters used to swindle money. The public should be educated on the need to safeguard one’s personal details such as PIN and passwords and should never reveal this important information on a call. No legitimate company will call and ask for passwords and pin codes. Financial scammers also often use random competition where one may receive a call that they have won something. If you do not remember participating in such a competition, then that is probably a scam. It is important for one to avoid calls that may seem as if one wants to get persona information, emails or even people who come to your door step. In case of such incidences there are numbers that can be used to call law enforcers and report such cases.

Through public education and availability of information, the public should be made aware that one should never wire any money to a stranger. One may get distress calls that they need to wire money because a loved one is sick or in jail but without verification of this information one should never send any money. Senior citizens mostly and the general public should be made aware of calls that asks of one’s social security number. The scam on Social Security number involves calls that threaten suspension of benefits or charging for services the Social Security provides for free. When one receives such a call they should report the matter immediately to the law authorities.

I believe public awareness and education is the best way one can deal with financial scams. By people being able to identify the type of financial scams that exist and the red flags to look out for then they are more likely to not fall victims.