Veterans Are Frequent Targets of These 5 Financial Scams
Financial scams can happen anytime of the year, but if you’re a U.S. military veteran or service member, scammers may have their eyes on you this Veterans Day.
According to the Consumer Sentinel Network, last year, there were nearly 100,000 complaints from military veterans and service members.
Local financial professional Derek Gregoire listed the five most common scams that could potentially harm veterans: imposter, identity theft, debt collection, bank and lender, and prizes/sweepstakes/lottery scams.
Scammers have set up a phony telephone line that very closely resembles the Veterans Affairs “Veterans Choice Program” real telephone number, says the Federal Trade Commission. A message on the phony line says the caller is eligible for a rebate if they provide a credit card number, but instead their own account will be debited.
It is important to remember that if you’re a veteran, or you’re helping one with health care, the VA will not ask for your financial account information.
Identity Theft Scams
Identity theft scams can cause long term damage. The most common way to be contacted is by phone or email, but theft can also occur if a thief goes through your mail or garbage. The scammer will then use your personal information to open fake accounts like a credit card, bank, and phone and utilities.
Gregoire recommends everyone check their credit report at least once a year to look for anything suspicious. Free reports are available from each of the three credit bureaus.
Debt Collection Scams
The debt collection scam is when someone says they are from a collection agency and you need to pay off your debt or you’ll be arrested. Make sure you verify the debt they are talking about is legitimate. Just because the person might have your name and Social Security Number does not mean the debt is real.
According to credit.com, under the Fair Debt Collection Practices Act a debt collector must provide you with a letter within five days after they first contact you.
Banks and Lender Scams
These types of scams can come in many forms. Again, you might receive a call, email or letter in the mail. The scammer could say they’re contacting you about a mortgage, issues with bank or credit union products, payday loans, student loans, auto title loans and other finance company lending products and services.
This type of scam is known for saying you’ve been approved for a loan even before your financial history is verified. The scammer also will use pressure tactics and even threats.
Gregoire says a reputable bank (one with a physical address, phone number, and website) will never request you give money upfront or charge a fee to review a personal loan application.
Prizes, Sweepstakes and Lottery Scams
If you receive a call, email or even a text message saying you’ve won a dream vacation, a car or money, it’s most likely it’s a scam.
Red flags for the prize scam are if the person says you have to pay taxes or some sort of shipping costs. They might even mail you a check that looks real, but it’s ultimately fake.
It’s actually illegal for a sweepstakes company to ask you to pay a fee or buy something to increase your chances of winning, Gregoire says.
According to Gregoire, the best way for veterans to avoid scams this Veterans Day is to do your research, keep your guard up, avoid wire transfer, and use “active duty alert” on your credit reports by applicable.