Fraud Trends to Watch in 2023

Scammers are not slowing down in 2023. They will likely take what they have learned in past years and continue to evolve their attempts to gain financially at your expense.

Changes in the economy often result in an uptick in scams and the number of people falling for them. Federal Trade Commission data shows that consumers reported losing more than $5.8 billion to fraud in 2021, an increase of more than 70% over the previous year. Within the cyber fraud category, increasingly common types of scams include student loan fraud, debit and credit card fraud, Business Email Compromise (BEC), and romance and employment scams.

Student Loan Fraud

As federal student loan debt relief becomes available, scammers are taking advantage of borrowers who are hopeful to have their loans forgiven. There are several tactics used by scammers that borrowers should be aware of so you can protect yourself and your finances.

Never pay to apply for federal student loan relief. If anyone contacts you requesting payment, guaranteeing approval or promising a quicker forgiveness process, you are being targeted by a scammer. Pay close attention to the sender’s address if you receive an email regarding debt relief, because typos or random letters indicate a fraudulent email address. During the application process, nobody should ask for your bank account or credit card information. For more information regarding federal student loan debt relief fraud, visit the Federal Trade Commission's website.

Virtual Debit and Credit Card Fraud

Electronic payment fraud has increased as more people at home use the internet to shop for everything from shoes and school supplies to cleaning products and grocery staples. Once you search for a product, targeted ads start showing up for that product, tempting you to make a purchase. However, not all of these ads, and the websites they link to, are legitimate. You may order the shoes or school supplies and never receive them.

Business Email Compromise

With the increase in remote workers, this scam has become quite common. For example, you may get an email that appears to be from one of your business’s vendors asking about a payment that is due. They may provide you with a Venmo or Zelle account or a new bank account number to replace the legitimate payment information you have on file.

The scammer may have a similar email address, maybe one letter is different from the vendor’s or with an added dash or period. In some cases, the scammer could have even duplicated the vendor’s email address. Once a wire transfer is sent, the likelihood of getting any funds back is very small.

BEC takes advantage of workers who are trying to get things done and may not have the right person nearby to ask quickly. According to the FBI’s Internet Crime Complaint Center (IC3), in 2021 the IC3 received 19,954 BEC and Email Account Compromise complaints with adjusted losses at nearly $2.4 billion.

Romance and Employment Scams

Scammers often take advantage of people looking for a job or a friend. They know how to target those who are in search of companionship, often preying on people that are lonely or isolated. When it comes to employment scams, often the fraudster will promise remote work, such as processing payments or working as a secret shopper. In both romance and job related scams, the scammer will tell you they need to send you money—they might even ask for your online banking login credentials or your account number so you can get paid. Instead, they send you a counterfeit check, or wire you stolen funds from another scam. The scammer will often tell you to not tell your bank, which is part of the scam. A scammer may also ask you to purchase gift cards and read them the redemption codes from the card.

Telephone Scams

While fraudsters do their best to stay ahead, both technologically and creatively, remember that more traditional types of fraud have not disappeared. There has also been a recent uptick in telephone fraud. If you receive unusual calls or emails claiming to be from your financial institution and requesting your personal or account information, such as your online banking credentials, do not respond.

Your bank will not request your personal information (e.g., account number, Social Security number, PIN, user ID, debit card number, passwords or any verification codes) through email, U.S. Postal Service mail, live or automated phone call, or text message. Similarly, do not respond to an email, phone call or text message urgently requesting you to activate or update an account. When in doubt, contact the account provider directly through a support email address or phone number found directly on their website, rather than responding to the message in question. If you believe your bank accounts have been compromised, contact us immediately at (833) 896-2850.

How Banks Can Protect Their Clients

At Enterprise Bank & Trust, we work hard to help clients avoid fraud and educate them to spot potential scams and take measures to protect themselves. We have a dedicated team of fraud experts in prevention and investigations. We continuously educate our staff so that they can help spot possible fraud, and offer many fraud prevention services for businesses and retail clients, such as positive pay service for checks and ACH, and dual-control security options including multi-factor authentication for online banking. Additionally, you can find articles and information relevant to your accounts on our website and through online banking messages, so you know what a suspicious email, link or URL could look like.

The best defense that a bank or financial institution can offer its clients is a cross-team effort. We foresee cyber fraud and scams to remain a great risk, and attacks continue to advance in complexity and creativity. Fortunately, there are actions you can take today to protect yourself and your business:

  • Research lenders and work directly with your banker to apply for loans.
  • Check your credit report regularly to make sure no loans have been taken out in your name by a scammer.
  • Work with the treasury management department of your bank to take advantage of fraud solutions that help protect your accounts from fraudulent activity.

Review your fraud prevention plan periodically and lean on experts to ensure that both employees and clients are well-educated on fraud. For more fraud prevention tips, check out our Fraud Prevention Best Practices and Fraud Prevention Checklist for business owners. For additional articles and educational materials, head to the Fraud Prevention section of our website.