Compared to a one-off theft, account takeover offers a better and longer return on investment. Compared to a credit card hack, the consequences and hassles for consumers are higher with account takeover. Federal laws and most issuers' zero-liability policies mean you usually don't have to pay fraudulent charges.

What to do if an account is hacked:

• View and verify account activity. First, go through your account activity to confirm any changes or fraudulent charges. Keep in mind that some legitimate transactions may seem fraudulent if the company does business under a different name.
• Update your system and delete any malware.  The first thing you should do if your account gets hacked is to run an end-to-end antivirus scan. This means skipping the "quick scan" setting in favor of a deep scan to identify and eliminate not only all forms of malware (including Trojans and spyware to keyloggers that could be tracking your keystrokes even after the hack has been identified) and potentially unwanted applications.  It's important to make sure you're clean before you change any of your other sensitive information to avoid restarting the cycle.  Also, set your security software, internet browser, and operating system to update automatically.
• Review Social Media Accounts.  Look for changes your social networking sites, look for changes to the account since you last logged in.  Look at your personal details, review any third-party apps connected to your account, and check your security questions and answers and your backup email addresses and/or phone numbers. If you think your hacker had a chance to scan your security questions and backup accounts, try to change these on the compromised account and on any other account that relies on the same information. This will prevent the bad actor from using your personal details to breach other accounts in the future.
• Change Your PINs & Passwords.  Once your computer is free of malware, it's time to change your password. If you've lost access to your account, you may need to contact the company directly, prove who you are and ask for a password reset. Choose a new password that is very different from your old one and make sure it doesn't contain strings of repeated characters or numbers. Your password should be unique for each account, complex (i.e., a mix of letters, numbers and special characters) and at least 15 characters long.
• Contact Other Online Services.  It's critical to change your passwords with other payment-based accounts such as Amazon, Netflix, LinkedIn, credit card companies, etc. Make sure you use different passwords for every online account.
• Notify People You Know.  Tell your friends, family and anyone else on your email contact list that they might have gotten a malicious link. During the period when attackers had control of your account, they could have sent dozens or even hundreds of fraudulent emails to everyone you know, in turn giving them access to a new set of victims. 
• Change Your Security Questions.  While your password was the most likely attack route, it's also possible that hackers broke into your account after answering your security questions. Many users choose the same answer to common security questions.  In order to further protect your email, be sure to employ the multi-factor authentication that many providers allow to gain access to your password, including using secondary email addresses or text messages, since security questions alone are not enough.
• Report the Hack.  If you haven't already, contact your financial institution, email provider, or other company and report the hack. This is important even if your hacked account didn't cause you to lose access since it helps providers track scam-based behavior. If possible, freeze your bank account online, on the app or by speaking with customer service.  In addition, your account provider may be able to offer details about the origin or nature of the attack.
• Contact Credit Agencies.  Contact the three credit reporting agencies TransUnion, Experian and Equifax to monitor your accounts in the months after you've been hacked.
• Consider Your ID Protection Options.  If you've been hacked, another idea worth considering is an ID protection service. These services typically offer real-time email and online retail account monitoring, in addition to credit score reporting, and personal assistance in the event of an identity theft. Your financial institution will offer this program for a small monthly fee.
• Review All Email Accounts.  If the breach affected a service that includes email, such as your Google account, check the email account for sent messages or for new filters. For example, clever hackers can set up filters that forward all incoming mail to an address you don't recognize. Delete such filters to prevent people from worming their way back into your account in the future. This is particularly important because you can reset many other accounts' passwords, and receive notifications about suspicious activity, over email. You don't want an eavesdropper to nab those recovery messages.  Also, check that your email signature and "away" message don’t contain unfamiliar links or forwards. 
• Create a New Email Account.  Sometimes it's not worth picking up where you left off. If this isn't the first time hacked email has been a problem, or if your provider doesn't seem to be taking steps to mitigate the amount of spam you receive, it may be time for a switch. Look for a service that offers default encryption of your emails and solid customer service in the event of an issue.

What types of crimes can be committed by criminals with your information?

• Phishing:  Mobile, Email, Web Site & Social Media phishing rely on social engineering tactics to fool you into either clicking on a link, sharing a link, downloading a file or entering information into an online form.  Having more of your personal information makes it easier for criminals to convince you that the "phish" is legit.
• Stolen or Compromised Credentials:  Armed with stolen, up-to-date PII data, criminals can more easily impersonate you in order to get into your account.  Stolen information will be used to take over existing accounts, such as banking, brokerage, phone service, tax refund fraud, social security, government benefit fraud and retirement accounts. Call centers and online systems rely on these pieces of information to verify account holders.  Criminals can use this information to correctly answer the call center knowledge-based authentication questions.
• Passwords: Reused passwords multiply consumer risk  Once a fraudster hacks one of your accounts, the next account often is easier to crack if you use the same username and password combination.
• Email Account: With access to an email account, the fraudster can reset site passwords on commercial websites using your trusted email address. 
• eCommerce Account: Once a fraudster accesses your e-commerce account, they now have access to all of the payment methods linked to that account.  You may have a stored account where you have linked a few of your credit cards and PayPal account to easily use when you check out.  Gaining access to this account is far more lucrative to a hacker as they now have access to your multiple stored payment methods versus trying to use a list of one-off stolen credit card numbers, which may or may not be valid.
• Rewards accounts: Another goldmine for fraudsters is rewards points stored online in retail store accounts.  Thieves who get access to those accounts can use the stored information to buy expensive items. 
• Banking: If a fraudster cleans out your bank account or takes out a loan in your name, your money is gone.  One way that this can happen is if click on a link that downloads keystroke logging malware onto your computer. That keystroke logging tracker will note that every time you click on your bank’s website and record the user name and password.  The malware sends the login info to the fraudster’s network. The malware works in the background and van be very difficult to detect. 

What can you do:

1. Reconcile or balance your bank account every month. The beauty of online accounts is that you can monitor them almost in real time. That means you can catch crooks long before a statement arrives in the mail.
2. File your taxes promptly.  While thieves may use stolen information to create fraudulent bank accounts, they may also use it to file fraudulent tax returns. File your taxes as soon as you have the tax information you need and respond promptly to letters sent to you by the IRS. Note that the IRS will never communicate with you via email, so watch out for this type of fraud and don’t open emails purporting to be from the IRS
3. Be extra careful about emails and attachments.  Avoid clicking on links or downloading attachments from suspicious emails that claim to be updates from any company connected to a data breach. 
4. Use Two-factor authentication.  Two-factor authentication adds a second level of authentication to an account log-in. When you have to enter only your username and one password, that's considered a single-factor authentication. 2FA requires the user to have two out of three types of credentials before being able to access an account. 
5. Check your Credit Cards accounts often. Reviewing your recent account activity is fundamental to credit card safety—and it’s easy. You can do it online or by phone. If your credit card issuer offers email or text alerts about unusual activity, sign up to receive them.
6. Monitor credit reports.  Check your credit report for any accounts that crooks may have opened in your name. Credit reports are available for free, from each of the three national credit reporting agencies — Equifax, Experian and TransUnion — every 12 months from http://www.AnnualCreditReport.com. Some monitoring services and credit card companies now allow you unlimited access to credit information, so you could theoretically check every day. 

Data breaches will help phishers trick you.

The likelihood that your personal identification is in the hands of criminals increases with every new data breach.  Data breach information goes way beyond just login credentials and credit card numbers.  Here are all the types of personal identification information that can be stolen during a data breach:

• Social Security Numbers.
• Date of Birth.
• Credit Card Numbers.
• Telephone Numbers.
• Public records of criminal and civil cases.
• Your credit history (current and previous loans, credit cards, credit card balances & utilities).
• Transaction history and length of accounts.
• Bankruptcy filings.
• Companies with which you have an existing or prior relationship.
• Your medical information or payments.
• Drivers license number and driving records.
• Work Records.
• Current & previous addresses, and property ownership.
• Voter registration.
• Professional licenses.
• Associates.
• Family, relatives, and neighbors.
• Car, homeowners, and renters insurance claims.

Data breaches may not play out for a really long time as hackers might not use stolen data right away.  The following suggestions should become habits that last well into the future.  This way if hackers are sitting on your information to use it in the future, you'll know.

What to do:

Order specialty free reports outside of the big three credit reporting agencies.  Specialty reporting companies may disclose information that can help prevent fraudulent accounts and other identity theft crimes:
LexisNexis Full File Disclosure. It’s one of the more comprehensive databases out there, containing all the information LexisNexis gathers to create its various reports about you. And, like credit reports, you can order one free copy per year.

Investment Fraud Schemes

These schemes, sometimes referred to as high yield investment fraud, involve the illegal sale or purported sale of financial instruments. Financial instruments are defined broadly as any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument to another entity. These instruments can be a tradeable asset of any kind, to include registered securities and commodities and unregistered securities (e.g. a simple promissory note between the fraudster and his/her victim investors). Schemes take on many forms, and perpetrators quickly alter schemes as they are thwarted by law enforcement.

• Ponzi Schemes: A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ponzi schemes often share common characteristics, such as offering overly consistent returns, unregistered investments, high returns with little or no risk, or secretive or complex strategies. This arrangement gives investors the impression there is a legitimate, money-making enterprise behind the subject’s story, but in reality, unwitting investors are the only source of funding.
• Affinity Fraud: Perpetrators of affinity fraud take advantage of the tendency of people to trust others with whom they share similarities—such as religion or ethnic identity—to gain their trust and money.
• Pyramid Schemes: In pyramid schemes, as in Ponzi schemes, money collected from new participants is paid to earlier participants. In pyramid schemes, however, participants receive commissions for recruiting new participants into the scheme.
• Prime Bank Investment Fraud: In these schemes, perpetrators claim to have access to a secret trading program endorsed by large financial institutions such as the Federal Reserve Bank, Treasury Department, World Bank, International Monetary Fund, etc. Perpetrators often claim the unusually high rates of return and low risk are the result of a worldwide “secret” exchange open only to the world’s largest financial institutions. Victims are often drawn into prime bank investment frauds because the criminals use sophisticated terms, legal-looking documents, and claim the investments are insured against loss.
• Advance Fee Fraud: Advance fee schemes require victims to advance relatively small sums of money in the hope of realizing much larger gains. Not all advance fee schemes are investment frauds. In those that are, however, victims are told that in order to have the opportunity to be an investor (in an initial offering of a promising security, investment or commodity, etc.), the victim must first send funds to cover taxes or processing fees, etc.
• Promissory Notes: These are generally short-term debt instruments issued by little-known or nonexistent companies. The notes typically promise high returns with little or no risk and are typically not registered as securities with the appropriate regulatory agency.
• Commodities Fraud: Commodities fraud is the sale or purported sale of a commodity through illegal means. Commodities are raw materials or semi-finished goods that are relatively uniform in nature and are sold on an exchange (e.g., gold, pork bellies, orange juice, and coffee). Most commodities frauds involve illicit marketing or trading in commodities futures or options. Perpetrators often offer investment opportunities in the commodities markets that falsely promise high rates of return with little or no risk. Two common types of commodities investment frauds include:
  
  Foreign Currency Exchange (Forex) Fraud: The perpetrators of Forex frauds entice individuals into investing in the spot foreign currency market through false claims and high-pressure sales tactics. Foreign currency firms that engage in this type of fraud invest client funds into the Forex market—not with the intent to conduct a profitable trade for the client, but merely to “churn” the client’s account. Churning creates large commission charges benefiting the trading firm. In other Forex frauds, the perpetrator creates artificial account statements that reflect purported investments when, in reality, no such investments have been made. Instead, the money has been diverted for the perpetrator’s personal use.
  
  Precious Metals Fraud: These fraud schemes offer investment opportunities in metals commodities such as rare earth, gold, and silver. The perpetrators of precious metals frauds entice individuals into investing in the commodity through false claims and high-pressure sales tactics. Oftentimes in these frauds, the perpetrators create artificial account statements that reflect purported investments when, in reality, no such investments have been made. Instead, the money has been diverted for the perpetrators’ personal use.

• Market Manipulation: These schemes, commonly referred to as “pump-and-dumps,” are effected by creating artificial buying pressure for a targeted security, generally a low-trading volume issuer in the over-the-counter securities market that is largely controlled by the fraud perpetrators. This artificially increased trading volume has the effect of artificially increasing the price of the targeted security (i.e., the “pump”), which is rapidly sold off into the inflated market for the security by the fraud perpetrators (i.e., the “dump”). These actions result in illicit gains to the perpetrators and losses to innocent third-party investors. Typically, the increased trading volume is generated by inducing unwitting investors to purchase shares of the targeted security through false or deceptive sales practices and/or public information releases. A modern variation on these schemes involves largely foreign-based computer criminals gaining unauthorized access and intruding into the online brokerage accounts of unsuspecting victims in the United States. These intruded victim accounts are then used to engage in coordinated online purchases of the targeted security to affect manipulation while the fraud perpetrators sell their preexisting holdings in the targeted security into the inflated market.
• Broker Embezzlement: These schemes involve illicit and unauthorized actions by brokers to steal directly from their clients. Such schemes may be facilitated by the forging of client documents, doctoring of account statements, unauthorized trading/funds transfer activities, or other conduct in breach of the broker’s fiduciary responsibilities to the victim client.
• Late-Day Trading: These schemes involve the illicit purchase and sale of securities after regular market hours. Such trading is restricted in order to prevent individuals from profiting on market-moving information which is released after the close of regular trading. Unscrupulous traders attempt to illegally exploit such opportunities by buying or selling securities at the market close price, secure in the knowledge that the market-moving information will generate illicit profits at the opening of trading on the following day.

Notice the Signs of Fraud

• Legitimate investment professionals encourage you to ask questions and to have as much information as possible.  They want you to clearly understand the risks involved.  They want you to feel comfortable with the investments you are making.  Con artists want you to believe them and not ask questions. All they're after is your money. 
• Educate Yourself and Recognize the Signs of Fraud
• High Pressure Sales Tactics
• Beware of sales pitches, whether from individuals or in ads, that urge you to get in on the ground floor or to act at once.  Avoid being pressured to make a quick purchase at a “low, low price,” to buy now because “tomorrow will be too late,” or overreact to being told “don’t be a fool,” or “when this becomes public knowledge people will be lined up to take advantage of this golden opportunity.” Shady promoters may even offer to have an express delivery service pick up your check! They don't want you to take time to think, read the small print, or talk to others.
• Promises of Exorbitant Profits
• No honest investment or business is built on quick, astronomical profits.  If it sounds too good to be true, it probably is.
• Claims of No Risk or Minimal Risk
• Return on investment is guaranteed.  Assurances that “you can’t go wrong” are a sure tip that you are being conned.
• Not Answering Questions or Allowing You to Ask Questions
• Con artists don’t want you to ask questions.  Instead, they will answer by asking you questions.  These are usually ones intended to get a positive response.  “You would like to make more money, wouldn’t you?”  Reputable investment professionals encourage you to ask questions. Con artists don’t want you to.
• Evasive Answers and Lack of Communication
• A promoter’s failure to provide details and a disclosure document or to respond directly to inquiries should diminish your enthusiasm.  He or she is probably hiding something.
• Claims that the Investment Doesn’t Have to be Registered
• Avoid Any Investment that isn't Clearly Described in Detail, Without Hedging
• Swindlers often declare that the specifics are “too technical” to describe in layman’s terms or that the information is “classified” or “confidential.” Don’t buy it.   A prospectus must accompany all investments.  If it is that complicated, you probably don’t want to be involved.
• Unprofessional Businesslike Conduct
• They refuse to return phone calls, answer correspondence, or give out their phone number and physical address.  Callers can only get an answering machine.  They always want to meet you someplace other than their offices.  These are all warning signs of fraud.  There are, however, con artists who have fancy offices, cars, and professional receptionists. 
• Promises of “Inside Information”
• Never buy on the basis of rumors or hot tips.  And acting on “insider information” is illegal and could land you in lots of trouble.  Always rely on fact rather than emotion.  If the urge gets too strong, call your broker and ask for a research paper on the security you have in mind.
• When hounded on the phone by a promoter, don’t be afraid to hang up without explanation. You do not owe the caller anything. This kind of solicitation is an invasion of your privacy.  If you have any doubts make no promises or commitments, no matter how tentative.  It is far better to wait and lose an opportunity than to take the plunge and lose everything.

Ten Self-Defense Tips

1. Don’t be a courtesy victim.  Con artists will not hesitate to exploit the good manners of the potential victim.  Remember that a stranger who calls and asks for your money is to be regarded with utmost caution and skepticism. You have absolutely no obligation to stay on the phone with a stranger who wants your money. It's not impolite to say you are not interested and hang up.
2. Don’t be rushed – check it out.  Say no to any salesperson that pressures you to make an immediate decision.  If he or she doesn’t have the time to explain the investment to your regular investment professional, or other party, or if they ask “Can’t you make your own investment decisions?”  Say NO!  You have the right and responsibility to check out the salesperson, firm, and the investment opportunity itself.  Almost all investment opportunities must be registered with the SEC.  Extensive background information on investment professionals and firms is available from the SEC.  Before you even consider investing, get the prospectus, review it carefully, and make sure you understand all the risks involved.  But remember, even written material sent from the promoter can be fraudulent or misleading.
3. Always stay in charge of your money.  Don't be taken in by anyone who wants your money and assures you that he or she is a professional and can handle everything.  Beware of any financial professional who suggests putting your money into something you don’t understand.  And never let yourself be talked into leaving everything in his or her hands. 
4. Always watch over and protect your nest egg.  Never trust anyone who wants you to turn over your money to them and then sit back and wait for results.  If you understand little about the world of investments, take the time to educate yourself.  Constant vigilance is a necessary part of being an investor.
5. Never judge a person’s integrity by how they look or sound.  Far too many investors who are wiped out by con artists later explain that the swindler “looked and sounded so professional."  Successful con artists sound extremely professional and have the ability to make even the flimsiest investment deal sound as safe as putting money in the bank.  Remember that sincerity in a voice, especially on the phone, has no bearing on the soundness of an investment opportunity.  Always do the necessary homework.
6. Watch out for salespeople that prey on your fears.  Con artists know that many investors, particularly older investors, worry that they will either outlive their savings or see all of their financial resources vanish overnight as the result of a catastrophic event.  It's quite common for swindlers and abusive salespeople to pitch their schemes as a way to build up life savings to the point where such fears are no longer necessary.  Remember that fear and greed can cloud your good judgment and leave you in a much worse financial posture.  An investment that is right for you will make sense because you understand it and feel comfortable with the degree of risk involved.  High return almost always means high risk.
7. Exercise particular caution if you have limited or no experience handling money.  Ask a con artist to describe his ideal victim and you're likely to hear "elderly widow or widower."  Many people now in their retirement years have limited knowledge about handling money.  They often relied on their spouses to handle most or all money decisions.  Those who have received windfall insurance in the wake of the death of a spouse are prime targets for con artists.  People who are on their own for the first time in years should always seek advice of family members or impartial professionals before deciding what to do with their money.
8. Monitor your investments and ask tough questions.  Too many investors trust unscrupulous investment professionals and outright con artists to make financial decisions for them.  They then compound their error by failing to keep an eye on the progress of the investment. Insist on regular written reports.  Check the written information.  Look for excessive or unauthorized trading in your funds.  Don’t be swayed by assurances that such practices are routine or in your best interest.  Don’t permit a sense of friendship or trust to keep you from demanding this information. If you suspect something is wrong and you don’t get satisfactory answers, call the Securities Division and let us help.
9. Look for trouble retrieving your principal or cashing out profits.  If a stockbroker, financial planner, or other individual stalls you when you want to pull out your principal or profits, demand to know why.  Since unscrupulous investment promoters have probably pocketed the funds of their victims, they will go to great lengths to explain why your savings are not available.  They may even pressure you to “roll over” non-existent profits into new and even more alluring investments. This will only further delay the fraud being uncovered.  If you're not investing in a product with a fixed term, such as a bond, you should be able to receive your funds or profits within a reasonable amount of time.
10. Don’t let embarrassment or fear keep you from reporting investment fraud or abuse.  Investors who fail to report that they've been victimized often hesitate out of embarrassment. Older investors fear they'll be judged incapable of handling their own affairs and be forced into a nursing home or other facility.  Sophisticated investors don't want to admit that a smooth talker took them in.  Con artists know all about such sensitivities.  They count on these fears preventing or delaying the time when the authorities will be notified about the scam.  It's true that most money lost to investment fraud is rarely recovered beyond pennies on the dollar.  In many cases, however, when investors recognized early that they'd been misled, they were able to recover some or all of their funds by being a “squeaky wheel”.  One of the best resources for investors who fear they have been victimized is the Securities Division of the Department of Financial Institutions.

While social media can provide many benefits for investors, it also presents opportunities for fraudsters. Social media, and the Internet generally, offer a number of attributes criminals may find attractive. Social media lets fraudsters contact many different people at a relatively low cost. It is also easy to create a site, account, email, direct message, or web page that looks and feels legitimate – and that feeling of legitimacy gives criminals a better chance to convince you to send them your money. Finally, it can be difficult to track down the true account holders that use social media. That potential for anonymity can make it harder for fraudsters to be held accountable. As a result, investors need to use caution when using social media when considering an investment.

What You Can Do to Avoid Investment Fraud

• Ask questions. Fraudsters are counting on you not to investigate before you invest. Fend them off by doing your own digging. It's not enough to ask for more information or for references – fraudsters have no incentive to set you straight. Take the time to do your own independent research.
• Research before you invest. Unsolicited emails, message board postings, and company news releases should never be used as the sole basis for your investment decisions. Understand a company's business and its products or services before investing. Look for the company's financial statements on the SEC's website, or contact your state securities regulator .
• Know the salesperson. Spend some time checking out the person touting the investment before you invest – even if you already know the person socially. Always find out whether the securities salespeople who contact you are licensed to sell securities in your state and whether they or their firms have had run-ins with regulators or other investors. You can check out the disciplinary history of  brokers and  advisers  for free using the SEC's and FINRA's online databases. Your state securities regulator may have additional information.
• Be wary of unsolicited offers. Be especially careful if you receive an unsolicited pitch to invest in a company, or see it praised online, but can't find current financial information about it from independent sources. It could be a 'pump and dump' scheme. Be wary if someone recommends foreign or 'off-shore' investments. If something goes wrong, it's harder to find out what happened and to locate money sent abroad.
  

Red flags for fraud and common persuasion tactics

How do successful, financially intelligent people fall prey to investment fraud? Researchers have found that investment fraudsters hit their targets with an array of persuasion techniques that are tailored to the victim's psychological profile

• If it sounds too good to be true, it is. Watch for 'phantom riches.' Compare promised yields with current returns on well-known stock indexes. Any investment opportunity that claims you'll receive substantially more could be highly risky -- and that means you might lose money.
• 'Guaranteed returns' aren't. Every investment carries some degree of risk, which is reflected in the rate of return you can expect to receive. If your money is perfectly safe, you'll most likely get a low return. High returns entail high risks, possibly including a total loss on the investment. Most fraudsters spend a lot of time trying to convince investors that extremely high returns are 'guaranteed' or 'can't miss.' They try to plant an image in your head of what your life will be like when you are rich. Don't believe it.
• Beware the 'halo' effect. Investors can be blinded by a 'halo' effect when a con artist comes across as likeable or trustworthy. Credibility can be faked. Check out actual qualifications.
• 'Everyone is buying it.' Watch out for pitches that stress how 'everyone is investing in this, so you should, too.' Think about whether you are interested in the product. If a sales presentation focuses on how many others have bought the product, this could be a red flag.
• Pressure to send money RIGHT NOW. Scam artists often tell their victims that this is a once-in-a-lifetime offer and it will be gone tomorrow. But resist the pressure to invest quickly and take the time you need to investigate before sending money. If it is that good an opportunity, it will wait.
• Reciprocity. Fraudsters often try to lure investors through free investment seminars, figuring if they do a small favor for you, such as supplying a free lunch, you will do a big favor for them and invest in their product. There is never a reason to make a quick decision on an investment. If you attend a free lunch, take the material home and research both the investment and the individual selling it before you invest. Always make sure the product is right for you and that you understand what you are buying and all the associated fees.

Look out for 'Affinity Fraud' Never make an investment based solely on the recommendation of a member of an organization or group to which you belong, especially if the pitch is made online. An investment pitch made through an online group of which you are a member, or on a chat room or bulletin board catered to an interest you have, may be an affinity fraud. Affinity fraud refers to investment scams that prey upon members of identifiable groups, such as religious or ethnic communities, the elderly, or professional groups. Even if you do know the person making the investment offer, be sure to check out everything – no matter how trustworthy the person seems who brings the investment opportunity to your attention. Be aware that the person telling you about the investment may have been fooled into believing that the investment is legitimate when it is not.

Be Thoughtful About Privacy and Security Settings

Investors who use social media websites as a tool for investing should be mindful of the various features on these websites in order to protect their privacy and help avoid fraud. Understand that unless you guard personal information, it may be available not only for your friends, but for anyone with access to the Internet – including fraudsters.

Ask Questions and Check Out Everything

Be skeptical and research every aspect of an offer before making a decision. Investigate the investment thoroughly and check the truth of every statement you are told about the investment. Never rely on a testimonial or take a promoter's word at face value. You can check out many investments using the SEC's EDGAR filing system or your state's securities regulator. You can check out registered brokers at FINRA's  BrokerCheck website and registered investment advisers at the SEC's Investment Adviser Public Disclosure website. 

A Few Common Investment Scams Using Social Media and the Internet

While fraudsters are constantly changing the way they approach victims on the Internet, there are a number of common scams of which you should be aware. 

Here are a few examples of the types of schemes you should be on the lookout for when using social media:

1. 'Pump-and-Dumps' and Market Manipulations
   'Pump-and-dump' schemes involve the touting of a company's stock (typically small, so-called 'microcap' companies) through false and misleading statements to the marketplace. These false claims could be made on social media such as Facebook and Twitter, as well as on bulletin boards and chat rooms. Pump-and-dump schemes often occur on the Internet where it is common to see messages posted that urge readers to buy a stock quickly or to sell before the price goes down, or a telemarketer will call using the same sort of pitch. Often the promoters will claim to have 'inside' information about an impending development or to use an 'infallible' combination of economic and stock market data to pick stocks. In reality, they may be company insiders or paid promoters who stand to gain by selling their shares after the stock price is 'pumped' up by the buying frenzy they create. Once these fraudsters 'dump' their shares and stop hyping the stock, the price typically falls, and investors lose their money.
   
   
2. Fraud Using 'Research Opinions,' Online Investment Newsletters, and Spam Blasts
   While legitimate online newsletters may contain useful information about investing, others are merely tools for fraud. Some companies pay online newsletters to 'tout' or recommend their stocks. Touting isn't illegal as long as the newsletters disclose who paid them, how much they're getting paid, and the form of the payment, usually cash or stock. But fraudsters often lie about the payments they receive and their track records in recommending stocks. Fraudulent promoters may claim to offer independent, unbiased recommendations in newsletters when they stand to profit from convincing others to buy or sell certain stocks – often, but not always, penny stocks. The fact that these so-called 'newsletters' may be advertised on legitimate websites, including on the online financial pages of news organizations, does not mean that they are not fraudulent. 
   
   
3. High Yield Investment Programs
   The Internet is awash in so-called 'high-yield investment programs' or 'HYIPs.' These are unregistered investments typically run by unlicensed individuals – and they are often frauds. The hallmark of an HYIP scam is the promise of incredible returns at little or no risk to the investor. A HYIP website might promise annual (or even monthly, weekly, or daily!) returns of 30 or 40 percent – or more. Some of these scams may use the term 'prime bank' program. If you are approached online to invest in one of these, you should exercise extreme caution - they are likely frauds.
   
   
4. Internet-Based Offerings
   Offering frauds come in many different forms. Generally speaking, an offering fraud involves a security of some sort that is offered to the public, where the terms of the offer are materially misrepresented. The offerings, which can be made online, may make misrepresentations about the likelihood of a return. 

Where can I go for help?

Investors who learn of investing opportunities from social media should always be on the lookout for fraud. If you have a question or concern about an investment, or you think you have encountered fraud, please contact the SEC, FINRA, or your state securities regulator to report the fraud and to get assistance.

U.S. Securities and Exchange Commission
Office of Investor Education and Advocacy
100 F Street, NE
Washington, DC 20549-0213
Telephone: (800) 732-0330
Fax: (202) 772-9295

Financial Industry Regulatory Authority (FINRA)
FINRA Complaints and Tips
9509 Key West Avenue
Rockville, MD 20850
Telephone: (301) 590-6500
Fax: (866) 397-3290

North American Securities Administrators Association (NASAA)
750 First Street, NE
Suite 1140
Washington, DC 20002
Telephone: (202) 737-0900
Fax: (202) 783-3571

Follow the tips below to prevent email wire transfer scams.

Be vigilant and when it comes to wire transfers and to verify the information from trusted sources. If you receive an email, you need to make sure it’s from a trusted source. If you receive a text, you must make sure it’s from a trusted source. If you receive a call, you need to make sure it’s from a trusted source.

• In these situations, the seller should sign the wiring instructions, and the signature should be notarized, if possible. Even then, the seller should verify the closing instructions over a phone call initiated by the law office, using contact information received prior to any discussion of proceeds and wires. Confirming a phone call verification via email is a good practice and a great way to document the file, but an email verification alone is inadequate.
• Verify Every Wire Request:  The more personal the verification, the better. Have the seller sign wiring instructions at the closing ceremony in the presence of an attorney. If the seller cannot attend the ceremony, the wiring instructions should be included in the deed package.
• Review Emails and Verify Instructions:  If wire instructions are received via email, mail or phone, you should always verify you are speaking with the right party by meeting in person or following a call back procedure using a phone number from a third-party source. This practice will ensure you are confirming with the correct individual. If wiring instructions are ever changed, you should presume the change to be fraudulent. Review the modified instructions in detail for any inconsistencies and always follow a call back procedure.
• Advise Buyers to Not Accept Wiring Instruction Changes:  Hackers target emails with wiring instructions. Then, they use this information to send a modified email with updated directions for wiring money into their personal account. This type of scam is not covered by E&O insurance, so it is extremely important for real estate professionals to protect themselves and their clients in this situation.
• Verify the Authenticity of Wiring Instructions Sent from a Free Email Service: If wiring instructions are attached to an email from a free service like Gmail, Yahoo, or aol.com, you should assume they are fraudulent. Sometimes, hackers set up an alias account with a very similar name to send modified instructions. Examining the account name in detail is a good idea. Because the hacker already has access to the original account, he or she may use the same account in all other correspondence.
• Don't Use Free Email Accounts:  These accounts have major security issues, and they are likely being mined for data by their providers. Plus, they may be in violation of the Rules of Professional Conduct. If you are currently using a free service, find a more secure and professional alternative. 
• Beware of Unusual Activity:  Be wary of wires going to any account that is not in the name of the seller. Also, be suspicious of any account with a geographic location different than the seller. There are possible explanations for different names and odd locations, but these red flags should be explored in detail, not via email.
• Don't Send Wires Overseas:  Once money leaves the United States, it is likely gone forever.
• Regularly Change Your Passwords:  Updating your password on a regular basis ensures someone can’t acquire your password and use it to access your private accounts. 

How to avoid losing your home settlement funds in a wire fraud

• Never wire funds to anybody or any institution unless you have checked the wire instructions independently with your title company, settlement or closing agent.
• If you can’t or won’t confirm the information over the phone, most title companies, settlement companies and closing agents post their wire instructions online, so be sure you check their official websites. If they do, you can compare those instructions with the instructions you received.
• Some agents will confirm the instructions you received over the phone if you give them the information you received. Just make sure you are talking to the right person at the right place.
• You need to have a good working relationship with your settlement agent to make sure that you know that “trusted” source. 
• The safest way is to go to see the closing or settlement agent in person and then go to the bank to initiate the wire transfer. That way, you have face-to-face information with your trusted source.

How to stop a wire transfer to Western Union or Money Gram

Sometimes a payment needs to be stopped. For example: in case of fraud, or when a duplicate payment has been erroneously sent.  Criminals launder billions of dollars overseas through financial fraud schemes like wire transfer fraud, corporate account takeovers, business e-mail compromise scams and other financially motivated crimes.  Detecting that you sent money to the wrong account within 24 hours is the best chance of recovering your money.
What to do immediately:  Call your financial institution and ask to issue a recall notice for your wire.

How to stop a wire transfer to Western Union or Money Gram

Western Union:  Call the Customer Service number at 1-800-448-1492 (select option 5 to speak to a representative) or its Consumer Fraud number at 1-800-325-6000 (say "no," say "consumer Fraud," select 1 "protect me").  Western Union will need the individual's name and phone number(s), including any variations in the spelling of the name (such as nicknames, abbreviations or misspellings). Western Union will ask for the tracking number (MTCN), the name of the at-risk individual and the telephone number on the transaction.
MoneyGram: Call the Customer Service number at 1-800-666-3947 (select 5 "more options," then select 5 "fraud").  Non-family members should call MoneyGram's general Customer Care Center at 1-800-926-9400 (select 5 "more options," then select 5 "fraud").  MoneyGram will need the individual's name and phone number(s), including any variations in the spelling of the name (nicknames, abbreviations, or misspellings).

Large international wire transfers

For international wire transfers over $50,000, call your regional FBI office (https://www.fbi.gov/contact-us/field-offices) and local police.  The FBI offers a Financial Fraud Kill Chain (FFKC) process to help recover large international wire transfers stolen from the United States.  The FFKC is intended to be utilized as another potential avenue for U.S. financial institutions to get victim funds returned. 
The FFKC can only be implemented if the fraudulent wire transfer meets the following criteria:

• the wire transfer is $50,000 or above
• the wire transfer is international
• a SWIFT recall notice has been initiated by your financial institution
• the wire transfer has occurred within the last 72 hours.

If this criteria is met, the following information will be needed:

• Summary of the incident
• Name of victim
• Location of victim (City and state)
• Originating bank name
• Originating bank account number
• Beneficiary name
• Beneficiary bank
• Beneficiary account number
• Beneficiary bank location (if known)
• Intermediary bank name (if known)
• SWIFT number
• Date
• Amount of transaction
• Any additional information that may be available, such as “for further credit,” or “in favor of”

Any wire transfers that occur outside of these thresholds should still be reported to law enforcement (http://www.ic3.gov/) but the FFKC cannot be utilized to return the fraudulent funds. 

Hacking & Phishing Prevention

Hacking and phishing attacks are among the biggest security threats to your cryptocurrencies, so you must set strong passwords for your wallets and all accounts that deal with cryptocurrencies.

Keep these tips in mind when setting up or using your cryptocurrency accounts:

• Use different passwords for every account you use to limit any damage that can be done by hackers.
• Use a unique email when opening accounts on each exchange and only use that email address for that specific exchange.
• Enable two-factor authentication for your exchange accounts. This adds a software to your smartphone which adds extra security to your account. Without two-factor authentication, a hacker only needs your username and password to empty your balance.
• Don’t store your wallets and passwords in the same place or an attacker can gain access to both your passwords and your wallet at the same time.
• Never mention what exchange or wallet you use on social media or online forums. Any information you post online can be turned against you.
• Maintain backups of your cryptocurrency wallets and recovery phrases to ensure your coins aren’t lost for good if something happens to your main device.
• External hard drives, USB sticks, and encrypted backup files can be used to secure your recovery options and programs like VeraCrypt can encrypt these sensitive files.

The different types of cryptocurrency wallets include:

• Desktop Wallet: This is installed on your desktop computer and gives you access to and control over your wallet. This wallet is only accessible from the computer on which it is installed and offers a high level of security. However, it’s at risk if something happens to your computer. Examples of desktop wallets are Exodus, mSigna, and Copay.
• Mobile Wallet: This is run from an app on your smartphone for the most convenient but most vulnerable option. These wallets need to be backed up securely; if you lose your phone, or it is compromised, you could lose your cryptos with it.
• Online Wallet: This is a web-based wallet, which means that your data is stored on an online server, making it easier to access it from anywhere. However, since your private keys are stored online with this wallet, they are more at risk of hacking and theft. Examples of online wallets are Coinbase and Blockchain.
• Hardware Wallet: Wallets such as the Ledger Nano S and Trezor are built to specifically hold cryptocurrency and keep it secure. You can turn them into hot wallets by connecting them to your computer, then take it offline once you’re done. You don’t need a specialized device for a hardware wallet, even USB sticks will do.
• Paper Wallet: The most basic form of a wallet involves a pen and paper. Simply write out your private key and you will be able to recover your wallet if you ever lose access to it. You can also print out a QR code for both your public and private key, which avoids storing data digitally, providing a high level of security.

Transaction Safety

• Wallet Address: Because of the irreversible nature of cryptocurrency transactions, it is very important to ensure that you have entered the correct wallet address. If you send coins to the wrong address, it may not be possible to recover it.
• Special Requirements: When using different cryptocurrencies, it is important to understand how they work before making transactions. Certain cryptocurrencies can have special requirements or safety precautions that should be taken. For example, with IOTA you should always use a new address when you send your cryptos, otherwise your security is reduced. With Ripple, there can sometimes be two parts to the address: a wallet address and a destination tag. If the proper destination tag is not included, the coins you send can be lost or end up in the wrong account.
• Malware & Viruses: Another risk to watch out for are trojans that have been detected lurking on people’s computers. When the victim copies a cryptocurrency address to send tokens, the trojan will swap the wallet ID that was copied for its own malicious wallet address in payment fields. Therefore, pay careful attention to the cryptocurrency address you are sending your cryptos to.
• Phishing: Phishing attacks, Ponzi schemes, and ransomware are all common types of cyber fraud and theft of cryptocurrencies. There have been reports of cybercriminals sending phishing emails with infected attachments that give the attacker access to the victim’s computer and their wallets. Always be vigilant when dealing with suspicious emails and attachments, especially when you are unsure of their source.

Best practice tips to keep you safe when dealing with cryptocurrency exchanges:

• Use a new computer for trading and install reliable antivirus software. Apply operating system patches and antivirus definition updates as soon as they are released. Also, back up your data to offline storage sites on a regular basis.
• After you register with an exchange service, use Google Authenticator with only one IP address whitelisted.
• Enable two-factor authentication for logging in.
• Use a VPN (virtual private network) solution for trading and private communications. (This tip is particularly relevant when you’re conducting transactions with a poorly secured public Wi-Fi because a VPN renders man-in-the-middle attacks futile.)
• Refrain from openly mentioning your personal email. Exchange services usually submit notifications to your registered email ID when you purchase or sell cryptocurrency. By compromising your email account, attackers can track your transactions and perhaps gain unauthorized access to your crypto wallets.
• Safeguard your email account by using a strong password containing uppercase and lowercase letters and special characters. Multi-factor authentication will add an extra layer of security to your email. Keep in mind that the overwhelming majority of cryptocurrency-related hacks are accomplished by compromising a user’s email.
• Use your smartphone wisely. It might be a good idea to get a separate mobile phone exclusively for trading. Also, do not conduct transactions from a smartphone with many apps. By hacking one of these apps, cyber crooks could obtain sufficient privileges to access your private data and blackmail you.
• Do not keep your cryptocurrency on exchanges when you aren’t actively trading. You are much better off storing your own digital cash in cold storage.
• Use a tamper-proof hardware wallet for high-frequency trading.
• Bear in mind that a dependable exchange service requires new users to verify their identity and location prior to making a deposit.
• A reputable exchange provides evidence of cryptocurrency kept in cold storage.
• A trustworthy exchange also participates in cryptocurrency-related events, hackathons and other academic initiatives in this domain.
• Diversify your risks to make sure your trading posture has no single point of failure:
• Consider using more than one exchange service.
• Use decentralized peer-to-peer exchanges.
• Invest in several different cryptocurrencies.
• Stay on top of the markets. Keep track of industry news, examine charts and visit dedicated discussion forums. Familiarize yourself with algorithmic trading. Abstain from trading with more than 30% of your cryptocurrency. Have a plan to convert your coins to fiat money if necessary.
• Follow your intuition to identify red flags. If some big names in the industry quit their jobs, it might speak volumes about the cryptocurrency exchange’s future prospects. For instance, William Dennis Atwood, the director of Hong Kong-based MyCoin exchange, resigned just before the service was revealed as a Ponzi scheme. However, if you see reputable people in the industry join a cryptocurrency exchange, it probably means you are on the right track.
• Steer clear of shady exchanges that ”coincidentally” react to Bitcoin price fluctuations by crashing. When they are back up and running, users might discover that their transactions were completed at a worse rate than they anticipated.
• If it takes the exchange’s customer service operators a long time to respond to helpdesk tickets, that’s a clue suggesting that the service might not be trustworthy.
• In case the exchange engages in high-volume trade campaigns involving altcoins [an alternative to Bitcoins] with a fishy reputation, treat the cryptocurrency exchange with caution. Furthermore, participation in ventures like Initial Coin Offerings may be a sign of a shady exchange. Keep in mind that trading new coins is a slippery slope.
• The cryptocurrency market is full of pseudo-coins and rogue services. Take your time and do your own scrupulous due diligence before trusting an exchange service with your cryptocurrency. Some healthy paranoia is a good thing.

Prevention Advice:

• Limit Exposure:  You can limit your exposure to mail fraud by utilizing online conveniences like eStatements, online bill pay, direct deposit and online banking.
• Opt-Out:  You should opt out of receiving credit card and insurance offers. You can do so by calling 1-888-5OPTOUT or on the web at https://www.optoutprescreen.com. This tells credit card companies to stop sending pre-approved credit card applications to your house.  By filing a simple change of address form with the post office or by contacting your creditors, an identity thief can have your personal mail sent to his or her own address.  Banks and other companies now send letters to both the new address and old address when a change is made in order to stop this type of fraud.
• Lock your mailbox:   If your postal carrier is willing, you can buy a padlock for your mailbox. Place it unlocked inside your mailbox. When the carrier delivers your mail, he or she locks the box. This works well with rural-delivery style boxes with a hole to accommodate a lock, or you can drill holes in a wall-mounted box. The method is not foolproof, however.  Persistent thieves have been known to use hacksaws to remove locks; some smash open mailboxes with baseball bats -- or even steal the mailbox, lock and all. 
• Replace a wall-mounted mailbox with a mail slot:  If you have door-to-door delivery, ask your local Post Office if you can replace your mailbox with a mail slot on your front or garage door. The postmaster needs to approve any changes in delivery. If you add a mail slot, make it large enough to accommodate catalogs and boxes of checks. Mail slots are not allowed, however, in rural delivery areas or newer neighborhoods with cluster boxes.
• Buy a security mailbox:  Check the yellow pages under "mailboxes" for listings of companies that sell tamper-resistant mailboxes. Heavy-duty metal boxes are available in both wall-mounted and free-standing models (the latter may be sunk in concrete to prevent vandalism.) Security mailboxes typically have a slot for the carrier to deliver mail. Mail goes down a chute and into a locked compartment.
• Ask your apartment manager to improve security:  If you're a renter and your mailbox lock doesn't work, insist that the management repair the damage. Counterfeit keys are another problem in rental communities, since often the same key opens all the boxes. Managers can counter these problems by installing security cameras or moving mailboxes into a mail room where residents must use an access key to get inside.
• Get a post office box:  If theft is a concern, the cost of renting a post office box may be worth the investment, since thefts from such boxes are rare, according to postal authorities.
• Consider a parcel locker:  If you own a home-based business and receive frequent shipments of valuable goods, you may wish to invest in a parcel locker. If you use multiple delivery services, however, you'll need one for postal deliveries and a separate locker for others, such as Federal Express or United Parcel Service.
• Pick up mail promptly:  Mail thieves often follow carriers on their routes, striking within 15 minutes after delivery. If you're home during the day, pick up mail as soon after delivery as possible. If you're not home, ask a trusted neighbor to get your mail. Thieves can steal mail from your mailbox in order to get credit card applications and other sensitive data.
• Outgoing Mail:  Outgoing mail is especially lucrative for thieves because it can include bills that you are paying by check or credit card. It's more common for mail to be stolen from apartment or housing complex mailboxes because they combine several households - mail in one place. 
• Keep your mailbox visible: Trim shrubbery to keep your mailbox as visible as possible, eliminating hiding places for thieves.

Protecting Outgoing Mail

• Don't leave outgoing mail in your mailbox: That little red flag is an invitation to thieves. Take outgoing mail to your office, or mail it at a post office or mailing outlet store.
• Don't mail holiday gifts from home: They'll not only steal your package, they'll peel off the stamps and use those, too.
• Don't put mail in street mailboxes: The highest rate of mail theft locally is from those big, blue Postal Service mailboxes located on street corners and at other public places.
• Send valuables via registered mail: Registered mail is kept under lock and key, and it is signed for every time it changes processing centers.

What is Check Fraud?

Check fraud is one of the largest challenges facing businesses and financial institutions today. With the advancement of computer technology it increasingly easy for criminals, either independently or in organized gangs, to manipulate checks in such a way as to deceive innocent victims expecting value in exchange for their money.
A significant amount of check fraud is due to counterfeiting through desktop publishing and copying to create or duplicate an actual financial document, as well as chemical alteration, which consists of removing some or all of the information and manipulating it to the benefit of the criminal. Victims include financial institutions, businesses who accept and issue checks, and the consumer. In most cases, these crimes begin with the theft of a financial document. It can be perpetrated as easily as someone stealing a blank check from your home or vehicle during a burglary, searching for a canceled or old check in the garbage, or removing a check you have mailed to pay a bill from the mailbox.

Types of Check Fraud:

1. Forgery: For a business, forgery typically takes place when an employee issues a check without proper authorization. Criminals will also steal a check, endorse it and present for payment at a retail location or at the bank teller window, probably using bogus personal identification.
2. Counterfeiting and Alteration: Counterfeiting can either mean wholly fabricating a check --using readily available desktop publishing equipment consisting of a personal computer, scanner, sophisticated software and high-grade laser printer -- or simply duplicating a check with advanced color photocopiers.  Alteration primarily refers to using chemicals and solvents such as acetone, brake fluid and bleach to remove or modify handwriting and information on the check. When performed on specific locations on the check such as the payee's name or amount, it is called-spot alteration; When an attempt to erase information from the entire check is made, it is called-check washing. 
   
3. Paperhanging:  This problem primarily has to do with people purposely writing checks on closed accounts (their own or others), as well as reordering checks on closed accounts (their own or others).
4. Check Kiting:  Check Kiting is opening accounts at two or more institutions and using "the float time" of available funds to create fraudulent balances. This fraud has become easier in recent years due to new regulations requiring banks to make funds available sooner, combined with increasingly competitive banking practices.

Is it risky to deposit a check that may be fraudulent?

You are responsible for the checks you deposit.  If a fraudulent check is deposited into your account and you spend the money, you’ll be responsible for the dollar amount when the check is returned. If you are unsure whether a check is fraudulent, DO NOT deposit it into your account. While a financial institution may initially accept the check, there is no guarantee that the funds are good. It can take days, or even weeks, for a check to come back as fraudulent. Do not use those funds unless you are confident the check is legitimate.
Here are some ways to determine if a check you have received is valid. 

1. Did the check come with a letter? If so, read the letter carefully. Many fraud scams start with a letter and a check. The letter will have instructions to send money or purchase a money order. Do an internet search to find out if other people have received letters for the same purpose.
2. Research the business that issued the check. You’ll find the name of the business in the top left-hand corner of the check. If you find a listing online, call the business and ask them if they issued the check. Do not call the phone number provided on the check or in the email as it could lead back to the fraudster.
3. If you have trouble finding any information, take the check to the financial institution that issued the check and they will be able to verify whether it’s legitimate.
4. If you have concerns that the check may fraudulent, take it and the accompanying letter into the nearest branch of your financial institution to discuss with a manager or call them.

How do I know if a cashier’s check is real?

One way Fraudsters attempt to ease your concerns about a fraudulent scheme is to mail you a Cashier’s Check. Scammers have become very good at counterfeiting these items or altering stolen cashier’s checks. 
These items are often presented under the following circumstances:

• As payment for something you are selling.
• As payment for work that has been promised to you.
• As lottery winnings.
• As part of a loan or advance.
• In connection with a roommate who hasn’t moved in yet.
• From someone who is pursuing a romantic relationship with you and needs to get funds to you for a variety of reasons.

While this list does not include all of the reasons why funds are sent from Fraudsters, there is one common theme among them. In each case, the Fraudster needs to get the cash from you which means that they will be asking you to either send funds via the numbers off of a Gift or Prepaid Card or have you wire the money to them. They may ask for all or part of the proceeds leaving you with a loss when the check that was deposited into your account is returned as a counterfeit by the paying bank.
If you receive a cashier’s check from someone with whom you have never transacted business, do not deposit it into your account via the ATM or Mobile Deposit. Please bring the item to the paying bank or into one of your branches so that your financial institution can scrutinize the item for you.

Signs for bad checks:

• The check lacks perforations.
• The check number is either missing or does not change.
• The check number is low (like 101 up to 400) on personal checks or (like 1001 up to 1500) on business checks. (90% of bad checks are written on accounts less than one year old.)
• The type of font used to print the customer's name looks visibly different from the font used to print the address.
• Additions to the check (i.e. phone numbers) have been written by hand.
• The customer's address is missing.
• The address of the bank is missing.
• There are stains or discolorations on the check possibly caused by erasures or alterations.
• The numbers printed along the bottoms of the check (called Magnetic Ink Character Recognition, or MICR, coding) is shiny. Real magnetic ink is dull and non glossy in appearance.
• The MICR encoding at the bottom of the check does not match the check number.
• The MICR numbers are missing.
• The MICR coding does not match the bank district and the routing symbol in the upper right-hand corner of the check.
• The name of the payee appears to have been printed by a typewriter. Most payroll, expenses, and dividend checks are printed via computer.
• The word VOID appears across the check.
• Notations appear in the memo section listing "load," "payroll," or "dividends." Most legitimate companies have separate accounts for these functions, eliminating a need for such notations.
• The check lacks an authorized signature.

Check Fraud Tips for the Consumer

• Make sure your checks are endorsed by your financial institution and incorporate security features that help combat counterfeiting and alteration.
• Store your checks, deposit slips, bank statements and canceled checks in a secure and locked location. Never leave your checkbook in your vehicle or in the open.
• Reconcile your bank statement within 30 days of receipt in order to detect any irregularities. Otherwise, you may become liable for any losses due to check fraud.
• Never give your account number to people you do not know, especially over the telephone. Be particularly aware of unsolicited phone sales. Fraud artists can use your account without your authorization and you may end up being responsible.
• Unless needed for tax purpose, destroy old canceled checks, account statements, deposit tickets, ATM receipts (they also frequently have your account number and worse yet, your account balance). The personal information on it may help someone impersonate you and take money from your account.
• When you receive your check order, make sure all of the checks are there, and that none are missing. Report missing checks to your bank at once. Should you fail to receive your order by mail, alert your bank. Checks could have been stolen from mail box or lost in transient.
• If your home is burglarized, check your supply of checks to determine if any have been stolen. Look closely, because thieves will sometimes take only one or two checks from the middle or back of the book. The longer it takes to detect any of your checks have been taken, the more time the criminal has to use them successfully.
• If someone pays you with a cashier's check, have them accompany you to the bank to cash it. If at all possible, only accept a check during normal business hours so you can verify whether it is legitimate. Make sure you obtain identification information from the individual
• Do not mail bills from your mailbox at night. It is a favorite location from which a criminal can gain possession of your check with the intent to defraud you. Criminals will remove a check from your mailbox and either endorse it using bogus identification, photocopy and cash it repeatedly, scan and alter the check, or chemically alter it. The Post Office is the best location from which to send your bill payment.
• Limit the amount of personal information on your check. For example, do not include your Social Security, driver's license or telephone numbers on your check. A criminal can use this information to literally steal your identity by applying for a credit card or loan in your name, or even open a new checking account.
• Don't leave blank spaces on the payee and amount lines.
• The type of pen you use makes a difference. Most ballpoint and marker inks are dye based, meaning that the pigments are dissolved in the ink. But, based on ink security studies, gel pens, like the Uniball 207 uses gel ink that contains tiny particles of color that are trapped into the paper, making check washing a lot more difficult.
• Don't write your credit card number on the check.
• Use your own pre-printed deposit slips, and make sure the account number on your slip is correct. Thieves occasionally alter deposit slips in the hope you won't notice and the money goes into their account.
• Don't make a check payable to cash. If lost or stolen, the check can be cashed by anyone.
• Never endorse a check until you are ready to cash or deposit it. The information can be altered if it is lost or stolen.

Theft of your Mail

If you have had your mail stolen from your mailbox then you have become a victim of mail fraud, a federal crime. It is important to report this crime immediately and to take steps to protect your assets and credit rating. Here's a checklist of actions you should take:

1. Notify your local postal authority: Ask to fill out Form 2016, available at your local post office, or by mail.
2. Call your local police agency: Report the theft to police or the sheriff's department, particularly if you suspect that checks or other valuables were stolen. Local law-enforcement authorities have caught some thieves by circulating lists of stolen checks to local banks, then nabbing suspects who showed up to clear out a victim's bank account.
3. Close accounts: If you suspect the thief obtained a credit card, checks or bank statement, cancel your accounts immediately and notify creditors both by telephone and in writing.
4. Take action on missing checks: If a check payable to you is stolen, ask the sender to stop payment and issue a new one. Give police the stolen check number.
5. Protect your credit: Make a list of creditors and see if any bills are overdue to arrive. Call creditors and obtain duplicate copies to avoid late payments, which could damage your credit rating-or worse. Be sure to pay your mortgage payment and car payment to avoid the risk of foreclosure or repossession. Don't forget other bills that could be missing, such as an annual insurance premium, property-tax levy or income tax refund.
6. Determine what else is missing: Contact professional organizations to learn if you've missed meeting notices or dues statements. Ask friends and relatives if they've mailed anything to you recently. Were you expecting a new driver's license? If so, contact your state Division of Motor Vehicle (DMV) promptly.
7. Talk to neighbors: Find out if their mail was stolen. Ask if anyone saw a strange person around your home or an apartment mailbox, then pass any information along to postal and law enforcement authorities.

Safety Measures to Follow

• Lock your mailbox: If your postal carrier is willing, you can buy a padlock for your mailbox. Place it unlocked inside your mailbox. When the carrier delivers your mail, he or she locks the box. This works well with rural-delivery style boxes with a hole to accommodate a lock, or you can drill holes in a wall-mounted box. The method is not foolproof, however. Persistent thieves have been known to use hacksaws to remove locks; some smash open mailboxes with baseball bats -- or even steal the mailbox, lock and all.
• Replace a wall-mounted mailbox with a mail slot: If you have door-to-door delivery, ask your local Post Office if you can replace your mailbox with a mail slot on your front or garage door. The postmaster needs to approve any changes in delivery. If you add a mail slot, make it large enough to accommodate catalogs and boxes of checks. Mail slots are not allowed, however, in rural delivery areas or newer neighborhoods with cluster boxes
• Buy a security mailbox: Check the yellow pages under "mailboxes" for listings of companies that sell tamper-resistant mailboxes. Heavy-duty metal boxes are available in both wall-mounted and free-standing models (the latter may be sunk in concrete to prevent vandalism.) Security mailboxes typically have a slot for the carrier to deliver mail. Mail goes down a chute and into a locked compartment.
• Ask your apartment manager to improve security: If you're a renter and your mailbox lock doesn't work, insist that the management repair the damage. Counterfeit keys are another problem in rental communities, since often the same key opens all the boxes. Managers can counter these problems by installing security cameras or moving mailboxes into a mail room where residents must use an access key to get inside.
• Get a post office box: If theft is a concern, the cost of renting a post office box may be worth the investment, since thefts from such boxes are rare, according to postal authorities.
• Consider a parcel locker: If you own a home-based business and receive frequent shipments of valuable goods, you may wish to invest in a parcel locker. If you use multiple delivery services, however, you'll need one for postal deliveries and a separate locker for others, such as Federal Express or United Parcel Service.
• Pick up mail promptly: Mail thieves often follow carriers on their routes, striking within 15 minutes after delivery. If you're home during the day, pick up mail as soon after delivery as possible. If you're not home, ask a trusted neighbor to get your mail.
• Keep your mailbox visible: Trim shrubbery to keep your mailbox as visible as possible, eliminating hiding places for thieves.

Protecting outgoing Mail

• Don't leave outgoing mail in your mailbox: That little red flag is an invitation to thieves. Take outgoing mail to your office, or mail it at a post office or mailing outlet store.
• Don't mail holiday gifts from home: They'll not only steal your package, they'll peel off the stamps and use those, too.
• Don't put mail in street mailboxes: The highest rate of mail theft locally is from those big, blue Postal Service mailboxes located on street corners and at other public places.
• Send valuables via registered mail: Registered mail is kept under lock and key, and it is signed for every time it changes processing centers.