Common types of financial fraud
Learn how to recognize red flags and protect against financial scams and frauds.
Ameriprise imposter fraud
The objective of Ameriprise imposter fraud is to obtain money and/or personal, financial or account information from individuals who believe they are investing money. The fraudster uses fake Ameriprise websites, social media posts and/or emails to lure individuals into providing money or personally identifiable information.
| Common types of fraud | Red flags to watch for | How to protect against it |
|---|---|---|
|
Fake company websites using the company name within the domain for the website
Picture purporting to be the Ameriprise brand logo |
Sites may contain poor grammar, misspellings, odd phrases, or misuse of financial services terminology Promises of guaranteed high investment returns |
The website for Ameriprise investments is Ameriprise.com and no other domain |
Recruitment fraud
In this type of financial fraud, the objective is to obtain money and/or personal, financial or account information from people who believe they are applying for a real job. The fraudster uses fake company job websites, career websites, social media posts and/or emails to lure applicants into providing money or personally identifiable information.
| Common types of fraud | Red flags to watch for | How to protect against it |
|---|---|---|
|
Job postings on legitimate career websites
Social media
Fake employer website
Recruitment emails |
Fraudsters request bank account information to pay for training materials, interview travel or direct deposit for paychecks
They set up fake links for applicants to enter banking or other personal information
They provide an applicant with a fake cashier’s check (paper or digital) to purchase office equipment
They promise a job without interviews |
Never provide money
Contact Ameriprise Financial at Ameriprise.recruiting@ampf.com if concerned about the legitimacy of any correspondence/interaction with Ameriprise |
Advance fee fraud
This financial fraud example typically sees the fraudster promising the victim a large sum of money in return for an up-front payment, which they “require” in order to provide the victim with the promised sum. If that victim makes the payment, the fraudster will then either invent a series of new fees that the victim must pay, or they’ll simply disappear.
| Common types of fraud | Red flags to watch for | How to protect against it |
|---|---|---|
|
Lottery
IRS
Inheritance
Vacation rentals
Work from home/career opportunity
Check overpayment
Loan |
The offer seems too good to be true
Grammatical errors and typos
Sense of urgency –scammers will pressure you and say the situation is very urgent to get you to act before you think
Extreme confidentiality –the scammer doesn’t want you to tell friends or family
Up-front payment – asking for money is a major red flag
Winning a lottery that you did not enter |
Stop communication and block the sender
Never share your account information, Social Security number, bank information or other sensitive financial information
Do not respond to offers that sound too good to be true
Be wary of a website or correspondence claiming to be from a U.S. government agency whose e-mail address does not end in “.gov”, “.mil”, or “fed.us.”
Be aware of secondary scams that may include someone promising to find your scammer and get your money back |
Romance scams
Romance scams typically involve feigned romantic intention toward a victim, gaining their affection, and then using that goodwill to commit fraud.
| Common types of fraud | Red flags to watch for | How to protect against it |
|---|---|---|
|
Online dating
Social media |
Someone has claimed to have fallen in love with you quickly, often within 24-48 hours
The person wants to immediately leave the online site to use instant messaging or email
Their online profile seems to disappear as soon as you start talking to them
They request to keep the relationship a secret
They ask for money
They claim to be in the military or work overseas and need money for flights home
They plan to visit you, but an event prevents them from doing so, or they ask for money for travel costs
They tell you they need money for medical issues (such as a sudden surgery), for themselves or a family member |
Never share your account information, Social Security number, bank information or other sensitive financial information with anyone
Avoid posting details such as your full name, date of birth, or home and work addresses on online profiles
Never respond to any requests to send money, or have money transferred into your account by someone you don't know and trust
Trust your instincts – if you think something feels wrong, it probably is
|
Debit card fraud
Debit card fraud involves the unauthorized use of funds through debit card transactions.
| Common types of fraud | Red flags to watch for | How to protect against it |
|---|---|---|
|
Lost/stolen card
Compromised/counterfeit card
Pre-paid debit card scams
|
Multiple card entries for high-dollar orders
Unauthorized purchases
Multiple purchases of the same item
International shipping
An unsolicited phone authorization for a cash advance |
Enroll in email and text alerts (Note: For Ameriprise accounts, register or log in and go to My Profile to enroll)
Check account statements frequently
Never share your PIN number with anyone
Keep your card and PIN stored in a safe place
Do not allow non-account holders access to your card or PIN |
Advisor imposter fraud
The objective of advisor imposter fraud is to obtain money and/or personal, financial or account information from individuals who believe they are investing money. The fraudster uses fake company job websites, social media posts and/or emails to lure applicants into providing money or personally identifiable information.
| Common types of fraud | Red flags to watch for | How to protect against it |
|---|---|---|
|
Fake advisor website using the registered representative name as the domain for the website
Picture purporting to be the registered representative
Information about the registered representative’s employment history, CRD numbers and/or exam history
Request for contact form asking for names, email addresses and phone numbers |
Sites may contain poor grammar, misspellings, odd phrases, or misuse of financial services terminology
Emails with fake links for individuals to enter banking or other personal information
Requests to send cryptocurrency or gift cards
Requests to send money payable to anyone other than Ameriprise
Promises of guaranteed high investment returns |
Search for an Ameriprise Advisor using the tool “Find an Ameriprise financial Advisor” on www.ameripriseadvisors.com
Once you locate a financial advisor using the tool, you are provided a valid website, email address using ampf.com as the domain, and a phone number
Reach out to the financial advisor using the information provided on our website to discuss investment opportunities |
Investment fraud
Investing scams are an increasingly common because they are more likely to have large amounts of money saved, and “get rich quick” schemes can be appealing to those on a fixed income. The first step to protecting yourself — or a parent — is knowing what types of investment scams to watch for.
|
Kinds of investment fraud |
What is it |
Red flags to watch for |
|
Ponzi scheme (also known as pyramid scheme) |
A Ponzi scheme involves using money from new investors to provide a return — often much higher than typical market gains — to existing investors rather than using legitimate investment returns. Ponzi schemes fall apart when the money owed to the initial investors becomes greater than the amount that can be raised from new investors. Pyramid scheme operators may reach out via phone, email or word of mouth
|
If investment returns seem too good to be true, they probably are. If in doubt, request documentation such as a fund prospectus or the most recent annual report. These may help provide more context for investors — or raise suspicions if they aren’t readily available for review
|
|
Pump and dump |
This involves a group of people buying a stock then recommending it to thousands of investors. The result? A rapid spike in stock price followed by an equally fast downfall. The perpetrators who bought the stock sell off their shares at a huge profit when the price peaks. Pump and dump schemes often circulate on internet investing blogs via promotional emails
|
Fraudsters are more likely to use smaller, lesser-known companies for this scheme because it’s easier to manipulate a stock when there’s little or no information available about the company
|
|
Off-shore investing |
The internet has eroded barriers that once made it difficult for overseas fraudsters to prey on U.S. residents. Conflicting time zones, the cost of international telephone calls and differing currencies are no longer obstacles — and international wire transfers can occur instantaneously. Phone calls are a common method of communication for the perpetrators, enabling real-time wire transfers to be made before victims have time to do any research
|
Investment opportunities originating in a country that is outside the jurisdiction of local U.S. law enforcement agencies. Ask for legal documentation stating where the funds are registered |
|
Prime bank |
Used in an official capacity, this term describes the top 50 or so banks in the world. Real prime banks often trade high-quality, low-risk investments such as bonds. Fraudsters often claim investors’ funds will be used to purchase “prime bank” investments that they claim will generate significant gains
|
The term “prime bank” is often used by perpetrators looking to lend legitimacy to their scheme, whereas real prime banks don’t often use the term as they can rely on name recognition alone
|
|
Bulletin boards and newsletter |
Investment boards have gone the way of online blogs, where nearly anyone can offer an opinion no matter how qualified they are — or aren’t. While there may be some valid posts by financial experts, perpetrators often use boards to plant fake “insider” tips meant to drive stock prices up or down. Know that company employees can also use blogs to spread promotional information, and it’s not illegal for companies to use employees to write online newsletters to promote their stock |
Federal laws require that disclosures with legally required details about their offerings are located at the bottom of documents on company-generated information. Fraudulent newsletters are unlikely to provide such language |
|
Virtual Currency |
This type of scam involves individuals who leverage fictitious identities, the guise of potential relationships and uses elaborate stories to develop a partnership and gain trust with their victim. The individual will then convince victims to invest in virtual currency, all with the intent to defraud them of their investment |
Scammers usually communicate using instant messaging services and text messages, professional networking sites, social media and dating sites. It usually starts under the guise they accidently reached a wrong number or trying to re-establish a connection with an old friend. Over time, the scammer develops a virtual relationship and then introduces them to a supposedly lucrative investment opportunity in virtual currency |
Phishing: Email, text or phone fraud
Phishing scams are when a scammer sends a fraudulent message designed to trick you into giving them sensitive or financial information. Phishing scams can come in several different forms: email, text or phone calls.
| Kind of investment fraud | What is it | Red flags to watch for |
|---|---|---|
|
Email fraud |
Emails that are sent from unusual or look-alike email addresses or domains
Suspicious links
Spelling or grammatical errors
A sense of urgency to act immediately |
If you think an email might be fraudulent, delete it and contact the company directly
Roll over links with your mouse to display the URL. If the URL looks suspicious, do not click on it
Visit the company website to check for suspicious account activity |
| Text message phishing |
Urgent or threatening messages
Suspicious links that do not appear to come from the company sending the text |
If in doubt, do not respond
|
| Phone phishing |
Requests for personal information
Remote access requests |
Let calls from unfamiliar numbers go to voicemail
Visit the company website directly |
How to report email fraud
If you suspect you’ve received a fraudulent email, please:
- Forward it to us immediately at: anti.fraud@ampf.com.
- Do not remove the original subject line or change the email in any way when forwarding.
- Watch for an auto-generated reply to let you know we’ve received your email. If we confirm the email is fraudulent, we will take appropriate action immediately.
Account takeover fraud
Account takeover fraud occurs when your personal information is compromised resulting in unauthorized access to your account. Once an account is taken over, fraudsters will attempt to steal funds through unauthorized transaction requests.
| Common types of fraud | Red flags to watch for | How to protect against it |
|---|---|---|
|
Online account takeover
Unauthorized wire transfers
Unauthorized ACH transactions
|
Unauthorized logins to the Ameriprise.com client website
Unauthorized phone number, email address or address changes
Unauthorized wire transfers, unauthorized attachments of new external bank instructions, unauthorized bill payment requests or unauthorized electronic ACH transfers
|
Learn more about how we safeguard your information online for tips on how to protect yourself |
Check fraud
Check fraud involves the unauthorized use of checks to obtain money. This may be the result of stolen and altered checks, stolen and forged checks, or the use of a routing and account number to create counterfeit checks. These usually start with a bad actor intercepting a check in the mail.
| Common types of fraud | Red flags to watch for | How to protect against it |
|---|---|---|
|
Forged checks
Altered checks
Counterfeit checks
|
Unauthorized checks clearing your account
Checks clearing your account for a different amount or payable to a different payee
Missing checks
|
Discontinue using physical checks and use electronic means to make payments or send money
Do not mail personal checks |
Related Information
Or, request an appointment online to speak with an advisor.
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If you know someone who could benefit from a conversation, please refer me.
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Securities offered by Ameriprise Financial Services, LLC. Member FINRA and SIPC.