Financial fraud has been around as long as people have used money, and while the scams have changed along with technology, parents can still give their teens the skills they need to recognize and avoid online scams.
While parents may remember a time when phones were for calling, not accessing the internet, the saturation in all things online is something today’s teens were born into. Using a computer is as natural to them as breathing, whether for school work, entertainment or social interaction. However, even if mom and dad still aren’t quite sure what Twitter is all about, they have a lot more experience avoiding financial scams than their kids.
Financial fraud has been around as long as people have used money, and while the scams have changed along with technology, parents can still pass along valuable advice on how to recognize and avoid online scams. (While using a prepaid debit card is safer than carrying cash, teens are still open to fraud online if they expose their info to scammers.)
Common scams
While there are numerous types of online fraud, the following are some of the most common teens may encounter.
• Winning a lottery
Spam and pop-up ads may tell teens that they’ve won some form of online lottery or sweepstakes, and provide them with a fake business name and return address. These scams request personal information from teens, such as bank account or credit card numbers. Of course, this is just an opportunity for criminals to obtain sensitive information and use it to steal a young person’s financial identity.
• Mystery shopper
This scam involves an illegitimate business offering teens the opportunity to make money as a mystery shopper – a person who uses a service in order to evaluate it. The common trick is to have the person evaluate a money transfer service by wiring their own personal funds to a location in return for a higher payment.
• Foreign person in need
This may be the most well-known online scam, but there’s a reason it’s still around: People still fall for it. It involves receiving an email from someone claiming to be a foreign person in need of help transferring money to the U.S. They will ask for a teen’s banking information, or other sensitive financial details, “in order to transfer their money.” In return they promise to give the person a percentage of their money.
Of course, there are plenty of variations on these scams, with many geared solely toward young people. One version is to pretend to be someone else requesting personal information over a social media platform like Facebook. However, the outcome is always the same: Fraud aimed toward stealing money or sensitive information.
Smart practices
Fortunately, there are plenty of strategies parents can teach their kids to minimize the risk of being taken by an online scam.
• Don’t reveal personal information
Part of the proliferation of social media is the fact that many people – especially teens – feel so comfortable sharing sensitive personal information with perfect strangers. This is a bad idea for a number of reasons, one of which is that poor security can allow a criminal to steal a teen’s identity. Remind your kids how important it is to keep their personal information secret at all times online, including their phone number, address, financial details, passwords or any other bits of information that can be used against them.
• Never give money to a stranger
Just as with personal information, teens should know not to give money out to people or businesses they don’t know. There are too many scams to count that depend on people forking over money under false pretenses. Young people should always be on guard when it comes to individuals they don’t know, especially if they’re asking for money.
• Don’t assume a business is legitimate
A fancy website or professional sounding name may lead teens to think they’re dealing with a reputable business, but scam artists know this and prey on it. It’s easy to look up a business online to make sure it’s not a scam. Teens should always follow their instincts and investigate a business making a suspicious offer. If it sounds too good to be true, it probably is.
• When in doubt, get a second opinion
Second opinions are a great way to get another perspective before a decision is made. If after following these tips your teen is interested in pursuing an offer or request seen or received online but still isn’t quite sure whether or not that’s a good idea, let them know you’re available to lend a fresh set of eyes to the situation. Double-checking is never a bad idea, especially when it comes to anything that can compromise your personal information and identity – better safe than sorry!