Ep. 43: How Scammers Are Stealing Billions

In this episode, Laura Neal, CFP®, and Vic Colella, CFP®, CDFA®, discuss some of the most common and increasingly sophisticated scams targeting individuals and families today. From impersonation schemes to financial fraud, they break down how these scams work, the warning signs to watch for, and the practical steps you can take to protect yourself and your hard-earned assets.

If you have suggestions for future episode topics or would like to share feedback, we'd love to hear from you. Please email us at podcast@woodwardadvisors.com.

Transcript

SPEAKER_01 0:26

Hello, everyone, and welcome to another episode of Your Money and Twenty, a podcast by your friends here at Woodward Financial Advisors. Speaking of friends, I'm joined by Laura Neal. Hi, Laura.

SPEAKER_00 0:37

Hi, Vic. Always happy to be here.

SPEAKER_01 0:40

Yeah, great to have you back in the virtual studio. We are both excited and dreading today's conversation. I don't know, it's not the most positive of topics, but it's one that we believe is very timely and very important. So we're talking about fraud, scams, things that have been around for a very long time, but we have seen a notable uptick in folks getting falling victim to sort of cybersecurity-related, fraudulent scams. So before we get started, today's podcast here, we're going to be talking about a lot of things that could have to do with your investments, taxes, uh unlikely but possible, you know, things related to the law. None of this is meant to be advice for your specific situation. So we encourage you to talk to the professionals in your life who know you and your specific situation if you're looking for advice. So with that said, Laura, do you want to lead us off with some statistics, perhaps?

SPEAKER_00 1:42

Yeah, who doesn't love statistics? Um, but in this case, there it kind of blew my mind. So in 2025, so this is according to the FBI, there was about 20.9 billion in cyber-related fraud and internet scam losses. So almost 21 billion dollars. And this is just in America, this isn't worldwide. One piece of that that surprised me almost 50% of it was investment in crypto scams. That blew me away.

unknown 2:16

Yeah.

SPEAKER_01 2:17

If you're looking for another reason to perhaps stay arm's length with crypto, that's one of them. Yeah.

SPEAKER_00 2:23

Yeah, absolutely. And then another 30% started with social media. And then, of course, we got to factor AI into it now. That was it. And then, you know, Americans over 60 accounted for about 8 billion of those losses. But I think that's an interesting number because that means about 12 billion wasn't people over 60. So this isn't just elderly people falling victims to this. This is young people and old people alike.

SPEAKER_01 2:56

Yeah. Yeah. And that's one of the things that in in talking before we started recording, Laura said we don't take some of the shame away, which is such a good point because this happens to everyone. I've clicked a link and realized 20 minutes later, oh, that was a mistake. I gotta go change all my passwords. This happens to everyone. And we I was telling Laura, I can't remember a month in the last six months or a year where one of my clients or someone who I know hasn't realized that they've been taken advantage of with one of these scams.

SPEAKER_00 3:31

Yeah, we're getting calls all the time.

SPEAKER_01 3:34

That is a notable uptick in the last year. Uh pretty dramatically. And you know, we gotta think that AI has something to do with that, right? Even if it's not an AI scam where it's a fake video of some influencer who, you know, asks for an appeal for funds. I think AI is just also making your regular day-to-day scams more convincing. Just like, you know, if I'm planning a vacation, I might use AI to do that a little bit a little bit quicker and easier. I think fraud folks who are committing fraud are doing the same thing. How can I make this spoofed email look more convincing? Just using it for good or evil, I guess, is the is the the trick.

SPEAKER_00 4:16

Yeah, because that used to be the way that you were supposed to spot that it was fraud, because it would be, you know, please send this Nigerian prince money, and there'd be so many misspellings and misuse of words. And now they're these really well-worded official-looking emails, right?

SPEAKER_01 4:34

Yep. Yeah. So our goal today, I just to set the intention for the next, I don't know, 15 or so minutes, is we want to make this one big dress rehearsal. And I mean dress rehearsal, and we're gonna basically talk about some specific scams and types of scams that we've heard of or that our research has turned up in the hopes that at least one person listening is gonna hear one of these situations out there in real life or see it in their inbox, and a bell is gonna ring, and they're gonna say, I'm gonna pause and make sure that this is the correct phone number, the correct link, whatever it is. So, Laura, let's do it. We've got a list of I think four or five that we're gonna go through. I'll kick out, I'll kick out the type of scam, and then maybe you describe it a little bit. We'll talk about each and then we'll move to the next one.

SPEAKER_00 5:22

Yeah.

SPEAKER_01 5:23

Okay, let's do it. So this one we're gonna call it somewhat broadly, phishing and impersonation scam. So, what do these look like?

SPEAKER_00 5:32

Yeah, so these are gonna be things that you're getting through either your text message or through your email. And they're gonna look official or sound like they're from somebody you're familiar with. The IRS, oh my gosh, you owe us a thousand dollars in order not to, you know, get prosecuted. Please click on this link. Um, my I got permission to use this story. My husband got a text message claiming to be somebody he knew, and it had the person's name on it, had and wanted him to buy Apple gift cards for employees. I mean, they they get very sophisticated. But I would say, like, what to look out for is number one, is there a sense of urgency or fear that they're trying to make you feel? These are called social engineering frauds because they're creating some kind of emotional pressure on you that makes you think, oh my gosh, I don't want to get in trouble or I don't want to miss this package, right? Click on this link for this important package that you were supposed to receive. Um so there's I think these are the most common that we think of because no longer can we be on the do not call list, right? With our cell phones. Our cell phone numbers are out there everywhere, along with our email.

SPEAKER_01 7:06

Yep. Well, and and we've had clients who have forwarded us emails that look like a DocuSign packet, which we use DocuSign all the time. And it is referring to something that we are actually doing. So this is it, it'll have their name and it'll say beneficiary change. And they will forward it sometimes and say, this doesn't seem correct. And maybe when you open that, it asks for your social security number, maybe your account number, and then your bank details are compromised. So they're getting better. You have to assume that it's possible that they have access to your email inbox. And if they're reading your emails, then they can tell they're doing a beneficiary change or they're getting a package delivered today. And you know, your package delivery failed, click on this link to avoid a redelivery fee. That was the example that we actually had down here. So yeah, yeah, watch out for those. And just because they're referencing something specific that you've got going on, if they have access to your email inbox, then they might know that information. Which we're not gonna talk about what to do. I'll say this before we move on to the next one, Laura. We're not gonna talk about what to do when you have clicked one of these things or realized it too late. We have another podcast that we'll or we have several other podcasts where we've talked about this that we'll link to. But one of those things is resetting your email passwords and adding two-factor authentication because if they have access to your email or your social media accounts, all of a sudden they can get really specific about the things that they're referencing, and that gets really, really dangerous. So we'll we may sprinkle in some of those, what to do about it, but for now, we're gonna move on to the next one. So this next one, let's do it. I'm gonna call it a fake check and overpayment scams.

SPEAKER_00 8:59

Yeah. So let's say that you decided to sell a piece of furniture on um eBay or Craigslist. And so a buyer will send you a check for the item you're selling. Um, but then they accidentally write it for too much, and then they say, Oh my gosh, I wrote it for too much. Can you send me the extra $10 back? Right. And they try to get you to do this quickly before you cash their check because what's going to happen? Their check is gonna bounce, and then you've sent them some money. Um, I haven't heard as many of the these specific scams, but obviously they wouldn't be on this list if they weren't out there. So I think anytime we've heard before of, you know, you send me this much money, and then I'll send you this much back, right? I think that's a common one we've heard of. So be anytime anybody's asking for money, I think that's that's a good rule of thumb. Beware.

SPEAKER_01 10:07

Yeah. Yeah, and there there are triggers to keep in mind there. So folks are asking you for money, account numbers, social security numbers, sure. But even if you follow a link that tells you to log into your email or log into your bank account, follow this link to log into your bank account. Always go to your bank's website independently and log in and see if there's anything there. If there isn't, then it's a it's not real, right? Then it's not real. So don't be careful what they're asking.

SPEAKER_00 10:41

This is actually something I don't know that it's new, but it's new to me, is that they will, you know, impersonate entire websites just to get your information. So for like all our work websites, we make sure we have them bookmarked and we go directly there. We're never Google searching for Schwab. You know, we're we're linking going into the one we know is the correct one.

SPEAKER_01 11:06

Yeah. And two-factor authentication is everything. Because even if they have your login credentials, if they don't have your cell phone or if they don't have your a third-party authenticator, so like a Google Authenticator or something like that. We have that on all of our all of our systems here. And that's because it's just that extra layer of defense. Okay, next one. Let's talk about a specific scam under the investment and cryptocurrency scams umbrella.

SPEAKER_00 11:35

Yeah, yeah. So we have a lot of clients interested in cryptocurrency, but they know we don't do it. So this is an example of somebody finds an online broker that is, you know, promising great returns on cryptocurrency. Maybe they met them on social media. The platform shows these great profits. And so they set up a bank account or a brokerage account with this online broker and send money to invest in cryptocurrency. And it ends up being completely fake. And now they have 10, 20, who knows how much of your money. So um, yeah.

SPEAKER_01 12:19

Well, and this is different, but I something you said on the last section reminds me of this, which was an interesting one that I've heard. We have a lot of really generous clients, and it's one of my favorite parts about working at Woodward Financial Advisors, is just the sheer generosity of the people who we work with. And that is also a vulnerability. I I was listening to a podcast, and there was a priest on the podcast, a Catholic priest on the podcast, and he was talking about how folks had made videos. He made YouTube videos or something. So they had made YouTube videos that were made by AI that were fairly convincingly him. And it was some sort of campaign to raise funds for you know feeding children. So he does do charitable campaigns, he does make YouTube videos. So if someone saw this and he was talking about a campaign, they're sending money. You're not getting that money back, right? So if someone hacks your credit card, usually there's a fraud policy. If you freely send a check, if you freely send money to a fraudulent place, it's not coming back. So so be careful there. That is part of the whole AI thing is spoofing a video or spoofing a website. The barriers to doing that just went through the floor. There are no barriers anymore. You can just do it on ChatGPT or any of the AI tools.

SPEAKER_00 13:42

So that goes back to going to the source, right? You see that, go find that priest, find his real website, yeah, and see if he's really doing that. Yeah.

SPEAKER_01 13:52

Exactly. All right. So romance and dating. There's love in the air, Laura.

SPEAKER_00 13:58

I mean, this, yeah, this is uh this is uh uh an old one, but still works, unfortunately. So I liked this real world example. An overseas oil rig worker you've only spoken to online claims to have an injured crew member and urgently needs you to wire funds for medical bills or equipment. So that, you know, that one's been going for a long time, but it still works. And I think that's where what we talked about at the beginning, the shame needs to be, you know, don't worry about it. It happens to everyone. And so sometimes, lots of times, things like this will happen and people will be ashamed to tell anybody because they're they can't believe that they fell for something like that.

SPEAKER_01 14:42

Well, and it used to be that there had to be somebody in like Eastern Europe sitting in a center pretending to be an oil rig worker overseas. Now that's not even true. You can have a convincing conversation with an AI right now on your computer or on your phone or whatever it is. So those types of things which used to be really committed, you had to be a really committed fraudster to talk to somebody for months and develop a romantic relationship and then ask for funds. Not anymore. I I think that's why for so many of these things we've seen such a massive uptick in these amazing tools in AI. They have lowered the barriers for everything, including, unfortunately, fraud. And we're seeing its impact, even if it's not a like a deep fake of a priest asking for funds, it might also just be you know, uh dating app or whatever it is. So be careful. Um, all right, tech support. How ironic. This one, this one always kills me.

SPEAKER_00 15:52

This one has happened to me, like it's tried to happen. I didn't click on it, but I've had something pop up on my computer that's like, your computer is infected, virus. Sometimes they come with sounds, scary sounds like alarms going off on your computer, where it just makes you want to click on it, make it stop, right? So it can be something like that, or it can be, again, a caller. Somebody calls your cell phone, they claim to be from some well-known tech giant. I'm from Microsoft, Windows. Your computer is infected with a virus. I'm here to help you. I'm gonna walk you through the steps to get your computer clean. And that feels very vulnerable and very believable. Um, and so this happened to my mom. She was on the phone with somebody for hours and finally something clicked in her brain, and she said, I don't think this sounds right. Because they had made their way towards needing banking information. And she hung up the phone, she called her bank, and she said, Is this you? They said no. And thankfully, she didn't fall victim to it.

SPEAKER_01 17:04

When anyone claiming that they need access to your computer, you should have initiated that call. Right. Full full stop. You should have found the contact information for the tech support person that you know or that you know the company. You should have found it independently. No one else should be initiating a conversation and asking for support or the ability to remote into your computer. That is a very common way that even our IT provider works. It's the way that they can get access to help you. But once they have access to your computer, they could do things in the background that you don't even know and of course, of course, steal your information. So be very careful, even with the most ironic of scams, which is like the the tech, the tech situation. Um, and then I think I that'll that should be the last one that we do in terms of examples. But let's spend just a moment on how to protect yourself, a moment more, and then we'll we'll wrap up. Hopefully, we've we've hit some of the big ones. Of course, IRS, and we've talked about these before, but anything that creates stress, folks have created a scam around it, and taxes certainly create some stress for people. So um, all right, how do we protect ourselves, Laura?

SPEAKER_00 18:16

So, two big things. So, a lot of times, if they're not getting directly into your bank account, they'll want you to buy a gift card or buy cryptocurrency and then send them the information on this so they can steal that from you. So never pay with gift cards, never pay with cryptocurrency. But I think the second one is the very, if you if you don't remember anything else from this podcast, it is verify before you act. They are trying to scare you into not thinking before you do the next thing. So take a second, stop, say, number one, does this make sense? Or number two, let me call the real person that they're claiming to be. Hang up the phone, call Microsoft, call your bank, and say, are you trying to contact me and verify that what they're claiming is going on is actually really happening.

SPEAKER_01 19:20

I'll even ask companies who I know I'm fairly certain are legitimate. I'll say, I need you to prove that you are who you say you are. I'll say that to folks and I'll say, Listen, I think this is legit because I'm I'm in the process of doing this. But if I take this thing in an instant, you called me, I picked up the phone, I answered. Before I authenticate myself, I need you to prove that you know that you are who you are. And they'll give me an account number and they'll give me something that they couldn't otherwise know. And they don't love that. I'll tell you that right now, but also I don't really care because it it's just a layer of protection. So um, Laura, with that, I think we're out of time. Thank you so much. I hope this has been helpful. And I hope, again, one of these things might ring a bell in the right moment for for our listeners. Thank you for listening to another episode of Your Money and Twenty, the podcast by your friends here at Woodward Financial Advisors. We hope you enjoyed it. Now, if you'd like to continue the conversation, you could find us on the web at WoodwardAdvisors.com and as a firm on both Facebook and LinkedIn. There's a link to those pages at the bottom of our website. You can also find us all as individuals on both Twitter and LinkedIn. Now we love receiving listeners suggested topics, so if you have a topic you'd like to hear more about, please hit the Let's Talk link at the top of our website and submit a message with podcasts in the subject line. Thanks again for listening and talk to you next time.