A recent client meeting (with experienced accounting and financial professionals as well as legal advisors) ended with the participants trading stories of attempted fraud, phishing or hacking attempts foisted on our clients, employees, colleagues and family members. Each of us present had multiple stories. These threats keep us up at night as much as (or more than) the substance of our professions such as tax legislation, financial market instability, trade threats and the like.
Damages from successful fraud schemes result in everything from the annoying and costly (lost productivity) to the catastrophic (substantial monetary loss or data theft). While not specifically related to estate planning or our auto dealer practice, I thought I’d share a few common scenarios (just a drop in the bucket of the many, many variants of criminal creativity):
- Call from a Government Agency. These calls follow short, tight scripts with a (usually) recorded warning from the “IRS,” “Social Security,” or “Medicare” about a tax delinquency, fraud affecting your social security number, or an offer for a free DNA testing kit. It’s important to remember that the real agencies never communicate in this fashion.
- The Grandchild in Trouble. In this scenario, a grandparent gets a call from his “grandchild” who has been arrested, often while traveling abroad. The scammers perfectly calibrate their communication to reel in the sympathetic relative and get him to send money to the scammers. If you think no one would fall for this, consider that the loss from family/friend imposter scams totaled $41 million between November 2017 and October 2018!
- Phishing. Email with attached files from a work colleague, friend or family member. The masked email address seems real enough to entice the recipient to click on the attachment. Once that’s done, the hacker and/or a virus is potentially in your system.
- Wire Transfers. This is a massive area of fraud in which a change of wire instructions just before closing on a transaction results in a transfer of funds to criminal third parties.
Given the ubiquity of these threats, it’s likely that you have heard of each of these in some form. Usually we know to just hang up, delete the email and move on. Particularly for older relatives, friends and colleagues however, they may be novel and therefore effective. Hopefully, sharing the existence of these threats makes them less potent. Abundant additional information and resources are available through the Federal Trade Commission, AARP, Consumer Finance Protection Bureau, and the FBI.