What to do After a Scam

Running Away with the Money
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The FBI’s Internet Crime Complaint Center (IC3) receives an average of 22,000 complaints per month. Unfortunately, this is now the way of the world: scams are a constant threat – especially in the virtual world (but that doesn’t mean in-person and telephone scams have dried up). So what can you do if you run across one of these scams and lose money?

Stop the Bleeding

If your bank account, credit card, debit card, or other account information was shared with the scammer, shut the account down as soon as possible.

Thieves know that they have a limited time to withdraw money, so they’ll act quickly as well.

Call your bank (or whoever has your account) and let them know that you suspect there will be attempts to steal from your account. If you can’t reach anybody right away, at least review recent transactions, change your password if there’s any chance it was compromised, and transfer funds out of any accounts at risk (move funds from your checking account to your savings account, for example).

Communicating with your bank quickly can help limit your losses. In many cases, federal law protects you from fraudulent money transfers. However, that protection is strongest when notify your bank before anything happens – and some products and services that don’t qualify as bank accounts might not offer you any protection.

You might also want to use a credit freeze or fraud alert if your Social Security Number was stolen.

Those tools make it harder for thieves to open accounts using your name, and can also reduce the amount of cleanup you’ll be faced with later.

Finally, see if there’s any way to stop any in-progress payments from being processed. If you did a wire transfer, it might be too late. But you might be able to stop payment on a money order or personal check.

Report to the Police

If you want to try and catch the scammers, report the scam to the local police – especially if the scam took place in-person. With online and telephone scams, law enforcement can rarely do anything to help you (but letting them know could help you recover your funds and prevent others from being scammed). Scams are often run from faraway places – even though it might look like the thief had a local phone number.

You may also need a copy of your police report for your bank or other financial institutions. A police report legitimizes your claim that a crime took place and can help you secure certain rights available under federal law (such as an extended fraud alert that is only available for victims of identity theft). In some cases, it’s difficult to get documentation from the police, but it’s an essential step.

Report to Regulators and Industry Watchdogs

In most cases, local police are not going to take any action beyond providing a police report. However, other organizations might be better able to track down scammers. It doesn’t hurt to report the problem to multiple organizations – some have more resources available than others to help.

Regulators: if you were scammed by a business, the Federal Trade Commission (FTC) is always a good place to start.

But industry-specific watchdogs will be especially motivated to clean things up (and be less bogged-down with a slew of unrelated complaints), so it’s worth letting them know as well. With financial services in general, it’s a good idea to report to the Consumer Financial Protection Bureau (CFPB). Those complaints can be handled by the CFPB or routed to the appropriate regulator (SEC for securities, FDIC for certain banking issues, and so on). If the scam was run online, the Internet Crime Complaint Center (IC3) should also hear about it. Finally, state consumer protection agencies can offer local support.

Intermediaries: you’ll also want to report scams to any intermediaries that unwittingly helped the scam take place. For example, if you were ripped off on eBay, eBay needs to know about it so they can look for patterns and shut down offending accounts.

Depending on how you provided funds to the scammer, you might have options with your payment processor (PayPal or a credit card company for example).

Expect Follow-up Attempts

If you’ve been scammed, there’s a good chance that the scammer will attempt to get more from you – it worked the first time, so they’ll try to string you along as long as possible. It’s best to ignore these attempts and simply report them to whoever is investigating. Engaging with the scammers can create more problems.

Spread the Word

You can be certain that scammers are trying to take advantage of others – and getting away with it in some cases. If you’re embarrassed about what happened, look into anonymous ways to share your story. If you really want to get the word out, contact local media outlets (just be sure you and they are on the same page regarding anonymity).

Ongoing: Monitor your Finances

Depending on the nature of the scam, thieves might have sensitive information such as bank account numbers, your Social Security Number, and your contact information. That information might be used to try and open accounts or get into your existing accounts. Just like you need extra care and rehabilitation after an injury, your finances need extra attention after a scam. Check your credit regularly, set up text or email alerts on your bank accounts, and watch for phone calls or mail that suggests identity theft is taking place.

If you see any problems, act quickly to fix them. Credit reporting agencies allow you to fix errors in your credit reports and remove any accounts that were opened fraudulently.