Impersonation scams are the oldest but effective tricks in the book. Consider the days when folks like Gregor MacGregor—a Scottish soldier, adventurer, and more infamously, a conman who persuaded millions of people to invest in what was billed to be the country of Poyais—walked the earth and preyed on those of weak discernment and intuition.
If the “Poyais Scheme” doesn’t ring a bell, how about the Marc Dreier $500 million investment fund scandal that saw most hedge funds and investors being fleeced of their entire life savings? Like Marc Dreier, nicknamed the “Houdini of impersonation,” the notorious Charles Ponzi who cheated investors out of $32 million as far back as 1919, and Frank Abagnale Jr., who mastered the art of impersonating pilots, doctors, and lawyers, there are many other scamsters who con people by pretending to be whom they are not.
These people show no sign of slowing down, as reports have it that impersonation scams skyrocketed by 30% in 2022 alone, with Latin America taking the most hit. In the UK alone, there were over 45,000 cases in the same year, according to UK Finance cost citizens a whopping £177.6 million.
Taking these alarming facts into account, it is necessary to ensure you don’t fall victim to the most prevalent—but most preventable—kind of fraud. But how do you do that when you don’t know what to look out for?
In this guide, we take a peek at the different types of impersonation scams, their tactics, and how you can avoid them. Let’s dive right in.
What is Impersonation Fraud?
In its simple form, impersonation fraud is a deceptive practice where someone pretends to be someone else with the intention of deceiving others for personal gain. In other words, the perpetrator assumes the identity of a known and trusted entity (whether it be a family member, friend, celebrity, agency, or business) to dupe their victims into disclosing sensitive information or stealing their funds.
Types of Impersonation Scams
Impersonation scams come in various forms, and scammers continually adapt their techniques to deceive unsuspecting individuals while evading detection and prosecution. Some common types include:
Phishing Email Scam
This tactic entails scammers sending emails that appear to be from legitimate sources, such as banks or government agencies. Think of the typical BEC scam where a fraudster hacks into a person’s email account and sends emails to their coworkers or associates with requests for sensitive information or financial transfers. These emails usually contain malicious links or attachments that can infect the target’s device with malware and steal their personal information.
Sometimes known as the vishing scam, this is a fraudster’s method of reaching out to their targets over the phone. They use spoofing technology to disguise their caller ID and impersonate well-known individuals and institutions like charities, credit card companies, or government agencies. They’ll often pressure their victims to take immediate action, such as dialing a malicious code, entering their credentials on a fake website, or providing financial information, under the guise of resolving an issue or taking advantage of a lucrative opportunity.
Social Media Impersonation
You might have come across DMs from celebrity profiles like Britney Spears and Lady Gaga claiming to be stranded somewhere across the Pacific and needed $100 to find their way home, often with a promise of rewarding you when they return. Of course, these are rudimentary strategies that can be easily sniffed out by almost anyone. But what about those elaborate schemes that can leave even the sharpest of detectives bamboozled?
Tech Support Scam
Tech support scammers typically impersonate IT professionals or representatives from well-known companies like Microsoft, Apple, or Google, and they’ll approach their targets via phone calls, pop-up ads, or even unsolicited emails. They’ll often claim to have detected malware on the target’s computer and insist on gaining remote access to fix the issue, thus stealing their sensitive information or financial details in the process.
Here’s where you have those who claim to be from the IRS, Homeland Security, FBI, or other government agencies. These fraudsters’ techniques include threatening their victims with legal action, deportation, or revocation of benefits if they don’t comply with their demands or pay a fine. Interestingly, their preferred modes of payment are gift cards, money orders, or cryptocurrency, to prevent tracing.
It’s surprising how many people fall victim to this scam every year, with the number pegged at over 14 million. However, when you factor in the high unemployment rate, the odds are not that far-fetched. Scammers capitalize on this vulnerability by posing as legitimate recruiters. Their ruse includes promising victims higher-than-expected paychecks or employment in foreign lands, but we all know how the story goes when demands like processing fees, travel expenses, and payment for “starter kits” crop up.
How to Avoid Impersonation Scams
All types of impersonation fraud entail an element of deceit to a certain degree, which you shouldn’t belittle, regardless of how seemingly insignificant it appears. Besides, most victims have one thing in common: believing that they are too smart to be scammed. And this makes them drop their guard. So, to keep your head from getting turned, follow these tips:
- Be cautious of unsolicited phone calls, texts, or emails, especially those from unknown numbers or senders. Legitimate companies and government agencies will rarely contact you unannounced.
- Use Nuwber to check people who reach out to you. You either need their full name, phone number, or email address for this.
- Look out for signs of impersonation, such as poor spelling or grammar, vague or unprofessional language, or inconsistencies in the sender’s contact details.
- Avoid disclosing sensitive information like your social security number, bank account details, or passwords over the phone or in response to unsolicited emails.
- Hang up on calls if you’re not comfortable with providing the requested information. It’s better to be safe than sorry.
- Use strong passwords and two-factor authentication for your online accounts.
- Monitor your bank and credit card statements regularly for any unauthorized transactions.
- Stay up-to-date with the latest scams and fraudulent activities.
- Report any suspected impersonation attempts to the relevant authorities or companies.
Nobody’s immune to impersonation scams. With scammers evolving their tactics, remaining alert and knowledgeable about the prevalent techniques and red flags is your best defense. And don’t trust just anyone who reaches out to you, as this can cost you a lot of money.