Fraud Protection with the FBI Recap

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Read this Periscope for a few tips from the FBI about how you can protect yourself from fraud and theft.

How to Protect Yourself from Fraud

On Wednesday June 16, Supervisor Special Agent Brian Blauser from the FBI shared some stories and advice about fraud happening right now. The FBI does not allow us to record the presentation, however I did take a few notes and will share with you some of my take-aways.

Talk on the Phone, not on Email or Text Before Sending Money
One of the inconveniences we impose upon our clients is also one of the FBI’s best advice. That is, we do not send money out of your account until we communicate with you in person or on the phone. Brian says that a lot of theft and fraud would be prevented if companies would just pick up the phone and verify.

One of the stories he shared was an email exchange between a fraudster impersonating the CEO of a company and a nervous employee. The CEO demanded, immediately, that the employee wire money to an address in Hong Kong for work previously done, for a supplier the employee did not know. The employee asked all the right questions, but he did not pick up the phone to verify. Had he done that, the fraud would have been prevented. As it turns out, it was a fraud and the company lost their money.

Complex Financial Crimes
Often the most complex crimes happen with a simple email hack. Someone sends you a link to an apparently innocuous website and you accidentally download a virus. The most common crime is called phishing, where the hacker learns your password.

The most sinister of crimes happen when the fraudster breaks into the computer network and watches the activity of your people. The fraudster can learn your habits and take advantage of an opportunity when you least expect it. Brian gave examples of imitating the CEO, or a payroll person, and more. Again, a conversation helps to avoid the crime!

Ransomware and Returning the Funds
The biggest paydays are for ransomware. The most sinister of bad-guys will hack into the company’s network for days or longer before they will shut down the network. The bad-guys will corrupt the backup files for the company as well as the current files the company depends on. Before releasing the files back to the company, the thieves demand huge payments. Famously, and recently, Colonial pipeline and JBS paid millions of dollars.

Importantly, Brian says we need to report the crime right away to ic3.gov. If they get the news quickly, they can track the bitcoin before it becomes legal tender. They were able to do this and recovered several millions of dollars for Colonial pipeline.

In Conclusion
Do not send money via the internet unless you have had a conversation with your intended recipient and/or sender. To avoid crimes, be careful of the links you click in the emails and the websites. If you have experienced a crime, report it quickly to ic3.gov, a website set up by the FBI.
About the author

Karl Frank, Certified Financial Planner ®, MSF, MBA, MA, is the President of A&I Financial Services LLC, a local business that specializes in wealth management, insurance planning, and retirement planning. Karl cares for business owners and the businesses that care for them. Learn More about Karl.