5 Red Flags of Online Banking Scams

5 Red Flags of Online Banking Scams

October 31, 2023

Online banking scams are very common, and very costly. In 2021, 93 percent of all banking fraud occurred online. While online fraud attacks are increasing, you don't have to fall prey to any of them. Most dishonest communications have certain features that give them away as fraudulent. To help you more easily identify these scams, here are 5 red flags to be aware of.

Unsolicited Communications

One of the most common red flags for banking fraud is the receipt of unexpected emails or phone calls. Usually, these communications will pretend to be from your financial institution. For example, a scammer may call impersonating a representative of your bank, or an email bearing what looks like your bank's name and logo will appear in your inbox.

Always be suspicious of these communications and take the time to verify their authenticity before revealing any of your personal information. Typically, financial institutions will NOT call or email asking you for personal details, and you will rarely, if ever, receive unsolicited communication from them. Here are some ways to identify a fraudulent communication:

  • They ask for personal information, such as account details, PIN, or Social Security Number.
  • They initiate contact instead of you reaching out to them.
  • There are slight discrepancies in your bank's information and that provided in the communication.
  • Written communication may have grammatical errors.

If you suspect that an email or phone call is fraudulent NEVER GIVE YOUR PERSONAL INFORMATION. Instead, take steps to verify the identity of the caller or the email. For example, you can take steps such as:

  • Contacting your financial institution through information on its official website.
  • Looking up your bank on their official website and contacting them.
  • Comparing the information provided to the bank's officially advertised information.

Phishing Websites

Phishing occurs when someone impersonates your financial institution in an attempt to get access to your account. Phishing websites are fraudulent websites that mimic your financial institution's own website. You may, for example, click on a link in an email and be taken to a phishing site. Once there, you may feel confident in providing personal information, such as account passwords, that the scammers can use to access your finances. Look for these red flags in any suspicious website:

  • Grammatical errors
  • Misspellings
  • Missing security indicators (e.g. The padlock in the address bar)
  • Unusual web addresses

In order to avoid phishing websites, do not click on links on unsolicited emails. Always type the address directly into your browser's bar, or use a bookmark to easily access the right address every time.

Request for Upfront Payments

Your financial institution should never ask you for payments before services are rendered. If someone asks you to pay upfront for services such as account reactivation, prize claims, processing fees, and other services, you should immediately stop communication and verify directly with your bank.

Urgency and Pressure

Often, online banking scammers will try to force you to act quickly to keep you from asking questions or investigating their claims. They may even threaten legal action or or try to intimidate you to get you to take action.

Any time you feel pressured to immediately give someone your personal information, or to take action, such as transferring or withdrawing money, you should step back and question the request. Genuine communications will be happy to confirm any information you need to feel confident in taking action.

Unauthorized Account Transactions

Finally, red flags that your online banking account may be at risk is the presence of unauthorized account transactions. For example, you may notice a small charge in your banking account from a source from which you are not familiar. This could be the precursor to a larger deduction from your account by someone who illegitimately accessed your account.

Other red flags that someone is accessing your transactions without permission include the following:

  • Unfamiliar account access
  • Access from unfamiliar devices
  • Alerts that your password has been compromised

In order to catch these red flags, you should regularly monitor your banking accounts. Your financial institution may also send you alerts for suspicious activity. However, carefully watching your accounts can help you catch problems early and take steps to lock down your accounts before you lose large sums of money to scammers.

At Bank of South Texas, the security of your financial accounts is our top priority. We will work with you to identify suspicious activity, alert you to problems and stop scammers before they can steal your hard-earned money. If you ever suspect that your accounts are being compromised, do not hesitate to reach out to us. We are more than happy to help you determine if a communication is legitimate, help you handle fraudulent activity or support you if you have been taken advantage of by a scam. We are here for you!