Here's what to do if you get scammed, and ways to prevent it happening in the first place.

“Hello. This is the Internal Revenue Service. You have been found guilty of tax miscalculation and owe us $1,200. Please make this payment now or you risk arrest.”

Phone calls like this are a common scam tactic around tax time, and the Federal Trade Commission has advice on avoiding them. (One dead giveaway is that the IRS doesn’t cold call or email people.) But what happens if you do fall for a scam?

The Financial Industry Regulatory Authority just put out a study of the “non-traditional costs” of fraud, for which they interviewed 600 victims. Here’s what the victims said they got hit with after their money was stolen…

  • Late fees/interest: 25 percent
  • Fees for bounced checks: 23 percent
  • Legal fees: 19 percent
  • Lost wages: 18 percent

Getting ripped off is just the start of a big, expensive hassle. Here’s how you sort it out, minimize your losses, and make sure it doesn’t happen again…

How to limit your losses

On late fees and bounced checks: The best way to avoid the damage of a low balance after getting scammed is to be upfront with your bank, as quickly as possible. Jonathon Ping’s MyMoneyBlog gives advice for getting overdraft fees waived, but it’s relevant for fraud victims, too. Basically…

  • Be nice but firm. Remember that bank customer service reps are people, too.
  • Tell them your personal story. Overdraft fees are (usually) your fault, while scams aren’t. Your bank should be willing to work with you once you share what’s going on. Chase Bank has a page dedicated to explaining the first steps to take if you think you’ve been a fraud victim.
  • Try multiple mediums. If a phone call doesn’t work, try visiting a bank branch in person and explaining what happened.

On debit or ATM cards: Under something called the Electronic Fund Transfer Act, you will not be held responsible for unauthorized transactions for a missing ATM or debit card if you report it before someone uses it. But you could lose a lot of money if you delay reporting it. According to the Federal Trade Commission, if you report it stolen within two days of the theft, your maximum loss is $50. But wait until after 60 days to report it, and you could lose everything in your bank account.

On credit cards: Again, you should report a theft or unauthorized charge to your credit card companies as soon as possible. Credit card have better protections built into them, thanks to the Fair Credit Billing Act. Your card can only be charged up to $50, when used without your permission.

You should never give out your credit card number to someone who asks for it over the phone. Sometimes scammers have part of your billing account information already, or pretend to. They will try to get you to “confirm” the rest so they can say you approved the charge, which might make it harder for you to fight later.

On cash: You should never mail a money order or use a wire transfer for someone you don’t know personally. If the business is a scam, you will never see that money again, since using cash causes you to give up your right to dispute fraudulent charges.


Getting back on your feet

After any type of theft happens, your first step should be to call the police and file a report. Even if they can’t track down the criminals who stole your information, you’ll have documented proof that a crime occurred.

Your next steps should be to call your creditors and your bank, as mentioned above.

Then call the three credit reporting agencies and ask that a fraud alert be placed on your credit report. Now you’ll be able to order a free copy of your credit report, where you can check for incorrect information and make sure someone isn’t using your identity to get credit. Fraud alerts last for 90 days (after which you can renew them) and don’t affect your credit score.

You can also go a step further and place a “credit freeze” on your report, which makes it a much bigger hassle for potential thieves — and you — to open new credit accounts. This lasts until you have it removed.

How to file a complaint

If you’re a victim of identity theft, or if someone is fraudulently claiming that you owe debt, you can use the FTC Complaint Assistant. If they “detect patterns of fraud and abuse” in a certain business, they may be able to take action to prevent that company from doing business anymore.

If someone keeps calling you at home and you believe they are a spam company, you can add your number to the National Do Not Call Registry to prevent them from contacting you. If they do it anyway after a month, you can file a complaint and get them in trouble.

If the business is listed by the Better Business Bureau — which is not affiliated with the government, but is one of the first places to check for rip-offs — you can file a complaint there to raise your odds of seeing some results. If the business doesn’t resolve your complaint, their rating will drop.


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Meet the Author

Jess Miller

Jess Miller


Miller is the former assistant editor of

Credit & Debt, Tech

credit cards, identity theft, theft

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Article last modified on December 28, 2017 Published by, LLC . Mobile users may also access the AMP Version: Study: The Worst Part About Fraud Isn't The Money - AMP.