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How to Recognize and Protect Yourself from Bank Fraud Scams



If you received a “fraud alert” text message from your bank notifying you of unusual activity on your account, you’d probably want to act fast to learn more and take necessary action. But replying “yes” or “no” to that fraud alert message could make you – and your bank account – an easy target for scammers after your money, according to the Better Business Bureau (BBB).

“This time, con artists are impersonating your bank,” says the BBB, which has seen an uptick in reports to the BBB Scam Tracker about scammers sending text messages with phony fraud alerts purporting to be from the recipient’s bank.

Once you know the red flags of a bank fraud scam, you can make sure you don’t become a bank fraudster’s next victim.

How do bank fraud scams work?

The text messages appear to come from your bank and pose as fraud alerts, asking the text recipient about suspicious account activity. For example, the message might read “Bank Fraud Alert – Did you approve a transaction for $1,500? Reply YES or NO.”

It may be tempting to hit “yes” or “no” immediately to get started on stopping further fraudulent transactions. Don’t do it, though

“If you reply to the text, the scammer now knows they have an active number – and a person to scam,” says the BBB. If you reply with a yes or no answer, the scammer calls you, claiming to be from your bank and offering to help you stop the fraudulent transactions by having you send money to yourself via Zelle or another digital wallet.

Then the “helpful” scammer walks you through the process of installing the app and connecting it to your bank account. When your bank sends a code for verification, however, the scammer asks you to share it. Don’t do it.

“If you give the scammer your verification code, the scammer can set up an account with your phone number and email – but their bank account information. If that happens, when you send money to ‘yourself,’ you’re actually sending money to the scammer,” says the BBB.

That’s what happened to this consumer, who reported their bank fraud scam to the BBB:

“The caller ID on my phone said Wells Fargo, and the person said they could reverse the transaction if I sign into my online account and open the Zelle app…It looked like I would be sending money to myself. The caller said everything was fine, and the money would come back to my account. After the call ended, I got two texts stating funds for $2,500 and $1,000 would be deposited in my Wells Fargo account.

“I went back into my account and there was no evidence of any deposits. What I did see was $3,500 taken out of my account and a zero account balance.”

“Disputing the charges will be difficult because the scammer has tricked you into approving the transaction,” according to the BBB. “Sending money through a digital wallet app is like using cash, making it very hard to get your money back.”

Find out: What is a Credit Report Fraud Alert and How Does it Work?

How to protect yourself from bank fraud scams

Now that you know how bank fraud scammers operate, here are five tips for protecting yourself from bank fraud scams.

1. Know your bank’s policies

“Know that your bank will never ask you to send money to yourself. If someone tries to convince you otherwise, it’s a scam,” says the BBB.

2. Beware of spoofers

Scammers can use special software to “spoof” a caller ID number from your bank. Don’t be fooled, warns the BBB:

“If you weren’t expecting to be contacted by your bank, it’s best to avoid answering. Instead, call the number on the back of your ATM card to confirm that there is an issue.”

Find out: 11 Easy Ways to Spot a Get Out of Debt Scam

3. Never share one-time passcodes

If you share a one-time password or code, a scammer can use the code to gain access to your accounts or change information. Don’t share them with anyone, no exceptions,”  says the BBB.

4. Contact your bank about suspicious messages

If you receive a suspicious text message or call that you think could be from a bank fraudster, call your bank to find out if the message is legitimate, and if it’s not, report the fraud attempt.

Find out: 7 Signs of a Debt Settlement Scam

5. Don’t reply

Don’t respond to unsolicited, suspicious text messages that include instructions to reply yes or no. “If you reply to a scammer, they could save your number as ‘active’ and target you with future scams,” says the BBB.

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