An illustration of common scam phrases on the end of fishing hooks.
Illustration: Matt Chase

When Angelica Chavez, a 30-year-old fashion illustrator in Los Angeles, met “Weijia,” a local businessman, on a dating app last fall, she was delighted to find that they had many interests in common, including entrepreneurship and music. The two began sharing photos and texting multiple times daily through WhatsApp. “We were so alike, and he was so kind and interested in talking about our daily lives,” Chavez says.

Then Weijia casually mentioned that he was investing in cryptocurrency, a digital-only form of currency whose value tends to be volatile. When Chavez expressed interest, he offered to help her get into the market, too.

With both trepidation and excitement, she purchased the cryptocurrency Ethereum through an app Weijia recommended. Her investment of a few hundred dollars appeared to nearly double in value within minutes, allaying any fears she had about the digital marketplace. “When I saw that, I thought, ‘Okay, this is real,’ ” Chavez says.

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She continued adding to her portfolio over the next several weeks. But she was becoming frustrated with her virtual dating relationship. Every time she and Weijia discussed meeting in person, he canceled with an excuse.

After a month, she told Weijia that she’d drop him if they didn’t meet. Shortly after that, he stopped responding to her texts—and her cryptocurrency account balance, about $20,000, vanished. “I realized I had ignored a lot of red flags because he got me to trust him,” she says.

Like Chavez, a growing number of Americans are falling victim to scams. The first three quarters of 2021 saw 2.1 million reports of fraud, putting it on a par with all of 2020, according to the Federal Trade Commission. And in a November 2021 nationally representative Consumer Reports survey (PDF) of 2,057 American adults, 95 percent said they had received communication in the previous 30 days that they believed to be fraudulent. Almost half of Americans reported getting six or more phony messages in a typical week.

The pandemic—and all the time people have been spending online, where scammers can target them by text, email, and social media—likely plays a role. In addition, “the scam landscape has changed,” with international criminal organizations increasingly in the mix, says Kathy Stokes, director of fraud prevention programs at the AARP. “They’ve got offices and employees, and lead lists that they buy off other scammers.”

But no matter how sophisticated scammers are, there’s plenty you can do to help protect yourself. Here, how to spot some top scams, what to do if you’ve been targeted, and how to avoid fraudsters in the future.

(All median loss figures below are from the FTC Consumer Sentinel Network, 2020 data.)

The Imposter Scam: You Owe Us Money!

Contacts you by: Telephone, email
Median loss: $850

This was 2020’s most common fraud strategy. Criminal poses as a government official or company representative. They say there’s a problem with your account, often that you owe money. They want the money ASAP and may want personal info, too.

Most victims were 50 and older. Someone from the IRS or another important-sounding government agency or business calls to alert you to a problem: You owe thousands of dollars in back taxes, a fine from Social Security, or an unpaid debt to a business. The caller may have your bank account data or partial Social Security number, making them seem more credible.

You’re also told you must pay up right away, or have your financial accounts frozen or face arrest. The caller directs you to use an unusual payment method, often a gift card.

To avoid trouble, you follow the instructions to buy a gift card and give the caller the number on the back. The card is immediately drained of value by the scammer.

Warning signs: Government employees never call consumers about money owed or threaten arrest. Neither a government agency nor a legitimate business would request immediate payment by gift card. For back tax payments, for instance, the IRS would notify you by mail and have you pay by check or credit card via mail or its secure online site.

What to do: Hang up. If you’ve already followed the caller’s instructions, that gift card money is likely gone. “It’s the same as paying someone with cash,” Stokes says. But the FTC recommends notifying the gift card issuer right away. Also, report the theft to the police in case you can claim losses on your homeowners insurance or tax return. File a complaint at ReportFraud.ftc.gov to help agencies track the scammers.

Best practices: Always contact the government agency or business directly if you receive any unexpected calls, texts, email, or other communication.

The Online Shopping Scam: Awesome Deals Here

Contacts you by: Social media, websites
Median loss: $100

Scammer advertises great deals on enticing products, such as designer handbags, furniture, cars, even adoptable pets. Or they may offer scarce items, such as masks or COVID-19 testing kits. They never deliver once you’ve paid. This often ensnares people 50 and younger.

Scrolling through Facebook or Instagram, you spot an ad for the cordless drill you’ve been searching for. Your click leads you to a website where you buy the tool, perhaps with a credit card or by using a debit card or peer-to-peer payment app such as Zelle.

These days, you’re likely to see ads on social media or Google for everything from drills to designer clothes to cars (even puppies up for adoption). But a growing number of online shoppers aren’t getting what they paid for, a Better Business Bureau (BBB) study found. In your case, perhaps no drill arrives. Or when your package does appear, it contains a poor-quality tool or something entirely different, like . . . a ruler.

While the last example may seem puzzling, it’s increasingly common, says Bill Kresse, an associate professor of accounting at Governors State University in University Park, Ill. Some sales platforms, like Facebook Marketplace, release your payment to a seller once package delivery is confirmed, even if the item inside isn’t what you ordered. Then “the bad guys disappear into the ozone” with your money, Kresse says.

Warning signs: No refund policy, phone number, or address is clearly listed. Watch for business emails with Yahoo or Gmail addresses and a lot of negative reviews.

What to do: If you paid by credit card, ask a representative how to get your money back. With some other payment methods, it may be iffier. Report the theft to the platform you bought the item on, and to keep scrutiny on scammers, to ReportFraud.ftc.gov and BBB.org/scamtracker.

Best practices: Instead of clicking on links in online ads, go to retailer websites directly, Kresse says. You can’t be sure where links will take you. When shopping online, try to pay with a credit card, which offers the strongest protection. Keep a record and screenshots of purchases.

The Employment Scam: A Great Job Awaits

Contacts you by: Email, social media, job websites, radio/TV 
Median loss: $1,950

Scammer impersonates employer and hires you, and often sends a paycheck, then asks you to return money, claiming they overpaid. The paycheck bounces. They may steal your identity, too. Or they might ask you to pay for work supplies, then disappear. In 2020, these scams were more commonly reported by people under 40.

While job hunting, you may see positions like mystery shopper, shipping/warehouse worker, or remote assistant on social media and employment websites like Indeed.com. (That online platform was the one most often cited for employment scams in a 2020 BBB report.) But a stranger may also reach out to you about a job by text or email.

Applications may ask for your Social Security and financial account numbers. Once you’re hired—usually in a lightning-fast process—your new boss asks for what may be thousands of dollars for work supplies or training, then disappears. Or right after sending your first paycheck, the employer asks for some of the money back, saying you’ve been overpaid accidentally. Once you return it, your paycheck bounces, leaving you on the hook for the money you sent back plus a bounced check fee. And the job scammer may also use your information to steal from you.

Warning signs: Hiring applications shouldn’t ask for Social Security or bank account numbers, nor should employers ask you to pay for training or work supplies—or request that you “refund” them part of a check they’ve sent you.

What to do: If you shared personal data like your financial account numbers, freeze your credit and change account passwords right away, says Eva Velasquez, CEO of the nonprofit Identity Theft Resource Center. (The FTC's IdentityTheft.gov has step-by-step identity protection plans.) Ask your bank to either flag or close the account and reverse the transaction if you’ve lost money.

Best practices: Be wary of applying for shipping/warehouse or mystery shopper work, and jobs that have vague descriptions or offer work from home or flexible opportunities, as well as “on the spot” offers, the BBB says. Check to see whether a job is actually listed on the company’s website, and search online for the company’s name plus “reviews,” “complaints,” or “scam.”

The Investment Scam: Big Profits, Low Risk

Contacts you by: Online ads, social media, telephone
Median loss: $1,560

Scammer touts a no-fail investment or insider secrets that will yield big profits, and urges you to send money right away, then disappears with your funds. This scam targets people ages 20 to 49.

You get a call from an investment adviser or broker with a can’t-miss opportunity. It may be someone in your orbit (a member of your church, a virtual acquaintance from a Facebook group) or a complete stranger. You’re told that to get in on the investment, you need to send money through a peer-to-peer payment app like Cash App or Venmo, a wire transfer, a gift card, or cryptocurrency (as Angelica Chavez was told). But that surefire investment turns out to be phony, and because the payment method you were urged to use is hard to track, your money is gone.

Warning signs: Being pitched through a cold call is suspect, Stokes says. But no matter who approaches you, if you’re asked to invest through a payment app, a wire transfer, a gift card, or cryptocurrency, it’s a strong indication that the opportunity is bogus. Being rushed, and the promise of huge profits and low risk, are also red flags.

What to do: If you lost money through an investment scam, you’re unlikely to get it back, but you can probably claim a loss on your taxes. And it’s wise to report the theft to the payment platform that you used and to your local police department. Also file a complaint with the Securities and Exchange Commission, the Financial Industry Regulatory Authority, and the FTC, which tracks patterns of complaints.

Best practices: Even if you know the person offering the deal, check their professional background first. Scammers are far less likely to have legitimate credentials. Go to the SEC's Investor.gov to find out whether an investment adviser is registered or licensed, or has a history of disciplinary actions. Do the same for brokers at BrokerCheck.finra.org. Always pay for investments in easy-to-track ways.

The Sweepstakes Scam: You’re a Winner!

Contacts you by: Email, letter, social media, telephone, text
Median loss: $1,000

Scammer says you won a prize and requests a fee—maybe for taxes on what you’ve won—and/or bank information to claim it, then steals that fee or raids your account. In 2020, this was more commonly reported by people over 50.

You get a text, an email, or a call saying you’ve won an iPad, a gift card, or a new car. The message, which may appear to be from a government lottery or sweepstakes, or a well-known firm (think Publishers Clearing House), tells you that you need to pay a handling charge or taxes on your winnings up front. Or maybe it says you’re only a potential winner but a small fee will boost your shot at the prize.

The “sponsor” asks for a credit card number to cover these costs and, possibly, for your bank account info in order to send your winnings.

To persuade you to ante up, they even deposit a small check into your account. You hand over your credit card info to pay the fees. Your card is charged, the check bounces, and the scammer drops out of sight.

Warning signs: Do you remember entering that sweepstakes? Even if you do, legitimate sponsors won’t ask for money or account information.

What to do: Contact your bank and credit card company. Depending on the type of transaction, it’s sometimes possible to get your money back. Report losses to the police and at ReportFraud.ftc.gov, and file a complaint at IdentityTheft.gov if you gave the scammer personal info. For mail scams, notify the United States Postal Inspection Service.

Best practices: If you really think you may have won a prize, reach out directly to the sponsoring organization, not to email or phone numbers the scammer provided. Online, search for the organization by name along with terms like “review,” “complaint,” and “scam.”

4 Ways to Prevent a Scam

1. Trust Your Gut
Scammers often urge you to act immediately. If you take some time to think about the message or offer you’ve gotten before acting on it, you may be able to sidestep a scam.

2. Don’t Respond
Ignore calls, texts, and email if you’re unsure about who the sender or caller is. It’s better, for instance, to simply let an unexpected phone call go to voicemail. Also, if you generally rely on caller ID, be aware that it can be falsified. And never give your personal or financial info to anyone who contacts you out of the blue. If you think that a message might have merit, get in touch with the organization yourself in a way you’re sure is legitimate.

3. Check Before You Click
Don’t click on links in email and texts if you have any uncertainty; some may put your device’s security in jeopardy. Hovering your mouse over a link in an email will reveal the entire URL, which may help you determine if it’s fraudulent. Case in point: An “.ru” at the end of a URL means the link you thought was to a local retailer was created in Russia.

4. Pay Wisely
With peer-to-peer payment methods like Cash App, Venmo, and Zelle, for instance, it’s best to use them only with people you know, says Bill Kresse, a fraud expert. Also, don’t send money to anyone who sends you an unsolicited check, even if the funds appear in your account, says Steven Baker, an international investiga-tions specialist for the Better Business Bureau. It may take weeks for a bank to realize a check is fake—which may put you in a dicey position.

Editor’s Note: This article also appeared in the March 2022 issue of Consumer Reports magazine.