Common Financial Scams: Tips to Help Identify Financial Scam Risk

As technology continues advancing, so do the financial scams designed to steal assets and sensitive information. Over the years, financial fraud has evolved from basic scam calls and mail schemes into sophisticated, highly technical endeavors often executed using social media, artificial intelligence and cryptocurrency. Technology has lowered the barriers to entry for many scammers, while expanding their reach globally. According to the FBI’s 2025 Crime Report, Americans lost nearly $21 billion to internet crimes last year alone, a 26% increase from 2024. Investment fraud and cryptocurrency scams were behind much of that damage. 

The disturbing truth is that a single scam can wipe out retirement savings, damage credit scores and lead to significant financial anxiety and insecurity. Businesses face risks ranging from operational disruptions and financial losses to reputational harm and regulatory scrutiny. On top of direct financial losses, identity theft can create ongoing challenges as fraudsters continue to expose personal information to other scammers. 

Understanding What Makes Financial Scams Work

Most financial scams share a few common traits. They often promise unrealistic returns, apply pressure to act immediately and discourage you from seeking a second opinion. Scammers frequently impersonate trusted entities — such as banks, government agencies or friends — to seem legitimate. They may use spoofed emails, texts or deepfake videos to gain your confidence and exploit your trust, which is why it’s so important to watch for these red flags. 

Before you take action or click a link, independently verify who you’re dealing with by using contact information you find on your own, not what appears in a suspicious message.

Common Types of Financial Scams

The most common types of financial scams typically fall into one of the following categories.

Cryptocurrency and AI scams

Cyber-enabled crimes defrauded Americans of nearly $21 billion in 2025 alone, according to the FBI. The Internet Crime Complaint Center (IC3) received more than a million total complaints, an increase of nearly 150,000 over 2024. Those who experienced cryptocurrency fraud reported the highest losses, at more than $11 billion. 

These scams often combine complex investment pitches with jargon, fake dashboards and pressure to move money quickly into wallets controlled by scammers. AI tools are increasingly used to generate convincing emails, voice clones and even video deepfakes that make fraudsters appear far more credible than they are.

Investment scams

Investment-related scams include Ponzi schemes, pyramid schemes, cryptocurrency fraud and operations where scammers build online relationships before pitching fake investments. In Ponzi schemes, fraudsters pay returns to earlier investors using money from newer investors rather than from actual profits, creating the illusion of legitimate gains. Pyramid schemes focus on recruitment over real product sales, promising high returns for bringing in new members. Scammers also pose as financial advisors or run polished social media ads to encourage investment in counterfeit opportunities. 

A major red flag is any “guaranteed” or unusually steady return, especially when paired with pressure to keep the opportunity secret or move money quickly.

Phishing and spoofing

Phishing and spoofing scams rely on emails, texts and fake websites that mimic legitimate sources, with a goal of convincing you to click malicious links or share personal information. Fraudsters then use stolen login credentials or personal details to gain access to accounts, change contact information or attempt additional scams in your name.

These messages often come from addresses or numbers that look close to real ones, contain spelling or grammar errors, or use vague, urgent subject lines.

Bank impersonation and account security scams

In this type of scam, a fraudster pretends to be from your bank, a government agency or a fraud department and claims your account has been compromised or linked to suspicious activity. The goal is to create panic, keep you engaged and pressure you into sharing login credentials, reading back security codes or moving money to a so-called “safe” account that’s actually controlled by the scammer.

These scams often unfold by phone, text or email and may use spoofed caller ID, convincing scripts and repeated contact over several hours. In some cases, older adults are targeted with threats, fear-based messaging or instructions not to speak with family members or trusted advisors until the “issue” is resolved.

A major red flag is any unexpected message urging you to act immediately to “protect” your account, especially if you’re told to wire funds, send cryptocurrency, buy gift cards or stay on the phone while transferring money. If you receive this kind of communication, hang up and contact your financial institution using the number listed on your bank card or their official website — not the number in the message or call.

For readers interested in a real-world example of how this type of fraud can play out, see this AOL article about a scam targeting seniors’ bank accounts.

Identity theft

Scammers use personal information to gain access to existing accounts, open new accounts or max out credit cards in your name. They may also file fraudulent tax returns and claim refunds or credits on behalf of legitimate taxpayers. This type of fraud can be very difficult to recover from, especially if scammers gain access to retirement accounts or bank accounts. 

Warning Signs to Watch For

Many scams share a similar set of warning signs:

• Unsolicited contact from someone claiming to be a financial institution, government agency or company you don’t recognize
• Pressure to act immediately or secrecy around the offer
• Requests for unusual payment methods, such as cryptocurrency, wire transfers or gift cards
• Offers that sound too good to be true, especially with “guaranteed” or high, consistent returns
• Messages with typos, poor grammar or odd phrasing 

Before you act or click any links, slow down and verify the contact using trusted channels, such as a number on your card or the institution’s official website.

Tips for Protecting Your Personal and Financial Information

Fortunately, there are several relatively simple steps you can take to help protect your sensitive information and avoid falling victim to financial scams: 

• Use multi-factor authentication (MFA) – MFA is one of the most effective protections against identity theft, because it requires anyone trying to access an account to verify their identity using two or more methods. In addition to a password, MFA might include a code received via text or email, biometrics such as a fingerprint or facial recognition, answers to security questions or use of an authenticator app.
• Be on alert for phishing scams – If you receive an email or text that appears to be from your financial institution, the IRS or another reputable source, don’t send personal information or click links until you’ve confirmed the message is legitimate. Look up the institution’s phone number online (never rely on a number provided in a suspicious email) and call to verify the communication.
• Monitor your accounts – At least twice a week, log in to your various accounts and review recent transactions. Consider setting banking alerts to notify you of large transfers, logins from new devices and other suspicious activity. 
• Use antivirus software – Any devices connected to the internet should be equipped with strong security software that regularly scans for suspicious activity. Keeping this software updated helps it address new threats and vulnerabilities.
• Install all available updates – Software developers frequently release updates to fix security vulnerabilities, so it’s important to update your devices and apps whenever new versions become available.
• Protect your business – If you’re a business owner, train employees to spot potential scams and verify unusual requests. Implement multiple layers of protection, such as dual approval for wire transfers, procedures for verifying changes in known contacts and vendors, and robust cybersecurity tools like firewalls, antivirus software and email filters. 

Legal Implications and Recourse for Victims

If you find yourself a victim of fraud, take action as soon as possible. Start by reporting the incident to the Federal Trade Commission (FTC), the FBI’s Internet Crime Complaint Center, your local police department and your state’s Attorney General. Investment-related crime should also be reported to the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

It’s also important to notify your bank or credit card company right away, because many financial institutions will reverse certain unauthorized transactions if they’re reported within roughly 60 days. 

Unfortunately, recovering stolen funds can be difficult, especially when assets were sent via wire or cryptocurrency. You may be able to file a civil lawsuit or pursue arbitration if you can identify a domestic scammer; however, international fraudsters can be harder to bring to justice. Prosecuting financial scams is often expensive and time-consuming, and law-enforcement agencies tend to prioritize the largest-scale operations. 

For many fraud victims, the most constructive path forward is working with a wealth manager and legal professional to rebuild your portfolio and strengthen security measures going forward. 

Real-Life Examples and Case Studies

One of the most well-known incidents of large-scale fraud was the Ponzi scheme initiated by Bernie Madoff in the early 2000s. Madoff defrauded thousands of individuals, charities, pension funds and institutional investors out of approximately $65 billion by promising consistent returns of 10% to 15%. Instead of paying out investment profits, he funneled money from newer investors to earlier ones.

A more recent example of fraud includes a 2025 deepfake scam in which a fraudster fabricated a video call that appeared to be attended by senior executives of a multinational firm. After the company’s finance director released a $499,000 payment, it became clear that the call had been faked using video and voice clones, and that none of the other executives were aware of the request. 

In 2025, the U.S. Department of Justice also reported $14.6 billion in healthcare fraud, often involving billing for unnecessary medical services, false claims for medical equipment and fraudulent laboratories. 

These cases all point to the same lessons: verify independently, follow clear internal procedures for large transfers and remember that while technology may evolve, skepticism is still one of your best defenses.

Future Trends in Financial Scam Prevention

Looking ahead, fraud is expected to rely even more heavily on artificial intelligence to create deepfake videos and voice-cloned calls that impersonate family members, financial advisors and company executives. Social media will likely remain a primary tool for “pig butchering” scams, in which fraudsters build long-term connections with unsuspecting victims before exploiting them financially. Cryptocurrency and other digital assets are also expected to remain preferred payment methods, due to their anonymity and tracking challenges. 

On the positive side, technology is also being used to fight fraud. Banks are increasingly incorporating AI-powered tools to flag unusual activity in real time, while blockchain analysis tools are getting better at tracing illicit cryptocurrency flows. And biometric authentication is strengthening account security across devices and financial platforms. 

Still, the best way to combat fraud is through collaboration between individuals, institutions and government agencies. Investors play an important role by reporting scams and suspicious activity, participating in fraud-education efforts and advocating for strong cybersecurity protections. 

Next Steps and Additional Resources

To learn more about common financial fraud and how to better protect yourself, consider reviewing these resources: 

• The FTC’s Consumer Sentinel Network and scam alerts
• FBI IC3 annual reports 
• Consumer Financial Protection Bureau (CFPB) fraud resources 
• FINRA investor education materials and BrokerCheck
• AARP Fraud Watch Network

At Creative Planning, our goal is to equip you with the knowledge you need to recognize threats, protect your assets and respond effectively to suspicious activity. We can support you by reviewing your accounts, enabling advanced security features and discussing additional strategies to help safeguard your financial future. 

When it comes to preventing fraud, vigilance is key. Treat every unsolicited opportunity with skepticism, independently verify all offers and requests, and stay up to date on emerging scams that could affect you. A proactive approach can help protect your financial security and support your long-term goals. 

To learn more about how Creative Planning can help protect your wealth as part of a comprehensive financial plan, please schedule a call with a member of our team.