What Is Financial Fraud: Know Its Causes And Prevention Methods

Financial fraud or scam means fraudulently obtaining money or sensitive information from a person or organization. This fraud can happen both online and offline. In the digital age, such fraud cases have increased rapidly, where a small mistake can wipe out your years of earnings in minutes. Therefore, it is very important to be aware about it and have correct information. Let us understand its causes and easy ways to prevent it.

Not keeping personal information safe

Often people share sensitive information like their date of birth, Aadhaar/PAN number, bank account details, password or OTP without complete verification, which can lead to huge financial losses and identity theft in the future.

Be careful before sharing information

The website is protected with HTTPS (see icon of lock in address bar).
The website belongs to a truly authoritative and trustworthy source.
Don’t click on suspicious emails, links or pop-ups, as they can steal your information.
Remember, no institution ever asks you for a password, OTP, or bank details via phone, email, or SMS.

1.Email spoofing

This is a cyber fraud technique, in which thugs send fake emails that look absolutely real like they come from a trusted source (like a bank, government entity or someone you know). The purpose of cyber criminals is to deceive you and steal your personal data, passwords, bank details or other information.

Be careful

Do not click on any links or attachments provided in unknown or suspicious emails.
In case of doubt about the validity of the email, contact the concerned entity or person directly through their official number or website.
Carefully check the email’s sender address, domain name, and language (mistakes, unusual words).

Not using strong passwords

Weak or easily guessable passwords become easy targets for hackers.

Keep these things in mind while creating a password

Create a password of at least 12-16 characters.
Capital letters (A-Z), lowercase letters (a-z), digits (0-9) and special signs (!Keep a mix of @#$% etc).
Never use your name, date of birth or simple words like password123.
Have a separate password for each account.
Update the password of your bank, UPI app, email, etc. every 3 to 4 months so that your account is protected from cyber fraud.

2. Clicking on unknown website/link

Cybercriminals often create email addresses or links that look like real websites, but have been lightly manipulated of letters or altered logos (Logo). This change is so minor that it cannot be caught at first glance. Many times such links can also come from the accounts of your acquaintances, if their account has been hacked.

Be careful

Carefully look at the true URL of any link by moving the cursor over it before clicking on it.
If in the slightest doubt, do not open the link and type the address of the official website directly into the browser.
Be wary of misspellings, extra letters, or unusual domains (like.co replacing.com).

Let us understand with an example

Address of the right website: www.amazon.in
Fake address: www.amaz0n.in (where “0” has been used instead of “o”)

3. Greed for offers or sales

Thugs often demand payment methods that are extremely difficult to track or get back— such as cash, wire transfer, money order or gift card. Tracking and canceling these payments can be more difficult than other payment methods, leaving you stuck with no options.

Understand these signs

Scammers create unnecessary pressure to pay.
Saying “is the only way available” or “pay now, otherwise the offer/service will be canceled”.

Be careful

Always use a trustworthy payment method (such as UPI, net banking, credit cards).
Fully confirm the recipient’s identity and purpose before making a payment.

Conclusion

Awareness, vigilance and timely action are most important to prevent financial fraud. Call the Cybercrime Helpline 1930 or file a report on cybercrime.gov.in as soon as suspicious activity is noticed, so as to prevent damage.

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