Here’s How Even Smart People Fall for Financial Scams

How even smart people fall for financial scams
Photo by Travis Essinger

From Birch Gold Group
“I thought that I would never fall for something like this,” financial advice columnist Charlotte Cowles said after handing over a shoebox filled with $50,000 in cash to scammers.

She wrote down the entire story, and it’s a tough read:

The man on the phone knew my home address, my Social Security number, the names of my family members, and that my 2-year-old son was playing in our living room. He told me my home was being watched, my laptop had been hacked, and we were in imminent danger. “I can help you, but only if you cooperate,” he said. His first orders: I could not tell anyone about our conversation, not even my spouse, or talk to the police or a lawyer.

“Don’t tell anyone… everyone is a suspect,” he said.

The whole thing started out as an Amazon scam call and branched out from there to the Federal Trade Commission (FTC) and, believe it or not, the CIA… It’s obviously a scam, right? The CIA is not going to call you at home! 

At the same time, Cowles’s story reminds us that even those of us who are savvy, who are street-wise, who’ve been around the block and seen all the tricks can still be fooled.

Take a moment and hear her story from her own lips:

Are YOU too smart to fall for a financial scam?

You may feel smug right now. You may think, “Obviously they were full of it. That silly woman…”

Listen: That attitude could land you in trouble. 

Overconfidence is risky! Certainty isn’t a good thing when you’re wrong.

The next time you read a story like this and feel self-righteous, remember this:

Americans reported losing more than $10 billion to fraud in 2023, a 14% increase from 2022, according to the Federal Trade Commission (FTC). It was a milestone benchmark, the agency said.

And these figures likely underreport the true extent of fraud! They only include reported cases.

If you had a five-hour call with the CIA and ended up handing a stranger $50,000 in cash and watching drive away, would you report it?

I hope the answer is yes! For me, I’m not sure… In order to call the police and report the crime to the FTC, I’d first have to admit that I’d been scammed to myself. To my family. That would not be easy…

Yet that’s one of the things scammers count on!

If we’re paralyzed with shame because we fell victim to their con, and we don’t report them, the scammers are free to strike again.

And again.

The FTC put together this interactive graphic. I encourage you to spend a moment with it.

Financial scams cost us more than money

If we accept that, under the right circumstances, anyone could fall for a financial scam, then it’s a little easier to let them (and ourselves!) off the hook. Sharing our stories is our best defense against becoming scam victims ourselves.

Reading a story about a stranger like Cowles who gets conned is one thing… Hearing that same story from someone you know personally, and respect? That really delivers the message.

Anyone can be a target!

We’ve got to stop shaming scam victims. Instead, let’s admit how brave they are for telling their stories. For standing up in public and admitting they were wrong.

Let’s listen to them with empathy and compassion rather than judgment.

Because remember, their story could be our story if we don’t listen.

Knowing what to look out for is key to defending against most scams. To help you detect and avoid financial scams, Birch Gold Group has pulled together an extensive resource guide that is now available on our website. The Birch Gold Group Scam Protection Resource Guide helps you identify warning signs and provides you with tips on how to avoid fraud.

2024, Featured, scam watch