Safeguarding Against Financial Scams


We routinely hear about financial scams becoming increasingly prevalent and sophisticated, as scammers are constantly looking for new inroads to people’s money. Familiarizing yourself with common ploys and being proactive in taking digital security measures can empower you in your efforts to remain safe and secure. 

Beyond awareness of what types of scams are out there, it’s important to recognize why they succeed, and acknowledge the pitfalls of some common reactions should they happen to you or a loved one. 

Wired for Community

Gone are the days when phishing emails were easy to spot, using choppy language and conveying far-fetched scenarios about foreign princes. In 2023, the most common way people were contacted by financial scammers was by email, most often purporting to be legitimate businesses or authentic government agencies, using more and more convincing logos, links, and language[1]. Artificial Intelligence plays a significant role now too, with emails written by AI sounding more relevant and believable. Scammers may use ChatGPT to sound convincing, and voice replication in phone call scams is on the rise.  

It often goes against our instincts not to respond to someone when we’re contacted – whether at the front door, a phone call, text, or email. We’re wired to communicate and connect. Scammers count on this natural tendency when casting a wide net in hopes of finding someone willing to engage. They target our natural affinity for community, and our instinct to help someone when they say they need something from us. It can take a real, conscious effort to pause before responding. 

Often these attempts share a bit of personal information about you or someone you know, lending an air of credibility to them. They may have a portion of a Social Security number or other personal details, using it to manipulate people in emotionally sophisticated ways. Sometimes, an email account is compromised or “hacked,” and contacts are targeted directly with requests to send money, preying on people’s personal connections. 

Slowing Down

Alerts from texts and emails come routinely, activating our adrenaline and dopamine, making us feel we need to respond immediately. The same nerve centers our devices target to keep us engaged, also trigger our “fight or flight” response. You may be contacted when you’re tired, or your kids are distracting you, and there is potential in these moments for anyone to misstep and fall for a scam they might otherwise recognize. Financial scammers rely on emotional manipulation, taking people out of the realm of logic and usual rational perspective and into a much more vulnerable state.[2] 

Recently I answered a call from someone purporting to be collecting on a legal judgment. In the 60 seconds I was on the phone, they shared names of family members and locations they and I have lived. Fortunately, being so familiar with the methods scammers use to try to lure people in, I realized immediately that this wasn’t real, and I hung up and blocked the number. The call was unsettling and momentarily raised my blood pressure, but I went on to the next important step, which was to alert family members that they might receive a similar call. Sharing this information could increase the chances that they didn’t fall for this scam or similar ones in the future. 

It takes a conscious effort to pause for a moment and scrutinize communications you weren’t expecting. It is essential to be selective about what kinds of information you share, and with whom.

Safeguarding and Recovering

Family members can play a crucial role in protecting their elderly loved ones by staying informed about common scams, regularly checking in on their financial activities, and discussing what sorts of communications they should recognize as red flags. One method of safeguarding is to set up a password manager, which creates unique, hard-to-guess passwords for your accounts, and only requires users to remember one universal password. Combined with slowing down, this can go a long way in preventing many financial scams.  

Aside from the potential financial loss, there can also be a great sense of embarrassment that comes when a scam is successful and money is lost. The fear of judgment from others is uncomfortable, and no one likes to admit they’ve been taken advantage of or made a financial mistake. It can be easy to think, “How could I fall for this?”, yet there’s no shame in admitting it happened to you. Their success underscores the sophisticated and relentless tactics scammers use, and their continued efficacy depends, in part, upon people feeling uncomfortable sharing details during and after the fact.  

The Power of Shared Awareness

It’s important to realize that you are not alone. Attempts at financial scams will likely continue, even as our efforts to protect against them evolve and strengthen. If you find it does happen to you or a loved one, it’s more important than ever to let someone know right away, as a way to mitigate the damage. 

Should something happen that causes you concern, reach out to your financial advisor, who will have suggestions for remedies or additional safeguards. Discussing what happened has the added benefit of spreading knowledge about the types of scams circulating and how often they’re occurring. Talking to a trusted family member or friend is key for the same reasons. In the same way that our desire for community can make us vulnerable, a community with shared awareness can help protect us all.

Jena Regan, CFP 

About Jena Regan, CFP®

Jena Regan is a Lead Advisor with North Berkeley Wealth Management. Jena works with clients to gain a sense of calm in their financial lives.

Read more about Jena


1 Facts about fraud from the FTC – and what it means for your business 

2 The Psychological Trick Scammers Rely on and How to Protect Yourself TIME 

This commentary on this website reflects the personal opinions, viewpoints, and analyses of the North Berkeley Wealth Management (“North Berkeley”) employees providing such comments, and should not be regarded as a description of advisory services provided by North Berkeley or performance returns of any North Berkeley client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this website constitutes investment advice, performance data, or any recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. North Berkeley manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.

By |2024-05-17T14:20:15-07:00May 17th, 2024|