To prevent becoming a victim of fraud, you should always keep your data in a secure location, protect your online accounts with strong passwords and Multi-Factor Authentication (MFA), sign up for a dark web monitoring service to receive dark web alerts, learn to spot phishing scams and more.
Continue reading to learn more about fraud prevention tips you should be following.
What Is Fraud?
Fraud is when a person deceives others to gain money, goods or services for their benefit. People who commit fraud typically do it by pretending to be someone they’re not so they can take things that don’t belong to them and use them for malicious purposes.
Some common examples of fraud include identity theft, phishing scams and embezzlement.
Identity theft: Identity theft is when a threat actor uses a person’s Personally Identifiable Information (PII) without their permission so they can impersonate them and commit fraud. One of the most common types of fraud that can happen as a result of someone stealing your identity is credit card fraud. Credit card fraud is when an unauthorized person uses your credit card information to make purchases under your name.
Phishing scams: Phishing is a type of social engineering scam that involves a threat actor pretending to be a person or a company they’re not to persuade victims into revealing sensitive information. Phishing scams can take place through emails, text messages or phone calls and typically display a sense of urgency.
Embezzlement: Embezzlement is when a person purposefully steals money from their business or employer for their financial gain. This person takes advantage of their position within a company and uses it to steal funds over some time so it isn’t “noticeable.”
What Is Fraud Prevention?
Fraud prevention describes the steps individuals take to prevent becoming a victim of fraud, such as securing their online accounts with strong passwords and being cautious of the information they share online. For an organization, fraud prevention refers to the policies, functions and processes that are put in place to prevent fraud from occurring.
10 Tips To Prevent Fraud
Here are ten tips to help prevent becoming a victim of fraud.
1. Always keep your data in a secure location
Securing your sensitive data is the first step in preventing your data from getting into the wrong hands. When an unauthorized individual gets a hold of your data, they can use it to commit fraud, such as stealing your identity.
To prevent this from happening, always keep your data stored in a safe place like encrypted cloud storage. Cloud storage is a way of storing your data “in the cloud,” meaning it can be accessed at any time no matter which device you’re using – all you have to do is be connected to the internet. When cloud storage is encrypted, it means that the data stored in it is converted from a readable format to an unreadable format known as ciphertext. The only way to decrypt your data is by using the encryption key, which is usually a password. By storing your data in encrypted cloud storage, you’ll always have access to it no matter where you are.
When choosing an encrypted cloud storage provider, be sure the service uses zero-knowledge encryption as this is the most secure encryption available and ensures no one but you will be able to access your data. If you’re unsure of where to store your data, you might want to consider using a password manager. Password managers aid users in generating, managing and securely storing passwords for their accounts. While password managers are known for storing passwords, they can also store additional data such as credit card information, tax documents, images and more. The best password managers secure your data using zero-knowledge encryption.
2. Protect your online accounts
Securing your accounts with strong passwords and multi-factor authentication is crucial to prevent becoming a victim of fraud. Strong passwords are at least 16 characters long and use a combination of uppercase and lowercase letters, numbers and symbols. Strong passwords are never reused across multiple accounts and don’t contain personal information or dictionary words and phrases. The best way to ensure you’re always using strong passwords is by using a password generator to create them. Remembering multiple strong passwords on your own is impossible, but a password manager can help by securely storing them all for you.
In addition to strong passwords, you should also have MFA enabled on your accounts whenever it’s an option. MFA adds extra layers of security to your online accounts by requiring that you provide one or more authentication factors in addition to your username and password. In the case that a threat actor is able to guess or crack your password, MFA would prevent them from being able to successfully log in to your account since they won’t be able to authenticate they own it.
3. Sign up for a dark web monitoring service
Dark web monitoring is a service you can sign up for that constantly scans the dark web for your personal information. An example of a dark web monitoring service is BreachWatch®. BreachWatch is an add-on to Keeper Password Manager that scans the dark web for breached passwords that match the ones stored in your password vault. When BreachWatch detects a password of yours on the dark web, you’re immediately notified so you can take action by quickly changing your password.
Once your password is changed, it will no longer show as high risk in your vault and your account is safe from the possibility of compromise. Because dark web monitoring services like BreachWatch notify you in real-time, they help mitigate the risk of fraud that can result from account compromise.
4. Learn to spot phishing and other social engineering scams
Phishing is a type of social engineering attack that aims to persuade individuals to disclose sensitive information. Phishing and other types of social engineering scams have become increasingly common and trickier to spot due to the increased use of Artificial Intelligence (AI) by cybercriminals.
However, this doesn’t mean these scams are impossible to spot. Here are some common indicators of a phishing scam.
- Use of urgent language
- Too-good-to-be-true offers
- Being sent unsolicited links and attachments
- Requests for personal information
- Threats of serious consequences (e.g. being arrested if you don’t send a payment)
5. Shred your sensitive documents
Sensitive documents like tax returns and bank statements often contain personally identifiable information that threat actors can use to steal your identity. It’s important that you securely store these sensitive documents or shred them completely if you no longer need them.
Shredding sensitive documents once you’re done with them will prevent anyone from being able to use the sensitive data on those documents maliciously.
6. Avoid insecurely sharing sensitive information
Insecurely sharing sensitive information like login credentials, tax documents and identification cards can lead to you becoming a victim of fraud. Avoid sharing sensitive information through non-encrypted formats such as text messages or email; instead, share sensitive information through the use of a password manager.
Most password managers use zero-knowledge encryption to protect your data at all times. By using a password manager to share your sensitive data, you ensure that unauthorized individuals won’t be able to get their hands on the data as it’s being sent.
7. Avoid storing your credit card information on websites
Shopping online has become increasingly common, and because of this, most people choose to store their credit card information on retail websites to make purchasing goods and services even more convenient. However, storing credit card information online places you at risk of credit card fraud if the website experiences a breach or a threat actor gains access to your online account.
If possible, avoid storing your credit card information on any retail website to prevent becoming a victim of credit card fraud.
8. Avoid using public WiFi networks
The use of public WiFi comes with risks, which is why it’s best to avoid using it altogether. Since anyone can log on to public WiFi networks, they increase the potential of falling victim to Man-in-the-Middle (MITM) attacks. A MITM attack is when a cybercriminal intercepts the data being sent between two individuals so they can use it for malicious purposes such as to commit fraud.
To mitigate the chances of falling victim to fraud due to a MITM attack, avoid using public WiFi. If you have no other choice but to use a public WiFi network, connect to a Virtual Private Network (VPN) first. A VPN protects your internet connection by encrypting it and masking your IP address so threat actors won’t be able to determine your location.
9. Opt to use virtual cards
Virtual cards, also known as virtual credit cards, are a way to make transactions online without having to reveal your actual card information. Some banking institutions like Capital One provide you with a stand-in credit card number, expiration date and Card Verification Code (CVC) so you can make online transactions without sacrificing the security of your credit card information.
Some other virtual cards you may be more familiar with are the ones you use when conducting “tap to pay” transactions through Apple Pay or Google Pay. Tap-to-pay transactions also mask your actual card information when you’re paying for something, making them a more secure way to conduct online transactions.
Using virtual cards whenever possible will help prevent you from becoming a victim of credit card fraud, which is difficult and costly to recover from.
Your digital footprint consists of the traces of data you leave behind on the internet. There are two main types of digital footprints, passive and active. Your passive digital footprint is the data that is collected about you unknowingly as you surf the internet such as cookies and your shopping and browsing history. Your active digital footprint is the data you knowingly post on the internet such as your social media posts, public reviews and articles you publish online.
Having too large of a digital footprint can make you more vulnerable to targeted cyber attacks that aim to steal your sensitive information to use for fraud. While it’s impossible to delete your digital footprint completely, there are ways you can reduce your digital footprint.
Here are steps you can take to clean up your digital footprint.
Stay Protected Against Fraud
Fraud can happen to anyone, so everyone must take the proper precautions to prevent themselves from falling victim to this threat. By implementing the tips above into your everyday life you can mitigate the risk of becoming a victim of fraud.
To see how a password manager like Keeper Security can help you secure your online accounts and sensitive data, start a free 30-day trial of Keeper Password Manager today.