Fraud
Candlefocus EditorFraud happens when someone gives false information or makes false promises in order to get something from another person or an organization. Their intent is to deceive and ultimately to benefit monetarily or otherwise from their action. In the finance industry, fraud can take many forms, including the making of false insurance claims, the preparation of false financial statements, a pump and dump scheme, or identity theft leading to unauthorized purchases.
In the U.S., the Federal Trade Commission (FTC) estimatesthat fraud costs businesses and consumers billions of dollars each year. For example, the FTC reported that in 2019, consumers reported losing over $1.9 billion to fraud. This includes common scams like pyramid schemes, schemes that falsely promise cures for medical conditions, and romance scams, as well as more complicated financial fraud cases.
In addition to the economic cost, fraud can also result in criminal proceedings. Instances of fraud can land perpetrators in jail and include hefty fines and jail time, depending on the severity of the offense.
The landscape for fraud is continually changing, so it’s important for both individuals and businesses to remain vigilant and aware of new trends. Some ways to protect against fraud include: regularly monitoring financial accounts, using secure passwords, only using official websites when shopping online, avoiding unsolicited emails, and regularly updating security software for computers or mobile devices.
Ultimately, people should strive to practice good cyber security habits and stay informed about current fraud trends and scams in order to better protect themselves from becoming victims of fraud.