8 Tips for Avoiding COVID-19 Scams
Helpful tips to stay vigilant about fraud
In the past weeks, all of our lives have experienced significant disruption. We are balancing caring for the health of loved ones, learning to home-school children, all while continuing to work. Not to mention losing social outlets and drastic economic changes – we really don’t need more life hurdles.
So it’s with the top focus of safety and health in mind that I implore you to: Stay vigilant about fraud.
Criminals are taking advantage of widespread panic to make a quick buck. Phishing attacks are on the rise, with fraudsters posing as legitimate organizations such as the World Health Organization in an attempt to get you to click links or open attachments that will install malware and steal information.
Social engineering and attempts to get you to disclose personal information that will facilitate financial fraud are rampant and even include creative attempts at COVID-19 tax refund schemes.
At FICO, we are continuing to work hard every day to protect people from fraud. We wanted to share some guidance on how to prevent the bad guys from profiting off of the panic. Some of these tips will be familiar, but they’re worth a reminder. You also may want to share them with relatives and seniors in particular.
- Do not click links or open attachments from people you don’t know. If a company is sending you an email to advise you of their coronavirus response, Google the company’s name to navigate to their website where the information will likely be cross-posted.
- Talk to your loved ones and assure them you are safe, and discuss what your plan would be to reach out if you need help. Grandparents and others can be tricked into sending payments and draining their savings – don’t let them be.
- Bear in mind fraudsters may be going door to door for scams such as disinfecting homes to gain access to a home. Double check their legitimacy during this time of social distancing.
- Be aware of pandemic-related scams such as buying face masks, or fake funding sites purporting to be collecting money for people that have lost their jobs.
- If you are buying goods online, be careful of the seller’s legitimacy. When in doubt, Google the seller’s name + the word “scam”. If it’s a phone call, Google the number + the words “who called”.
- Don’t trust a website simply because it begins with “https://”. The s” merely means the data in transit is encrypted, that the site is legitimate or secure. 74% of all phishing sites now use SSL.
- Think about how you want to pay for orders and use a trusted mechanism - such as a credit card or PayPal - which generally provides more protection. Be wary about making payments using wire transfers or bank transfers. If you are a victim of fraud, it will be difficult or impossible to get your money back.
- When trying to contact a company, or your bank, only use contact information you have found from a reliable source. For example, if you get an email that looks like it is from your bank don’t check by calling the number in that email, but rather look on the bank’s website or on your bank card.
Scammers rely on creating a false sense of urgency, and the current situation is making us all more vulnerable. Be cautious about responding to any offer where there is undue time related pressure.
Stay safe and let’s flatten the COVID-19 and the fraud curves!
For more information, Forbes has announced several malicious domains: Watch Out For These Risky COVID-19 Websites And Emails.
You can also read my post for more tips: 6 Types of COVID Scams to Watch Out For.
Popular Posts
Average U.S. FICO® Score at 716, Indicating Improvement in Consumer Credit Behaviors Despite Pandemic
The FICO Score is a broad-based, independent standard measure of credit risk
Read more
The GSE Data Is Public. Here's What It Shows About Credit Score Modernization.
Independent Milliman analysis of GSE historical data confirms what anyone can now verify directly: FICO® Score 10T is the most predictive score.
Read more
FICO® Score High Achievers: Is Age the Only Factor?
<p>FICO’s latest research on <a href="http://www.fico.com/en/blogs/risk-compliance/us-credit-quality-rising-the-beat-goes-on/" target="_blank">national FICO® Score distribution</a> shows that US credit quality continues to trend upwards, with an increasing number of consumers scoring in the highest scores ranges. Given that, we decided it was time to refresh our study on “<a href="http://www.fico.com/en/blogs/risk-compliance/infographic-what-does-a-high-credit-scorer-look-like/" target="_blank">FICO® Score high achievers</a>,” where we examine the credit behavioural profiles of consumers with higher credit scores.</p> <p>As expected, our latest study showed that older people generally have higher scores, as has been the case in our <a href="http://www.fico.com/en/blogs/risk-compliance/age-before-beauty-credit-worthiness-before-youth/" target="_blank">past research</a>. This is largely because they have trade lines that have been open longer, which leads to higher scores (assuming the trade lines are in good standing and all other things equal). The most credit savvy among you will remember that length of credit history accounts for roughly 15% of the overall <a href="http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx" target="_blank">FICO® Score calculation</a>.</p> <p>But for younger consumers, it isn’t too helpful to say, “just wait until you are 50 years old, and that will fix things!” Thus, I decided to dive deeper with our analysis, including looking at the credit behavioural characteristics of younger consumers with high FICO® Scores.</p> <p>In this analysis, I looked at credit characteristics for the two highest score bands, 750-799 and 800-850, which have about 16% and 23% of the population, respectively. I further broke this down by looking at the characteristics of the youngest 15% in each group, which occurs at age 29 for the 750-799 group and 43 for the 800-850. We used FICO<strong>®</strong> Score 9 for our analysis, and examined typical variables of the categories that go into the make-up of the score.</p> <p><a href="http://www.fico.com/en/blogs/wp-content/uploads/2016/10/FICO-Score-High-Achiever-table.png"><img class="alignnone size-full wp-image-29367" src="http://www.fico.com/en/blogs/wp-content/uploads/2016/10/FICO-Score-High-Achiever-table.png" alt="fico-score-high-achiever-table" width="715" height="747" /></a></p> <p>Since there’s a lot to dissect in this chart, I’ll highlight a few findings that struck me: <ul> <li><strong>Credit history.</strong> Higher scores are undoubtedly associated with a longer time on file. What’s striking is the higher average time on file for the 800+ group, both overall and for revolving accounts (the most common trade line). Clearly, it helps to start credit use early in life – but that’s not the sole determining factor for high scoring. The younger cohorts in both the 800+ and 750-799 groups have time on file medians significantly less than their older counterparts.</li> <li><strong>New credit.</strong> High credit scorers do, in fact, pursue new credit. We see little variation in months since last trade line opening and last inquiry among all groups observed.</li> <li><strong>Pay on time.</strong> As you might expect, the further in the past the delinquency, the higher the score – and that’s <u>if</u> a delinquency ever happened. 95% of the 800+ people and 72% of the 750-799 group have never been delinquent, which is a striking contrast to the 57% for the total population. The percentages for the younger groups are even higher, especially so for the 750-799ers. Collection items are also scarce for these high scorers. While 23% of the national population have collection items greater than $99, the figures are only 0.5% for the 800+ group and 3% for the 750-799 group. It is clear that, in conjunction with starting a credit file early, paying on time is a key trait of the FICO® Score high achiever.</li> <li><strong>Balance and utilization.</strong> Finally, we look at how credit is being used, focusing on revolving product use. (Since most people only have one mortgage or one auto loan, variation in instalment product figures is minimal and driven by payment history, which is near perfect for high scorers, as we’ve seen.) FICO® Score high achievers tend to have more open revolving accounts. While the % active trades and utilization are generally lower, by no means do high scorers avoid the use of credit products. What drives the difference here is the amount of <u>available</u> revolving credit utilized. The 800+ group is roughly 1/4 of the national median, both in total and on their highest utilized card; they also have lower balances and more cards<em>. </em>The 750-799 group is more active and higher utilized, but still only at 2/3 of the national figures. The young 750-799 group compensate with lower revolving balances and, as a result, lower utilization, which is in line with what we see for the 800+ group.</li> <li><strong>Benchmarks.</strong> I’d like to point out that while this study provides good benchmarks of the typical credit traits of the FICO® Score high achiever, individual credit profiles will vary widely. And keep in mind that when we sort groups of consumers as a whole by different behaviours, some results may look superficially odd. For example, the 800+ band has a longer median average open account time (128 months) than average revolving months on file (140 months).</li> </ul> So, what do we conclude? A huge takeaway is that high scorers don’t have too much in the way of serious delinquencies and negative public record data.</p> <p>In most respects, the young 800+ people are like their peer group. They really only differ markedly in their shorter credit history and higher non-mortgage balance, both of which are a function of life stage. Our results show that you don’t have to be a credit product hermit; these high scorers have more credit cards. The takeaway is to start credit activity early and maintain well-managed and moderate usage.</p> <p>In many ways, the young 750-799 people are more interesting because their age profile is much younger. Their credit characteristics differ more from their peer group, particularly in terms of length of credit history. They compensate by having almost pristine credit records and lower balances.</p> <p>Ultimately, 39% of US consumers are FICO® Score high achievers, which they accomplish by following common-sense credit practices. It ain’t rocket science!</p>
Read moreTake the next step
Connect with FICO for answers to all your product and solution questions. Interested in becoming a business partner? Contact us to learn more. We look forward to hearing from you.