As the holiday season approaches, you might be feeling more generous than usual. But giving out money or your personal information to the wrong recipient might leave you feeling blue this Christmas—and could potentially harm you financially in the long-run.
Understanding common fraud and scams that criminals use to steal your money or identity can help prevent you from falling for their tactics. Later on we’ll discuss what to do in case you have fallen victim to any of these schemes, but first here is the difference between a scam and fraud.
Fraud vs. scams
Fraud: A fraudulent activity or charge generally refers to any action taken within your bank account or with your personally identifiable information (PII) that you did not authorize.
An example of a fraudulent charge is someone making a purchase using your debit card number without your knowledge. An example of fraudulent activity is when someone uses your personal information to open a new bank account or credit card in your name.
Scams: A scam is when someone convinces you to willingly share your personally identifiable information or authorize a transaction under false pretenses.
An example of a scam could be someone calling you pretending to be an IRS employee asking for your personal information or money. The willing exchange of information or payment is what makes this a scam tactic as opposed to a fraudulent activity.
The difference: In situations of fraud, the victim…
