Safe or Scam: How to tell the Difference

Being able to recognize fraud is the best defense against it.

Take this short quiz to test your awareness and see if you can spot the red flags of some common scams.

Terms of Use: This quiz is provided for informational and educational purposes only. It does not constitute financial or investment advice, nor should it be relied upon as such. When it comes to investing, we strongly recommend consulting with a registered investment advisor for personalized guidance.

1. A few months ago, you connected with someone on a dating site. Despite the fact they live overseas, and you have never met in person, there was an immediate attraction, and they tell you they love you. 

One day you receive a message from them, and they seem upset. A family relative you've never heard about has been hospitalized. They ask if you might send them some money to help, saying they're stressed out since they can't afford the medical bills.

How would you respond in this situation?

2. You see an opportunity advertised online to invest in a start-up company. This is a one-time, risk-free offer to purchase shares using money from your locked-in retirement savings. You are guaranteed high dividends and a complete return of your investment, free of fees and taxes. This sounds too good to be true, especially because you know that you will be taxed when you make a withdrawal.

How can you tell this is a scam?

3. You get a message from an unknown number. The person on the other end claims to be your grandchild and is in trouble. You have the following chat:

Scammer: Grandma it’s me! I am in trouble and need help.

You: Oh no! Are you OK?

Scammer: I got into a car accident and need money to fix the car. If Mom and Dad find out I’m in so much trouble.

You: Oh my! OK, how much do you need?

Scammer: $250. Can you send me a wire transfer?
 

How would you respond?

4. You come across a TikTok video in which a finfluencer showing himself living a lavish life and lots of wealth, claims to know the method for getting rich quick with crypto. He asks people to trust him with their money so he can invest it on the platform that made him so wealthy.

You should:

5. Scammers of affinity fraud target groups such as clubs, associations, ethnic communities, and religious organizations.

Select the illustrations below that are examples of affinity frauds:

A. The scammers may offer you “faith-based” investments exclusive to your ethnic community or religious group.
B. An unregistered advisor claims affiliation to a certain faith or religious organization and is pushing a high-return, no-risk investment opportunity.
C. Someone new to your group is name dropping or encouraging influential people to help them attract investors.

6. While scrolling through your Facebook feed, you come across a video of a news team you recognize running a story on an exciting investment opportunity. They even show a video of a celebrity endorsing the investment.

You should:

7. Which of the following are not commonly impersonated by scammers?

8. Scammers may pose as fictitious Financial Advisors or firm, promising high returns with low risks. They may even know information about you – taken from social media – and urge you to transfer funds or share personal financial information. These scammers are hoping that you fall for the too good to be true opportunity and scam you out of your funds.

Select all the ways you can help protect yourself against these types of impersonation scams.

A. Be skeptical. 
B. Research before investing. 
C. Use official investing apps. 
D. Be wary of unusual requests.