Financial Fraud Is on the Rise During COVID-19. Your Bank Can Use Social Media to Help.

by | May 5, 2020

As a trusted financial institution, it’s your bank’s responsibility to proactively communicate and share information with your customers to help educate them about and protect them from financial fraud. Read to learn what your bank should be sharing with customers in social media:

As if these uncertain times aren’t hard enough, scammers are increasingly trying to take advantage of people when they’re most vulnerable. The Federal Trade Commission received 18,235 reports of financial scams related to the COVID-19 pandemic between January 1 and April 15; in that time, people lost $13.44 million to fraud.

As a trusted financial institution, it’s your bank’s responsibility to proactively communicate and share information with your customers to help educate them about and protect them from financial fraud. Customers expect this from brands now more than ever: According to the “2020 Edelman Trust Barometer Special Report,” 84% of people surveyed said they were looking to brands to share reliable information during this time.

Being a useful source of information not only allows your brand to protect your customers, but it can also help your bank build further trust and form customer relationships that will last. In fact, the same Edelman report also found that 65% of respondents said the way a brand responds to this crisis would greatly influence how likely they are to do business with that brand in the future.

As social distancing continues, however, helping customers and building relationships probably looks a lot different for most banks. With in-person meetings and branch visits off the table, social media is the best channel for your bank to reach and engage customers on important topics related to financial fraud. Here are the three most important points that banks need to communicate with their customers about the risk of fraud now:

1. Tell customers how your bank will be communicating with them.

Communications are rapidly shifting to digital channels as people must connect virtually, which means consumers might be more likely to respond to a bogus email, message, or text. Scammers are sending out phishing scams specifically targeting those in need during COVID-19. For example, one common scam is a text message from the FCC Financial Care Center (a program that doesn’t exist) offering money to those in financial need due to the pandemic and asking recipients for personal information.

Scammers also impersonate real organizations such as charity groups or the IRS. To make sure your customers don’t fall for scammers trying to impersonate your bank and collect personal information, proactively tell your customers which channels you will be using to contact them. If they get a message from someone claiming to be you on any other channel, they’ll know to be suspicious.

2. Share the warning signs of common financial scams.

Scammers are innovating continuously and coming up with new ways to commit fraud, but there are some common warning signs you can share with customers. According to the FTC, for instance, customers should know that the government will never contact them without warning requesting personal information or payment. Customers should also know not to trust any communication asking for payment through Western Union, MoneyGram, or gift cards.

3. Educate customers about the COVID-19 stimulus package.

As COVID-19 stimulus checks start to roll out, confusion about where to get them and what to do with them has created even more potential avenues for fraud. It’s not business as usual like customers would expect with a tax return — and where there’s confusion, there’s risk.

Share information on social media about what your customers should expect with their stimulus checks. Stay clear of speculative, potentially dubious news stories, and provide customers with trusted, government-backed sources of information.

The boom in financial fraud and scammer activity gives your bank an important role amid the COVID-19 crisis. In order to build trust, protect customers from financial fraud, and be a genuinely helpful partner, communicate with your customers on social media to give them the information they need to stay safe.