Common Categories of Fraud

Fraud is on the rise, and scammers trying to get your personal info have lots of tricks up their sleeves. Get savvy about common types of fraud to protect yourself!
Categories of Fraud

It’s not hard to find examples of fraud—common scams pop up in the news frequently. And no wonder: Americans lost about $667 million to fraud schemes last year, according to the AARP. The trend seems to be continuing through 2020 as well: fraud is on the rise these days, driven by a number of factors like economic uncertainty, COVID-19, natural disasters, and rising unemployment. CNBC reports that so far, Americans have lost $145 million to COVID-19 scams alone!

While there are many categories of fraud, they all have the same ultimate goal: using stolen information to get money illegally. Scammers can do a lot of damage if they get your information, from taking money right out of your account to perpetrating crimes in your name.

By understanding the types of common scams that fraudsters run, you’ll be ready to spot fraud attempts and stop them in their tracks.

Impersonating the IRS or SSA

One way scammers trick people into handing over personal details is to call you up (or send an email) and pretend to be a government entity, like the Internal Revenue Service (IRS) or Social Security Administration (SSA). They may use fear tactics—like saying you owe back taxes—or try to convince you that you’re owed a stimulus payment. These scammers are usually after your social security number, which they could use to:

  • gain access to your bank account
  • file a false unemployment claim in your name
  • open credit cards or take out loans using your identity
  • open a bank account in your name (and use it for fraudulent activity, like collecting unemployment payments illegally or laundering money)

Unemployment insurance fraud

In addition to going after your money, fraudsters target government funds—and unemployment insurance (UI) benefits are particularly prone to scam attempts. You may not even know you’re a victim, yet you could get in big trouble if someone is perpetrating a crime in your name! Scammers might:

  • file a fraudulent UI claim and convince you to accept UI payments into your bank account on their behalf—with a promise to let you keep some of the money
  • use your info to make fraudulent UI claims (often in multiple states) and abscond with the payments before overwhelmed government offices catch on

Impersonating your bank

One of the most common types of fraud in banks is impersonation. Fraudsters claiming to be your bank might call, email, or text you—maybe even message you on social media—with a scam such as:

  • claiming there’s suspicious activity in your account, then ask you to confirm your account number
  • asking you to take a survey, then use your answers to figure out what financial institutions you use—so they can target you with a scam call that sounds legit
  • offer you a fake bonus and ask you to provide your account number (often by entering it on a fake website) to receive the money

Impersonating your mobile carrier

If a scammer knows which carrier you use, that may be all they need to get additional details they can use to defraud you. One common scam goes like this:

  • someone impersonating your carrier calls and says your payment did not go through and they are going to cut off your service
  • when you inform them that your payment was made on time, the scammer asks for a variety of personal information to help resolve the issue
  • they may even trick you into giving them your credit card, debit card, or bank account number to “correct” the billing problem


Scammers search social media to find people who talk about bitcoin and other cryptocurrencies, then use social engineering—gaining your trust in order to manipulate you—to target them with scam attempts. They might message you to:

  • beta test their new platform—and capture your info when you set up an account
  • invite you to sign up for a service, assuming you’ll use the same email and password you use for your other accounts
  • offer an expensive product at a much lower price if you pay in cryptocurrency; if you bite, they’ll send you a form that steals your info (and, of course, you’ll never get that enticing product)

Deposits for personal services

A common scam that’s been on the rise since the COVID-19 pandemic began hinges on selling in-home services—like manicures, massage, or haircuts. Scammers prey on people’s desire for services they can’t get at a shop during quarantine. Two common methods they use to defraud people are:

  • asking for a deposit up front when you book an appointment—an appointment that never happens, because no one shows up at your house
  • requiring a credit or debit card number to reserve the appointment in order to steal your financial information

Employment scams

The promise of a job can be very enticing bait. There are many common scams that prey on people seeking work; fraudsters may:

  • offer you a job and claim they need your account details so they can direct-deposit a hiring bonus, then take your money or use your account to commit other kinds of fraud
  • offer a fake job training course that comes with the guarantee of a job at the end; once you pay for the course, that training (and the job) evaporates along with your money
  • claim that, if you’re an independent contractor, you qualify for special stimulus funds and offer to obtain and deposit them to your bank account on your behalf

Charity schemes

Fraudsters play on both desperation and sympathy, especially when large-scale disasters have emotions running high. Common scams of this sort include:

  • posting fraudulent fundraisers on sites like GoFundMe
  • seeking political donations, often by targeting people who post passionately about certain topics on social media
  • offering to open a bank or credit card account on behalf of people who can’t get an account due to bad credit or a lack of a permanent home address

Romance scams

Some fraudsters try getting into your wallet by getting into your heart. Through a fake profile on a dating site or social media, someone may get close to you in order to manipulate you into:

  • opening a bank account and giving them the number so they can deposit or wire funds for a gift or plane tickets to come visit them
  • giving them your bank account number so they can regularly give you money (often under the guise of a “sugar daddy” or “sugar mama” relationship)
  • revealing personal details—like clues to your passwords or answers to common security questions—that can help them perpetrate other scams
  • opening a bank account on their behalf, which they can later use to launder money

Protect yourself from fraudsters

While there are many categories of fraud, there are also plenty of tools and practices at your disposal for keeping your information safe. Read our Bank Fraud 101 guide to get educated on smart, practical ways to identify fraud attempts and protect yourself—and your money!

Disclaimer: Hey! Welcome to our disclaimer. Here’s what you need to know to safely consume this blog post: We do our best to make sure information is accurate as of the date of publication, but things do change quickly sometimes. Any outbound links in this post will take you away from, to external sites in the wilds of the internet; neither Simple nor our partner bank, BBVA USA, endorse any linked-to websites; and we didn’t pay/barter with/bribe anyone to appear in this post. Individual situations will differ; consult your favorite finance, tax or legal professional for specific advice. And as much as we wish we could control the cost of things, any prices in this article are just estimates. Actual prices are up to retailers, manufacturers, and other people who’ve been granted magical powers over digits and dollar signs.

Important! This account is for your personal use only

An increasing number of customers are being targeted by fraud scams. Before you apply, review these guidelines to help prevent you from being involved in fraudulent activity.

Do not open an account on behalf of someone else
If anyone asks you to open a Simple Account to receive funds, it is an attempt at fraud. Common fraud attempts include requesting that you open an account to receive a gift or bonus offer, obtain a job or job training, or help someone else receive funds (such as unemployment benefits).

Do not share your login or account information with anyone
Neither Simple nor any other legitimate institution will ever ask for your account information. If any third party requests your Simple Account login information, it is an attempt at fraud. Sharing your account information with another person or allowing someone else to use your account to receive funds is a violation of the Simple Deposit Account Agreement terms and conditions and can expose you to fraud.

Actions we may take if fraud is suspected

We take fraud and security very seriously at Simple, and take rapid action in the instance of suspected fraud attempts.

We may freeze and close accounts
We may freeze and close accounts if fraudulent activity is suspected, including the following circumstances:

We will report fraud attempts
We are responsible for reporting fraud attempts to authorities, including attempted unemployment fraud. There are state and federal penalties for unemployment insurance fraud (including potential fines and incarceration). If you suspect you are a victim of unemployment fraud, contact the appropriate state fraud hotline listed here.

I acknowledge that I have read this notice Continue Application