It is a simple fact of life that there are some people who will seek to benefit from taking advantage of other people rather than by delivering anything of real value to them.  This is a very sad truth, but it is still a truth and recognizing the fact is the first step in defending yourself against them.  In the financial services industry, companies protect themselves against scammers by following “know-your-customer” regulations.  Private individuals can apply the same principles to protect themselves from scammers, who may be individuals or companies.

Assume someone is a fraudster until they provide solid proof otherwise

That is as horrible a sentence to write as it is to read, but it really is essential to protect yourself against scammers.  At the end of the day, all scams work on the basis of persuading you to put your trust in someone who will abuse it.  There are four common tactics scammers use to persuade their victims to trust them.

They impersonate someone (or a company) with whom you have a connection (for example your bank)

They indicate that they have been referred to you by someone you know (for example a friend).

They openly acknowledge that they have no connection with you, but present themselves as having a genuine reason to believe that you, specifically, would be interested in what they have to offer.

They present themselves as victims in need of your help.

They impersonate you to other people and leave you to deal with the consequences

Here are some tips which will help with all of these situations

Never allow yourself to be pressurized into acting in haste. 

The only situation in which urgent action may be required is in the case of someone claiming to be a victim needing your help.  This is arguably the vilest approach of all since it does a disservice to genuine victims, but it is still a reality.  Fortunately, there is an easy solution in this instance, if someone really is in a hugely serious situation, then they can contact the emergency services, or you can do it on their behalf.  If there really is some legitimate reason why they cannot do this, for example, they are overseas or the emergency relates to a pet, then you can still take the time to apply some of the other measures suggested here.

Always remember contact details can be faked

There are two main ways in which contact details can be faked.  The first is for people to have their accounts hacked.  This is more likely to be the case with private individuals than with companies, although the latter cannot be completely ruled out.  With this in mind, always check any unusual emails from an address you recognize, especially if they ask for money or your personal details or contain links for you to click.  It is, however, probably vastly more common for scammers to create fake contact details for themselves, which just happen to look very like the legitimate contact details for someone, or some organization, you would recognize.  Often it can be very easy to spot these as there will be some little detail which isn’t quite right.  Sometimes, however, it can be more difficult, which is why you need to double-check everything directly with a source which you know to be legitimate.  Never use any contact details sent to you.

NB: Phone numbers can be faked so you do need to check them too.

Keep your own details private

Always verify the credentials of anyone asking for any personal information from you.  Your personal information can be used to build up a profile of your life so that a scammer can represent you.  This is known as identity theft and can be devastating.  Often scammers will start with innocent questions and then build up to requesting more detailed information.  Be very alert to this and above all, never give identification details such as passwords or PINs.  No legitimate organization will ever ask for them.