A phoney fraud alert is similar to a phishing scam. It can come in the form of an email or a phone call claiming to be from your bank or financial institution. The scammer will usually tell you that your credit card or account has been cancelled because it was involved in criminal activity, or because they suspect your card or details have been stolen. This is a trick to get you to given them your account details.

You will be told that a suspicious transaction has recently occurred on your account, perhaps a large purchase in a foreign country. You will be told that if you did not authorise the transaction, you need to take immediate action as your credit card details have been stolen.

The scammer will ask you to confirm your credit card or account details so the ‘bank’ can ‘investigate’. If you receive an email, it may ask you to visit a website to confirm your credit card details or to find out more information on the supposed ‘fraud’ to your account.

In some variations of this scam, the scammer may already have your credit card number (that they have stolen previously), and may even quote this to you. They will then ask you to confirm that you are the cardholder by telling them the 3 or 4 digit security number printed on the card. If the scammers have this number, they can use your card to buy things over the internet or phone.

These phoney fraud investigations are used to steal your banking details so the scammers can use your account. They work by lowering your guard with the phoney fraud alert. They hope that you panic and do what they suggest to fix the ‘problem’. They are particularly tricky to spot because real banks and credit unions often do contact people if there has been suspicious activity on their account.

Warning signs