Scary Scams Are Real, Not Imaginary

You’ll hear news reports about scams, but rarely are they called “scary scams.” They should be—because everyone should be quite afraid of what the true impact on their lives could be if they were to get scammed.

Scams are scary. But people don’t think it in that way for a handful of reasons: 1) they have yet to be scammed, 2) they think it will never happen to them or 3) they were scammed and it was upsetting, but they got over it…and never talked about it.

Maybe referring to this brand of crime as “scary scams” would actually help make people fear falling into a trap. Maybe the new tag would also help raise their awareness of the hundreds of real schemes that are out there.

Life is scary and people know it.

The truth is, when someone is worried about danger or trouble, they often take steps to prevent it or are more vigilant of in their daily lives—and that would be a good think when it comes to scams. For example:

• People worried about safety in a strange town take steps to protect themselves.
• Parents watch their children closely because the world is a dangerous place.
• Individuals concerned about their future buy life insurance to protect themselves.

That’s why we’re suggesting that placing the word scary before the word scam isn’t a ridiculous idea: It’s purposeful. After all, a measure of worry about scams could go a long way to getting people to take positive steps, such as these:

• It would get people actively interested in learning about scams
• People would be more careful about interacting with others online.
• Everyone’s antennae—their “Spidey Sense”—would be a lot higher and that might help them reduce their risk exposure.

Don’t think you’ll be saying scary scams? Not so fast.

Take a step back and imagine these scenarios, which sadly occur every day. 

• Does the thought of losing all your savings scare you?
• Wouldn’t you be terrified if your child or grandchild called and said they were kidnapped?
• How worried would you be if the IRS called and said they were sending police to your house?
• If your father (or grandfather) or mother (or grandmother) told you they met the wonderful new person online, wouldn’t that absolutely scare you? (It should.)

Here’s the thing to remember: A scam target will not know that the scenario they’re facing is fake—it will seem very real, which is why the target becomes a scam victim. You must admit, most everyone would be concerned with any of those situations. So, yes: when it comes to scams, there’s plenty to be scared about.

Scary scams can have devastating real-life impact.

Little kids are afraid of the dark, strange noises and imaginary monsters under their beds. As we grow older, we grow out of our childish fears. We may even start to believe there’s nothing to be afraid of when things are going well. Then you start to hear about people being scammed, and losing something valuable, and not just money.

EMOTIONAL IMPACT

Here’s what psychologists and other professionals have to say about the effects of one of the scariest of scams, an investment scam:

• A loss of hope: Imagine having a solid retirement account with plenty of money, then losing all of it. That would certainly devastate anyone who suffered that tragedy. The future without money would certainly look scary.
• A feeling of intense shame. After an investment scam victim has lost their savings, a feeling of shame is common, which they thrust upon themselves. Once they realize their dream of riches has transformed into a total loss, they’ll be ashamed that they “allowed” it to happen.
• A total loss of trust. Often in an investment scam, a close relationship develops with the financial advisor, which is often a young woman involved in the deception. Even when the relationship is collapsing, and money is disappearing, the contact continues. Only when all the money is gone does trusting relationship end.  
• Confusion and delusion. Many investment scam victims might not fully comprehend or believe that they’ve been fleeced. Even once their money is gone, they might think there has simply been a mistake or there’s just an account access problem. When the thought of losing it all is so scary, some victims won’t allow themselves to admit it.

FINANCIAL IMPACT

The potential aftermath of an investment scam is terrifying to think about. Still, it’s important to consider the scenario, if only to realize how vital it is to avoid any situation that even has the whiff of a scam.

• Financial security…gone: A sense of stability and future comfort are gone—college savings for the kids, retirement home money, vacations and fun…all gone.
• Emotional collapse. There’s no way to bounce back quickly…if at all. Understand the big picture: victims spend decades amassing wealth, through hard work and savvy investing for most of their life. Such a devastating loss could lead to divorce, depression, health problems and, sadly, even suicide.
• No possibility of getting their money back. A scam victim may turn to the police, SEC or a legal team with hopes of getting their money back. When they discover that effort will likely yield no results, the devastating financial impact is complete.

Scams and PTSD.

With any devastating scam, a highly traumatized victim can experience emotional distress similar to Post-Traumatic Stress Disorder. The symptoms include ongoing anxiety, severe depression, insomnia, and emotional withdrawal. It’s like grieving the loss of a loved one. In that instance, the life lost is the one the victim had before their personal scam tragedy.

Scams are indeed scary stuff.

By now you should be convinced that scams can have devastating effects on your life in a matter of months, weeks and days. It’s them vs. you. You must prepare yourself to fend off their attacks. The key to avoiding a scam is to do all you can to prevent becoming a victim. You can learn more about scams and how to avoid them at our Learning Center.