State of Connecticut Department of Banking

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Protect Yourself Against Cyber Fraud

The Internet has brought an exciting global marketplace directly to our fingertips, allowing us to shop and invest at our convenience. Yet when you provide personal information and check out your "shopping cart" at an online store, can you be certain your purchase will be safe? Can someone steal your credit card number during a transaction? Can you confirm that you are doing business with a reputable website and not with a shady imposter? 

Although millions of people do business over the Internet daily, it's still important that you take steps to protect yourself. The Internet is unique technology with characteristics that offer potential for certain types of fraud. As a result, scam artists are continually trying to create new schemes to take your money.

The Internet is essentially an open communications system, so it's important that private and confidential information, such as credit card numbers and personal financial data, remains private during e-commerce. The Internet is also relatively anonymous, so it's important that you confidently confirm a person or entity's identity before conducting business with them.

Watch For Scams

Stock price manipulation, pyramid schemes, fraudulent business opportunities and "off-shore" scams are just a few examples of the illicit activity found on the Internet. Where telephone "boiler rooms" may once have been restricted to hundreds of calls daily, the Internet allows scam artists to easily reach thousands of potential victims with inexpensive websites. E-mail also allows countless people to be "spammed" with fraudulent offers.

One of more common scams today is "phishing" where crooks carefully copy the look of bank, government and other legitimate institutions' communication in fraudulent e-mails and related websites in an attempt to obtain customers' account information and personal identification numbers (PINs).  Learn more about "phishing" scams.

It's easy to communicate across the Internet, but more difficult to determine someone's real motives in a conversation. Persons with undisclosed interests have tried to drive up the price of particular stocks - often thinly traded, obscure companies - by issuing false or misleading press releases, quoting from nonexistent or fraudulent analyst reports, and promoting the stock in a chat room. Given the Internet's anonymity, the "many" people touting a stock in an investment discussion group may, in fact, all be the same person. As promoters build interest and stock prices rise, they suddenly dump their shares for profit and an unsuspecting public is left only with losses.

Follow These Precautions:
  • Do business with financial institutions and merchants you know and trust.
  • Be suspicious of websites that don't allow you to easily verify a company's identity and legitimacy by clearly providing a physical address, telephone number and email address.
  • Investigate persons and firms selling investment products. Contact the Department of Banking to determine if they are licensed.
  • Never give out your account passwords - even to persons claiming to be from your bank or from your on-line service. If your passwords fall into the wrong hands, you may find your account billed with unexpected, expensive charges.
  • Carefully check your financial account statements each month for suspicious activity.
  • Keep your browser and computer up-to-date with the latest security software and new patches as they are released.
  • Be very skeptical of offers that sound too good to be true - such as extraordinarily high bank deposit rates, unusually low loan rates or spectacular investment returns that are touted as being "risk free."
  • Never make an investment simply on the basis of chat room hype or a tip from an on-line newsletter.
  • Be wary of international offers. Problems offshore can be harder to investigate and restitution more difficult to obtain.
  • Be cautious with short-term "free trials." They may simply be a ruse to obtain your credit card number and other personal information.
  • Be very skeptical of unsolicited "get-rich-quick" e-mail opportunities.
  • Never pay advance fees for an unsecured loan. Connecticut law prohibits brokers from requiring such fees.
  • Before completing a purchase or financial transaction, be sure that the website you're visiting supports secure transactions. Your browser should clearly indicate when you link to a secure location. Look for a URL that begins with https:// and a browser icon displaying either an unbroken key or a closed padlock.
  • Avoid websites that do not allow you an opportunity to print or save a record confirming your transaction.
  • Don't send sensitive financial information, such as credit card numbers, via e-mail.
  • If you see something suspicious on the Internet or if you've been victimized by a fraud, immediately contact the Banking Department or another regulatory agency (see below).
Additional Resources:

The Federal Bureau of Investigation (FBI) and the National White Collar Crime Center host an Internet Fraud Complaint Center, which accepts online Internet crime complaints.

OnGuardOnline.gov, managed by the Federal Trade Commission, provides tips to help you be safe, secure and responsible online.