If you read nothing else this year, read this.
As you probably already know, our absolute first and most resolute duty—legally, ethically, and yes, even morally—is to our clients. It is in that spirit that I write to you today.
Several of our clients—very intelligent people—have been scammed this year.
Don’t say it can’t happen to you because the scammers are very, very good, and they are working in a well-rehearsed team-approach using technology that you probably did not know existed.
Here’s how two of our clients got scammed (details may vary):
SCAM 1:
Your phone dies. Suddenly you get a call from Apple. It says “Apple Security” or something similar on the caller ID. The very professional-sounding agent says that your phone has been hacked, and the hackers have infiltrated your checking account at your bank. They are here to help you. They know where you bank because they have hacked your phone and they can see everything, including your banking apps and your email. They can see your personal pictures and read all your texts.
Then you get a call from your bank. The caller ID matches. The caller is from “bank security” and informs you that you are involved in a government “sting” that will entrap the culprits.
You are told to remain absolutely quiet. You must tell no one, or you will be arrested for interference with an ongoing criminal investigation and possible collusion. Anyone you tell will face similar charges and be arrested immediately.
Then, another call. This time the caller ID says “Federal Trade Commission” or “FDIC” or “FBI” or “GBI” or something similar. It’s always a “government agency” of some sort.
(These scam artists have technology that will show whatever caller ID name and number they want. You want FBI, GBI, FTC, Space Force, your own bank? It doesn’t matter—they can make it say the Pope. You get what I’m saying? You absolutely cannot trust it.)
This official-sounding caller informs you that YOU are an active participant in an illegal activity, and as such YOU are subject to immediate arrest. (This should always be a trigger to you. They love to threaten arrest by government authorities.)
The most popular accusations seem to be child trafficking, child pornography, and whatever else seems absolutely horrid. You are also told quite firmly that if you disclose ANY of this to ANYONE, especially your spouse or other family members, they also will be arrested as co-conspirators. You are made to believe that YOU are also a criminal.
Because of this, you MUST do some things. Number one, tell no one. Number two, since we need to trap these culprits, it will be necessary for you to transfer some money to a separate account within your bank. (Because remember, you have already spoken to the bank representative that said you MUST cooperate with the authorities).
Don’t worry, they say, because you will get all of your money back once these terrible hackers have been brought to justice. But until then, you must do exactly as they say or you will be in violation of federal laws and subject to immediate arrest.
First, you need to go to a bank branch. Not your normal branch, because the criminals will be expecting you there—no, you need to go across town. (They don’t want you to talk to someone you may know at the branch who may warn you.)
Secondly, withdrawal cash. One client withdrew $14,000, another $24,500. Tell no one.
Step three, buy Bitcoin and transfer it to this address. Or stay there and we will send a courier to pick up the cash.
A couple of our clients succumbed to this intricate scam and lost this money without any hope of recovery. Even worse, both had been convinced that they needed to send more money to this “special account”. But then they called us.
They told one client he needed to withdrawal $250,000 from his IRA. With the associated tax burden this would have cost him almost $400,000. This was not normal—this was not rational.
It’s hard to tell a client that he can’t have his own money on demand—and luckily it never escalated to that—but I was resolute. I knew in my heart of hearts that he was being scammed, and however distasteful, we had to protect him from himself. We were resolved that his money would not leave his account. And indeed, it never did.
In retrospect, of course, both he and his wife are eternally grateful. But unfortunately, with call centers based all over the world and AI coming online everywhere, many people do not have the “human filter” of those that know you personally, recognize your voice over the phone, and know your habits and preferences intuitively. Anything that is suspicious or out of your character is immediately flagged and scrutinized. I can’t tell you exactly how many potential illegal attempts this system has deterred, but it is not a few.
In these two cases, all three of the callers had an Indian accent. This is also a red flag, but with AI coming online everywhere, they will soon sound like your neighbor.
SCAM 2:
This one steps it up in some ways because the scammers are already using AI to mimic the voice of one of your family members, particularly your children or grandchildren.
Most of your younger family members can be found on social media. There they leave a rich trove of images and voice files. Scammers use AI technology to mimic the voice and vocal delivery of your family member to ask you for financial help. Can you imagine? You believe you are talking to your grandson when in reality you are talking to a computer. And you have no idea.
Our client got a call from his “grandson”, who said he was in jail and accused of drunk driving. He had just been in an accident and possibly killed a pregnant woman (or some other terribly sad circumstance) and needed a bond posted. They bond company will be calling him soon.
Sure enough, there’s a call. Caller ID says “Free-at-Last Bondsman” or something similar. Of course, at this point you just need to wire them the money, or guess what? They can send a courier to pick up the cash. How convenient.
He didn’t fall for it, by the way. He called us.
These are just a few examples of the intricacy and sophistication that go into these scams.
What Can You Do to Protect Yourself?
Scammers are becoming increasingly sophisticated, but a few simple precautions can protect you and your life savings.
1. CHANGE YOUR PASSWORDS REGULARLY; do not keep the same password for all sites, especially sensitive ones such as banking, financial logins, etc.
2. HANG UP AND VERIFY. If someone claims to be from your bank, Apple, or a government agency and says your money is at risk, hang up. Call the organization directly using a phone number you know is legitimate. Never trust caller ID alone.
3. NEVER MOVE MONEY TO "PROTECT" IT. No legitimate government agency will demand that you withdraw cash, purchase Bitcoin, wire money to a "safe account," or hand cash to a courier.
4. CREATE A FAMILY PASSWORD. Agree on a private word or phrase with your loved ones. If someone calls claiming to be a family member in trouble, ask for it. Even if the voice sounds familiar, hang up and call your loved one directly.
5. NEVER KEEP IT A SECRET. If someone tells you not to inform your spouse, children, attorney, or financial advisor, that is a major warning sign. Scammers rely on fear, urgency, and secrecy. The worst criminals in the world can talk to an attorney.
6. PROTECT YOUR ACCOUNTS. Use strong passwords, enable two-factor authentication, and never share verification codes. Ask your financial institutions about adding a trusted contact who can be notified of suspicious activity.
7. PAUSE BEFORE SENDING MONEY. Before making any unexpected large withdrawal or transfer, speak with someone you trust. A legitimate emergency can withstand a few minutes of verification. When the government wants money, it will be in writing.
If You Think You've Been Scammed
Contact your bank immediately to see whether funds can be recovered and your accounts secured. Report suspected fraud at [ReportFraud.ftc.gov](https://reportfraud.ftc.gov) or [IC3.gov](https://www.ic3.gov).
Remember: No legitimate authority will threaten you with arrest for hanging up, asking questions, speaking with your family, or especially speaking with your attorney.
Scammers target intelligent, successful people every day. There is no embarrassment in asking for help. If you think you are being scammed, contact our office at 404-257-8811 or the client hotline. Ask to speak with me.
Very truly yours,
J. Kevin Meaders, J.D. CFP ®, ChFC, CLU
The views and opinions are those of J. Kevin Meaders, J.D., CFP®, ChFC, CLU and should not be construed as individual investment advice, nor the opinions/views of Magellan Planning Group, Inc. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.
Magellan Planning Group, Inc is a SEC Registered Investment Advisor. Estate services offered by Magellan Legal, LLC and tax services offered by Magellan Tax, LLC.