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Common Scams and Fraud Prevention

At New Direction Trust Company (NDTCO), we believe that knowledge is your first line of defense. As part of our commitment to helping you navigate your financial future with confidence, we’re spotlighting three of the most common—and preventable—scams: fake checks, identity theft, and imposter phone calls. In this article, you’ll learn how these scams work, how to recognize the warning signs, and what steps you can take to protect yourself and your assets. 

Because when it comes to keeping your money—and your identity—safe, the answer is always yes to awareness, action, and support. 

 

Fake check Scam 

Scammers are getting more creative—and fake check scams are one of their favorite tricks. These scams prey on trust and quick decision-making, often leaving victims on the hook for thousands of dollars.  

What Is a Fake Check Scam? 

A fake check scam occurs when someone sends you a check and asks you to deposit it, then send a portion of the money back—typically via wire transfer, gift card, or another untraceable method. The check appears legitimate and may even clear temporarily, but eventually, the bank discovers it's fraudulent. By then, the scammer is long gone, and you’re left responsible for the full amount. 

How to Spot a Fake Check 

  1. It Arrives Out of the Blue 
    If you weren't expecting a check, be wary—especially if it’s accompanied by instructions to send money back. 
  1. The Bank Name Looks Suspicious 
    Look up the issuing bank’s contact information online—don’t trust what's printed on the check. If the name doesn’t match an actual institution, or if the website is suspicious, that’s your cue to pause. 
  1. The Check Has Errors 
    Misspellings, poor formatting, and faded ink can signal a counterfeit. Authentic checks are professionally printed and free of typos. 
  1. You’re Asked to Act Quickly 
    Scammers want you to deposit the check and send money back before your bank catches on. Real business deals rarely require urgent action without verification. 
  1. The Routing and Account Numbers Seem Off 
    Every bank has a specific routing number. If the number doesn’t match the bank listed or appears unusually formatted, that’s a red flag. 
  1. The Check Draws on a Foreign Bank 
    Checks from international sources can take longer to process and are more likely to be fraudulent. 

How to Protect Yourself against Fake Check Scams 

  1. Verify the Source: If a check comes from a person or business you don’t know, verify independently. Contact the issuing bank using a verified number—not one provided by the sender. If the check appears to come from an entity you recognize, it may be a good practice to contact the business before depositing the check to verify its validity. 
  1. Wait Before You Act: Even if a check “clears,” that doesn’t mean it’s good. Banks are required to make funds available quickly, but they can still bounce checks weeks later. 
  1. Don’t Share Sensitive Info: Never give out your account numbers, PINs, or personal information to unverified sources. Protect yourself and others by ensuring your personal information, bank information, and other private details do not end up in the wrong hands. 
  1. Ask Questions: Reach out to trusted financial professionals if something doesn’t feel right. It’s better to double-check than to regret later. 

What to Do If You Suspect a Fake Check 

  • Don’t Deposit It: Once deposited, the bank may credit your account temporarily—but when the check bounces, that credit vanishes. 
  • Contact Your Bank Immediately: Show them the check and ask for verification. 

 

Identity Theft and Imposter Scams 

As we embrace the convenience of digital communication, fraudsters are working just as hard to exploit it. Two scams that continue to grow in sophistication and impact are identity theft and imposter phone call scams.  

What Is Identity Theft? 

Identity theft occurs when someone uses your personal information—like your Social Security number, bank account details, or login credentials—without your permission. This information can be used to open credit cards, drain your accounts, or commit other forms of fraud in your name. 

The Role of Imposter Phone Call Scams 

Often, identity theft starts with an imposter call. These scammers pose as banks, government agencies, or even companies you trust. They use fear or urgency to pressure you into giving up personal details or making payments. These imposters may reach out to banks or other institutions posing as you in an attempt to gain information. 

How to Recognize a Scam Call 

  • The Caller Pretends to Be Someone You Trust: They might say they’re from the IRS, Social Security Administration, or your bank. 
  • They Pressure You to Act Fast: Scammers thrive on urgency. They may claim your account is compromised or that you owe money. 
  • They Ask for Sensitive Information: Legitimate organizations will never ask for your full Social Security number, PIN, or passwords over the phone. 
  • They Want Payment in Gift Cards or Cryptocurrency: No real agency accepts payment this way. 

Steps to Safeguard Your Identity 

  1. Hang Up and Call Back: If a call seems suspicious, hang up and contact the organization directly using a verified number. 
  1. Monitor Your Accounts: Regularly check your credit report and financial accounts for unusual activity. 
  1. Use Strong, Unique Passwords: Enable two-factor authentication wherever possible. Avoid sharing your credentials with others. 
  1. Use Caution When Entering Personal Information Online:  Entering personal information such as account numbers, credit card information, security questions into non-secured channels such as contact forms, or email can put your information at risk. 
  1. Freeze Your Credit: If you suspect fraud, a credit freeze can stop new accounts from being opened in your name. 
  1. Report Scams Promptly: Contact the Federal Trade Commission (FTC) at IdentityTheft.gov and your financial institutions. 

 

How New Direction Protects Account Holders 

Fraud prevention is paramount at New Direction Trust Company. In addition to firewalls and other such technological measures that protect your self-directed retirement plans and personal non-public information, we are proud to offer front-line measures to keep your accounts as safe as possible: 

  • The NDTCO Portal is protected with security questions whose answers you choose, allowing you to defend your account with specific information that nobody else should know. 
  • Our portal provides NDTCO account holders with a secure messaging system to upload documents and share relevant information with our team. 
  • Account changes submitted through our portal cannot take effect without your confirmation via two-factor authentication. This helps ensure that you are the only one who can modify your account information. 
  • Among other verification efforts, our live representatives will request your verbal password before discussing sensitive account information. As with your security questions, your verbal password should be unique and therefore difficult to intercept by an identity thief. 

How New Direction Handles Fraud Attempts 

New Directions takes the security of its accounts very seriously.  In accordance with with Bank Secrecy Act (BSA) and the US Patriot Act, any suspicious activity is reported to both local authorities, as well as FinCen, the US Financial Crimes Enforcement Network. 

If you suspect your account may have fallen victim to fraud or security threat, please contact our service team immediately 877-742-1270. 

 

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