Financial fraud is on the rise, and it’s more sophisticated than ever. From phishing schemes and fake tech support calls to imposter scams that prey on fear or urgency, the average consumer is facing a digital minefield. That’s why fraud education is not just a helpful resource—it’s a necessity.

But more importantly, fraud prevention begins with financial education. Consumers who understand how the financial system works—how to manage accounts, transfer funds, evaluate loan offers, or spot phishing attempts—are significantly less likely to fall victim to fraud. Education is protection.

Financial institutions that invest in teaching their customers how to avoid financial scams through foundational financial education not only protect their bottom line but also build trust and long-term loyalty. As we look to the future, empowering consumers with the knowledge and tools to recognize and respond to fraud is one of the most impactful services a financial brand can offer.

According to the Federal Trade Commission (FTC), consumers reported losing more than $10 billion to fraud in 2023—a 14% increase from 2022. The most common fraud types included imposter scams, online shopping scams, and investment scams.

Common Scams Targeting Your Customers

Impersonation Scams

• Bank impersonation: Scammers call or email pretending to be your bank, requesting sensitive information like account numbers, login credentials, or even debit card PINs.
• Government agency impersonation: Fraudsters pose as IRS or Social Security reps, demanding payment or information under threat of legal action.
• Tech support fraud: Victims receive messages claiming there is an issue with their device and are directed to provide access or pay for unnecessary services.

Digital Payment and QR Code Scams

• Peer-to-peer payment fraud: Scammers trick users into sending money via apps like Zelle, Venmo, or Cash App.
• QR code redirects: Fraudulent QR codes placed in public locations redirect users to phishing websites or install malware on their devices.

Investment and Prize Scams

• Cryptocurrency schemes: Promises of high returns on crypto investments lead to disappearing funds.
• Sweepstakes/lottery scams: Consumers are told they’ve won a prize but must pay “fees” to claim it.

While it’s important to understand the types of fraud threatening consumers today, awareness alone isn’t enough. Preventing these scams requires proactive, sustained education that builds confidence and decision-making skills over time. The good news? Financial institutions are uniquely positioned to deliver that education—meeting customers at key moments in their financial journey. Here are five strategic steps your organization can take to empower consumers and strengthen fraud resilience through financial literacy.

5 Steps to Help Improve Fraud Education Through Financial Literacy

1. Raise Awareness with Timely, Relevant Content

Scammers evolve quickly. Education efforts must too. Use digital platforms, email campaigns, and mobile banking alerts to share trending fraud tactics. Leverage bite-sized, real-world examples to make the risks relatable.

“The best fraud prevention starts with awareness. Customers can’t avoid what they don’t recognize.” – Identity Theft Resource Center

Pair fraud updates with core literacy lessons: understanding account access, payment verification, and how to evaluate messages claiming to be from financial institutions.

2. Teach Consumers What to Do if They Suspect Fraud

Knowing how to act quickly is key to minimizing damage. Teach consumers to:

• Contact their bank immediately
• File a report with the FTC
• Monitor accounts closely
• Change passwords and security settings

According to Javelin Strategy & Research, victims of fraud who act within 24 hours are 64% more likely to recover their losses.

Combine this with education on consumer rights, digital security practices, and how different types of accounts are protected.

3. Encourage Safe Digital Behavior

Simple habits make a big difference:

• Use two-factor authentication
• Don’t click unknown links or attachments
• Avoid using public Wi-Fi for financial transactions

Offer simulations or interactive training to help consumers safely practice these behaviors. EVERFI’s safe-practice environments are designed for exactly that.

4. Monitor and Share Fraud Trends

Your fraud and compliance teams are likely tracking patterns. Use that internal knowledge to publish regular fraud bulletins or quarterly updates.

To increase impact, link these alerts to foundational literacy content: budgeting basics, understanding phishing, recognizing predatory lending language, or interpreting fine print. Tools like EVERFI Achieve allow financial institutions to deliver these insights at scale and personalize content delivery.

5. Embed Financial Literacy in Community Programs

Fraud prevention and financial literacy are two sides of the same coin. Consumers who understand:

• How to identify legitimate communication from financial institutions
• How interest rates and fees work
• How to research financial offers or investment pitches

…are far better equipped to avoid scams.

A study by the FINRA Foundation found that adults with higher financial literacy were less likely to engage in costly credit card behaviors, more likely to plan for retirement, and less susceptible to financial fraud.

Explore how institutions are building customer trust through just-in-time financial education.

Impact Your Community with EVERFI

EVERFI helps financial institutions educate and empower their customers with scalable, high-quality financial education. From K-12 outreach to adult consumer programs, our solutions help build financial confidence and reduce fraud risk.

Looking to strengthen your fraud prevention and financial education strategy? Learn more here.