The DFPI Consumer Connection | November 2022

Resources for International Fraud Awareness Week

International Fraud Awareness Week (Nov. 13-19) is a global effort to minimize the impact of fraud by promoting anti-fraud resources and education. As California’s financial services regulator, DFPI’s mission is to protect and educate consumers. We want to make sure Californians understand financial products before they purchase them, know their rights, and avoid becoming victim of financial fraud — especially our most vulnerable populations, such as seniors, students, military servicemembers, and new Californians. 

To learn more about the DFPI’s fraud prevention efforts, visit DFPI Consumer Education & Outreach, a one-stop shop where consumers can find information and resources, including a calendar of events, financial education tips, and publications. If you would like to partner with the DFPI, schedule a fraud prevention presentation, or request brochures, contact us at Outreach@dfpi.ca.gov.  

Never rush to make a financial decision. The DFPI can help by checking licenses and answering general questions. For assistance, contact us toll-free at (866) 275-2677 or via email at Ask.DFPI@dfpi.ca.gov.

“Thinking Money” Documentary 

If you've ever made a financial decision, you regretted the next day, you're not alone. In fact, as the emerging field of behavioral economics reveals, you're practically hard-wired to overspend, an activity that lights up the brain's pleasure centers. The documentary film, Thinking Money: The Psychology Behind Our Best and Worst Financial Decisions, uses a mix of humor, on-the-street interviews, and provocative insights from innovative thinkers to explore why we spend, why we save (or don't), and how we think about money. The film is produced by the Financial Industry Regulatory Authority (FINRA) Investor Education Foundation.

Honoring All Who Have Served 

According to a recent AARP Report, veterans are much more likely than civilians to be targeted by fraudsters. Veterans can be viewed as easy targets by scammers due to the assumption that veterans have a sense of giving back to other fellow veterans. This has led to fake veteran charities or causes being among the highest reported scams by veteran victims.

The DFPI offers a wide range of resources dedicated to protecting our California veterans and military servicemembers on our Consumer Financial Education for Military and Veterans page. You can also find additional resources and downloadable brochures on our Information for Military Service Members page.

Other veteran and military servicemember resources include:

• Veterans’ Crisis Line – Veterans and their family members who are feeling any kind of mental distress can call the new Veterans Crisis Line by dialing 988 then pressing 1, dialing (800) 273-8255 then pressing 1, by text (838255), and through the Veterans Crisis Line Chat.

• CalVet Calendar of Events – Visit this webpage for a list of Veterans Day ceremonies happening across California. Please check back often as the calendar updates in real time as events are added in your area.

• VA Office of Inspector General – Its mission is to serve veterans and the public by conducting independent oversight of the Department of Veterans Affairs. It investigates a wide range of financial crimes from threats against VA personnel and property to actions associated with patient harm. For more information about trending scams and fraud related to veterans and the military, visit their Fraud Indicators Toolkit and Crime Alerts Webpage.  

• PACT Act Scams – The PACT Act is a new law that expands VA healthcare and benefits to veterans exposed to burn pits and other toxic substances. There’s been an increase in scammers using PACT Act-related phishing (email), vishing (phone), and social media scams that target veterans to access their PACT Act benefits or offer to submit claims on their behalf for a fee. Veterans should be cautious of anyone who guarantees a lucrative financial benefit or service. For tips to avoid PACT Act scams, read the Department of Veterans Affairs’ Be Vigilant of Pact Act Scams. 

Safer Shopping Means Happier Holidays 

The Holiday Season is here! Like millions of Americans, you are probably planning to buy many of your holiday gifts online. The internet has made shopping easy, affordable, and convenient – without even having to leave your home (or pajamas). Unfortunately, this has caught the attention of cybercriminals who are keen to exploit individuals benefitting from these conveniences. Every year many consumers get scammed, with stolen money and personal information spoiling holiday cheer. The two most prevalent holiday scams are non-delivery and non-payment crimes. In a non-delivery scam, a buyer pays for goods or services they find online, but those items are never received. Conversely, a non-payment scam involves goods or services being shipped, but the seller is never paid. For more information on how to protect yourself from these common holiday and online shopping scams, read Safer Shopping Means Happier Holidays.

Should You Buy Now, Pay Later for Holiday Purchases? 

Retailers are increasingly offering payment options that allow you to stretch payments over the course of several installments, known as Buy Now, Pay Later (BNPL) loans. A recent report from the Consumer Financial Protection Bureau, Buy Now Pay Later: Market Trends and Consumer Impacts, reports that BNPL is a rapidly growing type of loan that serves as a close substitute for credit cards. BNPL is a form of interest-free credit that allows a consumer to fully purchase a product and then pay back the loan over four installments with the first installment typically being a down payment on the purchase. Most BNPL loans range from $50 to $1,000 and are subject to late fees if a borrower misses a payment. Buy Now, Pay Later rose to prominence in the past decade as an alternative form of credit for online retail purchases. The lending option has gained traction with consumers, especially Millennials and Gen-Zers, who seek the flexibility of being able to pay for goods and services over time, but who may have been leery of other credit products. 

Buy Now, Pay Later loans can be attractive due to initial payments being low. However, it is important to note that BNLP loans don’t have the same consumer protections as other forms of credit. It’s important to carefully read the terms of the loan, so you understand the possible risks. Many BNLP loans don’t charge interest, instead they charge fees, such as late payment fees, with every BNLP lender having different policies. This makes it extremely important for consumers to carefully review the terms of the BNLP loan to avoid any possible penalties. Most BNPL lenders don’t report payments to credit reporting companies, meaning your credit scores won’t be affected. However, if you don’t pay BNPL loans on time and the debt is turned over to a debt collector, your BNPL loan may be reported to a credit reporting company, hurting your credit score. As this holiday season approaches, it may be tempting to use Buy Now Pay Later loans, but it’s important to read the fine print of the loan and have a good understanding of your finances to avoid additional fees. For more information, read the CFPB’s Should You Buy Now and Pay Later? 

Tips for Safe Holiday Charitable Donations 

As the Thanksgiving holiday quickly approaches, we urge everyone to do their research before donating and be aware of possible scams. Charity scams increase with the holiday season of giving. They can be found online, via text or email, on the phone, or delivered to you in the mail. Some scammers will try to rush a sentimental decision or lie and thank you for a donation you never gave — then ask for your payment information. Never give personal or financial information to someone you do not know. And never send money to a charity by wire transfer, gift card, or cryptocurrency. For more information, including how to verify a charitable organization, read the FTC's Before Giving to a Charity. 

Password Tips for National Computer Security Day 

National Computer Security Day (Nov. 30) demands our attention because cyber security affects everything from where we bank and how we spend our money to who we elect to public office. National Computer Security Day also reminds consumers about better password practices. Passwords are vital gatekeepers to our digital identities, allowing us to access online banking, shopping, social media, and private work and life communications. Secure passwords are a must! Other than keeping your information offline (which is virtually impossible these days), unique and complex passwords will best protect your valuable information. Another tactic is changing your passwords every few months or any time you think your accounts have been compromised.  

Use these security tips to protect your online bank accounts: 

• Change an old password to a “passphrase.” 

• Turn on multi-factor authentication on all your important accounts. 

• Password-protect your personal Wi-Fi. 

• Don’t store passwords on your computer or phone, unless encrypted. 

• Log off and close your browser when you’re done using an online program. 

For more information, visit the Federal Trade Commission’s Password Checklist Webpage.

We’re Renovating the DFPI Website!

The DFPI is working to improve our public-facing website and welcomes any feedback our readers and stakeholders can offer based on your user experience. Completing the DFPI Website Improvement Survey helps us enact impactful changes that will support our mission of protecting California consumers and enhancing their awareness of potential marketplace risks and fraud. Thank you for participating!