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7 Steps to Detect and Report Bank Fraud

report bank fraud

Bank fraud is a serious issue that can have a significant impact on your financial well-being. As technology advances, so do the tactics of criminals who seek to defraud innocent individuals. It is crucial to be aware of the common signs of bank fraud, know how to respond if you suspect you have fallen victim to it, and understand the resources available to help you in such a situation.

At Leaders, we want you to trust us for all your financial needs and questions. Part of walking alongside you and helping you champion your financial success is making you aware of fraud and helping you prevent it before it happens. In this blog post, we'll outline the essential steps to help you detect and report bank fraud and begin the recovery process.

What is Bank Fraud?

Bank fraud, a deceptive and illegal act, poses a significant threat to the financial security and well-being of individuals, businesses, and even financial institutions themselves. Bank fraud refers to any scheme or fraudulent activity that looks to obtain money, assets, or sensitive financial information through deceitful means. It often involves dishonest individuals or criminal organizations attempting to exploit vulnerabilities within the financial system, from unauthorized transactions to identity theft and various other deceptive tactics. Understanding the nature of bank fraud is crucial in today's world, where digital transactions and online banking have become a normal practice, making us all potential targets for these practices.

Since bank fraud encompasses a wide range of scams, we wanted to provide you with some bank fraud examples to look for. Here are some common examples of bank fraud:

Identity Theft: A fraudster steals personal information, such as Social Security numbers or credit card details, and uses this information to open accounts or make unauthorized transactions in the victim's name.


Phishing Scams: Criminals send fake emails or create fake websites that impersonate banks, requesting recipients to provide their account information, passwords, or PINs. Once this data is obtained, fraudsters gain access to the victim's account.


Account Takeover: In this scenario, a fraudster gains unauthorized access to a person's bank account, often through compromised login credentials, and can make withdrawals, transfers, or changes to the account without the account holder's knowledge or consent.


Check Fraud: Criminals may forge or alter checks, often from stolen checkbooks, and deposit them into their own accounts, effectively draining the victim's funds.


ATM Skimming: Criminals place skimming devices on ATMs to capture card information from unsuspecting users. This data is then used to make unauthorized withdrawals or clone credit/debit cards.


Wire Transfer Fraud: Fraudsters may deceive victims into wiring funds to a fraudulent account, often through social engineering tactics, posing as legitimate business partners, or using compromised email accounts.


Loan Fraud: Perpetrators may apply for loans using false information or manipulate loan terms to secure a larger loan amount than they are eligible for, with no intention of repaying it.


Account Manipulation: Criminals may gain access to online banking accounts and manipulate balances or transactions to make it seem as though funds have been moved or spent, causing confusion or panic for the account holder.


Mortgage Fraud: This involves providing false information on a mortgage application to secure a loan with the intention of not repaying it or defrauding the lender.

Mobile Banking Scams: Criminals may trick individuals into downloading malicious apps or clicking on fraudulent links, which can lead to the theft of personal and financial information.fraud prevention kit


How to Recognize the Signs of Bank Fraud

To protect yourself from bank fraud, you must first be able to recognize the common signs. Avoiding fraud begins with educating yourself on common tactics used by fraudsters and scammers.

These signs may include:

Unauthorized Transactions: Keep an eye on your bank statements and account activity regularly. Be vigilant for unfamiliar transactions, withdrawals, or purchases you didn’t make. 

Suspicious Emails or Calls: Beware of unsolicited emails or phone calls from individuals or entities claiming to be your bank or requesting your personal information. Legitimate banks or credit unions will never ask for sensitive data like passwords or PINs via email or phone.

Unexpected Account Changes: If you notice alterations to your account information or unexpected changes in account balances, take this as a warning sign.

Missing or Delayed Statements: If your bank statements suddenly stop arriving, or there’s a noticeable delay, it could be a sign that someone has tampered with your accounts.


What to Do If You Suspect Bank Fraud

We know that bank fraud can happen to any individual and the most important thing for you to know is to act quickly. The faster you get on top of fraud, the higher the likelihood that you can recover the assets that have been stollen or keep the fraudster from taking more information.

If you have reason to believe that you've been a victim of bank fraud, take the following steps:

  1. Contact Your Financial Institutions

    Call your bank or credit union immediately to report any suspicious activity or unauthorized transactions. They can provide guidance and initiate an investigation.

  2. Change Your Passwords

    Change your online banking, email, and other related passwords to prevent further unauthorized access.

  3. Report the Fraud to Authorities

In addition to notifying your bank, file a report with local law enforcement and your country's financial regulatory authority, along with the Federal Trade Commission. They can help investigate the matter and potentially track down the fraudsters.

  1. Check Your Credit Report

Request a copy of your credit report and review it for any unusual or unauthorized accounts or inquiries. Reporting such discrepancies to credit bureaus can help protect your credit score.

  1. Monitor Your Accounts Closely

Continue to monitor your bank and credit card statements regularly. This vigilance can help you detect any additional suspicious activity and alert your financial institution promptly if anything appears amiss.

  1. Close Affected Accounts

    If necessary, close the affected accounts that have been hacked and open new ones to prevent further fraudulent activity. Your credit union or bank should be able to help you do this smoothly and efficiently.

  2. Seek Help from the Experts

If you find yourself struggling to resolve the situation, consider seeking assistance from experts in the field. You may want to consult an attorney specializing in financial fraud or contact a local consumer protection agency. Your financial institution is always the best place to start. 


Recovery from bank fraud can be a lengthy and complex process, depending on the severity of the issue. It's important to keep all records of your communications and actions taken, including correspondence with your bank, law enforcement, and any other relevant parties. Being patient and persistent is key to restoring your financial health. Remember, always report fraud as quickly as possible. 

Avoid Bank Fraud with Leaders Credit Union

Bank fraud is a growing concern in today's increasingly digital world. Detecting and reporting bank fraud promptly is essential to minimize the damage and protect your financial well-being. By recognizing the common signs of bank fraud, taking swift action when you suspect foul play, and seeking assistance when needed, you can navigate the process of recovery and minimize the impact of this unfortunate event. Remember, staying informed and vigilant is your best defense against bank fraud.

Leaders Credit Union is a lender that cares about your financial security. That’s why we’ve created the Ultimate Fraud Prevention Help Kit. Download our guide so you can stay one step ahead of scammers and safeguard your finances. 

Report Scams to the FTC

If you were scammed or think you saw a scam, report it to the Federal Trade Commission.