National emergencies and major disasters often bring out the best in us, producing stories of courage and heroism. Sadly, they also create opportunities for scams and crime.

Scammers go after your finances and material possessions, which are essential to leading your family and organization through a disruptive event. And the effects of being a disaster and post-disaster fraud victim can have major consequences on your wellbeing and mental health.

Victims in the wake of disasters are often vulnerable and distracted. Scammers take advantage of this vulnerability.

Post-disaster insurance scams are still prevalent. Scammers will claim to be a broker or local insurance agent, saying they can expedite a disaster-related claim — sometimes even before you’ve filed one. In doing so, you may provide the criminals your insurance or personal information.

Clean-up and repair scammers pressure victims into paying for disaster repair services that will never be provided. Following winter freeze disasters, criminals will call disaster victims to offer bogus financial assistance, or to threaten adverse action should you not pay their bill for services never rendered.

Scammers and COVID-19

COVID-19 related frauds have been prevalent. The Canadian Anti-Fraud Centre states that in the year following the COVID-19 pandemic, more than 15,000 fraud victims lost $7.25 million CAD. In roughly the same timeframe, the U.S. Federal Trade Commission reported over 225,000 complaints with losses topping $380 million.

Prevalent scams include victims paying for bogus COVID-19 tests, vaccines, treatments, supplies and relief funds. Families have been targeted with false offers for free school meals using malicious email links. Elderly and vulnerable community members have paid thieves for non-existent grocery shopping services. Impersonating contact tracers, some scammers have harvested personally identifiable information (PII) from victims.

Some fraudsters use stolen PII to steal unemployment benefits and economic impact payments aimed at providing COVID-19-related relief and recovery.

In addition, the post-pandemic shift to online services and digital communication has created new threats. For instance, online tax filing scams can dupe tax advisors into providing identity thieves your personal information while fraudulently filed tax returns done online cheat citizens out of their refunds.

The U.S. Securities and Exchange Commission continues to charge sham investment companies for purporting to manufacture and sell post-pandemic technology and solutions, as investors become targets in post-disaster stock market “pump-and-dump” schemes.

An often-overlooked post-disaster risk comes from employers and business owners. Strained budgets and remote work environments have prompted many organizational leaders to pause key risk management procedures. Workers who remain employed in light of layoffs may agree to accept pay cuts, longer hours, or take unpaid furloughs, resulting in extreme work pressure, financial hardship and mental strain.

And when opportunity, incentive, and rationalization come together, the stage is set for occupational theft and fraud.

Five steps to combat disaster scams

  1. Get educated. In the wake of Hurricane Katrina, the U.S. federal government established the National Center for Disaster Fraud to assist post-disaster fraud victims. It provides educational resources and provides ways to report and investigate disaster fraud. The FBI Internet Crime Complaint Center is a place to report online fraud. And the Anti-Fraud Center in Canada provides information on current scams affecting Canadians and ways for reporting complaints.
  1. Keep your guard up. Recognize that unfortunate events like natural disasters and national emergencies create a target-rich environment for criminals, fraudsters, and scammers to exploit the event. Apply the due diligence and common sense you usually would to in-person and online communications. Be wary of unsolicited telephone calls, emails, and knocks on your door. Also acknowledge the factors within your organization that may create scenarios ripe for internal and external fraud. Manage your fraud risk by assessing and implementing internal controls.
  1. Don’t rush into decisions. Unless your house is on fire, there is no need to make an on-the-spot decision. If it’s a legitimate organization or investment opportunity, there should be time to consider it and consult your trusted confidants. If it sounds too good to be true, it probably is.
  1. Don’t divulge personal information. Your PII and health information can be exploited, stolen, and used for other nefarious purposes. Remain vigilant in protecting it with technology and a healthy dose of skepticism when people approach you asking for it for any reason.
  1. Transfer your risk by considering crime coverage. Cyber insurance, a basic homeowners or liability policy may not cover online post-disaster scams such as social engineering. Instead, you may need to consider a crime policy.

Contact your HUB broker to determine if you have the right personal or business insurance in place to protect you or your entity, especially should you be the victim of a disaster fraud scam or crime.