Beat the Heat: Keeping Members Safe from Travel Scams
Written by: CrossState Credit Union Association & Members 1st Federal Credit Union
While vacationers are planning trips, fraudsters are planning ways to scam them. Fake travel websites, misleading listings, and fraudulent payment pages are becoming more common, putting members at risk of losing money before they ever reach their destination.
Sherry Ehler, AVP of Card Services for Members 1st Federal Credit Union, and Erin Ensminger, Compliance & Operations Officer for CrossState, highlight the danger of travel fraud for members, common scams they should look out for, and how your credit union can help them stay safe.
Why It Matters
The impact of fraud is rising fast, and the travel industry is no exception. Recent research from McAfee indicates that 38% of vacationers have encountered a travel-related scam, with 41% of those losing money as a result—nearly half of whom lost over $500.
“Travelers are especially vulnerable when planning because they’re often trying to do it quickly or have several websites or apps open,” says Ehler. “This can lower their awareness of risk.” In fact, the McAfee report found that 41% of travelers trust messages that appear to come from airlines or hotels without verifying them. Perhaps even worse, 33% admit to ignoring warning signs to avoid missing out on deals.
“Credit unions play an important role in educating their members about scams to help protect them from financial loss,” notes Ensminger. “By learning how to recognize the red flags of scams and verify the legitimacy of travel-related promotions and services, members can mitigate the risk of becoming a victim.”
Common Scams & Red Flags
Fraudsters can attack travelers in many ways, but here are some of the most prevalent:
- Fake deals: The scammer tries to solicit you with a free vacation or other “can’t miss this opportunity” type of messaging.
- Fake booking sites: These can look and feel real, often mimicking legitimate platforms like Tripadvisor. But they’re simply fronts to steal your information.
- Fraudulent rental listing: The scammer will take pictures of houses on the market and falsely present them as places to rent to get your money.
With all these scams, two key red flags include:
They ask you to pay outside of the website or app.
This could include doing a wire transfer, sending gift cards as payment, or paying through a cryptocurrency website. These can all be great tools if they’re used properly, but in the context of travel planning, they are a huge red flag because that money is very hard to detect and track.
The scammer will put pressure on you.
Everything is always extremely urgent with fraudsters as they don’t want people to be able to pause, think, and doubt. A legitimate company would allow someone to take the time to review the details and make an informed decision.
Protecting Your Members
Credit unions are here to provide guidance and education for members, and this can be done in several ways. One of the easiest is offering safeguards for cards. For instance, you could provide the ability for members to set up transaction alerts and lock their cards in case something goes wrong or to notify you when going out of state to help you accurately flag suspicious activity.
In addition, create fraud or scam education pages on your website if you haven’t already, and keep them updated with the most recent information. These can include tips on how to use your card safely when traveling, such as:
- Utilizing secure payment methods
- Not using public Wi-Fi for transactions
- Keeping your physical cards and personal information protected
- Staying on top of your account activity—some charges may not show up immediately
When it comes to protecting themselves, the most important thing to reiterate with members is to trust their gut. “If that vacation sounds too good to be true, more than likely it is,” notes Ehler. “If something feels off, take a pause and slow down. Before you share your payment information, ask a friend to look at it and see if it seems real.”
Always There If Needed
In the unfortunate event a member gets scammed, that’s what their credit union is there for! “It’s essential for members to notify their credit union immediately so they can help prevent further loss,” says Ensminger. “Depending on the facts and circumstances, the credit union may be able to stop pending transactions, temporarily freeze a compromised account, issue new cards or account numbers when information has been compromised, investigate disputed transactions, and guide members in alerting the credit bureaus when identity fraud has taken place.”
Ultimately, scammers are very sophisticated and learning new things every day. But by spreading awareness and offering support, you can help members protect themselves to enjoy their well-earned vacations with peace of mind.