We are indeed living in unique times. The COVID-19 Pandemic has resulted in the near-total shutdown of the U.S. economy, a sharp increase in unemployment, and has spread fear and uncertainty across the country. The vast majority of Americans have met this challenge, from the front-line health care providers and law enforcement agencies to the everyday citizens looking out for one another. However, every crisis brings out those who prey on the fears related to that crisis. Scams related to the COVID-19 Pandemic range from email phishing schemes to charity scams to investment scams.
To combat fraud related to the COVID-19 crisis, the U.S. Department of Justice has directed each federal district to appoint a Coronavirus Fraud Coordinator to direct the prosecution of coronavirus-related crimes and to conduct outreach and awareness. In the Western District of Pennsylvania, the U.S. Attorney’s Office has opened a COVID-19 Fraud Hotline (1-888-C19-WDPA) and has issued an alert (https://www.justice.gov/usao-wdpa/covid-19-fraud-page) outlining some examples of COVID-19 scams, including:
- Treatment Scams — Offering fake cures, vaccines, etc.
- Supply Scams — Offering fake shops, websites, etc., claiming to sell medical supplies.
- Charity Scams — Soliciting donations for individuals, groups, and areas affected by COVID-19.
- Phishing Scams — Posing as national and global health authorities and sending phishing emails designed to trick recipients into downloading malware.
- Investment Scams — False claims that products or services of companies can prevent, detect, or cure COVID-19.
Likewise, the FBI has issued a press release that it expects a rise in scams involving Cryptocurrency related to the COVID-10 Pandemic (https://www.fbi.gov/news/pressrel/press-releases/fbi-expects-a-rise-in-scams-involving-cryptocurrency-related-to-the-covid-19-pandemic) urging awareness of various cryptocurrency fraud schemes, including blackmail attempts, work-from-home scams, non-existent treatments or equipment, and investment scams.
Investment scams, in particular, are widespread, as many investors may feel compelled to invest in COVID-19-related companies to recoup recent losses in the stock market without conducting proper research. Be wary of even publicly traded companies touting COVID-19-related investments. For example, the Securities and Exchange Commission recently suspended trading in the securities of Applied BioSciences Corp. (APPB) due to questions concerning the accuracy of coronavirus test kits for home use. (https://www.sec.gov/litigation/suspensions/2020/34-88627.pdf)
As with any investment, research and common sense are the keys. Check any investment with the SEC (www.sec.gov) and your state’s securities department, and check the registration of the seller on BrokerCheck at www.finra.org. Be wary of any unsolicited emails offering information or requesting personal information.
Finally, ignore offers relating to a COVID-19 vaccine, cure, or treatment. Remember, if there is a medical breakthrough, you won’t be hearing about it for the first time through an email or unsolicited sales pitch.
Stay safe out there!