Cybersecurity. Whether it’s Identity theft or securities fraud – there are daily threats to all Americans with a social security number. In 2014, 17.9 million Americans were victims of outright identity theft. Then there’s the grayer area of having your identity compromised. If you shopped at Target during the holiday season, or have Anthem as a healthcare provider, you’ve been a victim of hackers obtaining certain parts of your personal information. Once hackers have that one piece of a victim’s identity, the cycle of fraud starts. The cycle of fraud can go on and on – from getting spam emails and clickfraud, to compromised credit cards, to ransomeware, to stealing funded accounts once hackers get a hold of your information.

The financial services industry hasn’t been hit as hard as healthcare and retail industries, but fraud is on the rise. Fraudsters try to get funds via third party wire transfers or Moneylinks to third party bank accounts. They use hacked email addresses to send money requests to advisors. Hackers will monitor your email address to wait for opportune times and then make requests for fund transfers, posing as you – with urgency and often out of the ordinary demands such as the funds are required immediately and to a third party. In all of these cases, prevention is the best way to protect against fraud. On Peloton’s end, that means we call to confirm those wire transfers, funds requests and monitor our daily alerts through custodial websites.

While all of this seems alarmist, there are simple things you can do to protect yourself against fraud:  

  1. Passwords: While it’s a simple premise – don’t use the same password for all of your accounts.
  2. Storing Logins: It’s okay to keep a log of your passwords, but store it in a safe place, not in your wallet where it could be easily stolen. 
  3. Employ a Password Manager: This is a great tool for keeping your passwords difficult for hackers to obtain, but easy for you to remember.
  4. Verbal Passwords: Request to use a verbal password when initiating a funds transfer. That can be with your advisor or your custodian.

Within our industry, we all have a responsibility to clients – helping them safeguard their accounts against fraud. Our internal processes and procedures are always evolving to keep up to date with the changing climate of fraud. Peloton utilizes these steps to assist our clients – is your institution employing similar measures to protect your investments?

  1. Calling clients to confirm money movement transactions such as wires, ACH’s and MoneyLinks to third party accounts.
  2. Sending forms and any confidential email via encrypted links through Sharefile.
  3. Monitoring accounts via advisor access to custodial websites and our own practice management software.
  4. Staying on top of the latest fraud prevention tactics and how we can help clients protect their personal data and assets through continuing education courses, webinars and training tools provided by our custodians.

Our goal at Peloton is to continually educate investors – empowering them with information and resources.  Use our tips and practices to ensure your portfolio is well-protected.