(NEXSTAR) – A multi-phase scam credited with emptying the financial accounts of numerous Americans – many of whom were nearing the age of retirement – is again making headlines after the FBI recently issued a warning.

Unlike many scams, “Phantom Hacker” attacks often come in three distinct phases, each building on the last to thoroughly convince the victim to allow access to their funds.

“Victims often suffer the loss of entire banking, savings, retirement, or investment accounts under the guise of ‘protecting’ their assets,” the FBI said in a news release.

Aaron Rose, security architect manager at cybersecurity firm Check Point Software, told Nexstar in an email that the crooks often use victims’ personal interests against them. Fans of vintage cars, antique watches or other items might post publicly on social media, making them vulnerable to bad actors.

“Criminals use personal interests to make their criminal actions appear authentic which decreases the chances of being caught,” Rose said, adding, “AI technology can analyze social media content to detect personal interests and life milestones which allows it to generate messages that seem personalized.”

Since 2024, the scam has reportedly been used to steal over $1 billion in funds, with the majority of victims being at least 60 years old, according to FBI data.

“These attacks are not just simple phone calls or phishing emails—they’re complex operations that involve multiple impersonators, spoofed phone numbers, and coordinated follow-ups,” Scott Davis, chairman of the Cybersecurity Association of Pennsylvania, said in a recent interview. “Seniors are being tricked into believing they’re protecting their money, when in reality they’re handing it straight to criminals.”

‘Tech support’ and the first phase

While pretending to work in tech support for a legitimate company, the scammer will use a phone call, text, email or pop-up window to contact the victim.

Once the victim calls for tech support help, the scammer instructs them to download a program giving access to the victim’s computer. After pretending to check the device for viruses, the scammer will then suggest the victim open financial accounts to look for unauthorized charges.

After choosing an account to target, the scammer tells the victim to wait for a call from the “fraud department” of the bank or institution holding the funds.

A call from the ‘financial institution’

The next phase begins when a scammer, posing as an employee of a well known financial institution, calls the victim to inform them that their account has been hacked by someone overseas.

The only way to keep the money safe, the scammer says, is to move it to a third-party such as the Federal Reserve or a U.S. government agency, according to the FBI. The scammer helps organize the transfer, which is often broken into several transactions and may happen by wire, cash or crypto.

The ‘government’ representative

In an effort to legitimize the prior two phases, a scammer may impersonate an employee of the Federal Reserve or another agency.

If the victim starts to get suspicious, the scammer may send a follow-up letter using what appears to be official government letterhead, with the goal of convincing the victim that their funds continue to be “unsafe” and must be moved.

How to protect yourself – and others

Experts say there are a number of steps to take to safeguard yourself against the Phantom Hacker scam, tips that you should also share with family members and other loved ones who might be at risk.

“The simplest advice is the most important: never give remote access to your computer if someone calls you unexpectedly,” Rose said. “Do not move your money just because a caller says they are from your bank or the government. Hang up, call the number printed on your bank statement, and verify the situation for yourself.”

If you find yourself unsure of what to do, end the call and talk to someone you trust before taking any action, Rose said.

“Scammers rely on secrecy and pressure,” according to Rose. “Breaking that pattern by taking a step back and checking with someone else – a friend, family member, or official from your bank or local law enforcement agency – is often the best defense.”

The FBI encourages anyone who is the victim of a crime to contact the local field office or file a report at tips.fbi.gov. If the crime is internet-based, file a report with the Internet Crime Complaint Center (IC3).

Both major political parties are considering holding large-scale gatherings ahead of the midterm elections, underscoring the stakes next year as President Trump faces a potential check on his power if Democrats flip one or both chambers of Congress. 

A Democratic National Committee (DNC) spokesperson confirmed that the party is considering an event next year “to showcase our tremendous candidates running up and down the ballot and harness the amazing grassroots energy we’re already seeing.” Trump floated a similar idea for Republicans in a post on his Truth Social on Thursday, saying, “It has never been done before. STAY TUNED!!!”   

Though neither party has confirmed that their event is taking place yet, the gatherings could offer both sides a shot-in-arm as Democrats and Republicans alike brace for a grueling midterm season. 

“Anything that we can do to put our party in a better position to win, we should absolutely consider doing,” explained Drew McKissick, chair of the South Carolina GOP. 

A midterm convention “could offer the opportunity to capitalize on grassroots enthusiasm, get more Republicans trained and ready to turn out the vote in November of ‘26,” he added. “That’s a good thing.” 

Conventions between the parties are typically held once every four years when both sides formally nominate their presidential candidate. The DNC has previously held conventions before or right after midterm elections, according to Axios, but stopped the practice. 

But both parties are now considering holding a similar event ahead of next year, where a broader redistricting battle has heightened the stakes of securing the House majority.  

DNC spokesman Abhi Rahman confirmed on Thursday that the party was considering a convention for next year, a day after Axios reported the DNC was mulling the idea. 

“Americans everywhere are fired up and ready to fight back against Trump’s reckless policies — including his budget betrayal that cuts health care and food assistance for millions of people,” he said in a statement. “To showcase our tremendous candidates running up and down the ballot and harness the amazing grassroots energy we’re already seeing, several options are on the table for next year, including hosting a large-scale gathering before the midterms.” 

Republican National Committee (RNC) spokeswoman Kiersten Pels lauded Trump and touted Republicans’ track record thus far in a statement when asked about a potential RNC convention. 

“President Trump is leading with bold, innovative ideas to energize our Party and keep us on the path to victory,” she said. “The results speak for themselves: President Trump and Republicans are strengthening and uniting the country, delivering historic wins, and undoing the disastrous policies of Democrats and the Biden Administration.” 

The idea has received support from both parties — and was even discussed during the last midterm cycle. 

Former DNC Chair Jaime Harrison told The Hill in a text message ahead of the party’s confirmation that it was considering a large-scale gathering next year and that a midterm convention “is something I proposed to the WH a few years ago and encouraged the candidates for DNC Chair to consider.” 

While details and plans for a convention — if it even happens — haven’t been finalized, Democrats and Republicans alike see potential upsides for a midterm convention, which could help galvanize the parties as Democrats look to reset from a disappointing November and the GOP braces for a challenging midterm election. 

“If the purpose of this is to show unity and to drive a message, that can be beneficial,” explained Republican strategist Alex Conant. 

Glendale Mayor Bryan Kennedy, a DNC member from Wisconsin and president of Democratic Municipal Officials, said he was “intrigued” by the idea. He said he was surprised he hadn’t heard about the idea during their summer meeting this past week, but noted it could help bring national attention to down-ballot challengers. 

“If you’ve got some congressional candidates running in Wisconsin, and they get seen on a national stage, and you have then people wanting to donate from other states, and people wanting to do volunteer — whatever they can do, online stuff from other states — those are always helpful,” he explained.  

Inevitably, the event could also become a forum for the shadow Republican and Democratic 2028 primaries, with the parties’ rising stars using the platform to tout their own biographies and accomplishments. Republicans, however, will have to walk a more delicate line to avoid risking outshining the president. 

An added challenge for GOP candidates is how closely they’ll want to associate with Trump and the national brand during a midterm convention, given the president’s party typically faces headwinds in midterm years.  

But Democrats won’t be without their own challenges as well. For one, the party will need to figure out how to pay for an event of that scale. The DNC’s latest campaign filing showed the party raised $8.5 million in July and had close to $14 million cash on hand; some of the cash flow has been directed to help fund state parties. 

The RNC’s filing this month showed the GOP had raised $13 million last month, including $4 million from offsets, and $84 million in the bank. 

New York state Sen. James Skoufis (D), a member of the DNC’s “People’s Cabinet” and an ally of DNC chair Ken Martin, said that the party’s finances should be compared to those of the 2018 cycle, noting the party is doing better financially this go-around than it was then. He also noted it will take some time for Martin to build relationships with donors. 

Perhaps most importantly, DNC is hampered by the fact that it’s helped cover the Harris campaign’s debt since the 2024 election. The party has also privately raised the possibility of borrowing money, according to The New York Times, though Martin told the newspaper in June, “That’s certainly not our plan right now.” 

Some Democrats believe donors will slowly return back to the party after pulling their pocketbooks after the November election, particularly if Democrats secure key wins in New Jersey and Virginia this fall.  

“We do certainly need to raise more money. I would acknowledge that. Chair Martin would acknowledge that,” Skoufis said. “And in particular […] the full expectation is that some of our larger donors who thus far have not been contributing to the DNC […] as every month goes by from last November’s election, wounds will continue to heal.” 

President Trump’s new effort to cancel funding previously approved by Congress through “pocket rescissions” is setting up a political land mine for Congress as it races to avert a government shutdown by Sept. 30.

The so-called pocket rescission comes as Democrats had warned that efforts by the administration to unilaterally claw back money would seriously undermine the fragile bipartisanship required to fund the government.

And some Republicans are also sounding the alarm, questioning whether the move is legal and saying it undermines the will of Congress.

Senate Minority Leader Chuck Schumer (D-N.Y.) said in a statement Friday that the latest announcement by the administration is evidence that “Trump and Congressional Republicans are hellbent on rejecting bipartisanship and ‘going it alone’ this fall.”

“As the country stares down next month’s government funding deadline on September 30th, it is clear that neither President Trump nor congressional Republicans have any plan to avoid a painful and entirely unnecessary shutdown,” he said.

Senate Republicans’ chief funding negotiator, Appropriations Committee Chair Susan Collins (R-Maine), meanwhile, said “any effort to rescind appropriated funds without congressional approval is a clear violation of the law.”

“Given that this package was sent to Congress very close to the end of the fiscal year when the funds are scheduled to expire, this is an apparent attempt to rescind appropriated funds without congressional approval,” she said, while also citing Congress’s “power of the purse.”

“Instead of this attempt to undermine the law, the appropriate way is to identify ways to reduce excessive spending through the bipartisan, annual appropriations process,” she added, noting Congress “approves rescissions regularly as part of this process.”

The rescissions request sent Thursday to Speaker Mike Johnson (R-La.) calls for yanking back about $5 billion in funding for the State Department and the U.S. Agency for International Development (USAID), which the administration dismantled earlier this year.

Under the budget law governing the process, known as the Impoundment Control Act (ICA), the administration asks Congress to cancel select funds. While lawmakers consider that request, the administration is also allowed to temporarily withhold funding for 45 days. If lawmakers reject the request, the funds must be released.

Democrats were furious earlier this summer when Republicans in Congress approved such a request along party lines, accusing them of using a partisan maneuver to undo funding that had passed on a bipartisan basis.

But Trump’s latest proposal is known as a pocket rescission because there are fewer than 45 days until the end of the fiscal year on Sept. 30, which means the administration can bypass Congress altogether and simply run out the clock.

Some lawmakers have described the request as illegal and say it’s strategically timed close to the end of the fiscal year so that targeted funds can be canceled without Congress’s say-so.

Sen. Patty Murray (Wash.), the top Democrat on the Senate Appropriations Committee, criticized the targeted cuts as a “get-out-of-jail free card for this administration to simply not spend investments Congress has made” and said lawmakers “should instead insist on making decisions over spending through the bipartisan appropriations process.”

Trump officials have argued the tactic is legal. Office of Management and Budget (OMB) Director Russell Vought earlier this summer described the controversial maneuver as “one of the executive tools” that are “on the table” to reduce spending.

A White House official argued on Friday that they don’t “believe that this should distract from the appropriations process that is underway.” 

“Talked with one senator this morning who said, you know, this will take time away from the appropriations process to consider this bill,” they said. “Again, we don’t believe that this bill needs to be considered because it is an executive mechanism that allows us to bank the savings just by using the process.”

They also pushed back on arguments that the move signals the administration wants “a shut down.”

“That is not true,” the official said. “This in some respects we believe will help with those members who are not normally accustomed or willing to vote for a continuing resolution, that will in effect keep the government open. So, we believe this is in no way contributing to the argument put out there by Democrats this will lead to a government shutdown.”

Since news broke of the package of cuts, a number of conservatives have cheered the move keeping up calls for more rescissions. 

“President Trump just scrapped $5 BILLION in foreign aid with a pocket rescission — the first in nearly 50 years,” Rep. Ralph Norman (R-S.C.) posted Friday morning on social platform X. “The President is putting America FIRST instead of sending your tax dollars overseas!!”

Among the cuts the administration has touted in the proposal are the cancellation of $3.2 billion for the development assistance account for USAID, $393 million for the account covering “payments for the U.S. share” of United Nations “peacekeeping assessments,” and $521 million for an account that provides “funding for the assessed contributions” to the U.N. and other international organizations.

The administration described the funds as “woke, weaponized, and wasteful,” while listing examples of funding for items like “climate resilience in Honduras,” “micro-insurance for smallholder farmers and microbusinesses in Colombia for climate disaster response,” the World Trade Organization and the International Labor Organization that it said works to “punish U.S. corporate interests abroad.”

“The Trump Administration is committed to getting America’s fiscal house in order by cutting government spending that is woke, weaponized, and wasteful,” the White House said.

The cuts mark the administration’s latest effort targeting foreign aid this year. 

In July, Trump successfully clawed back about $9 billion in previously allocated funding for foreign aid and public broadcasting, after Republicans in both chambers approved the cuts with zero Democratic support — but not without some headaches for GOP leaders.

There was uncertainty around the bill’s chances of passage at the time over concerns about cuts to global health programs, as well as how local and tribal stations would fare from cuts to public media funds. Some GOP lawmakers also clashed with the administration at the time over what they argued was a lack of information in the administration’s request.

In an interview on Friday, Bobby Kogan, a former Senate budget aide and senior director of federal budget policy at the left-leaning Center for American Progress, singled out the administration’s renewed focus on foreign aid in the most recent rescissions request.

“I think that they were worried that if they had done all of this at the time, it wouldn’t have passed,” he argued. “There’s a legal way to rescind money, which they took for foreign aid before, and then they’re sending more for it through illegal means, and that really shows that the whole purpose is to get around Congress, which they’ve been explicit about.”

He compared the request to introducing an “atom bomb” just as Congress prepares to ramp up funding talks ahead of the shutdown deadline.

“This definitely increases the likelihood of a shutdown,” he said.

Brett Samuels contributed.