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The convenience offered by digital transactions and online communications comes with a significant downside: the increased risk of financial scams and identity theft. Cyber scams take many forms, from bulk emails that rely on a few people clicking suspicious links to highly-targeted and individualised scams.

Because most scammers are ultimately aiming for one thing – moving money from a victim’s bank account into their own – our fraud team at Sasfin is exposed to many different types of scams.

Here are the five most common scams, how to spot them, and what you can do to keep your personal information – and finances – safe.

Identity theft

What it is: Unfortunately, this remains one of the biggest threats worldwide and can be devastating if it happens to you. Identity theft involves the unauthorised acquisition and use of someone’s personal information, such as their name, identity number, or credit card details, typically for fraudulent purposes, such as opening additional credit cards or store credit, or using existing credit cards for fraudulent purposes. Identity theft can also be used to open cellphone contracts, to buy airtime and so on.

How to identify it: Warning signs include unexplained transactions on your bank statements, bills for services you didn’t use, and unexpected credit card or loan rejections.

How to avoid it: Protect your personal information by using strong, unique passwords for online accounts, monitoring your financial statements regularly, and being cautious about sharing personal information, especially on unsecured websites or in response to unsolicited communications.

Deposit and refund scams

What it is: These scams trick individuals into believing they are receiving a legitimate deposit or refund from a trusted institution. Victims are then asked to send a portion of the money elsewhere, only to find out the initial deposit was fraudulent.

How to identify it: Be wary of unsolicited messages claiming you are owed a refund or have received an unexpected deposit, especially if you are asked to send money to a third party. This is commonly used in online marketplace scams. Either you will be asked to pay for goods before seeing them (and then they never arrive), or the buyer of something you are selling deposits too much money and asks you to return the difference. The money looks like it’s in your account, but it bounces back to the depositor and meanwhile you have sent them some of your money.

How to avoid it: Never forward money based on an unexpected deposit. Verify the legitimacy of any unexpected funds with the issuing institution directly before taking any action.

419 or investment scams

What it is: Also known as Nigerian scams, these schemes promise victims significant returns on investments or a share of a large sum of money in exchange for a small upfront fee.

How to identify it: Red flags include unsolicited emails or messages from strangers promising large financial gains, requests for confidential information, and demands for fees before receiving any supposed benefits. Another clue is when the promise of a return is much higher than any other investment.

How to avoid it: Ignore unsolicited investment offers, especially those requiring upfront payments. Remember that if something seems too good to be true, it is. Finally, conduct thorough research and consult with financial professionals from well-known and established financial advisory firms before making any investments. Speak to other clients whom you know and can verify and check LinkedIn profiles to verify advisors and their expertise and reputation.

Employment scams

What it is: Scammers post fake job listings or reach out with job offers that require the job seeker to pay for training, equipment, interviews, or background checks upfront, only for the job to be non-existent.

How to identify it: Warning signs include job offers without interviews, requests for payment to secure an interview or a position, and offers that seem too good to be true.

How to avoid it: Research the company or recruitment agency offering the job, look for reviews or complaints online, and be sceptical of any job that asks for money upfront.

Pyramid and ponzi schemes

What it is: Pyramid schemes involve recruiting members with the promise of payments for enrolling others into the scheme, rather than supplying investments or selling products. Ponzi schemes promise high returns from fictitious sources and use new investors' money to pay earlier investors.

How to identify it: Key indicators include a focus on recruiting new members over selling products, promised returns that seem too high or consistent to be true, and pressure to invest quickly.

How to avoid it: Steer clear of any investment opportunity that prioritizes recruitment over product sales and promises guaranteed returns with little to no risk. Always perform due diligence before investing.

This is just a sample of the most common threats, and while some scams are easier to spot than others, often all it takes is an unguarded or unconcentrated moment for a scammer to trick you. However, by staying informed and above all, vigilant, you can protect yourself against these cyber threats.

About the Author

Tanja Swanepoel
Head: Fraud and Client Risk Management, Sasfin Holdings Limited

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