With the countless advances in technology that enhance our daily lives in many ways including banking, we also see recurrent criminal threats striking the financial industry. Fraudsters are improving their methods and we need to join forces to spot fraud attacks and proactively protect your money from unethical activities.
We want to increase your awareness of current scams and describe some below.
Advance Fee: That happens when fraudsters target victims and trick them into making advance or upfront payments for goods, services and/or financial gains that do not materialise. Sometimes, they get people to provide bank account numbers. Types of Advance Fee Fraud includes - Lottery/Prize Draw Fraud, 419 Fraud, Inheritance Fraud, Loan Scam, Internet Auction Fraud, Dating Romance Fraud, Clairvoyant or Psychic Fraud, Work from Home Opportunity Fraud, Career Opportunity Fraud, Cheque Overpayment Fraud and more.
Ponzi and Pyramid Schemes: It is a fraudulent practice that dupes investors by promising above average returns in a short space of time. In both schemes, fraudsters pay returns to existing investors out of the money brought in by new investors. Since those schemes are not supported by any real investment that could generate the promised returns, the schemes collapse whenever there is a liquidity crisis in the system, triggered by higher redemptions, or when promoters cannot raise enough money from new investors to pay earlier ones. Except for the criminals who started the scheme, everyone else lose money!
Vishing: Short for Voice Phishing, it is a fraudulent practice of making phone calls or leaving voice messages purporting to be from reputable companies in order to trick people into revealing critical financial information such as bank details, credit cards details or even lure them into transferring money over the phone. During sophisticated attacks, the criminals already know your name, address, phone number - essentially the kind of information you would expect a genuine caller to have. A vishing attack can be conducted by voice email, VoIP (voice over IP), landline or mobile phone.
Dumpster Diving: Fraudsters rummage through trash looking for bills or other papers with your personal information on it.
Cheque Fraud: Scammers may use various ways to make bogus cheque payments. Those cheques, either stolen (forged signature), altered (change of recipient name) or counterfeited (created on non-bank paper), are valueless meaning that you would remit goods or services with no money in return. Sometimes, fraudsters fake cheques with a higher than the agreed value and trick you into refunding them the difference.
Timeshare/Boiler Room Fraud: This refers to an investment scam that works towards selling you worthless, overpriced or even non-existent shares. Fraudsters claim - via email, phone, post or seminar - that you can easily become a share owner of a property, by buying a timeshare. The property either doesn’t exist or is not of the same value as advertised. Sometimes, they offer you a gift or discount on their dealing charges, and usually exercise pressure on you to sign a contract for the timeshare. If you are already a timeshare owner, fraudsters may offer to sell it on your behalf, for a fee.
Recovery Room Fraud: This rapidly growing fraud often exploits investors who have already fallen victim of another fraud like Timeshare fraud. Scammers, posing as a representative of a government agency or organisation that aid scam victims, offer to help recover the money lost, for an advance fee. This might even be carried out by the same group of criminals.
CEO Fraud: These scams involve the creation of spoofs of company emails or the use of social engineering to dupe employees at large lucrative organisations, into wiring funds to fraudsters. They usually impersonate the CEO to request urgent fund transfers into nominated bank accounts. This kind of fraud is very well organised and can result in significant financial loss. People behind it takes the time to understand the target organisation’s environment and activities including payment procedures.
Bank Guarantee Fraud: This involves bogus investment schemes encouraging potential investors in trading prime bank instruments, and promising guaranteed, risk-free high returns. Fraudsters usually use complex, sophisticated but official-sounding language. This may include letter of credit, debentures, prime World Bank bank guarantees, private funding project, and more.