Ina Opperman

By Ina Opperman

Business Journalist

Watch out for old and new scams that can cripple your life

Fraud and scamming are increasing at an alarming rate and consumers must ensure they are vigilant all the time to prevent being scammed.

Consumers are warned to watch out for old and new scams that can cripple their lives as scammers try to take their hard-earned cash and private information.

According to the Southern African Prevention Service (SAFPS), fraud impersonation increased by 337% in 2021 and crypto and Ponzi schemes cost South Africans more than R54 billion.

While technological measures designed to protect you against scammers may be sophisticated, so are fraudsters’ methods to scam you, says the Momentum Metropolitan Cyber Security Team.

“The festive season was the most wonderful (and expensive) time of the year. Scammers were busy taking advantage of seasonal spending with fake online stores, phantom hotel bookings and bogus deliveries.

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Be cautious of sneaky scammers

“We hope you did not get caught out, but we want to remind all consumers to keep on being cautious. Perpetrators are skilled at their craft, employing countless tactics, such as phishing emails or texts to trick people into disclosing financial and sensitive personal information. The impact, as a result, goes well beyond financial loss as it is an unfortunate and traumatic experience.”

The Momentum Metropolitan Cyber Security Team found that scammers are sneaky and opportunistic criminals who always take advantage of consumers during busy seasons, such as the festive season, Valentine’s Day, back to school, early in the year or when consumers are job hunting.

“Being sceptical can help to keep you safe. You should continue to question everything and always double check, especially when a situation feels too good to be true.”

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Be vigilant and aware with these tips

Protecting yourself from both fraud and scams requires vigilance and awareness. The Momentum Metropolitan Cyber Security team has these tips to help you stay safe:

  • Educate yourself: Learn to recognise common fraud and scam tactics to protect yourself online. The media, watch-groups such as the Financial Sector Conduct Authority (FSCA) and companies such as Momentum Metropolitan are continually reminding consumers to be alert.
  • Authenticate information: Always verify the legitimacy of people or companies requesting access to your personal information or your money. Rather contact the company directly to check if you are dealing with it.
  • Secure your devices: Use strong, unique passwords (or even better, passphrases) and keep your devices and software up to date to reduce vulnerability. Password123 is not a good password!
  • Be sceptical: Question all unsolicited offers, requests, or deals that seem too good to be true and do your research.
  • Research businesses: Before buying online or investing, research the credibility of the company. Check online or on trusted review platforms for complaints or compliments about a company.
  • Monitor your bank statements: Regularly review your financial statements and credit reports for any unusual or unauthorized transactions.
  • Stay safe on social media: Be cautious about accepting friend requests from strangers, avoid quizzes that may be used to hack your account, or calls where the caller asks personal questions and always report dubious activity. Most channels, like Facebook have a reporting option.
  • Job hunt securely: Research potential employers and be mindful of unrealistic job postings. Never meet prospective employers at private residences or apartments and rather opt for public places like their offices or a coffee shop. If they say they will pay for your travel costs, make sure they pay upfront.

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What does a scam look like?

The Momentum Metropolitan Cyber Security Team says to protect yourself from scams, you need to be aware of what a scam can look like. While scams can sometimes be difficult to spot due to scammers’ improved impersonation skills, there are red flags that South Africans can keep an eye out for. These include:

  • An offer of an incredible way to make or save money, at much higher interest rates than banks, with pressure to act quickly so you do not miss out.
  • Someone you have never met requests your help or money, often by telling you heartbreaking stories with no actual proof of need.
  • A message contains links or attachments which you must open where you are asked to enter certain personal details. This allows the scammers to send you to a fake website or steal your information. Always verify the authenticity of the website with the company yourself.
  • When you buy or invest you are asked to pay in unusual ways, such as via Bitcoin or preloaded debit card or into someone’s private bank account. Remember reputable companies will never ask for this or allow deposits into personal bank accounts.
  • You are encouraged to open a new bank account to facilitate payment to you for something or to pay for them for something you bought.

“If you understand the consequences of letting scammers into your life (and bank account) can have on you and your finances and how seductive and sophisticated they can be, you are better equipped to boost your own cyber security measures, the team says.

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Recent scams the FSCA warned about

The FSCA warned consumers of these scams since the beginning of the year:

  • The FSCA warned consumers to be cautious when conducting financial services business with Tumi Links Investments as it has come to the attention of the FSCA that Tumi Links has offered to trade in forex products, amongst others, on behalf of members of the public. Tumi Links is not licensed in terms of any financial sector law to provide financial products or financial services and was unavailable for comment, the FSCA says.
  • The FSCA also warned consumers against doing any financial services related business with individuals who are soliciting investments while impersonating financial services providers (FSPs), Rich Ideas Group, IC Markets and Scope Markets SA as it has come to the attention of the FSCA that an entity named “Wealthfront”, Franz Wastl, David Daniel Venter and Roelof Johannes Riekert, as well as individuals named “George” and “Helena” target victims using WhatsApp and Facebook. They promise unrealistic returns. The FSPs have confirmed it they are not associated with them and did not give permission for their licence certificates, brand names and logos to be used. Wealthfront, Wastl, Venter and Riekert, as well as George and Helena are not licensed under any financial sector law to provide financial products or services in South Africa. They did not respond to communication from the FSCA.

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FSCA warns against guarantee insurance policies, TikTok and Telegram scams

  • The FSCA also warned consumers to be cautious when taking up guarantee insurance policies issued by Namco Capital, trading as Namco Guarantees as the FSCA received a complaint that Namco may be issuing guarantee insurance policies to consumers which were possibly not underwritten by an authorised short-term insurer. Without commenting on the business of Namco or its products and services, the FSCA points out that for a company to issue insurance policies in South Africa, it must be authorised by the FSCA and the Prudential Authority. Conducting financial services business or insurance business without a licence is a criminal offence. Namco is not so authorised and does not hold a licence from the FSCA to conduct financial services business. The FSCA is currently investigating Namco.
  • The FSCA also warned consumers to be cautious of a scam run on TikTok and Facebook by individuals purporting to be from International Capital Markets as it received information from a consumer who was defrauded by individuals on TikTok. They promised to invest her money in return for a greater payout and subsequently requested her to deposit more money to release her investment return. Furthermore, another individual on Facebook offered to assist her with recovering her investment returns from the individuals who defrauded her and this too turned out to be a scam as she was requested to deposit more funds. IC Markets is a registered financial services provider and confirmed that the company is not associated with the individuals on TikTok or Facebook using its name.
  • The FSCA warned consumers this week to be cautious of a Telegram group impersonating Seed Investment Consultants. The Telegram group advertises a Ponzi Scheme to hook potential clients. The FSCA received confirmation from Seed Investment Consultants, a legitimate financial services provider, that it did not give the Telegram group any right to use its names to solicit investments from consumers.

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How to check before paying over the money

According to the FSCA someone who offers financial products or services in South Africa must be licensed to do so by the FSCA. Consumers must always check:

  • that an entity or individual is authorised by the FSCA to provide financial products and services, including when giving recommendations about how to invest
  • what category of advice the person is registered to provide, as there are cases where companies or people are registered to provide basic advice for a low-risk product and then offer advice on far more complex and risky products
  • that the FSP number the entity or individual offering financial services uses matches the name of the FSP on the FSCA database. Consumers who wish to conduct financial services with an institution or person can first check with the FSCA on its toll-free number (0800 110 443) or on, whether the institution or person is authorised to render financial services.

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