8 Money Scams and the Warning Signs You Should Know | ExpatWoman.com

8 Money Scams and the Warning Signs You Should Know

Anyone can fall prey to a fraudster – so learning more about the tricks scammers use is a key line of defense

Posted on

16 October 2018

Last updated on 13 November 2018
Money scams and the warning signs you should know

Could you spot the tricks scammers use? It may be harder than you think, as frauds become increasingly sophisticated.

Consumers lost £92.9 million to scams – where they were tricked into transferring money directly to a fraudster – in the first half of 2018 alone. And adding insult to injury, people who have been tricked in this way may sadly never see their money again.

A voluntary code for banks to follow has just been proposed in the UK, which could give people more help in getting their money back. However, victims may still find themselves out of pocket – so it’s always best, if at all possible, to avoid falling for a fraud in the first place.

SEE ALSO: You can now start a business remotely in Dubai

A UK bank, Nationwide Building Society, recently found that three in 10 (30%) people would be willing to transfer their own money into another account ‘to keep it safe’ if asked by someone they thought was from the police – even though the police or a bank would never ask anyone to do this. The same rule applies to UAE banks.

Stuart Skinner, director of fraud at Nationwide, whose branches are running fraud awareness events, says: “The key to thwarting the scam artists and fraudsters is education. We’d urge people to learn as much as they can about the tricks that scammers use.”

Here are some of the warning signs to spot...

1. Purchase scam

The victim pays up-front for goods or services that are never received. These scams often happen online, such as when someone uses an auction website or social media. A warning sign could be if you spot something of high value, such as a car, phone or computer, advertised at a low price. Fake holiday rentals and concert tickets may also be advertised online. Victims may be persuaded by the fraudster to pay for the goods via direct bank transfer, instead of using websites’ secure payment options.

2. Advance fee scam

With this scam, victims may be tricked into parting with their money as a ‘fee’ after being promised a larger reward. Criminals may claim they have won an overseas lottery, or that gold or jewellery is being held at customs – and a fee must be paid to release money or goods which don’t really exist.

3. Investment scam

People are persuaded to move their money into a fictitious fund, or to pay for a fake investment. The criminal usually offers high returns to entice them. These scams include investment in items such as gold, property, carbon credits, land banks and wine.

4. Romance scam

The victim is convinced to make a payment to a person they have met, often online through social media or dating websites, and with whom they believe they are in a relationship. The ‘relationship’ is often developed over a long period and the person is convinced to make multiple, generally smaller, payments to the criminal.

5. Invoice and mandate scam

Scammers step into the middle of people’s legitimate transactions to swipe money that was intended for someone else. Someone could be paying a solicitor or a builder, for example, but the criminal intervenes and convinces the victim to redirect the payment into their account instead.

The criminal may persuade their victim that the bank details of the person they intended to pay have changed. Businesses can also be tricked by this scam, when trying to pay a supplier.

6. Impersonation scam

Someone pretends to be from the police or the victim’s bank, to convince them to make a payment. Often, they will claim there has been a fraud on the victim’s account and they need to transfer the money to a ‘safe account’ to protect their funds. However, the criminal actually controls the recipient account. Criminals may pose as the police and ask the individual to take part in an undercover operation to investigate ‘fraudulent’ activity.

7. Pretending to be from a legitimate company

Fraudsters pose as organisations such as utility companies, communications service providers or government departments, and claim that the victim must to settle a fictitious fine or to return an erroneous refund. The scams can often involve the criminal requesting remote access to the victim’s computer.

8. CEO fraud

This mostly affects businesses. Criminals may access a company’s email system or use spoofing software to email a member of the finance team, with what appears to be a legitimate email from the chief executive with a request to change payment details or make an urgent payment to a new account.



Working from home with Cigna

Picture: Supplied | Adjusting to work is easy with these top tips