Not the easy way out it seems?

 In times when financial difficulties occur, it can be tempting to find an easy way out of debt and the financial stress from losing your job, or dives in the value of your superannuation. Scammers are more than aware of people’s vulnerability and are very, very creative in how to take your money away from you.

Scam Alert

Credit card Phone Scams

One that seems to be doing the rounds at the moment is a clever way to trick you into giving your security code from the back of your credit card - these scammers already know your credit card number, and just need the 3 digit pin from the back of your card - for more information go to ACCC's Scamwatch on the link below:

http://www.scamwatch.gov.au/content/index.phtml/tag/CreditCardScams  

Some other examples of scams exposed on the Australian Securities & Investments Commission (ASIC) website that you might or might not be aware of include the infamous:
 

Nigerian scams which is code for ‘Beware”, and are really international scams that may in fact originate from anywhere. It goes something like this – you receive an email suggesting you could benefit handsomely by opening a bank account for funds to be deposited for a third party in another country, or to give you access to frozen or seized funds. Of course, they are totally bogus, and predatory in nature.

Pyramid schemes are another familiar scam. In most cases, you are asked to pay the person who recruits you for the right to go out and recruit your new members to the scheme. In turn they must pay you for their right to recruit their own new members. The scheme builds up layer upon layer of recruits, forming a pyramid. Every pyramid collapses. Most commonly, people give up because they cannot sell enough to recover the money they originally paid to participate. They find it much harder than they think to sell overpriced goods or services, especially to friends and social contacts. Schemes also inevitably run out of new recruits, although this may take some time to happen.

Fraudulent emails are becoming more common as the more you use the internet, the more likely you are of becoming a recipient of such an email. How it works is that you get an email out of the blue with some story about why you have to reply. The email claims to be from your bank, credit card company or some other service you use. It usually asks you to send your account details, and sometimes your PIN, either by return email or through a website. The emails include fake surveys, fake security and maintenance upgrades, phoney investigations, false bills and charges, or falsely claims that money has been withdrawn from your account.

We have independently chosen to review information and literature available from ‘Fido’, the Government website providing financial tips and safety checks on money matters, a bit like a ‘watchdog’, hence the name. Follow the link to Fido at the end of this article to get more details on the points and excerpts below.

 

Spotting Financial scams

The FIDO website suggests the following are tell tale signs:

·  It looks real - Scams that catch people often look realistic and are presented professionally. They    have attractive documents, a business-like website, and names that sound like reputable companies.

· Bigger and faster profits than real investments - Scams always offer a higher return than genuine investments. Some offer 20% a year, others go for 300% a year or even more. It's too good to be true. By comparison, Australian shares are some of the most successful investments, and their value has grown about 7-9% p.a. over the long term.

·  Less risk and less effort than real investments - Most scams say that financial success is easy and risk isn't a problem. But real wealth demands planning, hard work and guts. Even the best investors make mistakes and have to weather storms like market busts and economic recessions.

·  Something special that genuine investments don't offer –  It could be a 'secret' offer, 'inside information' or 'new techniques' to make you feel like you've got an edge over other people. But chances are it's a fairytale - and it won't have a happy ending.

·  More urgent than the real thing - Scammers often say 'don't miss out' and 'act quickly before it's too late'. They're really just trying to grab your money before you have a chance to check properly.

 

Top Tips for Dealing with a Scam

Safety checks to protect yourself from email scams:

1. First, stay calm

It's natural to be alarmed by an email claiming your account has been frozen or your credit card information has been stolen. Resist your first impulse to reply. Never follow the instructions in the email.

2. Keep your computer secure

Some frauds can lure you into opening an email or attachment that secretly installs a 'trojan' that allows scammers to monitor your computer and access your bank, credit card and other accounts. in order to counter this threat:

* Get an effective virus protection program and regularly download the latest version. If you have not upgraded for the past six months, your protection is probably inadequate.

* Get a 'firewall' to protect your computer from unauthorised access over the internet. This is especially important for broadband users.

* Delete suspicious emails without opening them. Avoid opening dubious attachments, even if the email seems to come from someone you trust.

* Change your PINS. Regularly change your internet banking and shopping PINs. Some banks recommend changing your PIN as often as every month.

3. Go to the official website for your financial institution

Use your 'favourites' to go to the official website for your financial institution or type its URL in the address bar of your web browser.

Never click any link in an email unless you're certain the email comes from a trusted source. The hyperlink leads only to trouble.

If there is a real problem, the genuine website will almost certainly tell you on its home page. You will not have to fix it by emailing confidential information. Some scam sites even show the padlock at the bottom of your web browser giving you a false sense of security.

4. Be suspicious if asked for details in an email

Suspect a scam if you’re asked for your account details or your passwords by email.

Legitimate companies never ask for your account details or your passwords by email. If you get this kind of email, it's almost certainly a scam.

5. For Australian sites, look for the ‘ .au’ domain such as ‘com.au’ or ‘net.au’

In Australia anyone registering an .au domain must show a link between the proposed URL and an Australian trading entity. To date, ASIC has not come across a phoney .au site, although that doesn't guarantee it will never happen.

Despite this protection you must still be suspicious of any link given to you in an email.

The address of your bank's real website can still appear as part of the link to a false website. The familiar link words in the URL are there to trick you by making you feel comfortable. But your website browser doesn't read all parts of the link and takes you to a false site.

6. Take a few privacy precautions

Some authorities suggest avoiding personal transactions at Internet cafes, community centres and libraries. In some places, criminals have loaded software that records keystrokes.

Check that nobody is looking over your shoulder and keep private information out of chat rooms or email.

7. Act quickly if you think you’ve been conned

If you get a suspicious email contact your financial institution or your legitimate service provider directly: do nothing about the email. Do not respond to any contact details in the email.

If you're still uncertain or if you have sent any details through an email or website you’re a bit worried about, email or phone your financial institution or the legitimate service provider through their customer support department, and ask them to confirm the email's authenticity. They will tell you what to do next.
 

Link for this review

Follow this link to FIDO, which is managed by the Australian Securities & Investments Commission, for more information and details on the source of this review: 

http://fido.gov.au/fido/fido.nsf

You could also go straight to the Australian Competition & Consumer Commission Scamwatch site by following this link:

http://www.scamwatch.gov.au/

 
We hope this article has been of interest to you. Please feel free to print a friendly copy or download the PDF article for your reference.

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Disclaimer: The information contained in this section should not be used for individual financial or professional advice. Please seek independent financial or professional advice if you have concerns or specific questions relating to your money and situation.