SCAMS – Who would fall for one?

If a stranger walked up to me in the street and said that if I gave them $100.00 cash, within a week they could double my money and then give me $200.00 cash – no strings attached! Would I fall for what is obviously a scam? Well, my resounding answer would be “Of course I wouldn’t do anything that stupid.” But, obviously some people would believe that it was a genuine “get rich quick” scheme (though surely that would be an oxymoron, getting rich quick that is)!

How often though do we hear of people who fall victim to one of the many scams “doing the rounds”? To some of us the scams that abound are just as obvious as the simple example above. However, it is nonetheless surprising how many people believe the “story” that they are told – and to their financial and in some cases, physical detriment.

But do we know the actual monetary cost of scams and how many people are victims to these activities. According to the Australian Securities and Investments Commission (ASIC)  MoneySmart  website  https://www.moneysmart.gov.au/tools-and-resources/quizzes/scams-quiz an Australian Bureau of Statistics (ABS) survey conducted in 2014-2015 found that the sum of three billion dollars was lost by Australians in scams and personal frauds. Furthermore it was found that approximately 1.6 million Australians are victims to some form of scam or personal fraud – EACH YEAR.

Scams would appear to target inter alia, money and/or love. Well, if love is meant to make the world “go round” then money, of course, keeps us clothed, fed and comfortable on the trip! Why then wouldn’t someone invest time and money into something they believe will make them rich and provide everlasting love? Remember the old saying “If it sounds too good to be true, then it is.” In other words think the proposition through very carefully. Perhaps instead of asking ourselves “what’s in it for me?” we should be asking “what’s in it for them?”

Truth will out at some stage and here I openly confess to my favourite website being the ASIC’s ‘MoneySmart’ website referred to above. I just love it. On this site you can read about the financial scams that have come to ASIC’s attention – and they are never-ending.  You can even take part in a ten question quiz to test your knowledge of scams. I actually scored 8 out of 10! The two I answered incorrectly were the two I mentioned above, i.e. the amount of money lost to scams and the number of people who fell victim to the scam! I was speechless, not only in getting something wrong but at the figures. In fairness I think many of us would get those two questions wrong, but hopefully none of the other questions – why not try the quiz yourself. There are also quizzes on “Borrowing and credit”, “Investing”, “Hybrid securities”, “Managing your money”,  “Superannuation and Retirement”, “Under 25’s” and “Women and money” – I can’t wait to finish this article and test my knowledge further.

Well, what are some of these scams? According to ASIC they are many and varied. The following is the list of the non-investment scams on the ASIC site, and let us be honest, some of them I hadn’t even heard of (or perhaps understood).

  • Carbon tax compensation payment;
  • Money transfer requests;
  • Lotteries and fake prizes;
  • Mobile phone scams;
  • Chain letters and pyramid schemes;
  • Tax scams;
  • Dating and romance scams;
  • Charity scams;
  • Job and employment scams;
  • Small business scams (fake billing);
  • Spam emails or unwanted telemarketing calls.

Of the above I have certainly received innumerable emails requesting my bank details so that “they” can deposit some outrageously large sum of money, which I am “entitled” to. There was a time I used to read them just for a laugh, but the novelty has certainly worn off and now my delete button works overtime.

Of the investment scams, ASIC categorizes them into those where the investment offer is not genuine, those where the offer is genuine, but your money isn’t going into the advertised  investment  and the third is where the scammer purports to represent a genuine company – but they are lying. The ASIC site provides a list of bogus companies – why not spend a few minutes checking the site.

While ASIC concentrates on financial scams, the Australian Competition and Consumer Commission (ACCC) SCAMWATCH  site www.scamwatch.gov.au  also addresses the issue of dating and romance scams.  I suppose in some ways the romance scams are more disheartening because the victim loses not only their money, but what they have naively thought of as their chance of everlasting love, and they may also suffer physical injury as well.

It’s really quite simple - when in doubt – don’t.  Check with both the ASIC and ACCC sites and always report a scam to the ACCC, once again their monthly statistics make for fascinating reading.

If the price of freedom is eternal vigilance, then really the same can be said about scams – eternal vigilance is up to each and every one of us.

LET'S FACE ITContributedOrange NSWComment