TOO-GOOD-TO-BE-TRUE investment cold calls and buy and sell scammers preyed on migrants and indigenous consumers resulting in $13.7M being scammed in 2020.
That amount is part of the $61.8M total losses from fraudulent investment schemes while incidents involving this sector of Australian consumers, particularly those aged 20-30, are rising based on Scamwatch 2020 data.
Investment fraud continuously surpass the list of scams, up to $66.4M losses, while buy and sell scammers netted $37.2M from 41,216 incidences, of which 33% of victims have not recovered money lost.
These “convincing and sophisticated” investments and buying and selling scams are among criminal offences authorities are trying to disrupt and stop but identities of scammers are difficult to track because many are operating overseas, an Australian Competition Consumer Commission (ACCC) spokesperson told the Parramatta Times.
The Australian Federal Police and other agencies have forged an “international law enforcement cooperation” that recently resulted in multiple arrests of suspects in Australia and overseas involved in telephone and online scams, the spokesperson said.
“[Our] role is to help Australians recognise and avoid scams. The ACCC recognises the impact of scams on all members of the community and is committed to ongoing education about scams,” the spokesperson said.
“Scam prevention and awareness is a shared responsibility across government, community and private organisations and we work closely with these stakeholders to increase awareness.”
According to the latest ACCC Targeting Scams Report released last June, 4.6 per cent who lost $5.3M from investment scams in 2019 are migrants speaking other languages and another 1.6 per cent identified as Indigenous.
Scamwatch recorded 2,767 reports from Indigenous consumers, or 14 per cent increase on incidences from 2018 netting $2.1M in losses, but 30 per cent lower than what this sector lost in 2017 as people become more aware of the dangers.
The fraud starts off with cold calls promising low-risk investments, Scamwatch said, and it is the “most financially harmful scams” that hit Chinese migrants, losing over $1M lured by high returns.
According to IT engineer Sreeni Pillamarri, Director of SoftLabs Parramatta, scammers find it easy to steal a person’s private details online because people willingly “share their private information on social media platforms such as check-ins and food.”
We’ve been giving away our mobile numbers
“We’ve been giving away our mobile numbers while ordering food and we don’t know how far the chain goes,” Mr Pillamarri said.
“One has to be judicious while sharing information online or even sharing their personal details.
“Never believe if someone calls you and gives an unbelievable offer and if they ask for personal details like email, date of birth, and address, they are getting it to create fake identities.”
“If someone calls giving a discount in your electricity and gas bills, it’s probably a scamster, call your provider yourself for a better deal.”
Scamwatch has listed common scams on social media such as ‘Facebook lottery,’ Loom’ pyramid scheme, and cryptocurrency scams with reports to the ACCC of $14.76M in losses between January and July 2019.
Those who have been scammed do not realise it until they are applying for credit or making purchases, according to Credit Fix Solution Chief Executive Officer, Victoria Coster.
Ms Coster’s Parramatta based firm assist consumers mostly from Western Sydney and she revealed they have handled victims’ cases of fraud where “someone had used their identity to obtain finance” that blemished the client’s credit record.
One of Ms Coster’s clients owned a medical practice and asked for assistance with a telecommunications default notice on an amount owing that was not his.
“We got the credit provider to have it removed on the grounds of fraud,” Ms Coster said. “Once or twice a week we get enquiries from people saying their credit report has information on it that is not theirs, and in these cases, we launch a fraud enquiry on their behalf.”
The popular “buy now and pay later” scheme should be a “concern” to consumers, according to Ms Coster.
“They should be aware that every time they enquire for a loan, a mobile phone or energy plan, that the credit provider is going to place an enquiry on their report.”
Beware the scammer’s methods
The Australian Securities and Investment Commission (ASIC) has listed indicators of investment scams:
- Call or email from a stockbroker offering amazing investment opportunities with high returns and low risk. In reality, this ‘stockbroker’ is unregistered and intends to steal your money.
- An insider tip about a company about to take off and encouraged you to buy shares. It is simply a pyramid scheme designed to raise money through the investments of many people.
- Invitations to an investment seminar with free advice, food and drinks. At the event, you’re persuaded to invest in high-risk strategies with hidden fees and undisclosed charges and to purchase expensive investment strategy books.
The ACCC Little Black Book of Scams is now available in 10 languages and an Indigenous outreach program, Your Rights Mob, is on Facebook. More information on www.scamwatch.gov.au.
By ELIZABETH FRIAS