Standard Bank fraud warning for these South Africans

Standard Bank has warned about a rise in fraudsters looking to take advantage of South Africans who are financially strained after the festive season. 

In particular, fraudsters are looking to take advantage of vulnerable individuals through loan scams by offering them cash to get them through to the end of January at extremely high interest rates. 

Standard Bank’s Head of Fraud Complaints Management and Awareness, Riyadh Mahomed, explained that this is also coupled with a rise in other types of fraud as criminals look to cash in. 

“January is known as Janu-worry for a reason. It is that time of the year when people are financially stretched as they have spent a lot of money over the festive season,” Mahomed said. 

“They are now in desperate situations, and fraudsters know this. They try to take advantage of this and reach out to customers to scam them.” 

Fraudsters typically try to exaggerate this sense of desperation as it forces individuals to act quickly and emotionally, rather than rationally. 

This is coupled with some individuals who actively look for alternative ways outside of banks and traditional financial services providers to get their hands on cash to make it through to the end of January. 

“Because of this, one of the big scams we see during this part of the year is loan scams where fraudsters reach out directly to clients,” Mahomed said. 

“Fraudsters reach out to you, offering you loans with tremendous interest rates, and try to convince you to take up these loans.” 

Apart from this, Mahomed said there is a corresponding rise in other forms of fraud and scams, whereby criminals try get a hold of your personal information. 

These typically result in another type of loan fraud, where criminals take on credit or debt in someone else’s name. 

Mahomed made it clear that banks will never ask their clients for their personal information over the phone and urged clients to contact their bank directly if any suspicious communication occurs. 

Phishing scams

Mahomed said that Standard Bank also witnesses increased frequency of more common scams in January to take advantage of the desperation of individuals. 

In particular, fraudsters try gain access to personal information to be able to take money out of your bank accounts, take out loans in your name, or make payments. 

“Something we see a lot of in the month of January, especially, is something we call phishing scams,” Mahomed said. 

“Phishing scams are where you get email communication or SMSes with links, where the fraudster prompts you to click on these links.” 

Clicking on these links typically results in a payment being made from your bank account or you giving fraudsters your personal information. 

Phishing scams have become increasingly sophisticated, with fraudsters impersonating legitimate companies and banks themselves to gain access to information. 

These scams have even begun to include the impersonation of authorities, such as the police, SARS, and the Reserve Bank. 

One of the tactics being increasingly used by scammers is fake non-compliance notifications to induce individuals to share confidential information. 

With this method, fraudsters exploit the bank’s need to comply with the Financial Intelligence Centre Act (FICA).  

They pretend to be the bank, sending customers emails and SMSs, claiming that their accounts are not FICA compliant.

Upon clicking the link, customers may be redirected to a fake login site or prompted to enter sensitive information, such as their card number, expiration date, customer verification value (CVV), or one-time password (OTP). 

In some instances, the link may disrupt the customers’ devices, giving the fraudsters remote access and total control.

“We also see an increase in investment scams targeting bank clients. This takes advantage of individuals looking to make changes to their portfolios at the beginning of the year,” Mahomed said. 

“Fraudsters contact you and try to convince you to invest money with them, often with ridiculous investment returns. If something is too good to be true, it usually is.” 

Mahomed urged individuals to be sure that those with whom they are investing are reputable individuals or institutions registered with the relevant authorities.