The 3 signs you are about to get robbed by an Internet scam

A South African teacher felt the effects of an online scam in a big way recently, after losing millions in an “investment opportunity”.

The Internet scam started in June after she clicked on an article about President Cyril Ramaphosa.

The teacher was asked to provide her name, mobile number, and email address to read this article – which she did.

She was contacted after this by WiseBanc, which offered her an investment with a high interest rate that she took up.

She invested money after contacting WiseBanc representatives, who promised her she could withdraw her funds at any time. The consultant then asker her to invest more money so “Bitcoin, Facebook shares, and gold” could be purchased.

When her account balance reached $274,577, she tried to withdraw money, but was told she needed to invest an extra R1 million to be able to access her fund.

After reportedly borrowing R2 million from a friend, the teacher invested the money with WiseBanc – and never heard from them again.

3 signs of a scam

While the incident above is devastating to the victim and the criminals targeting her appear to have taken her money illegally, there were warning signs which should have pointed to an online scam.

Common warning signs of a scam like this are:

1 – Asked to provide extensive personal details

If any website or company asks you to provide extensive personal details, you should immediately be on guard.

This is particularly true if you do not know the company or it is a website which only gives access to content after you have shared these particulars.

By providing your name, email address, and cellphone number in combination, you open yourself up to being contacted by scammers.

Sharing more details like your ID number and home address are even more dangerous, as this information can be used to open fraudulent accounts in your name.

2 – Guaranteed Interest rates

A high guaranteed interest rate or return on your investment is a sure sign you are going to be scammed.

Big banks and investment firms rarely offer guaranteed returns if you invest with them, and if they do offer a promised return, it is relatively low.

Good guaranteed interest rates from the banks on fixed deposits range from between 8% to 10% per year.

Additionally, according to the The Consumer Protection Act any scheme that offers returns 20% above the repo rate – currently 6.5% – is a “multiplication scheme”. This is also called a Ponzi scheme.

If you see an offer for “double your money – guaranteed” or “Get 50% returns in 6 months”, the offers are scams, and are defined as scams by legislation.

3 – Act now or miss out

Another tactic used by scammers is to pressure a victim to make a decision quickly or “miss losing out”.

Rushing a person into making a decision by stating that they must act now or miss a deal can lead to the potential victim not researching the offer or company properly – which sees them miss warning signs.

While many legitimate stores and companies offer “limited-time deals”, if you receive an investment offer that you have to take then and there, it may be better to err on the side of caution.

This is particularly true if the offer sounds too good to be true – as it invariably is.

Now read: The government’s middle finger to South African taxpayers

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The 3 signs you are about to get robbed by an Internet scam