Fake Investment Scams Increasing Substantially: What Can You Do To Protect Yourself?

This Fraud Awareness Week (14 -20 November), the Ministry of Business, Innovation and Employment’s (MBIE) Consumer Protection team, alongside New Zealand Police, CERT NZ, Financial Markets Authority and banks across New Zealand, are urging people to follow some simple steps to protect themselves from scammers.

The Banking Ombudsman Scheme has released alarming statistics showing a 63 percent increase in scam complaints reported to them in the latest financial year. Combined data from New Zealand banks shows customers lost $183.5 million to scams from October 2021 to September 2022 – a 40 percent increase from the previous year. The scheme says the true value of the impact of scams may be much higher, as many losses are not reported.

“These statistics show we cannot be complacent. It is not only the volume of complaints about scams that is increasing, but also the sophistication and sums involved. We need to remain vigilant – Fraud Awareness Week is about helping people to stay safe from fraud and scams,” says Banking Ombudsman Nicola Sladden.

The Financial Market Authority- Te Mana Tātai Hokohoko reported they are also seeing a clear upwards trend in scam activity with 397 complaints and 95 scam warnings issued this year (21 October 2021- 21 October 2022), compared to 310 complaints and 70 warnings issued pre COVID-19.

Agencies involved in Fraud Awareness Week are seeing an increase in romance, investment, and phishing scams – where the scammer often impersonates someone the person trusts. This is the focus of this year’s campaign.

“Through the theme of ‘Once Upon a Scam’, we are empowering consumers to ‘be the hero of their own scam story’ – demonstrating how to recognise when a financial offer is too good to be true and giving them steps to protect themselves from scammers,” says MBIE Consumer Services National Manager Simon Gallagher.

“It’s important for people to ‘stop and check’ before handing over any money - take some time to think about whether the request for payment is genuine; Google the person or company; and talk to someone you trust to get their opinion.”

Taking proactive steps can stop scammers in their tracks and make consumers less of a target.

“Scammers are getting more sophisticated in their methods – it’s easy to be fooled, so don’t be embarrassed. Report it to CERT NZ as soon as you can. New Zealanders are trusting by nature, this is why we need to remember to stay vigilant when dealing with anything online that involves money or personal information,” says CERT NZ Director Rob Pope.

“We know that the majority of New Zealanders are good at not giving personal information to strangers or avoiding clicking links in unsolicited emails. Fraud Awareness Week is a good reminder to keep these habits.

“It’s also just as important to take proactive measures, such as creating long, strong, unique passwords and turning on two-factor authentication. This makes it much harder for scammers to get at your hard-earned money.”

MBIE Consumer Services National Manager Simon Gallagher says some people can be particularly vulnerable to scams.

“We are all feeling the rising costs of living, some have job uncertainty and the effects of COVID may have bought about feelings of loneliness and isolation; scammers prey on this.

“While the effort that goes on behind the scenes by the banks to protect consumers is vast, there are some simple things that consumers can implement to be the “hero of their own scam story”.

• Check your card security settings - Banks offer different types of security features which keep customers’ accounts and cards secure – e.g. setting daily maximum withdrawal limits; setting up alerts when a card is charged; and being able to lock / cancel a cards in seconds.
• Update your contact details at the bank - Banks have teams and systems in place looking for suspicious transactions and activity across customers’ accounts. Keeping contact details up to date means the bank can get in touch with a customer if they suspect suspicious activity. Remember, banks will never ask a customer to provide login details.
• Stop and check - Take some time to think about whether the request for payment is genuine; Google the person or company; Talk to someone you trust and get their opinion
• Talk to your bank about what protections are available

Be the hero of your own scam story; together we can stop these scammers. If you suspect you or someone you know is being scammed, report it to CERT NZ Reporting form for businesses and individuals | CERT NZ

Visit the Fraud Awareness Week 2022 page to find out more: Fraud Awareness Week 2022 | Consumer Protection

© Scoop Media