Protect Your Wealth from Scammers
As Cyber Security Awareness Month approaches, it’s essential to focus on protecting your personal data and wealth from scammers. Cybercriminals are becoming increasingly sophisticated. It is difficult to watch television news or browse social media without seeing how these cunning perpetrators operate. The challenges of recovering from such scams are also widely reported, highlighting the importance of proactive cyber security measures.
Warning Signs: Five Ways Scammers Target Investors
Personal cyber security is your strongest defense against scammers and potential financial loss.
Scammers use advanced technology and social engineering tactics to create believable threats and opportunities. Here are five common financial scams to be aware of, along with tips to strengthen your cyber defenses:
1. Investment and Crypto
In 2023, Australians lost $1.3 billion to investment scams. These scams often begin with a low-risk, high-return offer, luring investors to make small initial investments. As they see ‘instant’ returns, they invest more, only to discover the platform is fraudulent when they try to withdraw funds. Victims typically take about six months to become suspicious.
Crypto scams, a subset of investment scams, are particularly hard to trace.
Your Defense: Avoid responding to unsolicited advertisements or cold calls. Never invest in products you don’t fully understand. Before investing, ensure the company is licensed with ASIC and independently verify their contact details. Avoid using links provided in their communications for verification.
2. Money Recovery
Victims of investment scams, particularly crypto scams, may have their details sold on the dark web, making them targets for money recovery scams. These scammers promise to recover lost investments for a fee but often use high-pressure tactics that can lead to further financial loss or even blackmail.
Your Defense: Be extra cautious if you’ve already been scammed. If anyone pressures you to transact, hang up immediately. While legitimate recovery services exist, always independently verify their contact details before engaging with them. Do not use links provided in their communications for verification.
3. Payment Redirection
Weak passwords can allow scammers to compromise email accounts, enabling them to alter invoices or payment instructions sent via email. Scammers redirect funds into their own accounts by intercepting payment instructions, often during high-stakes transactions like property settlements.
Your Defense: Always verify payment instructions by speaking directly to a known contact. Ensure that your payment is going to the correct provider of the goods or services you purchased. Never use contact details provided in an email, as they may belong to the scammer.
4. Remote Access
Scammers may pose as representatives from well-known organizations like telcos (such as Telstra, Optus), tech providers (like Microsoft, Google). They even pose as the Australian Federal Police. In these guises, they convince victims to download remote access software. Once installed, the scammer directs the victim to log into their internet banking account, gaining control of the device and initiating fraudulent transactions.
Your Defense: Never give remote access to your devices to someone who contacts you unexpectedly. The same rule applies to not sharing login details or authentication codes. These actions are the digital equivalent of handing over your passport or house keys.
5. Bank Impersonation
Scammers may impersonate a bank fraud analyst, using fear to coerce victims into resetting their online banking passwords and authorizing transactions. The victim believes they are canceling a fraudulent transaction, but they are enabling it.
Your Defense: Your bank will never ask you to transfer funds to protect you from fraud, share secure codes, or download remote access software. Always verify the details before authorizing any transaction. Use Multi-Factor Authentication (MFA), Two-Factor Authentication (2FA), or Authenticator Apps where available.
Protect Your Investments: Stay Cyber Aware
Staying vigilant and informed – cyber aware – about common scams is the first step in protecting your investments. Always independently verify information, avoid responding to unsolicited offers, and consult a trusted financial adviser if you’re unsure.
How Continuum Financial Planners Can Help
At Continuum Financial Planners, we stay alert to the latest scams and deceptive practices used by cybercriminals. While we are not cyber security specialists, we can help by:
- Verifying the validity of investment products.
- Protecting access to your personal investment data.
- Assisting in verifying the legitimacy of promoters.
As a sign of our commitment to providing helpful information, this is the second article in this calendar year that we have published on cyber security matters. You can read our earlier article here, ‘Cyber Alertness reduces financial risk.’
Before authorizing funds transfers or granting account access to an unsolicited entity:
- contact our office at 07-34213456 or
- use the Book A Meeting facility to arrange an appointment with your adviser.
(This article was first posted in September 2024. It will be refreshed/ updated from time to time.)
