Common scams to watch out for

We all like to believe we're invincible and impervious to a scam. Unfortunately, people all across the country are still getting scammed out of their hard-earned money every day.

Scammers and other con artists are constantly coming up with new malicious ways to deceive us. So it's crucial to understand how these scams work. If you can recognise the signs of a scam, you'll be in a much better position to avoid it and protect your assets and identity!

While this list is in no way comprehensive, these are the four most common scams to watch out for according to scamwatch.

1. Investor scams

What is an investor scam?

Australians lose more money to investment scams each year than any other type of scam. It is often dressed up as a money-making opportunity that's too good to be true.

Scammers will use marketing and technology to make their investment sound like a low risk/high reward opportunity you don't want to pass up. They may also use pressure tactics or language that makes you want to act fast. Some examples of investor scams include the use of crypto, celebrity endorsements, and ponzi schemes.

What do you need to look out for?

Some indicators it might be a scam include:

• stories or ads claiming a famous person supports a money-making plan
• an online contact (like a friend or romantic interest) that you haven't met in person wants to t alk about investing with you
• emails, websites, or ads that promise big profits with flashy testimonials
• high-pressure to make a quick decision so you won't 'miss out'
• people in 'adviser' positions without an Australian Financial Services (AFS) license
• requests to promote the offer to your friends and family for commission.

How can you protect yourself from investment scams?

Stop and think before you act

These scams will most likely have a time limit, or some kind of pressure that will make you want to act fast. 

Get independent advice

Before investing in anything, get independent legal or financial advice from a trusted financial advisor registered with ASIC.

Do your due dilligence

Make sure you know who you're dealing with. Check the company is real, publicly listed, and hasn't been alerted to as a potential scam by the International Organization of Securities Commission (IOSCO). Also check that the person you're dealing with works for the organisation they say they're from too.

2. Dating and romance scams

What is a romance scam?

This might seem a little far-fetched, but dating and romance scams are all too prevalent. These work by the scammer first creating a fake identity online, either using social media, dating apps, or even gaming apps and websites.

The con artist will then leverage this fake profile to try and enter into a relationship with the victim, in an attempt to get their money.

What do you need to look out for?

If you're talking to someone new online, watch out for these common signs of a scammer:

• They 'love bomb' you very quickly, and express strong feelings in a very short period of time.
• They try to move your conversation to a new platform - for example, off a dating app and onto Whatsapp.
• A scammer might encourage secrecy about your relationship, in an attempt to isolate you from your family and friends, so you only trust them.
• Constant excuses as to why they can't meet in person, or talk on camera.
• They have a sudden 'emergency' that they need financial help with, like a physical injury or illness, travel costs, or a family emergency. 

How can you protect yourself from romance scams?

Never send money to people you haven't met

If you're online connection asks for money, stop all contact right away. Do not send money, or any personal or financial details. Never agree to transfer money on their behalf - this could be considered money laundering and is a criminal offence.

Check the person is who they say they are

Ask a lot of questions and watch out for things that don't make sense. You can spot a fake profile with photos that look too professional, a profile with very little information and very few comments, likes or shares from other people.

Be careful what you do and don't share

Never send intimate images of yourself to people you've never met - these can be used as blackmail. And don't keep your relationship a secret, tell your friends and family who you are talking to, they might be able to spot the signs before you do.

3. Threat and penalty scams

What is a threat or extortion scam? 

These types of scams revolve around a person pretending to be from an organisation claiming you owe money, when in fact you don't. Sometimes this will include blackmail, a threat of arrest, or deportation for failure to pay.

What do you need to look out for?

Here are some indicators you might be dealing with a scam:

• You receive an unexpected call, text or email from someone claiming to be from a government department or debt collection agency.
• They will threaten legal action or arrest if you don't comply.
• The person may ask for personal information or bank details. '

How can you protect yourself from threat or penalty scams?

Stay calm

Never feel pressured if someone claims you owe money. Always connect the dots and try to recall if you have any connection to the alleged missed payment or fine.

Contact the organisation directly

Follow-up with the alleged business threatening you and request documentation of any claims. If the threat was made via email, don't open any documents attached to it.

4. Unexpected money scams

What is an unexpected money scam?

You might know this as the Nigerian Prince Scam. An unexpected money scam might involve someone contacting you to let you know you're entitled to winnings, or an inheritance that y ou didn't know about. 

The scammer will ask you to pay an upfront fee to transfer the funds, but their money never comes and you lose yours. An example of this scam you might be familiar with is the Nigerian Prince Scam. 

What do you need to look out for?

These typically involve the following steps:

• You receive an unexpected email, text or any kind of correspondence saying you are entitled to money in the form of a prize, compensation, or inheritance.
• You're asked to pay taxes or an administration fee upfront to receive your money or prize.
• You're being offered prize money for a competition you didn't enter.

How can you protect yourself from unexpected money scams?

If it sounds too good to be true, it probably is

As fortunate as it may seem, the chances that a large sum of money unexpectedly falls into your lap are beyond astronomical.

Don't pay a fee to collect a payment

Be extremely wary of anyone trying to give you money, especially if they need you to send them money first. Legitimate lotteries won't ask you to do this, nor will government departments or trusted companies.

We're here to help

Our dedicated Fraud and Scam Operations team helps protect customers against fraud and scams or recover funds if customers happen to fall victim. 

Visit our fraud and scams assistance page to find out what we can do to help you or your loved ones.

BOQ fraud and scams assistance page.