How to spot and avoid banking scams: fake threats and extortion explained

There has been a significant rise in extortion, email, and text scams (phishing) targeting banking customers, resulting in considerable financial and emotional distress for thousands in recent months.

The growing sophistication of these schemes, with fraudsters continually adapting their tactics to deceive individuals into sharing sensitive information. In some cases, victims are even coerced into transferring money into the fraudsters' accounts.

Here are common tactics used by scammers in recent months and ways to protect yourself:

Fake non-compliance notifications

Fraudsters are exploiting the bank’s need for compliance with the Financial Intelligence Centre Act (FICA).  They are purporting to be the bank, sending our customers emails and SMSs, claiming that their accounts are not FICA compliant.

Their emails and SMSs include malicious links, urging customers to click on them or risk their accounts being blocked or closed.

Upon clicking on the link, customers may be routed to a fake login site or prompted to capture sensitive information such as their card number, expiry date, customer verification value (CVV), or One-Time-Pin (OTP). In some instances, the link may disrupt the customer's device, giving the fraudsters remote access and total control.

Extortion scams

Extortion scams often involve threats to harm individuals, expose sensitive personal information about them, or tarnish their reputations unless a ransom is paid. We’re increasingly seeing fraudsters impersonate respected bodies such as the South African Reserve Bank (SARB), Sars, or the SAPS. They claim to be investigating customers for serious offences, anything from fraud to money laundering.

In some schemes, victims are given a fake account number and instructed to transfer all their funds for the duration of the “investigation.” In others, the criminals allege they possess compromising material such as private photographs, financial records, or other personal details, and demand payment in exchange for keeping it confidential.

These fraudsters go to extreme lengths to convince the targeted individual that they are from legitimate authorities. This includes telephone calls, emails, and documents and they sometimes suggest physical meetings.

The internet has become a prime hunting ground for fraudsters. Customers need to be wary of the information they share on social media platforms as cybercriminals are becoming increasingly sophisticated in their orchestration.

What to do if you are targeted

• Stay calm, do not panic. Fraudsters often use fear to manipulate victims. Take time to verify the legitimacy of the claims.
• Never send money or click on a link in response to unsolicited messages. Legitimate organizations, including banks, will never ask for payments or sensitive information this way.
• If you believe your bank account may be compromised, contact your bank's fraud department right away. They can help you secure your account and investigate the issue.
• Regularly review your bank and credit card statements and report any suspicious activity.

Standard Bank encourages its customers to stay informed on the latest scams, and adopt and enable features on their banking app to help protect themselves.

Khan is the head of fraud risk management at Standard Bank.

PERSONAL FINANCE