Financial scams are becoming more prevalent, with scammers using increasingly sophisticated tactics to steal money and personal information. In Australia alone, nearly $135 million has been lost to scams so far in 2024, with over 143,000 scams reported. By staying alert and cautious, you can better protect yourself from these risks, safeguard your finances, and ensure that your personal details don't end up in the wrong hands.

What is a financial scam?

A financial scam aims to trick people into giving away their money or personal information. Scammers use a variety of methods to gain access to your money and personal data, including: 

• Fake websites that look identical to legitimate ones, often copying logos, layouts and content. For example, a website that looks like your bank’s official website, asking you to log in so scammers can steal your account information.
• Phishing emails that look like they're from a trusted source, asking you to verify your account details or click on a link which leads to a fake website where scammers capture your login details.
• Phone calls from scammers pretending to be from your bank or a financial institution, asking for personal information such as your account number or PIN.
• Known as "smishing," scammers send fraudulent text messages pretending to be from legitimate companies. They may ask you to click a link or reply with sensitive information.
• Social media platforms like Facebook or Instagram are increasingly being used by scammers who pose as someone you know or a trusted company. They might offer "exclusive deals" or pretend to help you recover a lost account, but they’re really trying to steal your information.

What should you look out for?

Scammers use a range of tactics to target and prey on people in order to gain their money or personal information. Here are some examples of scams reported in Australia:

• Romance scams prey on vulnerable people through online dating platforms or social media. Scammers invest time in building a relationship, gaining your trust, and making you believe the connection is real. They may ask for money for an emergency or travel expenses to meet you, and once you send them the money, they disappear.
• Investment scams that lure people in with promises of high returns or guaranteed profits, often in a short period. Once you invest in the "too-good-to-be-true" scheme, often in areas like cryptocurrency, forex trading or real estate, the scammer vanishes along with your money.
• Product and service scams where scammers pose as legitimate businesses, offering goods or services that don’t exist or never arrive once you’ve paid for them.
• Threats and extortion scams make you feel like you need to act quickly to avoid serious consequences such as an outstanding tax bill that could lead to your arrest.
• Jobs and employment scams promise high-paying jobs or easy ways to make money but usually require an up-front payment.
• Unexpected money scams trick you into thinking you’ve won the lottery or a competition you can claim once you send an up-front payment or personal details.
• Impersonation scams use AI to mimic the voice or video of someone you know and trust asking for money. Often these scams have a real sense of urgency, such as a car accident or an emergency medical treatment.

What can you do to protect yourself?

If you think you’ve been scammed, report the scam to Scamwatch or your local police. And protect yourself from financial scams by:

• Using unique, strong passwords for all accounts, and a password manager to store and generate passwords for you.
• Regularly checking your accounts for suspicious activity and setting up automatic alerts to help detect fraudulent activity.
• Checking your credit report for unfamiliar debt or unrecognised accounts and then reporting these to the credit reporting agency.
• Shredding sensitive documents that could be used for identity theft.
• Being cautious online by using secure internet connections and avoiding public Wi-Fi.
• Before investing, sending money or accepting anything that sounds too good to be true, thoroughly researching, verifying and consulting to ensure the request is legitimate.
• Resisting pressure to act immediately without having time to review the information.

For more financial advice tailored to your unique situation, contact Mortgage Express today and connect with a finance consultant near you.

While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken by Finservice Pty Ltd (Mortgage Express) for any errors or omissions. This publication does not constitute personalised financial advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication. A Disclosure Statement is available on request and free of charge.

Finservice Pty Ltd (Mortgage Express) is authorised as a corporate credit representative (Corporate Credit Representative Number 397386) to engage in credit activities on behalf of BLSSA Pty Ltd (Australian Credit Licence number 391237) ACN 123 600 000 | Full member of MFAA | Member of Australian Financial Complaints Authority (AFCA) | Member of Choice Aggregation Services.