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Increased security across online, mobile and telephone-banking channels means fraud tactics are changing. Criminals are trying to trick individuals and businesses into personally transferring funds into unintended accounts.
Across the banking industry, the number of fraud cases where the account holder transferred funds to an unintended recipient grew 45% within the last year, according to industry body UK Finance.
This type of fraud is called authorised push payment fraud (APP) and it includes scams such as fake investments in cryptocurrency; email hacks and changes to banking details in emails and invoices. The number of these scams has been on the rise over the past few weeks, as fraudsters take advantage of the global Covid-19 emergency.
Take five seconds before you respond to any type of transaction request, to check that the beneficiary is genuine. Stopping to think about a payment is especially crucial in these trying times, where individuals feel under pressure to act quickly.
Six tips to protect yourself from push payment fraud
1. Use known or independently sourced telephone numbers
There has been an increase in Covid-19-related phishing emails in the hopes of gaining access to individuals’ inboxes. Once they are in, they can change the account details included in an email communication. If you are due to receive an invoice by email, contact the sender on a known or independently-sourced number before making a payment (not one contained in the body of an email). This way you can ensure you are paying to the correct bank details.
2. Beware of requests to move money to a safe account
Fraudsters have been calling individuals and impersonating the police, financial institutions, or even the World Health Organisation (WHO). The purpose of the calls is to obtain personal details about you, or convince you to move money to a ‘safe account’. Do not make a transfer before checking with your bank on a registered number, even if the caller tells you not to inform your bank.
3. Make use of trusted well-established financial institutions for investments
The recent drop in the South African Reserve Bank interest rate means investment opportunities may seem more attractive. Fraudsters know this. Reputable financial institutions will not contact you with unsolicited investment opportunities. Seek independent advice before making a decision on an investment, even if you’re told it’s only available for a short time.
4. Do not click email links
Be wary of unsolicited e-mails that appear to be from a ‘known’ organisation – many have been reported from the World Health Organisation (WHO) or Ministry of Health in the past weeks. Fraudsters will often replicate emails from these organisations and urge you to provide confidential, personal or financial information by clicking on a link or downloading a document. These can infect your device with malware, and personal information harvested can later be used to impersonate you.
5. Research online sellers
Shortages of medical and essential supplies in shops has led many consumers to shop online. This has also resulted in an increase of purchase scams, where fraudsters advertise goods they don’t have. After payment is made, they will disappear with the money and the items will never be shipped. Always conduct your own research into a seller before making a purchase, and avoid buying essentials from sellers you are not familiar with.
6. Verify the identity of a payee
No matter how well you think you know a payee, think twice before making a payment. Some fraudsters have been asking for donations while posing as charities pretending to assist with the Covid-19 emergency. Research a charity before making a payment, and call to confirm details on an independently-sourced number.