How to recognize online scams and avoid online scams? What types of scams exist and how to prevent them? Become more aware and protect your money and personal data!

To the attention of the citizens of Sri Lanka! Your personal financial security could be at risk! Our financial security directly depends on the decisions we make every day. An ill-considered choice of a financial service provider, inattentive reading of the terms of contracts, lack of financial discipline and, as a result, failure to fulfill their obligations and an unpleasant financial situation.

Financial fraud is associated with the commission of illegal actions in the field of monetary circulation through deceit, breach of trust and other manipulations for the purpose of illegal enrichment.

Several types of fraud will be considered in the material: fraud using bank cards, Internet fraud, mobile fraud, credit for the sale of medical services, financial pyramids.

Today, a bank card is a convenient tool for everyday payments. There are many ways to deceive people and steal money from their bank cards: from peeping over the shoulder during ATM operations and the subsequent theft of the card to hacker attacks on software.

In everyday life, there are types of fraud that we can avoid negative consequences by following simple security measures aimed at preventing such consequences from occurring.

The main methods used by attackers

The main methods used by attackers are:

  • Skimming or installing special devices on ATMs, with the help of which criminals obtain information about the card. It can be an overlay keyboard, a card reader, etc. There are manual skimmers, with the help of which store fraud is committed. This happens at the time of payment for a purchase or service. With such a manual skimmer, your card data can be read and recorded.
  • Trapping is the installation of a device on an ATM that blocks the card and does not issue it back, and a “kind” passer-by, allegedly trying to help, peeps the pin code and, after you leave, takes the card from the ATM and withdraws money from it. Trapping is a fraudulent scheme where scammers use fake or misleading advertisements to trick people into providing personal or financial information or performing actions that benefit the scammers.
  • Phishing - sending e-mails in which, on behalf of the bank, it is reported about changes made in its security system. At the same time, users are asked to renew information about the card, including specifying the credit card number and its PIN code.
  • Fraud by phone - when a client receives calls with a request to repay a debt on a loan that the client did not take, and during the conversation the card details are specified. According to a similar scheme, an “answering machine” can call and collect the data necessary for fraud.

Thus, by proving to some alleged credit organization your non-involvement in credit obligations, which are reported to you by a representative of this organization, you thereby voluntarily provide fraudsters with information about your card.

What recommendations exist to avoid the possibility of theft of funds from a bank card?

What recommendations exist to avoid the possibility of theft of funds from a bank card?

First of all, if possible, still use ATMs installed directly on the territory of Bank branches.

When using an ATM, carefully inspect the surface above the PIN-keyboard and the device for accepting a card for foreign attached objects.

  • Close the keypad with your hand when entering a PIN
  • Do not share your bank card with strangers: its details can be used for other people's purchases
  • Require that transactions with the card be carried out only in person, not allowing the card to be taken out of sight
  • Never share your PIN or SMS code with anyone

Secondly, always pay attention to calls to your phone. They may call you about some non-existent loan and find out your personal data. Either you already have a loan that is issued by a credit company or a bank and they tell you that you have a problem with your loan and scammers in a conversation with you find out the card number and pin code. Or they send you an SMS to your phone and ask for the final resolution of the situation to open the text of this SMS and tell them the contents. You inform them and at the same time money is debited from your card.

Remember: Banks and payment systems never send letters or call their customers' phones with a request to provide them with account details.

Recommendations for the safe use of bank cards:

  • Give the bank up-to-date contact details (the bank never asks for a PIN code).
  • Connect the SMS notification service, having with you the phone of the bank's card holders' round-the-clock support service, and you will ensure effective prevention of the risk of unauthorized transactions on your card. (in case of any suspicious situations, including blocking by an ATM, or loss of a card or a phone to which it is linked, immediately dial the Bank's support service and block your card) if the ATM does not return the card, do not leave the place of the financial transaction until the moment it was blocked.
  • Keep the PIN code separate from the card and do not write it on the card, do not tell anyone. If it is lost or stolen, immediately block the card

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Protect yourself also from the unpleasant consequences of your own inattention:

  • Pay the loan on time and do not exceed the credit limit - this will ensure an excellent credit history and save you from fines
  • Don't lose your card - reissuing may cost extra
  • Don't charge your card completely - leave some money to pay for fees or automatic payments
  • In case of a change of job, contact the bank and check the rates that are relevant for you
  • When using the card abroad, be aware of exchange rate differences to avoid an unwanted "technical overdraft"

Technical overdraft

Today, many people own credit cards, which make it possible to use a certain limit of funds set by the bank. As a rule, the bank communicates to customers information about the rules for using such cards, and everyone knows how and what needs to be done so that unforeseen debts do not appear on the card. But the owners of debit cards are usually sure that they have a credit debt is basically impossible, because only the client's own funds are credited to such cards, which he uses. However, this opinion is erroneous.

Even on a salary or pension card, a debt can arise, which is called a technical overdraft. Although, for such cards no limit is set. In essence, a technical overdraft on a debit card is an unauthorized debt arising solely for technical reasons. And it must be extinguished in the next month.

A technical overdraft may negatively affect the credit history of the cardholder, therefore, it should be a rule to check the account status after each transaction made at an ATM or store.

Some banks have a practice of setting the amount of a possible technical overdraft for the card, so that customers can pay for the purchase even if they do not have enough own funds. In this case, the overdraft is repaid automatically when money is credited to the card. This is usually practiced for salary and pension cards serviced by the bank.

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Why is a technical overdraft dangerous?

The most unpleasant consequence of a technical overdraft is an increase in several times the interest for using the card. They are the most significant in the line of loan products offered by banks.

At the same time, the client may not even guess that he has a credit card debt, and at this time it is growing literally every day. The owner of a debit card often cannot even imagine that he automatically got a loan. And when it becomes known to him, the amount of accrued interest may already be somewhat more than the amount of an unauthorized technical overdraft.

The debt that has arisen is mandatory for repayment, therefore, even when writing an application, one should not hope that the bank will meet halfway. Tariffs are clearly specified in the contract for opening a card account, therefore, it is impossible to refuse to pay the debt. Here it is not superfluous to recall once again the golden rule that prohibits signing a document without carefully studying its content.

To protect yourself from a technical overdraft on your debit card, you should:

  • withdraw money "at zero" only at the ATM of your bank in order to minimize the number of commissions.
  • Always leave a certain "margin" in the account, enough to cover small commissions and prevent a negative balance on the card.
  • Don't try to redo an operation if the program crashes while performing it. To make sure that the payment was not made, you can call the bank's 24-hour hotline.

By following these simple rules, each debit card holder will protect himself from an unauthorized technical overdraft and the unpleasant consequences associated with it in the form of paying unforeseen debts, worsening credit history, etc.

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Internet Fraud

Fraud on the Internet includes all existing types of deception invented by mankind throughout the history of its existence. Most often, troubles can await us in the following cases:

  • Online purchases (especially prepaid and unreasonably low prices)
  • When compiling all sorts of "free" horoscopes
  • When receiving SMS from supposedly payment systems. In fact, a virus is often waiting for you, the task of which is to collect data about your accounts in payment systems, bank card data that you enter on your computer.

How to protect yourself from online fraud:

  • Don't open payment system websites via a link (for example, in emails), check which URL is in the address bar.
  • Make online purchases with a separate bank card and only on trusted sites(consumers who make frequent online purchases should make it a rule to have a separate card for such purchases.
  • Never share your passwords with anyone. You can and should enter passwords only on the websites of payment processors.
  • If you are offered remote work and are asked to pay a fee as a guarantee for data forwarding, etc., do not fall into this trap.
  • Delete letters about problems with your account in any payment system that require you to go to the site and take any action from you.
  • In 99% of the cases, payments you make online cannot be reversed. Therefore, take your time, think before you pay for a product or service.

According to international statistics, the total losses of telecom operators and subscribers from mobile fraud annually amount to approximately $25 billion. There are a lot of options, but there are not so many main types: “You won a prize ...”, “Mom, I had an accident”, “Card blocking”, sending viruses that helps attackers get close to a bank card tied to a mobile phone, and transfer all the money to your account.

Ways to protect yourself from online fraud:

  • Do not reply to SMS or open MMS from unknown parties, including greeting messages and cards
  • If you receive messages from banks, mobile operators about problems with your account, call the bank number you know and clarify the information
  • Do not send SMS to short numbers without knowing the cost of such a message in advance
  • Never give out any personal data, even if they call you and pretend to be an employee of a bank, police, mobile operators, etc. Ask to introduce yourself, name your full name, title, position, ask what address the branch, office has, specify the name of the organization. Then find out the phone number of this organization and call back
  • You may be called and told that your relative or acquaintance had an accident, the police, the hospital - do not believe it! Call your relative
  • Never store valuable information only on your phone, duplicate it in a paper notebook or computer

Financial pyramid - financial fraud

Another scheme of financial fraud Financial pyramid. Most often, it works according to the following principle: the organizers of the pyramid collect money from investors (they sell pyramid securities), but do not invest this money in the economy, but keep it for themselves. They announce an increase in the price of their securities, and when the old depositors want to withdraw their money with interest, they are paid with the money of the new depositors.

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Pyramids usually promise ultra-high returns: 200-300% per year. Since at first the number of investors is growing all the time, the organizers of the pyramid can maintain its solvency for some time.

The danger of the pyramid is that sooner or later it will collapse. Too many investors will want to sell their securities at the same time. The organizers will realize that they won’t be able to pay everyone, they will suspend payments, and then disappear with the rest of the money.

How to recognize a pyramid?

Firstly, do not fall for the aggressive advertising of "easy and fast money", guaranteed profitability above the bank deposit rate is a reason to think about the appropriateness of such investments.

When concluding the Deposit Agreement between the Bank and the Client, the amount of the interest rate in force in the Bank on the date of acceptance from the Client of the Application for accession to the Conditions for attracting funds to the deposit by the Bank is established. Interest rates are set daily. It depends on the amount of the deposit and the period and on the conditions of the deposit, for example, without the possibility of early withdrawal and replenishment. Typically, the lowest interest rate is on a savings account.

Secondly, pay attention to the following signs that can characterize an organization as a "financial pyramid":

  • You are encouraged to think fast and invest quickly
  • They explain high profitability to you by opaque super-profitable projects, while not disclosing information about potential risks. Projects are usually located in another country, which makes it difficult to find out the current state of affairs
  • The organizers hide information about themselves, about the availability of licenses to conduct relevant activities and act through intermediaries. Often such companies are registered in Russia, and therefore your agreement does not protect your rights as a depositor.
  • You are promised high rewards for bringing friends, acquaintances or relatives. They offer to build a system to attract customers and earn on it. Aggressively advertise their services

Thirdly, try to make informed financial decisions, do not give in to the emotions of greed and fear.

Before giving money away:

  • Check whether you have a license from the Central Bank to conduct activities (banking, insurance, investment).
  • Carefully study the contract for the terms of investment and return of funds.
  • Search the Internet for information about this organization, its history, customer reviews, ratings in the relevant industry.

If money has already been invested in dubious projects, try to withdraw not only the profit, but also the main investments as quickly as possible. Don't wait for the pyramid to collapse, and don't try to make up for losses by investing new funds.