We had previously talked about 7 great tips you can use to identify legal and illegal moneylenders. Read it if you haven’t, as it might just save you from heaps of troubles.
We at Empire Global greatly enforce the rules stipulated by IPTO and our loan officers always advise our customers on the proper loan terms.
A reminder, legal and licensed moneylenders do not send out SMS marketing messages. If you ever received one, it MUST be from an illegal source. But unfortunately illegal moneylenders aren’t the only problems that borrowers face nowadays.
There are always unscrupulous businessman and scammers who constantly think of new ways to trick you off your hard-earned cash. These usually come in the form of financial scams that are carefully disguised as legitimate businesses deals or easy cash. Falling into any one of these could mean landing yourself in huge debt or seeing your savings wiped clean.
4 Common Types of Financial Scams
Now let me quickly take you through these 4 most common type of financial scams and how to identify them with a help of a great educational video.
Ponzi scams almost always lured victims with high short-term returns with low to zero risk, but things aren’t as good as it seems. Often victims will receive about 1-2 prompt returns on their investments (as advertised), but that’s as far as it goes.
The greatest Ponzi scam in Singapore was Sunshine Empire masking as a MLM business that promises extremely high returns. Lots of people around us at Empire Global had been duped by them.
Once the victims are convinced and hooked into investing more of their money, the scammer starts to disappear and becomes uncontactable.
Thus always remember the saying, “there is no free lunch in this world”. If the investment sounds too good to be true, or encountered such an attractive deal, do a research online (forums, news, government website) to prevent falling into such traps yourself.
Lottery winnings / Inheritance Financial Scams
These are one of the oldest scam out there. Typical a scammer will contact you about a huge windfall either through winning some lottery or inheritance.
These usually come in the form of an email/mail (usually very well written!), with proper letterheads, and promoting it as risk-free. This is to give you the perception that it comes from a legitimate source.
Once you bite onto the good news, they will then slowly bait you into transferring money as a “processing fee” or “handling fee” in order for them to transfer the winnings to you.
Phishing scams refers to scammers trying to impersonate as an existing legitimate business or government body to try to get your personal particulars or passwords etc.
Common ones are these online login website to your bank accounts. They develop a login website similar to those of the banks and trick you into keying in your personal data and passwords into the online form.
Hence, always ensure that the Bank login website that you are visiting is the correct and legit ones. Always check with the bank if you are unsure.
Illegal Moneylenders Scam
Today, we are also going to highlight another new financial scams scheme use by the illegal moneylenders in Singapore. If you think they only use SMS marketing to fake as legal licensed moneylender in their SMS message? You are wrong! They are more than just fake SMS marketing as licensed moneylenders.
In fact, there are even reported cases of scammers sending threatening SMS to their victims demanding for money that they have allegedly borrowed or payments that they have missed.
What really forces the victims to comply is the scammer ability to identify them by their names and NRIC number. Which is then followed by a threat to the victim’s family members.
Once successful, the scammer will then instruct the victim to pay the money within an hour or less to a bank account. This is to prevent them from having the time to go seek for advice or help from other inclusive of the Police.
However, since the rise of such cases, the Singapore Police Force came out with some guidelines highlighted below that can help you avoid such financial scams.
- Do not contact the senders of dubious messages or letters
- Do not response to unsolicited demand for loan payments
- Do not reveal your personal particulars such as Name, NRIC number, and address to unknown individuals
- And always report to the police when such incidents happen.
You may just save you your hard earned cash and the agony of dealing with such incidents.
Here we are also sharing an infographic about financial scams around the World! Arm yourself and your families with this knowledge and prevent these from happening to you!