New Large Scale Financial Scam

Financial Scam

It often seems like every other day we hear about a new financial scam that uses the internet to take advantage of others. This is certainly true once again as a new financial scam out of Sri Lanka uses social media and the web to prey upon small business owners. This particular scam is unique because it leverages the role of a customer to prey on businesses that sell their goods online. 

Financial Scam Targets Online Retailers on Social Media

This particular scam starts out when scammers search for advertisers on social media. They would then contact the companies advertising products to pose as customers. During this process, they would agree to make a purchase before requesting the individual or company’s bank account numbers in order to make a payment. 

Once the scammers receive the bank account numbers, they would make a small deposit into the account. This is where the scam would begin to take root. The initial deposit was utilized in order to gain the trust of the vendor. However, once it was made, the scammer would contact the vendor online again, noting that the full payment could not be made, and request a one time password from their bank in order to pay in full. 

Some people would then share a one time password with the scammers, allowing them access to their bank account. Once they were able to access the bank account, they would transfer money from the vendor’s bank to their own bank account and withdraw it using an ATM. Before the vendor would realize it, they would have fallen victim to this financial scam. 

Financial Scam
Financial Scam

Financial Scam Uncovered

This one time password financial scam was ultimately uncovered when it was investigated by authorities. The Sri Lankan Criminal Investigations Department responded to reports of the thefts by victims, launching an investigation into this financial scam. 

Work from the Criminal Investigations Department revealed that a total of 80 bank accounts had been compromised as part of this financial scam, resulting in theft from many victims. The department noted that a lack of technical knowledge among victims was targeted by the criminals in order to make this scam work. Criminals were said to prey on people who did not possess the knowledge necessary to identify the warning signs of a scam. 

This particular investigation ultimately led to the arrests of several people in their late 20s in the towns of Madawachchiya and Kandy. The police further cautioned the public to be aware of potential signs of scams and to report falling victim to financial scams to the police. 

Financial Scam
Financial Scam

How Can You Stay Safe from Financial Scams?

When it comes to protecting yourself from financial scams, the best resource at your disposal is arming yourself with the knowledge to detect the warning signs of these scams. A common theme in these various scams is people trusting the scammers instead of being cautious. This is not surprising as criminals will frequently try to establish trust in order to take advantage of people. 

For example, this particular financial scam was interesting in that the criminals posed as potential customers to businesses, even going as far as making a partial payment for goods and services in order to establish that trust. This also took advantage of the tendency of businesses to want to serve their customers, perhaps making it easier for criminals to obtain bank account access and commit theft. 

A healthy dose of skepticism is urged when dealing with online transactions and interactions. People should be quick to raise a red flag when interacting with others, particularly on social media. Additionally, it is important to be suspicious of people attempting to make payments in unconventional manners. For example, if someone wants to place a wire transfer for goods or services rather than paying via normal mechanisms, this should be a cause for concern. 

Finally, it is important to never share login information or passwords with anyone online. This includes one time passwords. While these one time passwords are aimed at helping protect consumers, giving them away to others defeats their purpose. If anyone asks for a password – even a one time password – this should be treated as a potential scam. If there is any confusion about whether something may be a scam, contacting your bank or local police is the best course of action. 

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