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How to protect yourself from fraud and being scammed
Reading time: 16 minutes
Reading time: 16 minutes
When it comes to avoiding fraud and scams, knowledge is power.
Become a real-life superhero by arming yourself with the information you need to fight fraud and keep yourself, your family and your money safe.
Fraudsters are real. They are out there every day. They will target you online, over the phone, by mail or in person.
They will target anyone. Thousands of New Zealanders lose millions of dollars to fraudsters every year. All kinds of people are targeted, from teenagers to grandparents, uni students to senior corporate officers. The impact of fraud on families and businesses is devastating.
Report it! The best thing you can do is to report the fraud, whatever the amount, to the appropriate authorities. Don’t be embarrassed – you're helping prevent others being caught in the same trap.
About the author
Why are frauds and scams a problem?
Studies have shown 72% of New Zealanders have been the target of some kind of scam, either online or by telephone. Scams are increasing in number and sophistication – it’s big business. Instead of a hacker with a laptop, these are entire corporations with call centres dedicated to ripping us off.
Scammers are smart and unregulated. If one scam or tactic doesn’t work, they simply change the game plan or set new rules.
Who's most at risk?
Most of us can fall victim to a fraud, especially when we are going through something challenging. Some of you may have already been a victim of a scam and not even realised.
There are so many different types of scams, and they all target people in different ways. They are becoming more and more complex, so it can be hard to tell what’s real and what’s not.
Types of scams to watch for and tips to steer clear
Scammers aim to trick you into giving away personal or financial details so they can steal from you. Their offer typically sounds too good to be true, like an easy way to make money or win a big prize. They may ask you for personal details like logins, PINs or passwords. You may get an unexpected message with links, a QR code or attachments.
Scammers want to trick you into handing over personal or financial details so they can take your money. Their offer usually sounds too good to be true, like an easy way to make money or win a big prize. They might ask for your logins, PINs or passwords, or send an unexpected message with links, a QR code or attachments. They’ll make you feel rushed, and they’ll often want you to pay in an unusual way, like with gift cards or cryptocurrency. Some will even hand you a story to tell your payment provider about what the payment is for.
What you can do to stay safe
- Use strong passwords and turn on multi-factor authentication (MFA is an extra security check that proves it’s really you).
- Keep your personal and financial details to yourself, especially your logins, PINs and passwords.
- Take a moment with any unexpected email, text or social media message, and check it out before you act.
- Double-check who you’re talking to by calling the company back on a number from their official website.
- Stick to payment methods you know and trust, and think twice if someone asks you to pay with a gift card.
Scammers use fake ads, websites or profiles to take money from buyers and sellers. Their price is much lower than it should be, or a buyer offers more than your asking price without even seeing the item. Their website is missing things like contact details or a privacy policy, and the web address can look odd too.
They might ask you to pay in an unusual way, like with gift cards, cryptocurrency or an unexpected deposit. Or they’ll ask you to send them money, saying they overpaid you or that you need to cover shipping or a ‘history report’. Another red flag is when they want personal or financial details that have nothing to do with the sale.
What you can do to stay safe
- Use payment methods you trust, like a credit card, debit card or cash. With a bank transfer, double-check that the name on the account matches the person you’re paying.
- Research the person or business first, checking reviews and how long their account has been active.
- Buy from brands or people you already know and who have a good reputation.
- Finish your deal on the official website or app, and share your financial details there rather than through a link a buyer or seller sends you.
- Wait for the money to land in your account before you hand over the item. A screenshot isn’t proof that they’ve paid you.
Scammers use fake job ads and offers to get your money or personal details. The catch is that you have to spend your own money to do the job. They might promise to pay you back later, or ask you to move money for someone else. Or you have to pay a ‘recruitment fee’ or buy training guides before you can start.
They’ll want to chat on a messaging app rather than a real job website or email. Their ad promises easy money for very little work, often from home. And the hiring happens fast, with no real interview and no checks on your background or past work.
What you can do to stay safe
- Hold on to your money when you’re applying for a job, and think twice if someone asks you to transfer money for them.
- Watch out for fake ads, even on job websites you trust.
- Check the company or recruiter is real before you share your ID, driver licence or passport.
- Look into the employer yourself to find any warnings or complaints, and get in touch using official contact details from their website.
- Take your time to decide. A real job offer gives you room to think.
Scammers dangle fake opportunities that promise financial rewards, then push you to keep investing. What they’re really after is your money and your personal details.
Usually someone contacts you out of the blue with a ‘secret’ or ‘exclusive’ deal. They promise guaranteed returns or say the investment is low risk, and they push you to hurry because it’s a ‘limited-time offer’.
Details about them are vague or don’t quite add up, and they’re not based where they claim to be. They might ask you to pay using cryptocurrency, or an overseas or personal account. And it’s a major red flag when they tell you to lie to your bank or payment provider, or to switch to a different one.
What you can do to stay safe
- Ignore any investment message or offer you didn’t ask for.
- Watch out for any offer that says there’s ‘no risk’. Real investments are never a sure thing, so there’s always a chance you could lose money.
- Take your time to ask questions and do your own research before you decide.
- Look into the company or person yourself to find any warnings or complaints, and get in touch using official contact details from their website or the official register.
- Listen when your bank or payment provider says a transfer looks risky. Once money goes to a scammer, it’s almost impossible to get it back.
Scammers become your friend or romantic partner to win your trust, then take your money. It starts with someone you meet online building a strong connection with you. Once you feel close, they’ll ask you to invest money or buy cryptocurrency. Or they’ll have a sudden emergency and need cash. They might even ask you to move money for them or set up a new account they can use.
Often they’ll want you to keep the relationship secret from family and friends. And there always seems to be an excuse for why they can’t meet in person or show their face on a video call.
What you can do to stay safe
- Take things slowly, ask lots of questions and watch for anything that doesn’t add up.
- Stay on the app or website where you met, and think twice if they want to move the chat somewhere else.
- Search their name online along with the word ‘scam’, and stay cautious even if nothing turns up.
- Hold on to your money and keep your personal and financial details private with anyone you know only online.
- Ask a friend or family member you trust for their honest opinion about the relationship.
Scammers pretend to be an organisation you know and send fake messages to get your details. Their message turns up out of the blue, asks you to do something and pushes you to act fast, warning that something bad will happen if you don’t.
They might ask you to confirm your details, update your account or make a payment. Their email address looks a bit off and doesn’t match the real company, and their link or QR code takes you to an unfamiliar website rather than the official one.
What you can do to stay safe
- Check the message is real by contacting the organisation on a phone number from their official website.
- Take a moment with any unexpected email, text or social media message before you act on it.
- Keep your logins, PINs and passwords to yourself.
- Turn on MFA, and always read the MFA text or notification carefully before you approve it.
- Type web addresses straight into your browser, and only click links or scan QR codes when you know and trust the sender.
Scammers call you pretending to be from an organisation you trust, so they can get at your money. The caller asks for your login, PIN, password or security code, then pushes you to act fast to stop something bad happening. They might claim someone has hacked your account or used it for fraud.
Other red flags are when they ask you to download a program or let them take control of your computer or phone. They might tell you to move money to a ‘safe’ account, buy gift cards or set up cryptocurrency accounts.
What you can do to stay safe
- Keep your logins, PINs, passwords and security codes to yourself, even when the caller says they’re the police or your bank.
- Check the call is real. Hang up and call the company back on a phone number from their official website.
- Leave your money where it is when a caller tells you to move it, buy gift cards or set up cryptocurrency accounts.
- Turn on MFA, and always read the MFA text or notification carefully before you approve it.
- Hang up whenever you’re not sure the caller is who they say they are.
10 ways to keep you and your loved ones safe from fraud
We’re all at risk. Here are our top tips to avoid being scammed. Stop and think: Is this for real?
- Only click on links if you’re 100% certain they are legitimate. Always check the link by hovering over address with your mouse, and the return email address, too.
- Remember that banks and other companies will not ask for your passwords or personal details by email, text or phone. If you receive a request like this, delete it or hang up.
- Just hang up! Cold calls with investment offers are illegal in New Zealand.
- If you’re suspicious of any caller, hang up and call the official number of the organisation they say they represent to check if the call was genuine.
- If you’re not sure who you’re talking to, whether online, over the phone or at the door – end the conversation and look them up to confirm that they are who they say they are.
- Make your passwords unique and hard to guess. We recommend using a password manager.
- Never send money to anyone you don’t know or haven’t met in person.
- Be suspicious when the love interest you met online wants to use your bank account for receiving and forwarding money.
- Avoid giving personal details that could be used to impersonate you.
- If you think you are being scammed, stop all contact and don’t send further payments.
These are all red flags. Remember, legitimate companies or government agencies will never ask for your passwords.
Here are telltale signs you’re being targeted – watch out whenever you’re:
- Contacted out of the blue
- Asked for your password
- Asked to verify your account or details
- Asked for remote access to your device
- Being pressured to make a decision quickly
- Asked to pay in an unusual way.
Scammers' tactics
1
‘You’ll make a lot of money from this opportunity.’ (Ghost riches)
It’s important to remember – if it sounds too good to be true, it probably is.
2
‘You can trust me.’ (Source credibility)
Scammers are often very good at acting as a close friend – they can build a strong connection that may feel like friendship. Once they have gained your trust, unfortunately you’re in a more vulnerable position. This isn't to say ‘Don't trust strangers’, but instead, ‘Don’t trust strangers with your money or personal information’.
3
‘Everyone is doing it.’ (Social proof)
For many of us, if everyone is doing it we assume it must be good! This isn’t always the case. In many cases, the statement itself may not be truthful. A scammer will say whatever they can to convince you to hand over your personal information or your money.
4
‘Hurry, time is running out.’ (Scarcity)
The effect of this simple sentence can put us into a panicked mindset, making us more vulnerable to making a quick decision that doesn’t necessarily align with our goals. We might skip some of the research and the gut–feel.
If you don’t have time to research and ask questions, it might be best to let it go. Better to stay safe than to lose your money to a scam.
5
‘You’re getting a really good deal.’ (Comparison)
There are a number of sneaky ways to encourage you to buy more – marketing 101. One way is to emphasise how much of a good deal you’re getting. If you’re shown a similar product or service for a much higher price, the lower price begins to sound reasonable in comparison.
6
‘Do this for me as your friend.’ (Friendship)
We all want to support our friends, right? Always be careful about giving your friends money. If a friendship is formed based on an investment opportunity, it’s important to know your ‘friend’ well, and to protect yourself from financial or business harm as much as possible.
Fraud hurts documentary
Fraud Hurts is the first film to be made by two fraud-fighting agencies telling victims’ stories. Produced by CFFC in association with the Serious Fraud Office, it premiered at the International Fraud Film Festival on November 14, 2019, as part of a free public session to promote fraud awareness.
Where to go for help
There are a few places you can go, depending on the type of scam or fraud you're dealing with. Here are some of your options.
Help and information
Own Your Online is designed to help New Zealanders understand cyber security, learn why it’s important, and discover how to get protected online.
Own Your Online
ownyouronline.govt.nz
Report an incident
Age Concern New Zealand provides free confidential advice and support for older people and their families who have been scammed or financially abused.
They can also help you connect with social groups and activities near you. Contact one of the national network of 33 Age Concern branches.
Age Concern NZ
ageconcern.org.nz
The FMA has more information on how to spot scam warning signs and deal with problems. You can also find out if the investment provider is registered.
Financial Markets Authority
fma.govt.nz
0800 434 567
CERT NZ is your first port of call when you need to report a cyber security problem. They support businesses, organisations and individuals affected by cyber security incidents.
CERT
cert.govt.nz
0800 CERT NZ (0800 2378 69)
IDCare is Australia and NZ's national identity and cyber support service. They help individuals reduce the harm from compromise and misuse of their identity information.
ID Care
idcare.org
Report spam to DIA, so they can investigate and take action where necessary.
Department of Internal Affairs
dia.govt.nz
Text Mobile SPAM to 7726
Find out what to know and do when purchasing a product or service in NZ.
Consumer Protection
consumerprotection.govt.nz
0508 4 CONSUMER (0508 426 678)
How to recognise, avoid and take action against scams, protect personal information, and prevent identity theft both online and offline.
Scamwatch
consumerprotection.govt.nz/general-help/scamwatch or facebook.com/FraudInfo
More resources
The Little Black book of Frauds and Scams is a great resource - share it with your friends and loved ones to help prevent frauds and scams. Knowledge is power!
A money mule is someone who transfers illegally acquired money on behalf of a criminal – unknowingly or willingly.
Coping with the Aftermath of Fraud has some helpful tips to get through, if you or someone you know has been victim to fraud.
About the author
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