Scams have been existent since the mid 1990s and scammers have evolved with new tricks being invented day and night. There has been a rise in the sophistication of scammers trapping victims into bogus schemes that rake scammers millions of dollars annually. A new report estimates that scammers raked in more than $11.7 million in 2016.For the first time, a South African based company has collated its scam data with the help of South African Cyber crime detection and reporting agencies to give a clearer picture of just how much South Africans are being ripped off.One of the report author told your blogger that the combined data showed investment scams mainly in Johannesburg, Durban and Cape Town caused $7.5 million in losses, with $7.1 million lost by victims over the age of 50. “Johannesburg investment scams come in many different guises including business ventures, superannuation schemes, managed funds and the sale or purchase of shares or property,” he told your blogger. “One of the reasons is South Africa has been in a low interest rate environment for quite some period now compared to other African countries, and retirees or those approaching retirement are really concerned about how they can grow their retirement fund, so we think that may be making them more vulnerable to scams. “We also think that scammers target countries like South Africa, they’re aware of our superannuation schemes, they realise people have money to invest later in life and that the rainbow country is wealthy by far compared to any other African country.”In Durban and Cape Town, dating and romance scams are still causing big headaches for victims and authorities, with $4 million lost in 2016 according to the real time data collected by various research companies and reporting, detection agencies. In the two cities, scammers using dating sites to attract their victims are often referred to as “kukufishers”. The author said dating and romance scams, combined with investment scams, accounted for more than half of the money lost by people in the over-50 age group. “Over fifty per cent of the scam losses last year were to people over the age of 50,” report author said.
Most of the dating and romance scams are being run out of South Africa with Nigeria being the hub for scammers followed by Ghana, while it is believed most investment scams are being run from within South Africa. “There have been occasions where they’ve been operated from South Africa but on the whole they seem to be based outside South Africa with Ghana and Nigeria being the main destinations,” report author added.The average amount lost to scammers is $1,000, with 17 people being scammed more than $100,000 in first six months of 2016.Fifty per cent of victims were contacted by scammers over the phone, while 41 per cent were contacted via email. In one of the documented case in the report, a small business owner in Port Elizabeth, was scammed when she was sent a fake invoice by a scammer to pay for clearing container at the port of Durban.In the report, the victim is quoted as saying, “When I went back to my computer everything was black, and it always had normally white background, and there was writing behind all the icons and it said ‘you have been held to ransom, you need to pay $1500 US dollars and we will restore all your files, pictures and that was it really.” The computer also held business files and precious photos of the business lady romantic images and her holiday with boyfriend. After trying to get help from a local IT company, the computer was still locked. Her boyfriend who lives in Durban, has a cousin who is a computer science graduate who traveled from Cape Town to Durban but unsuccessfully spent seven hours trying to unlock the computer. After the failure, the three agreed best option was to pay the money and when she eventually paid the money, her computer was unlocked 5 minutes later. She made the payments via local crypto currency as demanded by scammers. The report also quotes her saying, “I thought well I’d rather just spend a bit over $1500 to get it back than do nothing at all, and I think because it’s such a low amount compared to the loss of data in the computer, most South Africans would do the same. I think if they’d said $5,000 South Africans would say well go to hell with it.” Reading the report opened my eyes on the future outlook of cyber criminals operating in Africa who fall in two categories of low gain scammers or high volume scammers. The former focuses on hundreds and high volume focuses on investment and dating scams.My advise would be for people to use spam filters and be cautious when opening emails, especially if there are attachments, and also ensuring you are using a reputable, up-to-date security product is important. Back up data and always set a strong, unique password.I can’t also forget to emphasise how important updated operating system and applications are. Its important to run a regular scan of your devices or computer. No one is secure from sophisticated criminals but prevention is better than cure.