For swindlers and the swindled alike, the promise of a quick windfall is akin to a siren’s song. Sadly, only one side gets to line their coffers after a scam is run. Here’s how you can avoid falling into their traps, no matter the situation.
In advertising, it’s much faster to appeal to viewers emotionally. Whether it’s the PUB’s tearjerker produced to celebrate Hari Raya or Patek Philippe’s famed Generations campaign, the way to a person’s wallet is clearly through their heart. Unfortunately, scammers have realised this many moons ago and are still actively relying on this technique for a quick windfall.
And despite the growing awareness of scams across the globe, swindlers are continually upskilling as well. In 2019 alone, 9,502 scams were reported in Singapore, making up more than a quarter of all crimes that year. Close to $170 million was lost in a variety of scams, from e-commerce to loans.
No matter what situation you’re in, your money – and dignity – are at risk. Here’s a full guide to scam-proof yourself, no matter if you’re on a trip around the world or just visiting your favourite online shopping platform.
1. How to avoid knock-off or counterfeit products
Knock-off products have been a longstanding problem on e-commerce platforms. These look authentic, so it’s almost impossible to tell that you’re purchasing a counterfeit product from the images alone. Although merchants are reviewed by users across the world wide web, do note that they can pay for these glowing – and false – testimonials.
On the other hand, there can be counterfeit products that are actually authentic. How this happens would be surplus products being made by a brand’s factory to compensate for potential defects. The factory is unable to sell these to official retailers, so they end up on e-commerce platforms instead. They are ‘fake’ on paper, but still a good deal.
2. Dodge the Customer Service Representative scam
This has the tendency to happen on Chinese e-commerce platform Taobao. If you’ve ordered something, you may occasionally receive a call from a ‘customer service representative’. They may pretend to represent the seller or have a story about how you will be getting a refund because the seller cannot send the item.
A large red flag is when you’re asked for bank account details or PIN numbers. You should never give out such information as it allows scammers to access your accounts. Note that most sellers will just refund you, so it’s highly improbable that they’ll go through a convoluted process of calling Taobao just to inform you.
3. Of skincare and cosmetics
Unless it’s from the brand’s official account or webstore, you might want to avoid purchasing skincare products or cosmetics. This is largely for safety, because if the product is fake, you might end up brushing something toxic on your skin or near your eyes.
The second reason is that, among all the things that can be faked, skincare and cosmetics are the easiest. In many cases, fraudulent products will use real containers. It’s simple to fill a used skin cream bottle with a fake product.
1. Be aware of ‘Per Weight’ scams, especially if you can’t read the menu
A common trick that unscrupulous restaurants use would be to charge by weight, but ‘forget’ to mention this to customers. You’re especially vulnerable if you’re a tourist who can’t read the menu. Also, if it seems too cheap to be true, there’s probably a ‘by weight’ clause hidden somewhere.
An example would be a menu that advertises S$18 for a fish dish, but sneaks in a ‘per 100g’ in a tiny, cramped, font. If the menu isn’t in a language you know, you have no chance of noticing it. The waiter will then conveniently claim the fish you ate was 1kg, leaving you S$180 poorer.
2. Say no to the super-slow ala carte buffet
The restaurant’s all-you-can eat buffet is right off the menu: order as much as you want and they’ll keep bringing it out. However, there’s often a time limit and restaurants know how to use it. When you pay for an a la carte buffet at less credible restaurants, expect the second or third order to come out at a snail’s pace.
By delaying the food, the restaurant is able to drag out the time, thus providing less food before the ‘buffet clock’ runs out. You’re more likely to encounter this if you travel with a tour group. They’re fond of doing tie-ups with travel agents, letting them conveniently charge a fixed sum per head.
3. Question the staff when items you never ordered are brought to you
Some restaurants will ply you with small appetisers before the meal. These can be bread, crackers, cheese, or small cuts of meat. Never assume that these are free. Always check if they’re charged to the bill, as some of these appetisers are prohibitively expensive.
You should know that appetisers are some of the most overpriced items on any restaurant’s menu. In the hands of a scammer, they can add several hundred dollars to a bill. If a restaurant insists that the appetiser is mandatory, that’s your cue to leave. Don’t worry about being rude, as you’re going to be ripped off.
1. ‘Zero-commission’ moneychangers
This scam is particularly prevalent in Eastern Europe, due to lax government regulations. With this scam, money changers advertise a 0% commission rate. You go in and change your money, thinking it will be cheaper – but when you check, you realise that you were charged 30 or 40% more for the currency exchange.
That’s when the money changer points out the added service charges (which are mostly made up, such as a convenience fee for being located in the hotel). If you demand your money back, things can get downright unpleasant; expect threats and verbal abuse. In some states, the police are even in cahoots with said money changer.
2. The ’fragile’ souvenirs scam
Most shops prefer if you don’t touch the merchandise, unless you’re sincerely planning to make a purchase. However, a scammer’s shop operates differently. Right as you walk in, the shopkeeper is shoving all sorts of things in your hands. Jewellery, plates, wooden knick-knacks, the works. You’ll be told how rare and valuable these things are, but it’s very much the opposite.
The items are designed to break easily in your hands and once that happens, the shopkeeper will feign outrage and demand you pay for them. This is accompanied by threats to call the police and the scammer may also enlist the help of ‘bystanders’ (really their accomplices) to pressure you.
3. Walk past street auctions
This is the updated version of an old scam, which is to sell stolen or pirated goods on the street. It’s increasingly common in Western European cities like London and Paris. During the street auction, there’s apparently fierce bidding for someone’s cast-off goods. These can include artwork, watches, tablets, smartphones, etc.
However, a large number of bidders are just accomplices. Their job is to drum up excitement and ramp up prices. If you join the bidding and ‘win’, you’ll soon find that whatever you bought is broken or some sort of knock-off. It’s best to avoid buying anything on the street. Stick to stores, where you can also get proper receipts.
Saving & investing
1. Is the product too good to be true?
A simple but useful rule of thumb: If it sounds too good to be true, it usually is. Outlandish claims and suspiciously high returns are always red flags, especially when there is no logical explanation underlying them.
If you’re unsure what counts as ‘too high’, look up the historic performance of similar products to get a feel of realistic returns. It may also be helpful to bear in mind that the S&P 500 averaged 6.8% p.a. in returns over the last 50 years, adjusted for inflation. Another instance where you should be suspicious is when there’s an omission of important details.
2. Check the MAS Investor Alert List
Bald-faced liars are committed to bending the truth, so it may not be enough to simply ask if the investment or representing entity is approved by the MAS. To make sure, run a quick check against the Investor Alert List. It lists companies and entities found to have been ‘wrongly perceived as being licensed or regulated’.
Do note that this list is not exhaustive, so not appearing on it doesn’t automatically mean the entity is 100% legit.
3. Don’t spring for free or low-cost algorithm trading
Algorithmic trading is real. This refers to computers running applications that track price movements, while buying and selling according to programmed parameters. Large banks and funds use them all the time. Needless to say, the workings behind such algorithms are top-secret. They are money making machines which cost millions to develop or buy.
But you can get one for free or cheap off the Internet! Just run it on your computer and it will trade for you. This gives you the same advantage that financial institutions fork out tons of money for! Obviously, it doesn’t work. Free or low-cost algorithms do have fees: the scammers that give them to you want a small cut of any winning trade. It’s akin to allowing someone to gamble with your hard-earned money.
1. Buy truffle salt instead of truffle oil
Real truffles are expensive, so truffle oils have a high price point. A 40ml bottle of the stuff can cost you $16, going up to $39 for a 500ml canister. In case you’re counting, that’s between 8 cents and 40 cents per ml. The problem is that truffle oils do not contain any truffles whatsoever. Instead, they are edible oils (such as olive or grapeseed) flavoured with 2,4-dithiapentane.
If you can’t bear the thought of giving up your weekly serving of truffle scrambled eggs, try using truffle salt instead. Unlike the oil, truffle salt is made with salt and real truffle pieces, so you’ll be getting the real deal, both in flavour and content.
2. Don’t be fooled by social media impersonation scams
Social media impersonation involves a fraudster mimicking or outright hijacking the social media account of one of your contacts. They might contact you with a seemingly innocent request, which later turns out to be a scam.
A typical case goes like this: You receive a message in one of your social media accounts from an individual thought to be your friend. He/she then asks for a small favour, usually involving some sort of password or verification, such as a One-time Password (OTP) or gift card code.
The info you provide is then used to illegally gain access to your banking account or digital wallet (such as GrabPay) to make purchases and payments.
3. Don’t join MLM programmes disguised as fitness clubs
You may have been approached to join ‘free’ clubs that promise to be a community to help all members lose weight. One company is well known for doing this in Singapore. What you need to understand about these clubs is that, while they’re free, they have products that are not. Often, the clubs are an attempt to recruit you for a Multi-Level-Marketing (MLM) programme.
You will then be asked to buy and resell supplements, supposedly in a way that also makes you some money. Don’t get pressured into buying or taking part. If you join the club, you’ll be hemmed in by dozens of people who try to persuade you to sign-up. You’re better off working out on your own.
As you can tell by now, scams are aplenty. Due to the ever-evolving nature of fraud, it’s impossible to list down every scenario where a scammer will attempt to lay his hands on your money. It’s important to think before you act and rationalise whether a promotion or deal is too good to be true.
And if you’re really unsure whether an offer - or threat - is genuine, seek a second opinion from your family and friends. Chances are that if it ends up being a scam, they would’ve heard of it and allow you to make a more informed decision. It’s high time that scams are stamped out and fraudsters forced to return to making an honest living for once.
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