Tag: fraud

A new fake online shop is scamming South Africans out of money by claiming to sell stolen goods recovered from the looters who ransacked stores in July’s unrest. This is according to a recent report by MyBroadband.

  • Bulksales.store was brought to the attention of MyBroadband after one of our forum members asked whether it was a scam site
  • It has one Hellopeter rating was available — a negative review from a customer claiming to have lost money and stating that the store was a scam
  • The site looks clean, with a professional-looking design
  • It carries huge discounts on premium tech products, which included products like an Xbox Series X selling for R6,000, a discount of 50% from its normal price R12,000
  • The site claims that it was selling the items “so that all looted store (sic) can get their insurance payouts”
  • Major retailers like Game, Makro, Incredible Connection, HiFi Corp, Matrix and iStore were shown on the page, implying that the recovered loot was originally from these stores, but such stores deny they are reselling stolen goods
  • Contact Us section had a warehouse address which was actually an office space
  • No contact number available, only an email address
  • Plagiarised Terms and Conditions copied largely (83%) from a business-to-business marketplace called Lantador
  • Suspicious Return/Refund section was generated using a generator tool
  • Expensive courier options with a R1,800 Express option.
  • Unusually long delivery times ranging from 3 (Express) to 31 days (Standard)
  • The support phone number was listed on Truecaller as “Scam”

By Londiwe Buthelezi for News24

With Covid-19 waging a brutal war on human life, 2020 became one of the toughest years for insurers as death claims surged to levels not seen in recent history.

Insurers paid R522.7-billion to policyholders and beneficiaries in 2020 after fielding almost half a million (434 216) legitimate death claims.

But the industry had to deal with another epidemic: fraudulent claims which sought to fleece the industry R587.3 million.

Those providing funeral insurance were the hardest hit as 2 282 of the reported 3 186 cases of fraudulent claims related to funeral cover.

From a desperate family that laid a dead body on the road so that it can claim accidental cover to syndicates who buy dead bodies or prey on drug addicts, fraudsters had plenty of tricks up their sleeves.

The insurance industry’s representative body, the Association for Savings and Investment South Africa (Asisa), said it was not surprised. Even before the desperation brought by Covid-19 as people lost incomes and some stayed with bodies they didn’t know how they’d bury, insurance fraud was rife in SA. In 2019, SA insurers reported 2 837 fraudulent and dishonest claims to the value of R537.1 million.

READ | Unlawful for insurers to push exorbitant funeral cover increases, says regulator
Megan Govender, the convenor of the Asisa forensics standing committee, said funeral insurance has always been a soft target for fraudsters. But the Covid-19 pandemic has made it worse as the desperation due to job losses drove more people to resort to crime, especially because the excess deaths last year made it easier to source dead bodies for fraudulent claims.

“Since funeral insurance policies do not require blood tests and medical examinations and are designed to pay out quickly and without hassle when an insured family member dies, criminals and dishonest individuals most commonly try their luck in this space,” said Govender.

Some hair-raising cases

Asisa said the buying of dead bodies often involves syndicates and mortuary employees. The syndicates buy dead bodies and then use them to claim against policies that were fraudulently taken out some months earlier. They usually buy unclaimed bodies.

Another modus operandi involving syndicates targets drug addicts and alcoholics from poor communities with a promise of a job to obtain their personal details and fraudulently buy funeral cover for them.

When the waiting period lapses, the syndicates then have to find a body, which could be done through the purchase from a mortuary. But Govender said in one incident, the syndicate tried to murder the addict they’d covered. But the victim escaped.

However, it’s not just the syndicates that insurers have to worry about. One family collected the body from the mortuary before the death was registered and “purposefully” placed it on the road. It reported a hit and run accident and submitted a claim.

Govender said cases of families so desperate for funeral cover payouts are common, especially when the person died while they were still under the waiting period that insurers impose. Some resort to these tricks as accidental death benefits have no waiting period.

As for the other insurance products, Asisa said there were 388 fraudulent life insurance death claims totalling R264.3 million. Policyholders submitted 325 fraudulent and misrepresented disability claims, 141 hospital cash-back claims, and 50 retrenchment claims. KwaZulu-Natal had the highest number of detected fraudulent claims, followed by the Eastern Cape.

 

Source: IOL

A senior supervisor of a stationery store in the Eastern Cape has been sentenced to three years imprisonment for fraud.

In a statement released on Wednesday, provincial spokesperson for the Directorate for Priority Crime Investigation (Hawks), Captain Yolisa Mgolodela said Ntombifikile Kati, 50, was sentenced in the Mthatha Specialised Commercial Crime Court.

She said an investigation into the matter revealed that over a period between February 2013 and July 2019, Kati who was employed as a senior supervisor at the Ink Spot (a stationery store) stole R30,000 (US$2,180) from the company.

Kati was arrested by the Mthatha Serious Commercial Crime Investigation team on November 15, 2019, after they were tasked to probe the matter.

On the day of her arrest she appeared in court and was subsequently released on a warning.

Mgolodela said a series of court appearances saw Kati convicted and sentenced to four years direct imprisonment of which one year was suspended on condition that she does not commit the same offence during the suspension period.

Subsequently, she will be serving three years in prison.

Mgolodela said the conviction and sentencing of Kati comes after her sister, Vuyokazi Kati, 37, was sentenced to 15 years direct imprisonment on April 26, 2021 in the Mthatha Specialised Commercial Crime Court without an option of a fine for theft to the value of more than R2.3 million.

Vuyokazi was a store manager for the same company.

 

Source: Jacaranda FM

The Hawks in Gauteng have arrested a second person in connection with a Cell C tender scam worth an estimated R130-million.

Gauteng Hawks spokesperson Ndivhuwo Mulamu says 39-year-old Adriraan Pillay was arrested in Germiston on Friday.

“It is alleged that Pillay and his co-accused, Ismail Adanjee Mohamed, 44-years-old, were both Information Technology (IT) executives at one of the well-known South African mobile network service providers.

“They allegedly colluded with a director of a contracted entity responsible for IT and network service provider, falsely inflated invoices which resulted in an actual loss of over R130 million from 2012 to 2019,” she said.

Adamjee was released on R50 000 bail by the Johannesburg Specialised Crimes Court last month.

Pillay appeared in the Palm Ridge Specialised Commercial Crime Court on Monday where he was also granted R50 000 bail.

Mulamu said the case is postponed to 14 April 2021 where he will be joining his co-accused, Mohamed.

 

By Bradley Prior for MyBroadband

Old Mutual has confirmed that a portion of its customers have been signed up to its policies without their permission.

This follows a reader telling MyBroadband that they had been subscribed to, and had been billed for, two different policies for which they had never signed up.

The reader, who is a teacher employed by the government, said five of their coworkers had been affected by similar issues over the past few years, and was aware of more teachers working elsewhere who had also been affected.

The reader had been billed for thousands of rand over nearly a year-long period. One of the policies was with Old Mutual and had been billed since November 2019, while the other was with Emerald Life and had been billed since April 2020.

The reason the reader only picked up on this issue many months after it had begun is that they do not get regular payslips from their state employer.

Old Mutual finds the problem
MyBroadband brought the matter to Old Mutual’s attention, and it investigated the situation.

Upon the conclusion of this investigation, Old Mutual told MyBroadband that there was indeed foul play at work.

“Our investigations identified individuals that had been signed up for Old Mutual policies without their consent,” said Old Mutual.

“The implicated parties have subsequently been dismissed and barred from conducting intermediary work.”

Old Mutual also confirmed that it cancels policies that are found to have been opened unlawfully and refunds customers in these cases.

Old Mutual told MyBroadband that the parties in question were independent broker agents who were licensed under the FSCA and accredited to sell Old Mutual products.

Following Old Mutual confirming the problem, the reader told MyBroadband that they were compensated for the full amount lost due to this fraud from November 2019 to October 2020, as well as an additional R500.

Old Mutual fighting fraud
Old Mutual noted that fraud and identity theft are an industry-wide issue, and said it “investigates promptly” and “takes decisive action” in such cases.

“Old Mutual is working with the Provincial Treasury Anti-Fraud Unit and the SAPS Commercial Fraud and Statutory Investigations Unit to gain insight into identifying such incidents earlier, more frequently and accurately. We also conduct regular Fraud Awareness training and engagements with employees,” it explained.

“Old Mutual has a zero-tolerance attitude towards Financial Crime and we take appropriate action against any employee or agent implicated in fraud.”

It also noted that it runs consumer education campaigns to ensure the public is aware of how this fraud can happen and encouraged customers to stay vigilant.

“We have consumer education campaigns to make the public aware of this type of fraud and encourage customers to remain vigilant.”

How to protect yourself against fraud
Old Mutual noted that its campaigns to educate the public on this type of fraud includes encouraging its customers to review their payslips and bank statements on a continuous basis.

This will help them to find and report any transactions that they deem to be suspect.

If they detect such deductions, Old Mutual said customers should contact them in one of the following ways:

  • Email: Complaintadmin@oldmutual.com
  • Call MFC Servicing Call Centre: 0860 607 000
  • Visit any Old Mutual retail branch

3M expands actions to fight Covid fraud

Source: Medical Process Outsourcing

3M continues to fight the global pandemic from every angle, and help ensure a safe supply of needed personal protective equipment, by expanding its region-specific resources to report and stop fraud around the world.

The company has launched an aggressive legal effort to stop profiteers who are attempting to take advantage of the demand for 3M products used by healthcare workers and first responders. Building on this work, 3M has established hotlines around the world to report suspected fraud and has created online resources to help spot price-gouging, identify authentic 3M respirators and ensure products are from 3M authorised distributors.

3M has investigated more than 7 700 fraud reports globally, filed 19 lawsuits, and has been granted nine temporary restraining orders and seven preliminary injunctions. More than 13,500 false or deceptive social media posts, over 11 500 fraudulent e-commerce offerings and at least 235 deceptive domain names have been removed. 3M has been awarded damages or has received settlement payments in seven cases, with all proceeds being donated to COVID-19 related charities.

3M has not, and will not, increase the prices of its respirators as a result of the pandemic. 3M is a global company with factories that produce respirators and other critical products needed to fight COVID-19 in the U.S., Europe, Latin America and Asia.

To combat increased counterfeiting and online fraud during the COVID-19 outbreak, 3M is working with law enforcement and customs agencies in every region of the world.

3M is also engaged with many major e-marketplace operators to detect and disrupt fraudulent and counterfeit respirator offers, including Amazon, Alibaba, Mercadolibre, Lazada, eBay, Flipkart, Shopee, Made-in-China and several others.

In particular:

  • Since the pandemic began, 3M has worked with customs and law enforcement agencies around the world to seize approximately 3.5 million counterfeit respirators, either as the products are moving through customs, or in targeted raids against suspected resellers and manufacturers of counterfeit products.
  • 3M has engaged with law enforcement agencies to fight counterfeiting in more than 1,200 actions around the world.
    In Latin America, 3M has worked with customs agencies in more than 15 cases to seize counterfeit respirators being imported into the region from other parts of the world, with several of the seized consignments containing more than 10,000 counterfeit respirators.
  • In the United Arab Emirates, 3M has worked with police and the Dubai Department of Economic Development to seize over 600,000 counterfeit respirators.
  • In Vietnam, a 3M investigation led to a raid and seizure of more than 150,000 counterfeit respirators. The Hanoi and Ho Chi Minh City Market Management Bureaus also seized the manufacturing equipment used to make the fake respirators.
  • In Europe, 3M is fighting multiple cases of fraud involving bad actors using .nl, .uk and .pl domain names intended to deceive buyers with offers of nonexistent or fake 3M respirators. Other scams include using the names of 3M employees in fake invoices and certificates to claim a relationship to the company. 3M is taking legal action and is working with law enforcement through the European Union.
  • In India, 3M is working with law enforcement agencies in multiple states to investigate and raid manufacturing operations producing counterfeit N95 respirators, and resellers offering counterfeit N95 respirators to the public, seizing fake products and holding bad actors responsible.
  • In South Africa, 3M is investigating numerous cases of fraud and the sale of counterfeit respirators. In two recent cases, South African customs seized over 100 000 counterfeit 3M respirators.

These are just some examples of the many actions 3M is taking to stop and deter fraud to protect people around the world.

 

TERS payments suspended with immediate effect

Source: NEASA

The Department of Employment and Labour has suspended all TERS payments that are currently outstanding.

The Department has identified a number of anomalies in respect of past payments made to persons who are deceased, imprisoned or minor.

The Department will be comparing its database with that of the Department of Home Affairs in order to rectify this situation going forward.

It is unclear for how long payments will be suspended.

Cash-strapped employees struggled to apply for TERS benefits in July, amid a series of hiccups within the system.

Moneyweb previously reported that applications for May opened late, as well as June applications, which were closed shortly after due to security breaches. The system only came back online in the second weekend of July.

SABRIC (South African Banking Risk Information Centre) has warned bank clients to protect their mobile devices.

The theft of mobile phones is not a new phenomenon; however, there is an emerging trend where mobile phones that are being snatched from owners, affording criminals the opportunity to gain access to the victim’s personal and even confidential information which can then be used to commit crime.

Mobile phones are a convenient way to stay connected. They enable easy access to family and friends, make it possible to access vast stores of online information and can provide hours of entertainment. Despite these benefits you must always remain vigilant because your mobile phone stores far more information than you may be aware of. This is even more applicable if you use your mobile device to do your banking. Remember, your phone is equal to a bank card and could even act as a gateway to your bank account

“Personal information is a valuable commodity for criminals and because so much of it is on our phones, we need to take mobile security very seriously,” says Susan Potgieter, acting CEO of SABRIC.

There are a number of ways that criminals could access information stored on your mobile phone if it is stolen, to try and defraud you:

  • Criminals access all open applications on your unlocked phone and view your sensitive data
  • Social engineering is used to obtain your usernames and passwords stored in the cloud
  • Vishing might occur, where criminals call you and manipulate you into believing that they are from the bank to coerce you into revealing confidential information like PIN’s or passwords
  • Phishing occurs where you are sent an email, which you believe to be from the bank or a legitimate service provider, which asks you to click on a link that requests your PIN’s or passwords. Once your password has been compromised on your snatched phone, all other credentials are available and may be exploited.
  • Your credentials could also be compromised through shoulder surfing in public places such as restaurants.

In the event that your mobile phone is lost or stolen, borrow a phone and contact your bank immediately so that they can deactivate your banking app, block cards on other apps containing your bank card details and block your bank account. Make sure you always have your banks hotline number stored somewhere other than on your mobile phone. If you have activated the ‘Find My iPhone’ or ‘Find my Device’ facility from the web to locate or wipe your device, be aware that fraudsters may attempt to Vish or Phish you. If you receive an email or SMS after doing this, don’t click on any links as these are not safe.

“When a bank client’s mobile phone is stolen, they tend to focus on protecting their photos and social media profiles, however, their highest priority should be protecting their money,” concludes Potgieter.

Tips for banking clients

PINS and passwords

  • Reset/change your passwords and PINs often
  • Set different and complex passwords for each app or service. Ensure that these are not stored on a password manager app or on the phone itself
  • Never save your banking app username and password on your device in the contacts or notes
  • Never autosave your banking app username and password on your device
  • Disable the autosave function on your smart phone
  • Ensure that you have set additional security controls on your device for adding biometrics such as fingerprint or facial recognition, for instance you can enable your device to ask for the device password to add another person’s biometric on your device.

Behaviour

  • Do not click links in SMSes or emails stating that your lost or stolen device has been located as criminals use this as a way to get your banking app credentials
  • Always be vigilant by being aware of who is around you when using your phone in public

Your device

  • Treat your mobile device the same way you would treat your bank card
  • Pickpocketing is prevalent so ensure that your handbag or and backpacks are properly closed or zipped
  • If your mobile device is lost or stolen notify your Bank immediately to freeze your banking profile and prevent the perpetrators from using your banking app
  • In addition, contact your mobile service provider to block/stop your SIM card and handset to prevent criminals from getting any One Time PINs for fraudulent transactions
  • If your Apple device is stolen, log onto to your iCloud account to restore all factory settings so that all your personal data is wiped from the device
  • Avoid using Public WiFi “hotspots”. It is risky to connect your smartphone to just any available WiFi hotspot. Savvy hackers can spoof a WiFi connection and gain access to usernames and passwords stored on your smartphone
  • Consider keeping your banking app on two devices – this will enable you to block the stolen mobile from the other device and also change the log in credentials at a moment’s notice. Most banks will still ask you to call them to report the theft to ensure that all access is blocked for the stolen phone. Your bank can also advise how to get passwords changed
  • When calling the bank to report the phone as stolen, request that they place a temporary hold on your entire account to allow you the time to change, replace and update all of your info

Banking app

  • Always log out of your banking app manually once you have finished transacting
  • Keep your daily EFT and ATM limits low as some banking apps and internet banking profiles will require that contact be made with the bank before the limit can be increased on your profile

By Phillip de Wet for Business Insider SA

Scammers are separating helpful South Africans from their money in what appears to be a wave of fraud that relies on hijacking WhatsApp accounts – and then simply asking for money.

The scammers first take control of a victim’s phone number, usually by porting the number to a new service provider, and so associating it with a SIM card under their control. That allows them to receive confirmatory SMSes from WhatsApp, and so take control of an existing account, while the now-offline victim is none the wiser.

Now able to impersonate the victim, the scammers access the phone numbers of friends and acquaintances, in many instances seemingly just waiting for incoming messages, or by way of WhatsApp groups to which the victim belongs. Then they simply ask for money.

Number porting has in the past often been used to intercept one-time PIN (OTP) numbers – but that requirers scammers to have control of bank accounts, either by skimming credit card information or stealing login details for online banking.

In the current wave of scams, the attackers do not need such access. Friends of victims are asked to send money via services such as First National Bank’s eWallet, which sends the code required to withdraw money from an ATM via SMS – with the cash immediately available.

As of Wednesday it was not yet clear how widespread the new scam was, with network operators saying they were detecting only a small number of fraudulent attempts to port numbers – while many people said they were receiving worrying notifications, or had already seen their friends approached for money.

Here’s how to protect yourself against both sides of the latest WhatsApp hijacking scam.

Turn on security notifications in WhatsApp.
WhatsApp security code settings
WhatsApp will alert you when a contact changes their phones – if you let it. For those in many big WhatsApp groups – with people who like to switch phones – the constant messages that a contact’s “security code has changed” can becoming annoying, so some people turn it off.

If you are one of those people, turn those notifications back on by going to “settings”, then selecting “account”, and from there “security”.

Should a “friend” ask for money shortly after their security code changes, be extremely suspicious.

Don’t ignore porting SMSes.
Cellphone companies will send out notification, by SMS, before porting a number – but will consider no response as permission. If you receive an SMS that warns your number is to be ported, do not ignore it.

If you are worried that message might be a scam in itself, phone your network provider on the usual service number.

Don’t turn off your phone if you’re getting annoying calls.
Some victims of porting say they were bombarded by annoying phone calls before their numbers were hijacked. The idea behind constantly ringing your number is to make you turn off your phone – so that you won’t receive porting notifications, and won’t notice you have suddenly been kicked off the network.

If someone keeps phoning then putting down the phone before you can answer, or you keep receiving calls with nobody on the other side, assume you are being scammed, and rather put your phone on silent while watching out for SMSes.

Don’t ignore a loss of cellphone signal.
If your phone suddenly won’t connect to your mobile network – and you aren’t in the middle of nowhere, or in an area being load-shed – assume your number is being hijacked, and get in touch with your network service provider as soon as possible.

Don’t register a new WhatsApp account if you change phone numbers, update your number instead.
Some victims of WhatsApp identity fraud believe they were impersonated after their former, abandoned cellphone numbers were recycled by network operators.

If you are switching numbers and want to be sure nobody can pretend to be you in future, you can change the phone number associated with your WhatsApp account.

If you really care about your security, enable the PIN function on WhatsApp.
WhatsApp 2-step verification
For ultimate protection, you can create a six-digit PIN number in WhatsApp, without which it should be impossible to register on the service – so that no number-porting scam or other mechanism will let someone steal your identity.

There is no better way to protect yourself, but this two-step verification measure comes with a couple of caveats. If you do not associate an email address with that PIN, or lose access to the email address you register, you are in deep trouble if you ever forget your PIN. Also, WhatsApp will from time to time demand the number from you, which could get annoying.

The PIN activation is under “settings”, “account”, and then “two step verification”.

Ghost employees could cost you your business

The occurrence of ghost employees on a company’s payroll system ranks as the most difficult type of payroll fraud to detect, particularly in larger companies where no proper controls exist. Over time, this can pose a serious threat to the organisation’s profitability and sustainability, declares CRS Technologies general manager Ian McAlister.

“A ghost employee is a fictitious person on the company payroll who does not actually work for the organisation,” he explains. “It could be someone who left the company or passed away, or even a fictitious person with a fake ID number but valid bank account into which a salary is paid each month. The holder of the bank account is usually the perpetrator of the ghost employee fraud.

“Another example is when a real employee appears twice on the payroll. This is done by using a different ID number to create a clone of someone. The employee’s salary is then split between the two identities but only one identity receives a tax certificate, enabling the perpetrator to declare less than what he/she actually earns to the tax collecting authority.”

It goes without saying that failure to detect ghost employees can result in considerable financial loss over time. Consequently, McAlister says companies should seriously consider implementing a robust automated payroll solution that will reduce opportunities for creating ghost employees.

“The payroll solution should feature ID number verification so that if someone tries to enter a ghost employee on the system, it will immediately reject the ID number as invalid. The CRS solution, for example, incorporates ID numbers which are attached to each employee. Each number is unique and cannot be duplicated. This means that an employee cannot appear twice on the same system.”

Audit and risk management policies that facilitate the development of controls to aid in the prevention and detection of any type of payroll fraud are also extremely important, McAlister continues. He recommends carrying out audits at least once a quarter to ensure that the number of employees on the payroll actually exist and equal the number of people employed.

“Perform frequent spot audits to check that employees’ earnings, allowances and other remuneration additions are correct and in accordance with their employment contracts. Any changes to an employee’s earnings must be approved by a senior manager and not the payroll administrator. If possible, a multiple-party approval process should be followed to mitigate collusion. It is also advisable to run comparison reports between various payroll periods. Any variance of more than a predefined percentage occurs should raise a red flag.”

McAlister points out that ghost employee fraud does not have to be perpetrated by the person who controls the entire payroll system. “Mostly it is done by the individual who authorises payroll payments or controls the addition or deletion of employees from the system. Once the ghost is created, payments are generated to the ghost without the need for additional action or review by the payroll team. All the perpetrator has to do is sit back and collect the payments.

“This being said, an indication that some type of payroll fraud is being committed could be when the payroll manager or administrator always arrives early and leaves late, and never goes on holiday or takes sick leave. Being away from the office will force them to give their work over to someone else, who may discover their crime.”

For businesses that cannot afford the luxury of an internal audit department, McAlister recommends entrusting their payroll to a third-party professional. “CRS’s outsourced payroll services includes multiple levels of accountability where different people manage different payroll duties. Fraudulent activity is further prevented by rigorous internal controls.”

“Payroll is often a business’s biggest expense. Organisations need to understand the potential devastation ghost employees and other types of payroll fraud can cause and take the necessary steps to safeguard against it,” McAlister concludes.

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