There has been news aplenty about an onslaught of investment scams since the start of 2022, from popular shows on Netflix glorifying the brazen tales of “swindlers”, to home-ground stories about opportunists fleecing individuals as well as businesses.
According to the South African Banking Risk Information Centre (SABRIC), South Africans lost more than R1.5 billion collectively in banking and card fraud alone in 2020 (the latest available data). Add other scams into the mix, along with victims who are too ashamed to report being targeted, and that number is likely to be significantly higher.
Most recently, the Financial Sector Conduct Authority (FSCA) about a South African man who allegedly defrauded over 600 investors, some of whom lost more than R1 million, following claims that investors could double their money in three months of trading foreign exchange.
“Consumers have been hit hard financially, with shocking fuel price escalation and food price increases. These factors, together with our need for quick results, make us more susceptible to fraudulent “special offers” and get-rich-quick schemes,” said Phiko Peter, a client relationship manager at Allan Gray.
“On top of this, technology has made instant investing more accessible. Unfortunately, fraudsters are giving old-fashioned scams a digital makeover and using online channels to fleece their victims.”
Below Peter outlined some of the most common investment scams in Soth Africa right now.
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