In recent years, scams have been on the rising trajectory. Advancement in technology has made it easier for scammers to target their victims. On a daily basis, scammers use email, text messages, place direct phone calls, use social media platforms (e.g., Facebook, Instagram, X [Twitter], LinkedIn, etc.) to reach and lure people into accepting their deceptive scheme. To identify scam schemes in Nigeria and other parts of the world, you should be wary of those who give you offers you didn’t ask for (unsolicited offers). Some of these offers include promises of large sums of money, promises of investments that come with high returns without any risk, investment strategies that are very secretive.
The Economic and Financial Crimes Commission (EFCC) is the federal government agency saddled with the responsibility of fighting financial crimes in Nigeria. The body has fought and is still fighting scams and other financial crimes. Study shows that the United States has the highest concentration of victims of scams from Nigeria, estimated at 56%. Most of the scammers, about 58%, presented themselves to their targets as male Caucasian Americans. Similarly, the scammers are mostly university students and Facebook being the predominant social media platform used by the scammers.
Before proceeding with details on how to identify or spot scam schemes in Nigeria and elsewhere, it is essential for you to know the meaning of scam.
What is a scam?
The Cambridge dictionary defines scam as: “to trick someone into giving you money or giving you some advantage, in a dishonest and often illegal way.” Scam is mostly a deceptive scheme in which someone (scammer) attempts to deceive their targets or prospects into giving them personal information, money, and other valuables. Scam is a type of fraud or crime that often leads victims to lose their money, valuables or assets.
Below is the detailed explanation on how to know or identify when someone wants to scam you.
Common Scam Tactics
1. Unsolicited Offers
If you have an email, you might have been receiving emails from individuals or organizations that you haven’t contacted in the past. You might have also received calls or text messages from individuals or organizations that you didn’t call or message them previously. More often than not, scammers will send you unsolicited emails with inheritance claims involving large sums of money (in foreign currencies) that seem real. With the internet, most advanced scammers are involved with phishing. Phishing is a type of email scam where the message appears to come from sources (e.g., First Bank, Dangote Group, Jumia, Apple, Amazon, etc.) that are genuine or legitimate. The message will contain links which the scammer will encourage you to log into your account.
Usually, they will tell you that your account has just received a large sum of money or your account has been locked. Once you click on the link, you will be directed to a fake website that looks the same as the company where your information will be collected. Also, the email can come as an attachment with a form to fill or coupon for you to claim something. In reality, the form or coupon you’re asked to fill or claim is a computer virus. Vishing is a form of scam where the scammer places a phone call directly to you and pretends to be a government official, capacity building organization or your bank. While receiving the call, the scammer will trick you to share your information with them or request transfer of money from your bank. They also use a technique called “number spoofing” which involves changing their caller identity (ID) when they are making a phone call. Whenever you receive unsolicited messages or calls from individuals you haven’t solicited anything from, you should be wary and suspicious of lucrative investment opportunities, promises of a lump sum of money.
2. Advance Fee Schemes
Advance fee scams are a common type of fraud where scammers request upfront payments or “processing fees” to access something of value, like an inheritance, loan, or contract. When they place such requests to their prosppects, they often make a promise to pay a larger sum in return or later. For instance, scammers will claim that they have a large sum of unclaimed inheritance or a contract which they would like to share with their target if they make an upfront payment of processing fee. They could ask their target to make any payment that seems legitimate and often a small amount. The upfront payment is always made as a mandatory requirement in exchange for the larger amount.
After the upfront payment, the scammer will change the narratives and begin to demand for other payments. Or, may just end the conversation and disappear. Advanced fee fraud often comes with signs such as unsolicited offers, upfront payments, processing fees, commission offers, investment offers with high returns, promise of excellent career opportunities, and many more.
3. Promises of High Returns with Little Risk
If someone promises you exceptionally high returns with minimal risk, it’s a strong indicator of a scam. Scammers who chose this path always make promises of quick riches with little to no risk at all. Once they are able to establish a conversation with their victims, they tell success stories of investments in the stock market, cryptocurrency, and others. Mostly, the scammers will assure you that you’re guaranteed to make money off the investment. To make their offers very attractive not to ignore, they assure their victims of getting “double” of the amount they are willing to invest as a return on investment (ROI) over a given period. It may be over a period of three, six, or nine months, or even a year. Often, investments with little to no risk aren’t real because they’re too good to be true. An example of investment that promised high returns with little or little risk was Dot Com Bubble that occurred in the late 1990s. Another example was the Tulip Mania in the 17th century.
4. Vague or Secretive Details
One of the signs to identify scammers is that they make vague claims and keep details of their scheme secret. They often avoid providing clear and detailed explanations about their investment schemes. It seemingly makes it difficult for their victims to verify the legitimacy of their investment schemes. Legitimate investment schemes make public the details of their registration with the regulatory authorities. In Nigeria, for instance, legitimate investment organisations register their businesses with the Corporate Affairs Commission (CAC). After a successful registration, CAC certificate of registration and number are issued. Scammers cannot provide a CAC certificate and registration number. They can only provide fake evidence of registration with CAC. It beholds on the victim to fact-check such information to ascertain their genuineness or originality by visiting CAC website to search the name of the company and other relevant information.
5. High-Pressure Tactics
When scammers want to scam their victims, they often mount pressure to create a sense of urgency. The pressure is meant to force their victims into making quick decisions. They may use phrases such as “limited time offer”, “act now to avoid missing out”, “exclusive offer”, et cetera. These tactics are employed to exploit the psyche of the victim and make them act promptly without being rational. Any investment opportunity, whether solicited or unsolicited, you should be skeptical about the ones that tend to pressure you and create a sense of urgency that prompts you to act immediately. Legitimate investment opportunities do not pressure people to act immediately and should give you sufficient time to make informed decisions.
6. Requests for Personal Information
Scammers use various tactics to request for personal information from their victims or targets. Be cautious of individuals who will use communication channels such as phone calls, emails, text messages (short messaging system, SMS), chats, etc., to ask you to give them your bank account information, passwords, national identification number (NIN), social security number (SSN), and other sensitive personal or group information. Before divulging your personal details to someone you don’t know, make sure you have conducted background checks to ascertain the legitimacy of the request. Cyber criminals often create fake websites, use phishing, and email as tactics to steal sensitive information from their victims.
The moment they’ve succeeded in collecting the victim’s personal information, they use it to steal money from the victim’s bank account or steal money from other sources or commit any other forms of crime. After using your personal information to commit crimes, they would abandon it and digital footprints will be traced to you. Then, you will be held responsible or arrested for committing such crimes. Using illegitimate ways to collect your personal information is called identity theft.
Also Read:
- How to Easily Modify Your NIN Details from Home Using Mobile Phone
- How to Report Loan Apps That Harass Customers
7. Nigerian Letter or 419 Schemes
The Nigerian letter is popularly known as “419”. Scammers often use emails or letters as tactics to reach out to their victims. Usually, the scammers send emails or write letters to their prospects promising a large sum of money usually in thousands or millions of dollars as the victim’s share. They craft emails or letters in different deceptive formats that can easily lure or convince their victims to act. For instance, they may craft an email claiming that a self-proclaimed government official is trying to transfer money illegally out of Nigeria, to lure or deceive the victims into sharing bank details or personal information. It is a type of phishing where scammers try to deceive victims into divulging sensitive personal data.
In a 419 scenario, the scammer pretends to be a genuine government official, perhaps from an agency responsible for monetary services or assistance. A story is then crafted around a problematic transaction involving a huge sum of money and a claim of regulatory issues or legal payments. In the end, the scammer may request the victim or recipient or beneficiary to provide bank account information, personal information, or any sensitive data. These requests are placed to the victim with the goal of stealing the victim’s money or identity.
8. Ponzi Schemes
Scammers operate Ponzi schemes to defraud their victims. A typical ponzi scheme promises investors high future returns on their investments and requires existing investors to bring new investors to the scheme to succeed. In some rare instances, Ponzi schemes may not compel existing investors to recruit new investors. Visibly, ponzi scammers do not sell tangible products or invest in stocks; they simply use the money they’ve collected from new investors to pay existing investors. Usually, they pay early investors for a few months, or one to two years to give a sense of legitimacy to new investors; who they would eventually scam them of their hard earned money. An example of a recent Ponzi scheme in Nigeria was the Crypto Bridge Exchange (a.k.a. CBEX) where about 600,000 investors lost an estimated N1.3 trillion or $810,120,272. The scammers operated CBEX under a different company name called ST Technologies International Limited, which they registered with the Corporate Affairs Commission (CAC) and Economic and Financial Crimes Commission (EFCC). CBEX, a digital investment platform, offered investors 100 per cent profit after 30 days of purported AI crypto trading.
Note that some Ponzi schemes can operate for a long time. Don’t be deceived by how long a given Ponzi scheme had been operating. The origin of the Ponzi scheme is traced to an Italian named Charles Ponzi who relocated to the United States in 1920. He introduced a money-making scheme that guaranteed investors 50% profit in 45 days and 100% profit in 90 days.
9. Pyramid Schemes
The pyramid scheme is often a fraudulent money-making scheme that involves continuous recruitment of individuals into the network at an increasing multi-levels. Pyramid schemes require members to recruit new investors to make a profit or recoup their investments. Usually, it begins with a small group of people, at the top, who promote the scheme at the initial stages. As the pyramid grows, the small group of people who started the scheme has to depend on a larger number of investors at the base to pay profits to the earlier investors. To make it look legitimate, pyramid schemes use products or services. However, they use those products to disguise their intention for collecting money from new investors at the bottom levels to pay those investors further up the pyramid.
Notably, pyramid schemes demand a mandatory payment of fees for registration to be eligible or have the right to sell the products or services; including the right to recruit new investors or members for rewards that are not related to the schemes. The products that the victims must purchase from the scheme are often not usable. And unfortunately, the promoters of the scheme won’t repurchase the products. The characteristics of pyramid schemes include: easy money or passive income, absence of demonstrated revenue from sales, emphasis on recruitment, promises of high returns on investment, absence of genuine products or services, and complex commission structures.
10. Telemarketing Fraud
Another popular scam scheme in Nigeria is telemarketing fraud. Scammers who adopt telemarketing fraud as a means to scam people will pretend to be from a legitimate government agency and offer a grant. For instance, the scammer may pose as an official from the Federal Ministry of Humanitarian Affairs and offer grants to their victims. After making such an offer, they will demand your bank details or any other sensitive data as a requirement to deliver the said grant. In a real sense, the offer of the grant is to trick their victims into sharing sensitive information with them.
Scammers can also impersonate legitimate technology companies and offer a deal that seems legitimate. Eventually, they will demand for your payment information or any information that they can use to defraud you. They can contact you via phone and inform you that they are calling from the customer care of your bank and inform you that your account or credit card has a security issue.
11. Romance Scams
In a world where people are increasingly searching for love, romance scams are also on the rise. Romance scam is a situation where a scammer builds a relationship with another person online and gains their trust. In romance scams, the scammer creates a fake identity on social media or dating applications and shows so much love to their victims. In some instances, they can propose a marriage to their victims just to gain unquestionable trust. The ultimate goal is to get the personal information of their victims which they can exploit to their benefit. They can also fabricate non-existent reasons (e.g., medical expenses, emergency, travel issues, etc.) and ask for financial assistance. In most cases, victims are likely to send money multiple times before they would discover it was absolute lies.
The question is, how do you identify romance scammers? Scammers often look attractive, tend to present themselves as successful, and readily available always. Easily profess love to their victims within a short time after connecting. Often pretend to be working abroad to avoid meeting physically. Avoid having video calls with their victims to hide or prevent revealing their identities. After building trust, they start framing challenges facing them or needs and place demands from their victims.
12. Impersonation
The growing innovations in technology makes it easier for scammers to exploit it for their benefit. Scammers may use artificial intelligence to clone the voices of celebrities to scam victims. Starling Bank, a digital lending organization in the United Kingdom, revealed in a research they conducted that about 28% of people have been targeted by an AI voice cloning scam in 2023. About 46% didn’t know about the existence of such a scam tactic. Then, 8% said they would have sent money to such scammers that have targeted them.
Deepfakes is another AI supported scam tactics scammers use to defraud their victims. In this case, a scammer can use AI to create videos or pictures that replicate another popular person (e,g., celebrity, CEO, or politician) either saying or doing something. However, impersonation using AI tools display certain features that include: urgency to act, short conversation, request to keep conversation secret, request for money via wire transfer, among others.
How to Protect Yourself from Being Scammed
1. Verify Information
Whenever you receive any unsolicited message don’t rush to act. Take your time to review or scrutinize the information. Visit the organization’s website, get their phone number and call or write an email to the organization to confirm the legitimacy of the offer or request. Be sure that phone number and email address belong to the legitimate organization. If the message has some website and links, do not click them. Instead, search the company on the internet to ascertain their legitimacy because scammers can clone legitimate websites or create a similar one. Therefore, check the legitimacy status of the website by copying its URL and confirming it on Google Transparency Report.
2. Don’t Respond to Suspicious Emails or Messages
To be on the safer side, don’t respond or click on any links whenever you receive a suspicious email or message.
3. Don’t Fall for Pressure Tactics
Don’t allow yourself to make any hasty financial or risky decisions by individuals who pressurise you for certain requests or demands. Take your time to do background checks to verify the legitimacy of the demands. At best, you should turn them down outrightly.
4. Be Skeptical
Always be very cautious and treat any unsolicited messages and offers with great skepticism especially those with promises that seem too good to be true. Trust your guts and reject such offers.
5. Report Suspicious Activity
At any point in time you suspect that you have been targeted by scammers, report to the appropriate authorities immediately. You can report scams to the Economic and Financial Crimes Commission (EFCC), Independent Corrupt Practices Commission (ICPC), the Central Bank of Nigeria (CBN), Department of State Services (DSS), Federal Bureau of Investigation (FBI) through their Internet fraud centre, and Nigeria Police Force.
You can report fraud to EFCC through the following contacts:
Hotline: +2348093322644
Email: info@efcc.gov.ng
Eagle Eye App: Available on Google Play Store and Apple App Store
Website: www.efcc.gov.ng
Zonal Commands: The EFCC has several zonal commands across Nigeria. You can find the address of the nearest command on the EFCC website.
Social Media: You can also report fraud through their social media platforms (@officialefcc on Facebook and Twitter).
6. Read Reviews and Check Website Credibility
Ensure you Read reviews about the performance and legitimacy of the organization. Organizations with poor reviews are red flags. Sometimes, the reviews can be manipulated as some scam websites compel the first few set of beneficiaries down the line to go to trusted review sites to write positive reviews about the scheme. Therefore, before you make any purchase or invest in a scheme, check the legitimacy or credibility of the website by copying the website’s URL and checking it on Google Transparency Report.
7. Grammatical Errors or Poor Writing
Be wary of grammatical errors or poor writing in emails or messages. You should note that some scammers are educated, can speak and write fluently. While the uneducated ones can use AI to overcome grammatical and writing challenges.