In a bustling city like Delhi, the Singh family was always on the lookout for ways to secure their financial future. Singh, a seasoned banker, thought he was well-equipped to navigate the complex world of finance. However, even he was not immune to the various financial frauds that revolve around the Indian landscape.
Fraud 1: Phishing scams
One afternoon, Singh’s wife received an email claiming to be from her bank. The email informed her that her account was about to be suspended due to suspicious activity and urged her to click on a link to verify her account details. Without a second thought, she clicked on the link and entered her sensitive information. She never realised that moment, she had fallen victim to a phishing scam, where fraudsters impersonate legitimate organisations to steal personal and financial information.
Fraud 2: Ponzi schemes
Singh, always on the lookout for lucrative investment opportunities, came across a scheme that promised high returns with minimal risk. The scheme, operated by a well-spoken individual named Gupta, seemed too good to be true. Ignoring his instincts, Singh invested a significant sum of money. However, when it was time to withdraw his returns, Gupta vanished into thin air, leaving Singh and many others high and dry. Little did Singh know, he had fallen victim to a Ponzi scheme, where returns are paid to earlier investors using the capital of newer investors, rather than from legitimate profits! Thanks to many revolutionary changes by regulators, these schemes have significantly reduced. Yet, there are versions still active in few pockets.
Fraud 3: Credit card fraud
One day, while checking his credit card statement, Singh noticed several unauthorised transactions. Someone had used his credit card to make purchases online without his knowledge. Despite being vigilant about safeguarding his financial information, Singh had fallen victim to credit card fraud. Fraudsters had either obtained his card details through skimming devices or had intercepted his information during an online transaction.
Fraud 4: Fake insurance policies
Concerned about the financial security of his family, Singh decided to purchase a life insurance policy. He came across an insurance agent, Sharma, who offered him a policy at an unbelievably low premium. Thrilled at the prospect of saving money, Singh quickly signed the documents and made the payment. However, when he tried to make a claim after an unfortunate incident, he realised that the policy was fake and Sharma was nowhere to be found.
Fraud 5: UPI and digital payment frauds
One evening, while browsing through a popular shopping app, Singh’s wife came across an attractive offer for a product she had been eyeing for a while. The offer seemed too good to pass up, so she decided to make the purchase using UPI. She entered her UPI ID and made the payment, only to realise later that the app was a fake, and her money had been siphoned off by fraudsters.
How to protect your finance
Stay vigilant against phishing scams: Be wary of unsolicited emails, text messages, or calls asking for your personal or financial information. Legitimate organisations will never ask you to provide sensitive information through these channels. Always verify the authenticity of the communication before sharing any information.
Research before investing: Before investing in any scheme or financial product, research thoroughly and verify the credibility of the company or individual offering the investment opportunity. Be cautious of schemes that promise unusually high returns with minimal risk.
Monitor your credit card activity: Regularly review your credit card statements and transaction history for any unauthorised or suspicious activity. If you notice any discrepancies, report them to your bank or credit card provider immediately.
Verify insurance policies: When purchasing insurance, always deal with reputable companies or authorised agents. Verify the authenticity of the policy and cross-check the details with the insurance provider's official website or customer service. Utilise free look period facility in case of still falling prey to buying wrong policy.
Be cautious with digital payments: Make digital payments only through secure and trusted platforms. Avoid clicking on links or making payments through unfamiliar websites or apps. Double-check the authenticity of the platform before entering any sensitive information.
By staying informed, vigilant, and proactive, families can protect themselves from falling victim to financial frauds and ensure a secure financial future.
(The writer is a Financial Educator with 15+ years of experience, a published author, a TEDx Speaker and hosts multilingual podcast shows ‘LaxmiGyaan Library’ & ‘A Sip of Finance’)
