Five financial scams to be wary of in 2024

IN November 2023, an X user, @ElsaVanilla raised an alarm about the actions of Iriodalo Emmanuel Obhafuoso, a young man who she said fraudulently solicited money from multiple Nigerian women on the social media app under the guise of serious illness.

“This is Iriodalo Emmanuel Obhafuoso. He is a scammer. He enters girl’s dms, makes them comfortable talking to him and then proceeds to fall deathly ill. For me, he had a heart surgery. For Bolu, he had a spinal surgery,” she said in a post.

Following her post, several other Nigerian women came out to narrate their experiences of how they were seduced and unsuspectingly duped by the same guy who employs social engineering in manipulating individuals into giving out their fortunes.

Iriodalo’s primary targets are typically women in their twenties. He establishes a connection with them through charming messages, followed by falsely claiming to suffer from a serious illness, such as heart disease.

This kind of scam is called romance scam, and it is one of the many ways Nigerians lost their hard-earned money in 2023.

Financial scams have been around for a long time, but in recent years, they have become increasingly sophisticated. This article highlights some financial scams you should be wary of as we navigate the new year.

1. Romance scam 

Despite being a good platform for finding companionship, online dating apps and social networking sites are increasingly used by scammers to perpetrate financial fraud. Romance or dating scam has been defined as creating a fake profile to attract someone online.

Fraudsters befriend victims over the internet in the hope that they can get them to send money. Many Nigerian fraudsters called “Yahoo Boys” use this method to defraud foreign citizens. They use fake names and fake images to seduce people and defraud them of their hard-earned money. The Idalo’s case shows that several Nigerians might have been falling victim to this trick.

West Africa, particularly Nigeria, emerges as a global epicentre for these online romance scams, according to a 2023 study by Social Catfish, an online dating investigation company. Titled ‘State of Internet Scams 2023,’ the report identified developed nations like the US as prime targets due to their strong economies, tech-savviness, and bustling financial activity.

Similarly, a study conducted by Techshielder in 2021 ranked Nigeria as the second most notorious country in the world for romance scams, next to the Philippines.

Every year, the Economic and Financial Crimes Commission (EFCC) record a large number of arrests and convictions for romance scams but many people are still falling for the scammers’ favourite lies.

2. Investment scam/Ponzi scheme

This is a type of scam where people will be asked to invest a certain amount in a business with the pledge that their investment will be multiplied within a certain time frame. In some cases, they create a website or app to deceive people that they are engaging in virtual trading, they reward a few people to lure several others to join and afterwards, the website will reportedly crash.

Examples of such schemes include MMM, GMG, Loom and eBay, where many Nigerians have become victims. These platforms promise substantial returns, enticing many Nigerians to invest their money. However, after gathering a significant number of participants, they vanish with their money.

Their method involves paying earlier investors with the funds contributed by new investors, rather than generating legitimate profits. Referrals play a crucial role in these schemes, as participants are often required to invite a specified number of people before accessing their returns. As more people join, the operators struggle to meet payment obligations, leading to the inevitable collapse of the scheme.

3. Giveaway/Lottery scam 

Phishing scams remain the top most dangerous scam to avoid in 2024. This is a social engineering technique used to deceptively obtain people’s sensitive information or data. People are directed to enter their information on a website that looks legitimate.

Over time, The FactCheckHub have debunked several of such claims hiding under the guise of recruitment, support funds, empowerment programmes, government activity or free internet data. They often target subjects and issues that are of interest to the public. For instance, in 2023, the election was one of the major events we debunked several claims about politicians sharing money. These are mostly perpetuated by scammers.

4. Accounts infringement/Hacking 

Internet fraudsters often commit fraud by hacking people’s social media accounts.  After gaining access to their accounts, they send messages to their contact list that they are in need of money. One of the best ways to avoid this is to create a strong password for your social media accounts and secure them with two-factor authentication. If you feel like your accounts have been hacked, find a way to notify your followers about it immediately you notice.

5. Impersonation/Identity theft

This can come in various forms. Sometimes, fraudsters create social media accounts using the profile and image of a highly respected public figures like celebrities, politicians and business tycoons to defraud innocent people.

They use the account to message you on social media, and you will be told that they are considering you for a specific opportunity or appointment or wish to do business with you. Then, you will be asked to pay a certain amount to claim the opportunity or appointment.

For example, earlier this year, the Economic and Financial Crimes Commission arrested Charles Osaigbovo and Evans Obayaedo, both Oyo State residents for defrauding an unnamed British woman of £38,000 (pounds) after impersonating Fredrick Leonard, a Nollywood actor and movie producer. The duo obtained the money for the production of a non-existent film.

According to the EFCC, investigations revealed that Osaigbovo and Obayaedo, who were arrested in Ibadan, had been impersonating Leonard to defraud unsuspecting social media users.

Fraudsters also impersonate bank workers. They call to tell you that they need details of your bank accounts in attempt steal your personal details like BVN, Passwords, and ATM PIN, among others. Nigerian banks have made this clear umpteenth time that they don’t ask for the personal information of customers via phone call or SMS.






     

     

    CONCLUSION

    Financial scams can be devastating for individuals especially with the current economic situation complicated by recent high inflation and removal of subsidy. Scams can cause people to lose their savings and enter debts. In some cases, victims feel embarrassed or ashamed to report the scam.

    To protect yourself from financial scams, it is essential to be vigilant and take proactive steps to secure your finances. As we enter the new year, ensure that you secure your social media accounts by using strong passwords and two factor-authentication.

    Never invest in any business without conducting a thorough investigation into their modus operandi. Never send money to anybody without physical confirmation and ensure that you conduct routine searches of your name and images to ensure that you are not being impersonated.

    This report is republished from The FactCheckHub, read the original here

    Nurudeen Akewushola is an investigative reporter and fact-checker with The ICIR. He believes courageous in-depth investigative reporting is the key to social justice, accountability and good governance in society. You can reach him via [email protected] and @NurudeenAkewus1 on Twitter.

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    1 COMMENT

    1. Thanks for sharing valuable information, It will help people to know about tpes of financial scams. Financial Options Recovery Experts help people who are victims of above scams. Get expert consultation for free!

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