Significant efforts have been made to address the impact of fraud and scams on the South African consumer. However, it remains crucial to assess whether significant progress has been made in combating this challenge.
A recent report from Statistics South Africa (StatsSA) highlights South Africa’s crime statistics. While more consumers are reporting fraud to the police, there is a concerning trend of declining reported instances.
Manie van Schalkwyk, CEO of the Southern African Fraud Prevention Service (SAFPS), expresses concern about the potential financial impact of these crimes, especially when people’s life savings are at stake.
Individuals Most Susceptible to Fraud
One notable finding from the StatsSA report is that consumers residing outside of urban areas are more susceptible to fraud and scams compared to those living in metro areas. A recent media report illustrates this trend through the experience of a Cape farmer.
The victim encountered an advertisement for loans on the Messenger app, claiming affordable cash repayment at a 5% rate from R20,000 to R20 million. Believing it to be a legitimate offer, the victim applied for a R1 million loan for his farm. However, the scammers requested various fees, including lawyer’s fees, Financial Intelligence Centre Act (FICA) fees, and agent fees, depleting the victim’s pension fund.
To make the scam appear authentic, the scammers fabricated letters from institutions like the South African Reserve Bank (Sarb) and HSBC. Eventually, the victim lost R2.7 million in supposed fees.
An Empowerment Platform
In response to such scams, the SAFPS developed Yima, an innovative platform aimed at scam prevention and detection. Yima allows South Africans to manage their risk of falling victim to scams, report scams, secure their identity, and biometrically verify fellow citizens’ identities. It provides tools for identifying scams and offers educational resources for safe internet use.
Yima does not prevent online transaction banking fraud but ensures users shop confidently on verified websites. Users can report suspicious activity to the SAFPS, access consumer products and services like Protective Registration, and navigate decision trees to identify potential scams.
Supporting Fraud Victims
When consumers become fraud victims, reporting incidents to relevant authorities can be challenging and stressful. Yima simplifies this process by offering a scams hotline reachable at 083 123 SCAM (7226). This hotline directs victims to relevant authorities such as the South African Police Service (SAPS) and their banks, streamlining the reporting process and reducing stress for victims.
SAFPS partnered with MTN and stakeholders for a proactive fraud prevention hotline, emphasizing the strength of collaboration in combating fraud.