These are the banking scams you should look out for in South Africa right now – with fraud on the rise

 ·15 Jul 2021

InSites Consulting South Africa has published the results of its annual SITEisfaction Report, which reveals the behaviours and experiences of online customers using South Africa’s six main consumer banks: FNB, Capitec, TymeBank, Nedbank, Standard Bank and Absa.

With fraud being at an all-time high in 2019, the report pointed to a slight curb in 2020, with 60% of users reporting to have been targeted by fraudsters, down by 9% from 2019. “This year, we see the same number of consumers (60%) claiming to have been targeted by fraudsters,” the report’s authors said.

Somewhat more concerning is the slight increase in those who claim to have been victims of fraud, up from 30% in 2020 to 32% in 2021, they said.

Similar to 2020, the most prevalent fraud of 2021 was phishing – where a person tries to trick you into giving them your confidential information by pretending their email communication was sent from the bank – with 59% of the South African internet-banking population being aware of it, 15% reported being targeted by it, and 4% of users falling prey to it.

These figures are almost identical to 2020’s, suggesting that fraudsters are becoming more sophisticated, while users are perhaps not paying enough attention to this. “While the banks are frequently communicating about bank-card and ATM fraud, it would perhaps serve users well to receive more information on digital scams as well,” InSites Consulting said.

Other prevalent scams include the “You are a winner” pay-to-play scam – which involves alerting the targeted user that they are the alleged winner of a prize, but that they’d have to either pay to enter the competition or pay to redeem the prize – email hacking, SIM swapping and the deposit-refund scam.

“This year, we added another three new scams to the list, bringing the total number of digital scams to 31,” said Anneri Venter, research director at InSites Consulting South Africa.

“The usual suspects like phishing and email hacking seem to be difficult to control, remaining a pain point for many users. We hope, with the new POPI Act coming into effect, that users might practice more caution regarding the information they are exposed to, but fraudsters will always find new ways to scam someone, so it remains a tough battle to fight,” said Venter.

InSites Consulting pointed to a list of the most harmful scams:

  • “You are a winner” Pay-to-play
  • Email hacking scam
  • Online goods scam
  • Phishing
  • Deposit refund scam
  • SIM swapping
  • Social media scam
  • Dating and romance scam
  • Holiday scam
  • Covid-19/ coronavirus scam

Banking customers urged to remain extra vigilant

The Ombudsman for Banking Services (OBS) said that South Africa is in the middle of one of the most trying times in the country’s history.

Unemployment was on the rise which will only worsen in the aftermath of the current situation. In addition, tensions are boiling overturning into violent acts and destruction which are currently disrupting society. This includes bank ATM’s and branches.

“During these trying times, we are urging all banking clients to keep calm and to be aware that the violence will be causing some disruption to normal branch services.

“In addition to all the other challenges facing consumers, fraudsters will be more motivated than ever to take advantage of the current crises that are gripping the country. We need to be extra vigilant during these times,” said Reana Steyn, the Ombudsman for Banking Services.

The OBS has opened over 4,000 formal cases to date in 2021 so far. Current account complaints are presently the category with the highest number of complaints. Fraud and fees and charges are the two main sub-categories that were complained about.

Online migration

Many banks have announced that there will be disruptions to their branch services. Some branches, particularly in malls which are being targeted by looters and rioters, have been closed to the public until further notice. Others have even been destroyed along with associated infrastructure.

This will force a lot of people to shift to online transactions. This will also see a shift in fraud with scammers taking advantage of the desperation currently gripping the country.

“The move to online transactions and mobile banking will prove to be challenging for some people as it may be the first time that they ever transact with their bank in this manner,” said Steyn.

She added that fraud continues to pose a real threat to the financial wellbeing of our society. Banking customers continue to be tricked into divulging personal information such internet banking credentials as well as card information.

This enables fraudsters to conduct fraudulent transactions where cards do not have to be present.


Steyn explained that her office witnesses a lot of complaints where bank customers fall victim to scams where fraudsters convince customers into making payments into a nominated bank account under the guise of selling them goods such as motor vehicles. Tender scams are also becoming increasingly popular, she said.

In one of the matters dealt with by her office, Steyn explained that the complainant paid over R96,000 to a fraudster who had convinced him that they supplied water pumps. Unfortunately, by the time the matter was reported to the bank by the customer (and a block was placed on the fraudster’ account), the fraudsters had already depleted the funds.

Steyn said that an investigation conducted by her office found no evidence of wrongdoing by the bank which would justify the bank being held liable for the complainant’s loss.

Steyn urged bank customers to ensure that they contact their banks or the beneficiary bank to verify the authenticity of the recipient of the funds prior to making payment.

In the majority of the cases dealt with by the OBS, it was established, only after the funds had been depleted, that the accounts were not in the names of the businesses they purported to be in. Steyn particularly warned those making payments to recipients with no proven record to be vigilant.

“The level of desperation that fraudsters are showing is alarming. They are motivated and are acting brazenly. Never divulge any personal information to a person over the phone, even if they assure you that they are from your bank. Report any suspicious activity to your bank’s fraud hotline immediately,” said Steyn.

Tips from the OBS:

  • Be aware: always remember that legitimate businesses will never ask you for your personal, sensitive, or confidential banking information;
  • Anyone who does this over the phone is probably trying to scam you;
  • Always be sceptical: even if your Caller ID gives the name of a bank, or some other company or organisation, it could be a trick;
  • Don’t click on links or icons in unsolicited emails: don’t reply to these emails. Delete them immediately;
  • Check that you are on the secure banking website before entering any personal information;
  • Check your bank statements regularly and report suspicious entries immediately to your bank;
  • Never accept assistance from a stranger at an ATM.
  • If your card is jammed at the ATM do not leave the ATM but immediately contact your bank to report the incident.

Read: New scam targeting banking customers: FNB

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