Scammers pushing new ‘Ponzi’ scheme over WhatsApp in South Africa

 ·10 Jun 2020

The Financial Sector Conduct Authority (FSCA) has warned that the Covid-19 pandemic has resulted in a marked rise in investment scams targeting unsuspecting South Africans.

The regulator warned of new a scam which involves a method of fraud known as ‘identity hijacking’.

Here, a prominent person’s identity is used fraudulently by criminals, posing as well-known financial institutions, to extract money from individuals.

The Ponzi-style scheme operates on WhatsApp and is being perpetrated against investment company Alumni Energy Investments.

“The FSCA received information that individuals are attempting to use Alumni Energy Investments’ name to fraudulently solicit money from people on WhatsApp.

“The scam is communicated on WhatsApp and offers its investors immediate returns within 24 hours. The scam also illegally uses the name of Alumni CEO, Mr Shakes Motsilili to mislead victims,” it said.

Alumni Energy Investments has issued a warning statement on their website and has opened a criminal case.

The company also advises existing and potential investors that it will only accept new investment queries on email using the [email protected] email address.

“We are working with financial and criminal law enforcement authorities and following the necessary protocols at this time and we ask that if you suspect you may be a victim of this scam to call your local police station,” the firm said.

According to a joint advisory from the UK’s National Cyber Security Centre and the US Cybersecurity and Infrastructure Security Agency, criminals are using the Covid-19 pandemic to carry out phishing and malware attacks.

The agencies said that they have observed a rise in the use of Covid-19-related themes in attempts to harvest sensitive user data or to swindle users out of money.

The threat has been amplified by the increase in remote working as more people are confined to their homes due to governmental restrictions on movements.

“At the same time, the surge in home working has increased the use of potentially vulnerable services, such as VPNs, amplifying the threat to individuals and organisations,” the advisory stated.

Read: Uber Cash launches in South Africa

Show comments
Subscribe to our daily newsletter