Criminals are taking South Africans for a ride – and we go willingly

 ·10 May 2024

The Southern African Fraud Prevention Service (SAFPS) has warned that South Africa is becoming a fraud hub, with an alarming increase in cases across the country, which includes a spike in money-muling victims.

According to Fraud Statistics 2024, the number of fraud incidents reported to the SAFPS in 2023 increased by 32%.

The data further showed specific sectors are more open for fraudsters than others. Banking fraud made up 45% of the fraud incidents reported last year. This was followed by the Micro Finance Sector (19%) and the Clothing Retail Sector (14%).

“This increase is alarming and indicative of how South Africans are becoming easy targets for fraudsters and scammers who are highly motivated to find their next victim,” said Manie van Schalkwyk, CEO of the SAFPS.

Looking specifically at how fraud is perpetrated in these sectors, Van Schalkwyk pointed out that money muling is still one of South Africa’s most significant challenges.

The cases have again been flagged as a significant issue, and many South Africans are becoming willing victims, he said.

Van Schalkwyk added that one of the most common forms of money muling is when a victim is approached by someone claiming that they need to receive money from a family member in another country and they need a bank account to perform this transaction.

“Many people want to help and willingly let these fraudsters use their bank accounts.

“While this may seem an innocent crime, research points out that money muling funds activities such as drug and human trafficking and terrorist activities,” he said.

Standard Bank issued a similar warning last year, noting that the number of South Africans tricked into becoming money mules has rocketed in the past three years as cash-strapped individuals succumb to the financial pressures of the rising cost of living.

The bank explained that money mules are recruited from various backgrounds, ages and gender groups.

The fraudsters target individuals without criminal backgrounds to better evade the scrutiny of authorities, the bank said, adding that they target both economically desperate South Africans and foreign nationals.

The SAFPS reminded South Africans that the repercussions of being a money mule are significant.

The guilty party will be listed with the SAFPS, and the individual could struggle to get access to finance for ten years.

“It is one of the biggest issues that the SAFPS is currently facing, and it is important for the public to know about the seriousness of this crime,” said Van Schalkwyk.

The SAFPS flagged other cases of fraud, including forged documents, impersonation fraud, and employee application fraud—all of which Van Schalkwyk said are on the rise in South Africa.

Read: What to expect for interest rates in South Africa this month

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