01 April 2022
Data released by ASB this April Fool's Day shows a dark side-effect of COVID-19, with a significant increase in Kiwis falling victim to scams since the pandemic began in March 2020.
Investment scams, particularly those involving crypto-currency, top ASB's list of scams a growing percentage of Kiwis are falling for, with the number of customers being tricked into responding to fraudulent money-making opportunities more than tripling between April 2020 and March 2022.
The bank's data also shows more than double the number of customers falling for romance scams in the past two years.
ASB customers who reported falling victim to 'Phishing' and 'Smishing'* scams also peaked during the pandemic. The biggest spike took place between November 2020 and January 2021, following a 'Smishing' attack in which scammers posed as a postal agency, with this figure jumping to more than 1,000 customers impacted per month up from the normal average of 100.
ASB Head of Fraud Operations, Mark Emmett, says the highly sophisticated nature of scams and the ongoing impacts of COVID-19 are likely to blame for more Kiwis suffering a financial loss at the hands of scammers.
"We're seeing scams becoming very highly sophisticated, which makes them hard to spot and it unfortunately means more Kiwis are being caught out. Falling for a scam certainly doesn't make you a fool.
"COVID has put people in situations where they are isolated from their support networks and this can prevent them from getting a second opinion. Financial pressures brought on by COVID are also making people more susceptible to being deceived by scams offering opportunities to make money, so it's no surprise that we've seen these figures increase during the pandemic," says Mr Emmett.
Mr Emmett says a lack of knowledge and awareness of crypto-currencies is also contributing to more Kiwis being duped.
"Crypto-currency offers a new investment opportunity some Kiwis are keen to take advantage of, however as there's still a lack of understanding around it, we're seeing more people being lured by investment scams rather than seeking advice from a registered financial advisor," says Mr Emmett.
Another worrying trend is the rise of more complex cold call scams, with the bank reporting double the number of customers being caught out by a scammer posing as a bank employee in the past 12 months.
More than 70% of ASB's customers who had fallen victim to an investment, romance or cold calling scam during the pandemic were over the age of 50. The average age of customers who fell victim to an investment scam was 58, an average age of 60 for a romance scam and those falling for cold calling tending to be slightly older at an average age of 77.
Despite this, Mr Emmett says Kiwis of all ages should be wary of being caught out by scammers.
"Scams impact customers of all ages, in fact we're seeing younger people regularly being caught out via social media. It's typically our customers over the age of 50 who are more likely to report it, as they often suffer a larger financial loss," says Mr Emmett.
"The difficult thing with these types of scams is that customers can make transactions without realising they are being scammed. It's important for Kiwis to look at these things with a dose of healthy skepticism, and if they have any doubts to get in touch with our fraud team via 0800 ASB FRAUD. ASB will never ask for your internet banking details over the phone or send you a text or an email with a link to log into FastNet Classic, nor we will ask you to send money to any unfamiliar accounts" says Mr Emmett.
As well as raising awareness of the risk of scams and fraud, ASB is taking practical steps to help protect customers and has recently introduced new authentication measures via its mobile app to prevent and notify customers of unauthorized logins to their FastNet Classic accounts.
*'Phishing' refers to scams in which fraudulent emails are sent out in an attempt to trick a person into sharing sensitive information. 'Smishing' is a similar attack which relies on using SMS or text messaging for this purpose.