In the last six months, the Financial Markets Authority has observed a number of entities seeking to take advantage of crisis. Some were legitimate financial service providers, others were deliberate well-organised scammers. They included.
Money transfer fraud, targeting a Chinese family stuck in NZ due to the pandemic, who used a provider that advertised on a popular Chinese language website,
Fake investment adverts, using images of well-known New Zealanders with fictitious quotes and claims about alleged investments, usually crypto-currencies,
Imposter websites, which falsely claim to belong to a New Zealand business, or use images and information that belongs to others without their permission.
The FMA has issued more warnings about scams this year.
In the six months to September 2020, we issued 58 formal warnings – up 38% on the 42 issued during the same period in 2019,
From April to June 2020, we received a total of 226 complaints (including but not limited to any Covid-19 scams) – a 2.5% decrease on the same period last year,
From July to September 2020, we received a total of 243 complaints – down 23% on the same period in 2019.
International regulators have been issuing warnings about investment scammers who are exploiting the current market conditions and uncertainty due to the Covid-19 pandemic.
These include the following investment offers and activities observed overseas:
Goods or industries experiencing strong demand, such as sanitary products or pharmaceutical companies,
Products supposedly effective against Covid-19, such as vaccines, medications, protective gear or equipment,
So-called "safe haven" assets, including cryptocurrencies or precious metals such as gold, silver or platinum,
Promises of “passive income” or “cash flow” to appeal to people looking for new sources of regular income,
“Pump and dump” of low priced stocks, “pumped” up by fraudsters spreading false information about a company, then “dumped” by them once unsuspecting investors rush in.
Scammers are also using common techniques to trick anxious consumers:
Phishing emails, claiming to be from health authorities, banks or insurers, trying to trick people into sending sensitive information, or open attachments with malware,
Telephone scams, pretending to be from health authorities, claiming that a relative has fallen sick and requesting payments for medical treatment.
Resources available from New Zealand organisations