Eighteen agencies across Australia and New Zealand have joined forces to combat consumer fraud, warning consumers about the scams that affect thousands of Australians every year.
The Australasian Consumer Fraud Taskforce launched a four-week campaign today to help people to protect themselves from becoming victims of scams.
"Crimes involving fraud cost Australians millions of dollars each year", Australian Competition and Consumer Commission Deputy Chair, Ms Louise Sylvan, said. "The best protection against scammers is to hit the delete key, hang up, or throw it in the bin".
"As regulators, advocates, educators and other consumer protection agencies we see the devastating effects which scams have on people. Our combined experience and knowledge has shown that the best way of combating consumer fraud is to educate people and change their behaviour before they get caught out".
Ms Sylvan said Australian agencies including the ACCC receive thousands of complaints, and often calls for help, each year about scams received by mail, telephone and email.
"The key message to consumers is to 'delete it, hang up or destroy it'. Consumers are their own best defence, and should always err on the side of caution".
The Taskforce, which is chaired by Ms Sylvan, is working on outreach strategies, prevention strategies and research.
"Scammers are becoming increasingly sophisticated in the way they target people. We need consumers to resist these approaches and refuse to respond", she said.
The ACCC top scams in 2005 included:
- Lottery scams – where a consumer receives a letter about their 'big win' but they need to send some money for administration fees and the like
- Advance fee frauds – like Nigerian letters where you can make 'millions' by helping someone get their money out of the country – just send your bank details!
- Pyramid selling and chain letter schemes – where you too can make a fortune by just paying your upfront fees and recruiting many others to do the same
Scams are a global problem with many emanating from international jurisdictions, making them difficult to take action against.
"Consumers who respond to these scams nearly always lose their money, and most never see it again", Ms Sylvan said.
Australians became the victim of the third biggest pyramid scam, in terms of the amount of money lost, when Australian consumers bought about 156,000 Skybiz 'webpacks' amounting to nearly A$20 million between 2001 and 2003.
Australians have also lost considerable sums to advance fee scams, such as letters and emails purporting to come from Nigeria. One Sydney victim lost more than A$700,000 while an Adelaide businessman lost more than A$2.3 million to such a scam. In another case, a Japanese businessman is said to have lost US$5 million.
"So resist the temptation. Be wary. Do not respond to these scams. Do not send money upfront to collect supposed winnings from lotteries that you didn't enter. Don't reply to letters promising you rich returns. Do not click on links in emails and provide personal information, and do not believe people who call you up to offer a great investment deal", she said.
"All of these scams promise much and deliver nothing. The key message for consumers is: Don't help the scammers to scam you!"
The key characteristics of a scam include:
- it comes out of the blue
- it sounds like a quick and easy way to make money
- it tells you there is almost no effort and no risk, and
- it sounds just too good to be true.