The Straits Times reported on 21 February 2021 that many have fallen victim to dubious online ads promising "super profits" for those who invest online, including in bitcoin.
In one case example, John (not his name) was taken in by the sales pitch of a representative from an online investment platform. He followed her instructions to transfer $30,000 to an overseas bank so that he could start a trading account. A week later, another representative told him that his investment was making money and even emailed him screenshots of his purported trading account indicating profits.
Instead of being suspicious that only screenshots were sent and that actual access to his account was not provided, John believed the representative and transferred more money as instructed. Eventually, the representatives became uncontactable and John realised he had been scammed. He called his bank to try to recall his last transaction, but the bank was only able to retrieve $10,000 out of $110,000. John blamed the bank for his losses and made a claim at the Financial Industry Disputes Resolution Centre (FIDReC).
An initial mediation at FIDReC failed to resolve the dispute so John went on to the next stage of adjudication. At the hearing, John argued that the bank should not have facilitated the fraud by enabling his funds to go through to the scammer's account, especially as two overseas authorities had issued warnings against the company in question. He also said his bank should do physical checks on the business premises of all merchants before allowing them to accept electronic payments. The bank countered that it was not their usual practice to physically inspect account holders' business premises. It also noted that the overseas warnings were issued only after John had transferred his funds.
The Adjudicator eventually decided in favour of the bank because John had authorised all the transfers, which were done according to the rules. The bank's employees were also not careless in performing the transfers.
The report gave some tips on how to avoid being scammed - ask, check and confirm.
ASK - ask as many questions as you can, such as how the companies are able to give the promised returns.
CHECK - do background checks on the companies and their schemes
CONFIRM - confirm if the company is regulated by the Monetary Authority of Singapore
Read the full story here.