Avoiding scams

Protecting yourself from scams

Scammers know all kinds of tricks to get you to hand over your money. Here are some practical things you can do to protect yourself and stay one step ahead of the scammers.

Ask the right questions

To check the legitimacy of someone making you an offer, ask them:

  • What is your name and what company do you represent?
  • Who owns your company?
  • What is your address?

If they avoid answering these questions, the deal they are offering you is probably a scam. Hang up the phone, delete and block the email or messages through social media, and stop dealing with the person. Even if they answer all these questions, be cautious and do your own checks on their answers.

Smart tip

It is illegal for a foreign business to sell overseas investments to Australians if they do not have an AFS licence. Australian companies also need an AFS licence to legally sell investments in Australia.

Do your own checks

Always do your own research on a company before you deal with them. You should seek independent professional or legal advice so you are not relying solely on the information the potential scammer gives you.

Check the company's Australian Financial Services (AFS) licence or credit licence for any investment or credit opportunity being offered. Do this by searching ASIC Connect's Professional Registers.

Find out what an AFS licence means.

If the company does not have an AFS licence or says they do not need one, do not deal with them and report them to ASIC.

You can also:

  • Check ASIC's list of companies you should not deal with to see if they are on the list.
  • Check the publicly listed phone directory for the company's address to ensure it is correct.
  • Check the IOSCO website and overseas regulator websites to ensure they are legitimate or if there are any warnings against them in other countries.

Protect your personal information

  • Do not give out any personal, banking or credit card information to anyone who makes contact with you.
  • Check your bank and credit card statements every month.
  • Destroy all documents with your personal information on them.
  • Choose passwords that are hard to work out and never share your passwords with anyone else.
  • Avoid using the same password for multiple log-ins. 
  • Be careful what you post online and, if you can, try to limit what you share.
  • Make sure your privacy settings are up to date on your social media accounts and share personal information with 'friends only'. Beware if you receive friend requests from people you don't know, as they may be trying to gain access to your information.

Case study: Mark loses his money to a phone scam

Sad Young Man In SuitMark got a call from a person who claimed to be from his bank, who said his bank account was at risk. They asked him to move his money into an overseas bank account to protect it. Mark thought this sounded a bit extreme but said he would think about it.The person on the phone pressured Mark and told him he needed to move his funds or he could lose them for good. Mark decided to transfer the money to protect his savings.

A few days later he called his bank asking when he could move his money back to his Australian bank account. The bank said they had no record of the call and that his funds had never been at risk. Mark had been scammed. Because he had transferred his money overseas he couldn't get it back. Mark lost all the money he had moved.

Secure your computer and mobile device

Delete and do not open any unsolicited or suspicious emails you receive, and if you have opened them, do not click on any links in these emails. Enable security settings on your computer and mobile devices and install current anti-virus programs.

Never send any personal information via text message. If you get a text message from your bank or government department asking you to follow a link, be wary. A bank will never ask you to send personal information via email or text and will never ask for your PIN or CCV numbers. If the caller or sender claims to be from a government agency, remember that government departments would never ask you for your personal details via email or text message. 

You can also protect yourself on social media by ensuring your password is secure and by deleting and blocking ads for financial products from your feed. 

For more tips on scam avoidance see protect your identity and protecting yourself from online scams.

Reduce telemarketing calls

You can put your name on the Do Not Call Register to remove your name from telemarketing phone lists. This should reduce the number of telemarketing calls you receive but will not stop scammers from phoning you as they do not follow the rules set by government.

Be on guard about every offer that is made to you. Remember if it looks too good to be true, it probably is. Your best defence against scams is to hang up the phone, delete the email or text or destroy the letter if you think it looks even vaguely like a scam.

Related links

Last updated: 24 Apr 2018