Beware of New, Smarter Investment Scams

29 Jan

Investment scams are evolving, using professional-looking websites, fake registrations, and well-crafted schemes to trick victims. As an accountant, you need to help clients spot these scams before they lose money.

Recent Scams

Two recent scams cought the victims off-guard. The first is the Fake WHO Prize Scam where a scammer convinced a victim he had won $20 million from the World Health Organization, even sending a fake SARS approval letter. The victim paid R1,500 to "release the funds"—and never heard from them again. The second one was the SpaceX Pre-IPO Scam, where a fake investment firm offered pre-listing SpaceX shares, using a professional website, brochures, and local bank accounts. A victim lost R1.4 million before realizing the entire setup was fake.

What Accountants Must Watch For

Fake Registrations & Local Bank Accounts – A South African bank account does not make an investment legitimate. Always verify the service provider on the website of the Financial Sector Conduct Authority (FSCA).
Impersonation of Big Brands – Scammers use trusted names like WHO, SARS, Tesla, or SpaceX to appear credible.
Too-Good-to-Be-True Returns – If returns seem unrealistically high, they probably are.
Pressure to Act Fast – Fraudsters create urgency to make victims commit without verifying details.

How Accountants Can Protect Clients

As an accountant you should advice clients to be more vigulent and offer assistance to:

Verify investment firms on FSCA’s website.
Check company details—a professional website does not mean legitimacy.
Search for similar scam warnings online.
Advise clients to never transfer money to unverified investment firms.

Choose Your Path to Exclusive Insights

Stay ahead in the world of accounting with premium content designed for professionals like you. Access expert articles, industry trends, and essential resources. Become a CIBA member and claim your CPD hours from CIBA.