A Little Common Sense Can Go A Long Way

In these times of economic uncertainties there are a lot of people out there who will resort to any measures to part you with your money. It has been a proven fact that when the economy goes down, crime goes up.

Lately I have been receiving a lot of emails warning me of some scam or other. Apart from knowing how these scammers work, a little common sense on our part can go a long way in preventing yourself from being a victim of one of these scams. Below are some of the scams that's running rampant and how some common sense can help you avoid them:


1. Someone from a 'Bank' calling you to get information about your credit card or ATM card.

Firstly you should know that the banks WILL NOT call you over the phone or even email to get your information. Bank Negara Malaysia (BNM) has verified this. So when you can a call or a mail asking for information you should just thank the caller, hang up and call your bank's customer service center to verify.

Secondly, if you already have an account with the so-called bank, they ALREADY have all your details. Remember that you filled up form after form when you're opening the account? Why would they want the information again?


2. You get an email telling you that you need to verify your login credentials at Ebay or PayPal and there is a link in that mail for you.

NEVER, EVER click on a link on any emails asking for credentials. What you should do is:
- Close the email.
- Open your web browser and personally TYPE in the website's URL into your browser and go directly to the site.
- Login to the site that way and change your password in the control center there.

NEVER click on any link as this is a popular way phishers out there steal your account's credentials.


3. You get an email from a wife of a deceased government official in some country in Africa or some other third world nation pleading with you to help her transfer her husband's fortune out of the country with a promise that you will be rewarded with a handsome sum of money.

This is an OLD, OLD scam that is still successful in catching some suckers. It's called the Nigerian scam and has existed even before the internet became popular. What you should do is delete the email after having a good laugh reading it. There is no such money to be had. If all that money could not get her help where she is at, why would you think that you, living halfway across the world, can be of any help?


4. You receive a call or SMS telling you that you have won some grand prize in some contest that you don't remember entering.

This is another popular scam that seems to be evergreen. The catch is that you need to pay some 'fees' to claim your prize which is bound to be many times more than the 'fees' imposed. What you should do is tell the caller that you'll share the prize with him/her 50-50 if she'll front the so called 'fees' for you. Hey! It's win-win, no? The caller fronts the 'fees' processes the whole thing, claim the prize and then forward you 50% of the amount. If this were legit and you are the caller wouldn't you jump at the chance to do this?


5. You hear of some 'sure win' investment methods that so secretive and exclusive that you need to go through some shady agent to invest. The returns of the investment are ridiculously high and you can get your returns in a very short period of time and some may even be guaranteed.

Another old trick from the book of cons that seems to work time after time. You need to keep in mind that no investments are ever guaranteed. Even the money you put into a Fixed Deposit (FD) in a bank is not guaranteed 100%. Banks can go bankrupt and the government only insures the depositors up to a certain amount.

If high returns investments are so easy to come by, then we would all be millionaires. Most times these investments are done 'overseas' or via the internet and what not so that you never get a complete picture of where your money goes. Most of the time these investment scams ends with the agent or the company itself disappearing overnight along with your money.

Remember the first rule of investment - savings. In order to invest you first must have savings.Investments uses the 8th wonder of the world to gain returns. What is the 8th wonder of the world? Compounding interest. To make use of compounding interest you need the element of time and the longer the time frame, the larger the returns that compounding interest can get you. So there is no quick money.

Quick money can only mean one of 2 things - one is that it is a scam and the second is that is it no better than gambling. Investing is not the same as gambling. Investing is usually over long periods of time, i.e. 5 years or 10 years. Not 5 months or 10 months.

So if it is not a scam then you are probably involved in some form of gambling. You know the odds for gambling right? Whenever you're gambling, the odds are never in your favour. If you really want to gamble then go to a casino. At least in a casino you can see your money flowing away while you hope to win playing whatever game it is that you usually play.


So have your common sense around with you and never be too trusting with anything. Phone calls, SMSes and Emails are convenient but they are also anonymous to a certain extend. You can never be sure who is really on the other side. Better be safe than sorry.