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Cell phone banking fraud on the rise

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Award-winning consumer journalist with The Times, Wendy Knowler, in her recent article, which is titled ‘cell phone-related fraud’ took to task the alarming rate at which banking fraud is occurring within South Africa. Knowler explained that her motivation for writing the column was the numerous reports that she received, about cell-phone related crimes, over the years.

She further noted that in order for criminals to access the bank account of an individual, criminals require the consumer’s personal details, as well as the one-time pin, which would require access to the consumer’s cell-phone.

The criminals gain access to the one-time pin with the assistance of insiders employed at the bank.

“Last week forensic scientist Dr David Klatzow said that a client of his lost R200000 from her FNB account as a result of an MTN SIM-swap scam, and that other MTN-FNB clients had also suffered losses, and it was “an inside job” in both companies,” Knowler stated.

Criminals are, therefore, able to transfer funds from the consumers account into their account. Fund theft extends to credit card funds – funds which the victim does not own and leaves the victim in “a very desperate financial situation.”

Knowler explained that many more fund theft crimes surfaced after the publishing of her article. She noted that an elderly individual, whose bank account had been hacked, was robbed of R40 000.

One of the more alarming cases that she received was that of Irene Rheeder, a Vodacom customer, who banks with Absa.

Whilst on a flight from Cape Town to Seoul, in September, an individual at a Vodacom shop in Pretoria activated a “twin call” facility on her account.

“With this facility, when the primary number is switched off, the second or “twinned” number receives calls until the primary SIM is activated again.”

Knowler explained that R30000 was transferred from Rheeder’s credit card to her cheque account, R35000 was transferred from her savings account, and a further R25 000 was transferred into a Capitec account, “but thankfully a second attempted transfer was stopped by Absa’s fraud department.”

“Absa refused to refund the money, saying the security SMS’s to her cell phone were acknowledged, and when weeks went by without a response from Vodacom’s fraud department, Rheeder contacted In Your Corner for help.”

“Vodacom’s chief corporate affairs officer, Maya Makanjee, said an investigation had revealed that the fraudster had presented no documents in order to activate the Twin Call facility on Rheeder’s account, and had since been arrested and detained pending criminal investigations, along with “external persons”.”

The network as a “gesture of goodwill”, and in order to “resolve the matter on an amicable basis without resorting to litigation”, offered Rheede R8750.

Knowler further explained that the banks and cell phone companies deny liability of these crimes by asserting that consumers have “compromised their pin”.

Rheeder is adamant that she has never compromised her PIN.

Consumers in some instances are inadvertently handing fraudsters their information by clicking on links in emails that appear to be a secure link from their bank. This phenomenon, she believes to have occurred as a consequence of the increase in smart-phone usage.

“All the gains that we have made, in terms of convenience, has actually played into the hands of fraudsters,” leaving consumers vulnerable to theft.

Knowler urges consumers to refrain from clicking on email links that appear to be sent from a bank or SARS – “your bank will never send you a link to click on.”

Consumers who have been victim to fraud may contact Knowler on: consumer@knowler.co.za
VOC (Thakira Desai)


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