This article is also available in Chinese
The ‘Chinese Embassy’ scam, targeting Chinese New Zealanders, is an example of the lengths scammers will go to extort money from innocent people. The Banking Ombudsman Scheme, which helps fix problems between customers and banks, received a 21 percent increase in complaints about scams last year.
“We receive a steady stream of complaints from people about scams, including investment, romance, social media, telco or invoice scams,” says Banking Ombudsman Nicola Sladden. “During lockdown, with more people at home and online, scam activity increases so we ask people to be extra careful and to contact us any time.”
The ‘Chinese Embassy’ scammers pretend to be Chinese officials and claim their victims are the suspects of fraud, threatening them with arrest or deportation. One woman, who lost $200,000 this way, said the scammers sounded convincing and authoritative. She was terrified of being separated from her family.
“Scammers come in many guises and are becoming more sophisticated,” says Ms Sladden. “Scams can affect any of us and can be truly devastating.”
For example:
- Sally,* a property investor, lost $865,000 to a romance scam last year. After sending $500,000 overseas, she obtained $365,000 in bank loans to send to the fraudster. We found the bank should have made more enquiries about the third loan. However, Sally had given credible reasons for the first two loans, which would not have alerted the bank to the possibility she was the victim of a scam.
- In another romance scam, Harper* sent $50,000 overseas. We found the bank had not asked Harper about the purpose of the transactions and failed to act on two clear red flags. The bank paid Harper $25,000 for financial loss, stress and inconvenience.
- When Sue and Chris* lost their life savings to a Hong Kong investment scam, we found the bank hadn’t made enough enquiries about one of the loan applications.
“We urge people to be extra careful online, and be wary of calls, texts, emails or social media messages out of the blue. If you think you’ve lost money to a scam, contact your bank immediately.”
“Our service is free and independent. We can provide information and guidance and help you make a complaint to your bank.” Language translation services are available.
Ms Sladden says when they investigate scam complaints, they look at whether the bank has provided its service with reasonable care and skill.
Information is available in traditional Chinese here and simplified Chinese here
Link here for more scam cases and our quick guide
Contact: www.bankomb.org.nz
*names have been changed
