Don’t invest in a scam – advice from a Technology Leader
7 Jul, 2022

The rising cost of living continues to tighten its grip on the economy, giving scammers, fraudsters and hustlers the green light to prey on those desperate enough (and potentially unaware of the dangers) to choose an easy way out of the financial hole they have fallen into.

While there are many scams floating around our email and SMS inboxes, the good-old-fashioned ‘get-rich-quick scheme’ is still going strong as opportunistic criminals seek to swindle investors out of their money.

Recently, the Financial Sector Conduct Authority (FSCA) revealed the story of a South African man who allegedly defrauded over 600 investors, some of whom lost more than R1 million of their hard earned savings. This followed claims that the man could double their money in three months by trading foreign exchange.

Friedrich Rappard, Chief Information Officer at Momentum Investment says investment scammers wouldn’t be so successful if people remember the one golden rule: Investments are a long-term game.

“I’m afraid investments are not going to get you rich quick,” says Rappard. “It is important to remember that a solid investment plan is one that extends for years if not decades. If someone is offering to double your money in three months, you better be wary and start questioning their motives.”

Rappard says scammers lure individuals in with a promise of low repayment loans or high returns on investments in a short space of time. He says these scammers may also go to great lengths such as creating websites that almost perfectly imitate real investment brands like Momentum (e.g., or

According to the FSCA’s MyMoney Learning Series, there is a long list of investment scams. These include:

Pyramid schemes
Ponzi schemes
Advance fee fraud
Offshore scams
SMS phishing
Identity fraud
Online gift
Travel fraud
Job Scam
Truck scam
Property Scam

Rappard says the popularity of the recent Tinder Swindler documentary on Netflix should add the “Romance Scams” to the top of one’s mental list as well. “Requests for travel money to meet you, cash gifts, or money to help them out of a personal crisis should have you immediately running in the opposite direction. Not being able to ‘meet’ them on a video call or to speak on the phone should also be a red flag, especially if they always cancel at the last minute.”

To protect yourself from fraudsters, Rappard provides a few tell-tale signs to watch out for when it comes to potential scams:

Emails asking you to confirm personal information, such as passwords, personal pins or your ID number. This one should always be a huge red flag.
“Business” emails sent from public email domains. Another red flag.
Emails using generic greetings such as “Dear Sir” or “Hello dear” instead of your name.
Unexpected emails from unknown or even legitimate-looking sources, prompting you to click on a link or attachment.
Poorly worded emails. Pay as much attention to grammar as you would the spelling.

Always check that the URL provided matches with the actual domain.

When it comes to investments, Rappard says there are other tell-tale signs to look out for that only the savvy investor could spot.

As a savvy investor, he says one should take the following into account:

The investment company should be licensed by the Financial Services Conduct Authority (FSCA) and should display its FSP number on all marketing material
If the bank account of the investment is held in the name of a private individual, be suspicious.
Any investment transaction taking place on WhatsApp should be treated as suspect.
Any reputable investment company will be able to provide you with a solid track record of their previous transactions and should include client testimonials.

“Don’t be easily fooled. If it sounds too good to be true, it probably is,” says Rappard. “It’s up to you to do your homework and apply logic and reason to an investment offer. In the end, it is wise to only invest with an established investment company whose name and reputation you can trust.”



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