scamwatch Archives

Your super: A scammer’s new target

29 July, 202431 July, 2024 Updated on31 July, 2024 Education, Superannuation

In a recent media release, the Australian Securities and Investments Commission (ASIC) warned about a new scam doing the rounds. Scammers attempt, through cold calls to superannuation savers, to extract personal and super fund details by offering incentives in the form of gift cards, competitions or mobile phones. Some induce victims to create an account on their ‘comparison website’ to legitimise themselves and their advice. Rosie’s story: When you get those phone calls in the evening, you know, around dinner time, you’re immediately suspicious. But Steve rang mid-morning saying he represented a well-known investment firm. He said that his area of expertise was superannuation, and that it would only take a moment for him to explain what he could do for me. He then guided me through the steps for creating an account on his website. Naturally, I was cautious, but Steve reassured me it was just a comparison site, and I wasn’t signing up to anything. He showed me how to compare my super fund’s returns with others, and the website seemed so legit that I felt a bit silly for initially having doubts. I listened to what he had to say, and it all made sense. Gerry’s story: The first I knew about all this was when Rosie called asking me to transfer her super into an alternative fund. A bit of background; Rosie has been a client since we first set up a retirement plan and savings strategy for her, twenty-odd years ago. As her lifestyle changed over time, we reviewed and tweaked her portfolio, and she was on track for a comfortable, self-funded retirement. Rosie is an intelligent woman. She may not be a superannuation expert – that’s my job – but we’ve had some quite detailed conversations about her retirement and savings portfolios. So when she asked me to facilitate her roll-over to this other fund, well, to say I was concerned was an understatement. Scammers pose as financial planners or investment managers. Traditionally, they have targeted individuals searching online using words like, ‘safe’, ‘superannuation or ‘long-term’. Recently, they’ve gone to the next level and begun cold calling. Rosie: When I phoned Gerry, he seemed reluctant to organise my roll-over. He asked me for the details of the fund I was rolling into and said he’d get back to me. I thought he was just a bit miffed that I was talking to someone else. Gerry: Alarm bells were going off in my head. I asked Rosie to sit tight for a day while I researched the fund. I contacted the company this Steve fellow claimed to represent and asked them a few questions. Of course, neither Steve nor the fund existed. Then I checked whether the fund had a USI (unique superannuation identifier). Nothing for that either. I rang Rosie. Rosie: I was shocked, I mean, Steve sounded so genuine – and the website! Wow. What a close call! Gerry told me to report the scam to Scamwatch. They contacted me and said this kind of thing was increasingly common and recommended I join the ‘Do-not-call register’. Lesson learned. I’ve had a great working relationship with Gerry for years, there’s a reason for that! I’m due for my annual review next month – Coffee’s on me! If you suspect a scammer has called you, ASIC recommends you: Above all, never accept financial advice from someone you don’t know, if in doubt, speak to your financial adviser – seriously, if the fund is legitimate, they’ll know about it! The information provided in this article is general in nature only and does not constitute personal financial advice. 

Regaining financial control after a scam

23 April, 202430 April, 2024 Updated on30 April, 2024 Budgeting, Education, Retirement

A year before retirement, Tess’s superannuation plan was on track, and she was imagining her post-work life. With savings of $34,000 at the bank, she was looking to park it somewhere it could earn better interest while rates were rising. Considering herself reasonably savvy with money, she began investigating her options. After hearing about someone who’d made a fortune with cryptocurrency, Tess was intrigued and decided to look into it. Tess researched crypto-companies and compared what was on offer. When eventually she made her decision, she believed she’d chosen the right investment – how wrong could she be! Within hours Tess realised she’d been scammed. Shocked and feeling ill, she reported it to ScamWatch, but over the following days the self-blame settled in. How could she be so gullible? So naïve? What was she thinking?! How could she have fallen for such an obvious fraud? Who knew that financial shame was a thing? But there it was in the form of an empty bank account. Deeply embarrassed, her financial security shattered, Tess lay awake every night berating herself; through her foolishness she’d lost all her cash savings! She became withdrawn, declined social events and refused to unburden herself, even to close friends. Finally, in desperation, she decided to speak with a counsellor. Tess discovered organisations like Beyond Blue, ScamWatch and Lifeline offered advice and emotional support. She chose one that felt right for her. Initially, it was difficult to open up and acknowledge her mistake, but the counsellor explained that part of her recovery was confronting her feelings head-on and realising that victims came from all cultures, backgrounds and levels of education. Feelings of humiliation and shame were normal, although unjustified, as the crooks were highly skilled criminals with access to the latest technology. Heartened by the counsellor’s words, Tess learned to stop blaming herself and confided in her daughter Louise. What a relief that was! Louise was gentle and supportive, and introduced Tess to her friend Jarrod, a financial adviser. Throughout Jarrod’s career, he’d assisted innumerable people who’d fallen victim to scams. Most felt insecure and vulnerable, so his approach was to assist them with practical advice around getting their finances back on track. He believed that Tess would benefit from a temporary, part-time job. She could rebuild her cash savings, and staying busy would distract her from her worries and help her move on. When discussing her interests and skills, Tess mentioned she loved animals so Jarrod suggested she consider pet-minding or dog-walking, adding that he could setup the necessary insurance. Then, Jarrod explained, that while her superannuation was on target, there was a difference between investing for retirement and investing for wealth. Retirement investing was about saving to fund an income stream that met post-work lifestyle goals. Complying retirement funds offered tax advantages and focused on generating returns. Conversely, investing for wealth involved accumulating assets beyond what is needed to provide retirement income. For Tess, financial security was critical, so Jarrod considered her risk tolerance and structured a tax-efficient portfolio of growth assets to support capital appreciation and wealth accumulation. It also meant that Tess could leave something behind for Louise – a legacy she hadn’t felt was important, until she realised how financially exposed the scam had left her. Tess’s recovery wasn’t without its challenges. It took time and sacrifice, but along the way she developed a greater sense of independence and resilience. She delayed retirement by a year, so she could recoup her lost savings and contribute the money from her new side hustle to her wealth portfolio. In the end, Tess’s Dog Minding and Walking Service continued well after Tess’s retirement, for the sheer enjoyment she derived from hanging out with dogs. The information provided in this article is general in nature only and does not constitute personal financial advice. 