The reminder to be extremely careful and cautious is, in most cases, not enough to beat financial fraud. In order for the above reminder to fulfil its purpose and be useful in everyday situations, I will provide three basic recommendations and tips on what not to do.
- Do not share your banking usernames and passwords or PIN codes. While back in the day number and letter combinations were primarily used, then today Mobile-ID or Smart-ID PIN1 and PIN2 codes are more common.
Please keep in mind that these codes are only meant for you to know and use – you should never reveal them to third parties. What’s more, you should never enter these PIN codes on your smart phone when you receive a phone call claiming to be from your bank alerting you that they have noticed suspicious activity or unauthorised transactions on your account. Bank employees will never ask for your PIN codes over phone which is why these kinds of phone calls are always scams.
- Do not trust investment offers made over the phone and do not give strangers remote access to your computer. Fraudsters often first contact people by phone to present a supposedly good investment opportunity, for example, in the shares of some company, the price of which will skyrocket with 101% certainty in a few days after the news is published.
If the fraudsters are successful in establishing contact with a potential victim, but the process is delayed due to the victim’s lack of knowledge or skill in creating an account in a particular trading environment, the fraudsters kindly offer their assistance. To this end, they ask the victim to download remote control software on their computer and, by using this software, the fraudsters open a trading account for the victim right in front of their eyes, they will then transfer some money from the victim’s bank account and make the first transactions. Legal investment service providers or investment firms are not allowed to pressure their clients and never request access to their clients’ devices.
- Do not forget to check if the service provider has a valid activity licence and whether any alerts have been issued on them. Financial service providers, such as investment firms, must have an activity licence issued by Finantsinspektsioon (Estonian Financial Supervision and Resolution Authority). It is not allowed to provide financial services without the necessary activity licence. If it is done regardless, it is considered a criminal offence.
If Finantsinspektsioon identifies an unlicensed service provider in an area under its supervision, the Finantsinspektsioon warns the public of this person by publishing an alert on its website. The website of Finantsinspektsioon also includes a register of all persons who have been issued an activity licence by Finantsinspektsioon or who can provide cross-border services in Estonia.
In addition to the above, I recommend you remain calm in alarming situations and, depending on the situation, contact us, your bank, or even a friend.
This article was written in co-operation with Finantsinspektsioon www.fi.ee.
The task of Finantsinspektsioon is to enhance the stability and reliability of the financial sector and to reduce systemic risks through financial supervision.
Published in the youth information portal Teeviit in 2022.
