Understanding The Psychology Behind Online Scams and How To Protect Yourself

In the age of technology, where digital connections are made at an unprecedented rate, scams have evolved to become more sophisticated and seemingly genuine. The recent case of a S’porean retiree loses life savings in scam by fake Facebook friend , who lost over a million dollars in 15 days, brings to light the urgency of understanding online scam tactics and how best to shield oneself from them.

During my Masters in Cybersecurity from Singapore University of Technology and Design, I conducted extensive research on the topic of online scams, focusing on the psychology behind them and the methods to detect and prevent such deceptions. My thesis, titled “Raised Awareness Helps Detecting and Preventing Online Shopping Scams,” delves deeper into the various tactics scammers employ and the countermeasures that can be taken. You can access my research paper here.

I tried dissecting this news and came up with high level interpretations below:-

1. The Scammer’s Mindset

Scammers prey on a variety of human emotions:

  • Trust: By posing as a reputable individual or organization.
  • Sympathy: They might present a sad story or an urgent need for assistance.
  • Greed: Offering a too-good-to-be-true opportunity, playing on the prospect of significant financial gains.

“Alvin”, for instance, built trust by posing as a Singaporean executive in a reputable industry, requested assistance due to his linguistic shortcomings, and enticed Madam Tan with the promise of easy money.

2. Why Do People Fall Prey To Scams?

  1. Cognitive Biases: Humans are wired with certain biases. The optimism bias, for example, can lead us to believe that bad things won’t happen to us. This might explain why many think they won’t get scammed.
  2. Social Engineering: Scammers are adept at manipulating emotions. They might evoke fear (threatening legal action), urgency (limited-time offers), or sympathy (sharing sad personal stories) to bypass rational thinking.
  3. Authority and Trust: Scammers often impersonate someone of authority or trust. A person might be more willing to engage if they believe they’re talking to a bank official or a known contact.
  4. Information Overload: In today’s digital age, we’re bombarded with a plethora of information daily. This can sometimes make it challenging to discern genuine messages from scams, leading to misplaced trust.
  5. Lack of Awareness: Despite many awareness campaigns, not everyone is informed about the latest scam techniques. Some might not be tech-savvy or might be from older generations unfamiliar with online deceit tactics.
  6. Desperation or Greed: The prospect of quick financial gain or solving an immediate financial crisis can cloud judgment, making scams enticing.
  7. Loneliness: Some individuals, especially older ones, might engage with strangers online out of sheer loneliness, making them vulnerable targets.

3. Data Speaks Volumes

In just the first half of 2023, a staggering 22,339 scam cases were reported in Singapore, marking a 64.5% rise from the same period the previous year. The financial implications are equally harrowing with victims losing $334.5 million from January to June alone.

4. How To Protect Yourself – Stay

  • Stay Updated: The National Crime Prevention Council (NCPC) is a non-profit organization committed to promoting public awareness and concern about crime and to propagate the concept of self-help in crime prevention. It has latest stories on the ongoing scams.
  • Be Skeptical: Always question the legitimacy of unsolicited requests, especially from strangers online. If an offer seems too good to be true, it likely is.
  • Verify Independently: Never rely solely on documents or evidence presented by the other party. In Madam Tan’s case, had she independently verified the Barclays transfer statements, she might have identified the discrepancies.
  • Limit Financial Exposure: Avoid transferring significant sums of money unless you’re sure about the recipient’s authenticity. Scammers often use urgency to their advantage; always take a moment to think rationally.
  • Educate & Share: The more people are aware of such scams, the harder it becomes for scammers to find victims. Sharing stories like Madam Tan’s can be a powerful deterrent for potential victims.
  • Two-Factor Authentication: Always enable two-factor authentication for your online accounts, especially banking. It provides an extra layer of security.

5. Banks Are Not Infallible

While banks have security protocols, they aren’t foolproof. As the UOB spokesman rightly mentioned in the same news article, “customers remain the singular most effective defense.” It’s crucial for customers to be vigilant and proactive in their financial dealings.

6. If You Suspect A Scam

  • Stop All Communication: Immediately cease any interaction with the suspected scammer.
  • Document Everything: Take screenshots, save correspondence, and note down phone numbers or any other contact information.
  • Report to Authorities: Always file a police report. Your data might help prevent others from becoming victims.

7. Recovery & Mental Well-being

For victims, the aftermath of a scam isn’t just financial; it’s emotional. Seeking counseling or joining support groups can be a way to heal and recover. Moreover, loved ones play a crucial role in providing support and understanding during such challenging times.

While the digital age offers unprecedented convenience and connectivity, it also brings with it a shadowy world of scams. Staying informed, vigilant, and educated is the best defense against falling prey to these nefarious schemes.

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