As technology continues to develop in the 21st century, scams are unfortunately on the rise. In the first half of 2021 alone, scam victims in Singapore lost $168 million to scammers. When combined with the fact that investing has become increasingly popular in recent years, a new type of scam has inevitably emerged – investment scams.
In most cases, Person A will claim to be a financial expert and offer to help Person B make investments with Person B’s money to earn profits. Subsequently, Person A becomes uncontactable when Person B deposits more money or finds that they cannot withdraw their earnings.
Other common types of scams include:
- Love scams: Fake social media accounts are created by scammers who feign romantic interest in victims to gain their affection. Eventually, victims are induced into sending the scammers large amounts of money.
- Phishing: Scammers may pose as organisations (banks, government agencies) or trusted persons (friends, family members) to gain victims’ trust and make them reveal sensitive information.
- E-commerce scams: Victims purchase goods from scammers, who pose as online sellers. After payment is made, the scammers become uncontactable, and the victims do not receive their orders.
What to do?
If you have been scammed, you should immediately gather evidence to help in assisting with investigations.
The most important way you can do so is by providing proof of any banking transactions that show there was a transfer of funds. This can be in the form of either hard copies of your bank statements or screenshots from your mobile banking application.
Any evidence of correspondence you may have had with the scammer will also be helpful – be it SMSs, WhatsApp messages, call logs, or social media posts.
Pursuing Action
Criminal Action
Should you choose to take criminal action against the scammer, you will have to lodge a police report. This can be done either online or at your neighbourhood police station.
After the police report is filed, you may engage a lawyer, who will help you present your case in court and guide you through the legal proceedings.
When presenting your case in court, your lawyer and the police can make out offences that have been committed. One such example would be under section 420 of the Penal Code, which is the offence of cheating a person to induce the delivery of property.
Civil Action
Alternatively, if you decide not to pursue criminal action, you can sue the person in court instead.
Some of the possible causes of action that the defendant may be found to be liable for include:
- Deceit/Fraudulent misrepresentation: This occurs when the defendant knowingly makes a false representation, intending for the plaintiff to rely on this information and act on it. As a result, the plaintiff suffers damage from acting on the representation.
- Unjust enrichment: The defendant receives benefit at the plaintiff’s expense. One scenario would be when the plaintiff makes payment to the defendant as part of a contract. After receiving the payment, the defendant then refuses to carry out their end of the agreement.
Should you wish to commence civil proceedings, bear in mind that there are certain pitfalls to be considered. For instance, if you choose to engage a lawyer’s assistance, you will need to pay legal fees. Depending on the complexity of the matter, this may be costly if the matter is a complicated one.
In addition, if the defendant is uncooperative, you may face difficulty throughout the proceedings, such as effecting service or getting them to comply with any judgements or orders made by the court. This may cause the proceedings to drag on for longer than is necessary.
When deciding which course of action to take, keep in mind that while criminal action is aimed at punishment and deterrence, civil action will focus instead on debt recovery.
How can you safeguard yourself against being a victim of a scam?
- Make sure everything is in black and white: All the terms of the agreement should be clear. If you are unsure about anything, the other party should answer your questions with transparency and not give vague responses.
- Verify the person’s identity: Ensure that the other party is trustable, especially if they are unknown to you. For instance, if you are buying from an online seller, check their reviews to see if other buyers have had positive experiences with them.
- Collect evidence: Even if the transaction goes smoothly, it is still good to have proof of the deal. Keep records of any bank transfers and correspondence with the other party until the deal is concluded.
- If you are dealing with a company: You are advised to check if the company is on the Monetary Authority of Singapore (MAS) Investor Alert List, which provides the names of companies that are unregulated or unlicensed by the MAS. Exercise precaution when dealing with companies on the List.
Should you fall victim to a scam and require a lawyer’s assistance, Kalco Law is able to assist you. Do contact us for a free legal consultation at (+65) 6533 4833 or enquiries@kalco.com.sg.
