To avoid getting cheated or scammed, consumer education is extremely important. The Dubai Financial Services Authority (DFSA) has created a special section on their website and updates it regularly with the latest scams that might affect DIFC and investors. We reproduce some of their content to educate you on how to avoid being scammed.
Typical scams might begin by unknown people contacting you by phone, email or fax and informing you of an amazing investment opportunity that will make you lots of money. Remember the old saying: ‘If it sounds too good to be true, it probably is.’ You should ask the caller for proof of identity and registration/license preferably in writing. A simple internet search may not be sufficient protection as many scammers have developed sophisticated websites to conceal their true purpose.
A variation of this scam is when the unknown person calls or emails you to inform you that you have won an amazing lottery/prize, even though you may not have taken part in such a lottery. After you respond, you will gradually be told that you have to pay a small registration fee or transfer mobile credit to another mobile. Each time you send money, some more fees will be requested since the scam is to try and drain you out of as much money as possible.
Another scam is the fake bank email/phishing scam. While this scam takes many forms, the most common is when you receive an email that claims to be from a bank/credit card company telling you that due to security, maintenance, irregularities, upgrades etc, you need to provide account details, PIN numbers and passwords. You will then be directed to a fake website which looks identical to your bank website. Remember your bank will never/should never ask you for your financial details by email or over the Internet, so any such request is almost certain to be a phishing scam.
The DFSA also advises against financial scams known as Ponzi schemes, boiler rooms scams and the advance fee fraud (sometimes known as the Nigerian letter scam as many of them first originated from Nigeria). Please see the DSFA website for more details.
How to avoid being scammed
If you receive an offer of an amazing deal out of the blue, don’t believe it! If it seems too good to be true then it probably is a scam. If you receive an opportunity to invest in a financial product which either looks real, offers bigger and faster profits than real investments, offers less risk and less and less effort than real investments, offers something special that genuine investments don’t offer or urges you to act urgently, DO NOT INVEST!
Who to contact for more information, complaints and investigations on scams
DFSA– The Dubai Financial Services Authority is the independent regulator of financial and ancillary services conducted in or from the DIFC. You can see DFSA alerts on common scams or lodge a complaint online by visiting the DFSA website.
SCA – The Securities & Commodities Authority is the regulator of securities and commodities within the United Arab Emirates (UAE), excluding the DIFC. It is responsible for ensuring transparency, integrity and justice as well as the development of investment awareness.
Central Bank - The Central Bank of the UAE is the regulator of banks and other financial institutions in the UAE, excluding the DIFC. The main responsibility of the Central Bank is the formulation and implementation of banking, credit and monetary policies to ensure the growth of the national economy of the UAE in a balanced manner.
Dubai Police - Dubai Police seeks to ensure the safety and security of all citizens and residents of Dubai and the UAE. It provides a service by which individuals are able to report suspicious or criminal behaviour. Dubai Police also has an Economic Crimes Combating Department. The Department can be contacted directly on +971-4-2036341.