Heather Roy

Heather Roy, Minister of Consumer Affairs

It seems that every day I read or hear about a new scam intended to part innocent Kiwis from their hard earned money.

Sometimes I'm taken aback by the cunning and ingenuity but, more often than not, I'm dumbstruck at the brazen - and often feeble scams - which the majority of New Zealanders can see straight through.

I'm beginning to think we need a new way of highlighting the danger of even the weakest scams, and perhaps celebrating the incredulity of those who see through them - maybe it's time for our own version of the Darwin Awards or 'Razzies' (the anti-Oscars).

As Minister of Consumer Affairs, I am involved in a range of initiatives designed to protect people from scams - Fraud Awareness Week, Scamwatch (www.scamwatch.govt.nz), the recent launch of 'The ORB' (www.theorb.org.nz), etc - and wish that it were possible to say that we have finally rid the world of scammers and fraudsters. Failing that, however, I have to admit that life would be a lot easier if scams were so lame that people saw right through them immediately and were not taken in.

In a world where fraudsters and scammers are coming up with increasingly sophisticated ways to dupe innocent victims out of their hard-earned money, it is sometimes refreshing to hear about a scam that is so feeble as to be almost laughable.

I came across a great example of this while reading the 'Press' newspaper earlier this week.

The 'Press' featured an article in which the Department of Internal Affairs (DIA) issued a warning to people about a cold caller (someone who makes solicited phone calls) suggesting there is a problem with a person's computer and trying to talk them through fixing the system.

According to the article, a Christchurch woman received an unsolicited phone call from a man who asked if she had a computer. She answered that she did, and he then tried to convince her that he was calling about a problem with her operating system. He told her he needed her to log on to her PC so he could guide her through a process to fix the system. Given that the woman hadn't called anyone about her computer to begin with, she wasn't taken in and hung up the phone. Whoever it was that thought this scam would work is definitely a contender for one of these anti-awards.

Another example of an unconvincing scam involves an email that one of my staff recently received telling him that he had been successful in his application for a part-time job - a vacancy he'd never heard of for a job he never would have applied for. In order to secure the job he simply needed to provide his bank account details - and $100 for "administration". Needless to say, he wasn't fooled.

The fact is that there are just as many ill thought-out scams out there as sophisticated ones - as well as some that, although cunning when first created, are so well known as to be outdated. This could be said to be becoming true for the Nigerian letter scam, which is now so well-known that many people simply delete them without a second thought.

The problem is that no matter how simple a scam is there is always someone, somewhere, who will fall for it. Why? Because scammers prey on our weaknesses, gaps in our knowledge - and sometimes our arrogance.

The UK's Office of Fair Trading - the British version of the Ministry of Consumer Affairs - last year commissioned research from the University of Exeter to work out why people respond to scams.

What researchers found was that some people respond because they feel the scam is an unusually good offer. Take, for instance, a scam offering the chance to obtain a large sum of money. Those who respond can picture what it would be like to have that money, they can imagine what they'd do with it, and may be more easily taken in than most people.

What I found surprising was that the researchers also found that some people taken in by scams are actually quite knowledgeable about the subject that the scam is about - their belief that they are experienced in the scam's particular area increases their risk of becoming a victim. For example: the research suggested that people with experience of playing legitimate prize draws and lotteries may be more likely to fall for a lottery scam than those with less knowledge and experience.

New Zealanders lose an average of $400 million a year through scams and I wouldn't be surprised if some of this is through scams at the lower end of the sophistication scale.

Education is the key to preventing people from becoming scam victims. People need to know how to recognise a scam for what it is, and to move away from the attitude that scams happen to 'other people'. They also need to know that responding to a scam is never worth the risk and that if a deal seems too good to be true, then it probably is.