Financial crime is a global threat which affects every jurisdiction.Consumers must take reasonable measures to protect their personal information and financial data, and exercise due care and caution in their financial dealings.
If you are approached with an offer, remember the truism that if something is too good to be true, it almost certainly is. If anything seems suspicious, independently verify the credentials of the person or provider concerned. Persons providing financial services in Bahrain must be licensed by the CBB: if in doubt, check the CBB Register, or also contact the CBB (at firstname.lastname@example.org)
Click on the items below, to obtain more information on the types of frauds that exist (‘what to watch out for’), and to view any current CBB warnings on specific illegal activity that has come to our attention (Current Warning).
If you believe you are a victim of financial crime, or are aware of any such activity, please contact the Compliance Directorate, by e-mail (email@example.com), telephone (+973 17 547 956) or by fax (+973 17 535 673).
What to watch out for:
Phishing usually involves sending e-mails to individuals, falsely claiming to be a legitimate enterprise in an attempt to trick the user into disclosing sensitive information. The e-mails are typically crafted to look like messages from major banks or other financial service providers. These messages generally instruct recipients to click a link in the e-mail to confirm their personal information. The link then connects them to a bogus site that mimics the service provider’s site, where consumers are prompted to provide or verify private information, such as credit card numbers or an on-line banking password, which is then used by thieves to tap into accounts.
In other instances, attempts are obtaining confidential personal information are undertaken by sending bogus letters, purporting to be from official institutions (such as a tax authority), requesting details of bank accounts held and the like.
To protect themselves, consumers should:
- Always be suspicious of communications that request unusual amounts of personal information, and always be cautious about how and with whom you share personal and financial information.
- If suspicious about a communication, always independently verify its legitimacy, by confirming that any phone numbers and addresses used are legitimate, for example by checking against the phone number provided on the back of your credit or debit card. If in doubt, call the institution concerned using an independently verified number to check whether they have indeed sent the communication.
- Never respond to an e-mail (or other communication) asking you to disclose personal information, such as an online password, your debit or credit card numbers or your personal identification number (PIN).
- In some cases, financial institutions may contact you by phone or leave you a voicemail message if they suspect fraudulent activity on your debit or credit card or account. As part of a legitimate conversation with your financial institution, you may be asked questions to ensure they are speaking to their client. You will NOT, however, be asked to verbally provide your PIN or password. Use the procedure in (2) above to make sure that the financial institution you are speaking with is legitimate.
Advance fee frauds
These usually come in the form of an unsolicited letter, fax or e-mail promising substantial sums of money in return for assistance. Complicated stories about unclaimed assets that can be discretely transferred out of the jurisdiction concerned and shared with the recipient are typically used. Other frauds claim that recipients have won a large lottery prize (which the recipient has no recollection of ever entering). In some instances these communications may purport to be written on behalf of official institutions. If recipients respond, they are drawn into paying fees up front, for instance to pay forexpenses’ involved in transferring the assets involved, or in administering the distribution of the lottery prize. Needless to say, the promised money never materializes, and the victim is left out of pocket.
To protect yourself:
- Remember that if something sounds too good to be true, it usually is;
- If in doubt, don’t respond to such communications;
- Be very careful about any proposal that requests the payment of fees up front; the provision of blank letterheads, invoices or bank account details; or that emphasizes the need for secrecy or urgency.
Boiler room frauds
So-calledboiler room frauds’ use high-pressure selling techniques to persuade investors to purchase shares (or occasionally other investments), promising high rates of return. These investments are typically based in overseas jurisdictions and in most cases turn out to be worthless. Theboiler rooms’ are generally also based overseas and likewise vanish after investors’ funds have been taken. Besides being fraudulent, these operators are also acting without a license and thus illegally, when they approach investors in Bahrain.
Typical warning signs include:
- High-pressure sales, typically conducted through unsolicited telephone calls from overseas;
- Use of untraceable telephone numbers and
Fraudsters use a variety of techniques to copy or otherwise obtain debit or credit card details. To minimize these risks:
- Protect your PIN: do not reveal it to anyone, do not let people see you keying it in, and do not write it down;
- Protect your card: never leave them unattended; destroy expired cards; sign new cards immediately; and cancel and report lost or stolen cards immediately;
- When using ATMs, cover your hand when keying in your PIN, and do not let yourself be distracted. If anything looks suspicious about the ATM (e.g. poorly lit, unusual location or signage, or unusual apparatus around the card entry slot) use another machine.
- When using cards in shops or other outlets, make sure the card in your possession is in fact yours before and after a transaction. Try to keep your card in view at all times.
- For credit cards, if you don’t need the entire limit set by your bank, lower it to a level that suits you – this can reduce your risk in case it is illegally used.
- Always verify your credit card statement with your receipts, and report any discrepancies immediately.
- Finally, destroy all financial information (i.e. account numbers, bank statements, ATM and sales receipts etc.) before throwing it away.
Misrepresenting regulated status
Persons or companies may claim to be licensed when they are not. The risk to consumers is that such persons are more likely to be dishonest; or to provide expensive or inappropriate products or services. Such persons are also breaking the law, by undertaking regulated financial services without being licensed.
If in doubt, consumers should check the credentials of the person or company they are dealing with – visit the CBB website to verify that an institution is licensed, or else contact the CBB (at firstname.lastname@example.org ).
There are no specific CBB warnings active at this time.