August 2024
Scams are becoming more prevalent, and perpetrators are using different methods to entice victims through phishing or phone calls. Such illegal conduct affects all industries and communities in Hong Kong. According to the statistics issued by the Hong Kong Police (the “HKP”), there was a notable surge in deception cases. Specifically, phishing scams accounted for 4,322 cases, making it the second most prevalent type of fraudulent crime.[1]
On 27 March 2024, the Insurance Authority (the “IA”) and the HKP entered into a Memorandum of Understanding where we are jointly committed to work together to combat crimes. However, together as an industry, for each authorized insurer and licensed insurance intermediary, can also work together to combat such illegal activities and create a safer environment for the community.
Scammers attempt to send SMS messages containing unknown hyperlinks or QR codes that, if clicked, can lead to the disclosure of personal information, bank account details and passwords. To combat fraudulent calls and SMS messages, the Office of the Communications Authority launched the SMS Sender Registration Scheme (the “Scheme”) on 28 December 2023. Under the Scheme, only companies or organizations registered under the Scheme can send SMS messages with the prefix “#”. By ensuring that messages are identified with the prefix “#” in their SMS Sender IDs, members of the public can easily verify the authenticity of the senders via https://app2.ofca.gov.hk/apps/ssrs/onlineEnquiry?lang=en, thereby reducing the risk of falling victim to scams or phishing attempts.
The IA has already joined the Scheme. Insurance companies and brokerage firms are strongly encouraged to do the same.
So don't delay! Join the Scheme today!
In addition, the HKP has launched a Scameter+ App (“Scameter+”), which is a one-stop scam and pitfall search engine. Scameter+ helps the public identify frauds and online pitfalls. When the public encounters suspicious calls, online sellers, friend requests, job ads, investment websites, etc., they can enter the platform account name or number, payment account, phone number, email address, URL, etc. to assess the risk of fraud and cyber security. Details of the Scameter+ can be found at cyberdefender.hk.
The insurance industry is also susceptible to scammers. The HKP has received reports of scammers pretending to be staff of insurance companies who offer assistance to renew the victims' insurance policies. If the victims fall prey to the scam and reply that they do not take out such insurance policies, victims are required in some cases to pay funds for cancellation of the policies, or they would be asked to provide bank accounts details for cancellation of the policies. However, the scammer would then claim the victims' bank accounts were frozen and they would need to remit funds to the bank account of the scammer to unfreeze the bank accounts.
In another situation, the scammers impersonate public officers and inform the victims that they are under investigation, and security must be provided to assist with the purported investigation. The scammers would ask the victim to surrender their insurance policies or withdraw the policy value from the policies as a form of security. This is of course a ludicrous scam, but alas, elderly people have fallen prey and have lost a substantial amount of their savings.
Remember, scammers are becoming sophisticated in their tactics. Taking proactive action can help protect insurance companies, brokerage firms, and their clients from potential financial losses and identity theft. We strongly urge the insurance industry to participate in the Scheme and implement internal processes (even just a call to the policy holder to verify if they are truly intending to surrender or withdraw their funds) to prevent criminals from infiltrating the insurance industry. Alternatively, inform the policyholder to call 18222 to enquire if they are the subject of a scam.
Let's join hands in creating a more secure and trustworthy insurance industry and community!
Notes:
[1] HKPF. (2023). 2024-02-06 Law and order situation in Hong Kong in 2023 (with photos). Press Release. https://www.police.gov.hk/ppp_en/03_police_message/pr/press-release-detail.html?refno=P202402060003