Living in Korea is very safe and this safety can lead to a sense of complacency. Financial fraud through scams is a problem and here I will warn of some of the most common and how to avoid them. The Korean Police take scams very seriously, however as in all countries recovery rates are low.
The 2 Bankbook Scam
Your employer will ask you to open a separate bank account and get an ATM card and give it to them with the PIN. They may even tell you this is normal in Korea. It is not, it is illegal. This scam is popular with some recruiters and companies because they get payments paid into your bank account and then withdraw cash to pay you and themselves tax free. They get tax free money because you are liable for the tax on the whole amount. This violates the real name transaction laws in Korea, and leaves you personally liable to large tax bills. Do not ever give anyone your bankbook, card and PIN.
The Cheap Good Online in a Remote Part of the Country
A cheaper than normal good is advertised online. You reply to the ad and they negotiate a deal where if you transfer money to their bank account, they will ship the good to you from the remote part of the country. You transfer your money and then wait but the good never arrives. The best way around this is to either get on a bus and go and meet the person or only pay COD which can be arranged by courier companies.
Voice Phishing
You get a phone call telling you to pay money into a bank account. The caller may present themselves as a banker, a public servant, or a kidnapper. They may even tell you it's to avoid being robbed. Do not transfer money to people whom you don't know. Banks can freeze an account that is at risk, they don't need you to transfer money to another account.
Internet Phishing
Your bank sends an email asking you to click a link to confirm your details including name and password. Do not click the link. Banks do not send emails asking for security details.
Card Skimming
This can be done at an ATM or by a merchant at POS. Your card is read and recorded on a separate device and a concealed video camera records your PIN. Never use an ATM that has a strange looking card reader, and hide the keypad under your hand, bankbook or wallet when entering your PIN. Also remember that debit(check) and credit cards can be used without a signature or with minimal checking of the signature, do not have your life savings in a checkcard account and do not carry too many credit cards.
Letter, Email Scams
Hello, I don't know you and I want to give you half of $10 million dollars. We have all seen these emails, the writer wants to empty a large unclaimed bank account but of all the people in the world they want you to help them. Either that or “congratulations”, you have won a lottery you never entered. These emails have 2 purposes to either gain all of your personal information to commit identity fraud or should you wish to proceed, they will ask for money to help cover costs incurred in recovering the money. Do not respond to these emails, living abroad we are particularly vulnerable to identity fraud in our home countries.
Identity Fraud
By gaining personal information about you, fraudsters will either empty your bank accounts, or apply for credit in your name, which they will never repay. Be careful who you give your details to, including passport, drivers license, ID number, bank and workplace.
Have you been a victim of any of these scams or can you add to this article? Write to koreanbankingblog@gmail.com
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