The proliferation of social media the past five years has allowed criminal investment scams to thrive, and in combination with most people’s lack of financial sophistication, the amount of hard-earned money lost to scammers now runs in the billions of pesos.
This was why Sun Life Asset Management Co. Inc. (Slamci) and the Securities and Exchange Commission (SEC) launched on Wednesday a media campaign entitled “Slam the Scam” that makes use of social-media platforms to help Filipinos identify a scam.
According to SEC Assistant Director for Investor Protection Lalaine Monserate, the conservative estimate of losses from investment scams through the years is around P5 billion. By some accounts, the amount ranges from P12 billion to P25 billion.
More recent, scammers take advantage of everyone’s involvement in social media by using the platforms to ply their fraudulent schemes with minimal risk of being caught because almost every interaction between the scammer and the potential prey is online until the final meeting when the victim finally pays up or issues a check.
Monserate said one of the factors that make Filipinos vulnerable to scams is that most are too trusting. “Filipinos are very trusting and even without face-to-face dealings they are able to have enough trust to part with their money. Now, much of the recruitment in pyramid schemes are done through Facebook,” she said.
Slamci President Valerie Pama said that along with the misperception most Filipinos assess their own financial health, even the rich and the usually wary middle class could fall victim to a scam.
This was based on a recent Slamci survey on the financial literacy of Filipinos indicating that only 8 percent of the respondents got a grade of more than 80 percent. Another 55 percent answered wrong on objective questions about shares of stock, mutual funds and bonds.
Pama added Filipinos are also averse in reporting scams that victimize them and often opt to save face rather than be exposed as a victim of an investment scam.
Thus, the Slam the Scam media campaign aims to teach Filipinos how to detect a scam, aside from the usual demand for a certificate of registration from the SEC which scammers had already learned to circumvent by actually registering shell corporations that appear legitimate at first sight because it has an actual legal existence but actually do not have the secondary license to solicit investments from the public.
To protect against scams, Slamci came up with a clever mnemonic device urging investors to look for a “bright” investment partner. Under this, the proper investment partners should have the following traits: a bricks-and-mortar physical office; registration and license to solicit investments; integrity; grounded on reality and does not offer returns that are too good to be true; honest; and trustworthy.
The media campaign enlisted the help of actor Matteo Guidicelli, who made several videos shared on social-media platforms as the campaign’s new financial literacy advocate and shared his thoughts on how the youth should spend their money.
“When we buy something we should ask ourselves do I need that or do I just want that? And we also have to be realistic on how much we earn and how much our lifestyle costs, instead of living a fantasy lifestyle and going to the club each night,” he said.