We are all familiar with the convenience of making monthly payments – rates, water and electricity for example – by direct Electronic Funds Transfer (EFT) from your bank accounts. However, there are certain transactions that are somewhat special. These may be less routine, more complex, and require the cooperation of a third party alongside you and your banking institution.

An excellent example of such a transaction is – buying a house.

Let’s take a look at how buying a house fits the “special transaction” criteria:

• It’s not routine. For most of us, buying fixed property is something we do only a few times in our lifetime and it requires numerous transactions transferring substantial sums of money. As a result, the process can feel like very unfamiliar territory.
• It’s more complex than just a payment. Buying a house is a process and requires a number of steps, one following the other in an orderly fashion before the transaction is completed successfully. This often involves back and forth conversations between you, the estate agent, the conveyancer and possibly other service providers, too.
• It requires the cooperation of at least three parties. As you can see from the point above, this is a high-risk transaction, because concluding a property sale involves communication (via email) passing between multiple parties. And once the process is complete, making the final payment via your bank account is triggered by getting the go-ahead from a third party.

And that third party involvement sets the scene for a “triangular” EFT fraud.

Here’s how it happens: Cyber-criminals know that certain transactions involve the electronic transfer of substantial sums of money. They purposefully target the email accounts of businesses like estate agents and lawyers for hacking. When they succeed, they analyse the emails passing back and forth to establish the transactions underway and the parties involved (such as the buyer, seller, bond provider and conveyancer).

When it’s time for (say) a deposit to be paid, they strike: BAM!

They send an email (from the actual email account, because the hacker now controls it) advising “an update to the account details to which the payment must be made”. As you can see, if you’re not super-vigilant you could end up sending a large sum of money to a hacker’s bank account instead of to a legitimate service provider such as your conveyancer.

So, how do you protect yourself against such triangular EFT fraud possibilities?

Here are 5 concrete steps you can take to avoid being a victim of such a scam at any time, but particularly if you are in the middle of a transaction that involves payment of large amounts via EFT:

• Be suspicious of emails that advise you of changes with regard to the authorised account details to which payment should be made.
• Confirm all such account details either in person or by direct phone call to a known number and individual at your service provider before making any payment. NOT the number on the document you were emailed!
• You could also transfer a small amount, e.g., R100, and confirm receipt before sending the balance.
• Look out for common red flags associated with compromised email accounts, such as misspellings, poor grammar, and emails sent outside of normal business hours.
• Verify the completed transaction immediately with the person/service provider who should be receiving it.

As you may have noted, investment transfers can also be “special transactions”.

Like buying a house, investment portfolio transactions are also at risk because they:

• are not routine payments
• can be complex and consist of more than one step
• require coordination between yourself, an investment service provider and your bank

As a result, while we at Netto Invest take extensive precautions to keep all electronic data and systems secured tightly against hacking, we are never offended when you are hyper-vigilant while in the process of making changes to your investment portfolio. If you receive an email that gives you account details to which a payment should be made, call your Netto Invest portfolio manager or your CERTIFIED FINANCIAL PLANNER® (using the telephone number you usually use to contact us) and verify those account details. Small actions such as these help us to help you keep your finances safe. As always, your financial security is of the utmost importance to us so if you have any questions or concerns, please do not hesitate to reach out.