Financial fraud and digital scams target consumers in Latin America

Financial fraud and digital scams represent a significant threat to consumers in Latin America, where 77% of people reported being affected by cybercrime in the last year. Common methods include phishing and identity theft, where criminals impersonate financial institutions via email, text, or phone calls to steal sensitive credentials. One specific tactic involves call redirection, where scammers pose as bank executives to trick victims into entering codes that allow criminals to intercept security SMS or calls.

In addition to digital banking fraud, investors face risks from pyramid schemes and Ponzi schemes. Pyramid schemes rely on the active recruitment of new members to generate returns, whereas Ponzi schemes involve a central administrator using funds from new investors to pay earlier ones. To protect assets, experts recommend verifying company regulation, avoiding promises of guaranteed excessive returns, and researching the backgrounds of platform founders. Diversification and understanding investment strategies are also cited as essential defensive measures.