“Sophisticated Scam Alert: Uncovering the Deceptive Practice of Biometric Authentication Workarounds and Brand Name Bank Account Fraud”

Starting from July 1st, 2024, Decision No. 2345/QD-NHNN of the State Bank of Vietnam officially takes effect. Accordingly, online money transfers over VND 10 million per transaction through bank accounts will require mandatory facial recognition verification.

This is a significant step forward in fraud prevention. Compared to traditional methods such as passwords and OTP codes, biometrics offers a stronger security layer, ensuring accurate verification of the individual initiating the transaction. As a result, it protects customer accounts and minimizes risks for banks.

However, there remains a loophole in this regulation that allows scammers to easily circumvent the law. According to Decision No. 2345/QD-NHNN, corporate bank accounts are not subject to mandatory facial recognition verification.

Scammers have taken advantage of this loophole by setting up “shell companies” (companies that are registered but do not conduct any actual business or production activities) and opening bank accounts in the company’s name to facilitate their fraudulent activities.

According to the Cyber Security and High-Tech Crime Prevention Division (PA05) of Ha Tinh provincial police, from June 2024 to the present, they have received and guided the resolution of five cases of reported online fraud involving the use of corporate bank accounts, with a total loss of over VND 2 billion.

On September 11th, Ms. H. (from Loc Ha) reported to the authorities that she had been scammed on Facebook by a seller offering beauty products from a brand called “Mailisa” for just VND 500,000. As the recipient account was named “DT MAILISA Co., Ltd.”, Ms. H. trusted and transferred the money. Subsequently, she was asked to participate in a customer survey and help increase the company’s sales to receive a refund. Through this scheme, she ended up transferring more than VND 400 million to the scammers’ account multiple times.

Earlier, in early July 2024, Ms. T. (from Ha Tinh city) befriended a Facebook account named “Van Dung” and was later tricked into transferring money for online investment purposes. Out of gullibility, she made multiple transfers totaling VND 310 million to an account named “ABX Electric Car Manufacturing Co., Ltd.”

The common tactics used by scammers include: using accounts in the name of real estate companies to invite people to invest; using accounts of entertainment service companies to ask victims to like and follow videos, Tiktoks, or YouTube channels, and then scamming them; using accounts of commercial, electronics, or electrical appliance companies and scamming by asking victims to make payments for online marketplace or electronics store orders.

Lieutenant Tran Anh Duc, Deputy Head of PA05 (Ha Tinh provincial police), warned that to prevent scams involving “shell companies” and corporate bank accounts, people should be cautious about investment invitations on trading floors or financial and stock investment websites that promise high profits. Be wary of messages or calls from individuals claiming to be employees of well-known brands or companies, offering gifts or exclusive benefits.

Additionally, when transferring money to an account held by a legal entity, it is crucial to verify the company’s information through official sources, ensuring that the account name matches the actual business name. Stay informed about new scamming methods and enhance your awareness and skills to avoid becoming a victim of online fraud.

In the unfortunate event of being scammed, individuals should promptly contact their bank to report the incident and provide relevant information. It is also essential to gather and preserve evidence and file a complaint with the authorities.