Illusion of easy money: Unmasking digital scams in Egypt

Fraudsters find a fertile environment to lure victims, exploiting legal loopholes, regulatory gaps, and low digital awareness among users.

Although relevant authorities strive to control the situation, challenges persist as fraudsters innovate new methods daily, complicating and intensifying the issue.

The latest cases involve the FBC platform. More than 310 citizens filed complaints reporting that the platform's operators defrauded them, according to a statement by the general prosecutor.

The operators allegedly stole nearly EGP 8,2 million by pretending to invest in software and digital marketing, misleading citizens into believing they would receive fictitious profits.

Renewed fraudulent methods, same concept
 

Mohamed Azam, an American Society for Technology Management member, told Ahram Online that scams are not new but take various forms as technology evolves.

"Scams always exploit greed and the desire for quick profits. Today, fraudsters rely on digital tools such as electronic wallets, unverified phone lines, and fake investment platforms. However, the principle remains the same: enticing the victim with unrealistic profits before disappearing with their money," Azam explained.

He clarified that these activities occur without any legal framework, as their companies are not licensed by any regulatory body, thus operating outside any official oversight.

"The real problem lies not only in the lack of licensing but also in the activity itself, as such activities cannot be regulated without clear governance rules. According to the law, these companies fall under the category of illegal and unlicensed money employment," he added.

He also noted that the fundamental issue is that individuals are drawn to these activities despite knowing their risks.

"These individuals are not just deceived; they willingly participate in these operations, hoping for huge, illogical profits. How can you convince someone that they won’t receive these fictitious profits when they believe their money will multiply without any economic rationale?"

Absence of legislation: A fertile ground for scams
 

Mohamed Al-Harthi, an IT expert and business development consultant, said one of the main reasons for the spread of this phenomenon is the weak regulatory framework, which allows fraudulent platforms to exist without clear restrictions.

"The core issue is that these platforms do not appear on official app stores like Google Play or the App Store; instead, they are promoted via direct links or through messaging apps like WhatsApp and Telegram, making them difficult to track or regulate," Al-Harthi noted.

He explained to Ahram Online that crowdfunding companies are illegal in Egypt, except for one company operating under the supervision of the Financial Regulatory Authority (FRA).

"In general, any company operating in the investment sector must be under the oversight of the Financial Regulatory Authority, which supervises all non-banking companies," he stated.

He added that the absence of clear laws regulating crowdfunding opens the door to scams.

"If crowdfunding is regulated, it would be under the supervision of licensed companies operating within a regulatory framework, thereby reducing the chances of scam. However, in the absence of such laws, fraudsters find opportunities to exploit victims without any deterrent," he affirmed.

Digital vulnerabilities and unknown phone lines
 

Azam identified the ease of obtaining unverified phone lines as one of the biggest challenges, complicating the tracking of fraudsters.

"Today, anyone can purchase a mobile line without real verification, opening the door not only to scams but to more serious crimes like funding terrorism and money laundering. Every line should be registered in the name of its actual owner, making them legally accountable," he clarified.

Furthermore, Azam emphasized the need to distinguish between digital intermediaries and the fraudulent activities carried out through them.

"The digital intermediary is merely a tool and is not directly related to these crimes, but it is exploited to execute fraudulent schemes. Therefore, it is essential to raise awareness of the risks associated with the digital world," he continued.

Meanwhile, Al-Harthi believes the solution lies in using modern technology to track these activities.

"Technology can help monitor these activities, but this requires the development of AI systems capable of analyzing suspicious financial transaction patterns. Collaboration between regulatory bodies like the Financial Regulatory Authority, the Central Bank, and the Ntional Telecom Regulatory Authority is essential to ensure swift intervention upon detecting any illegal activities," he said.

Are current laws sufficient?
 

Al-Harthi confirmed that Egyptian laws criminalize digital scams, and authorities use criminal, anti-cybercrime, and data protection laws to pursue those involved.

"The laws exist, but they need amendments to keep pace with the development of fraudulent tools, improve financial oversight mechanisms, and strengthen identity verification in digital transactions, which could significantly reduce these crimes," he noted.

Awareness: Strongest weapon against digital scams
 

Azam stressed that the solution lies in laws and in raising user awareness to help them distinguish between legitimate and suspicious platforms.

"Financial and technological awareness should be integrated into educational curricula, alongside intensified media campaigns. Technology is evolving, and fraud methods are evolving with it. While this evolution cannot be stopped, it can be confronted with smart legislation, strict oversight, and, most importantly, genuine community awareness,” he elaborated.

Smart regulation and oversight
 

Amid the increasing incidents of digital scams, the solution remains to close regulatory gaps, update laws, and use modern technology to uncover illegal activities.

Additionally, increasing user awareness about the risks associated with these platforms can reduce the number of victims.

However, until a clear regulatory framework is established, Egypt will continue to face challenges in combating these platforms that exploit legal and regulatory vacuums, necessitating swift and decisive action from the relevant authorities.