How to guard against scams aimed directly at consumers
As fraudsters turn their attention to targeting consumers directly, what are the hallmarks of a scam? Vicky Shaw finds out
New figures show that the proportion of financial fraud being prevented has fallen. Around £6.40 in every £10 of attempted fraud was stopped in 2016, representing incidents being detected and prevented by banks and card companies. This is down from £7.01 in every £10 in 2015.
The figures come from Financial Fraud Action UK (FFA UK), which fights fraud on behalf of the payments industry.
What’s behind the decrease? FFA UK says it’s largely due to criminals shifting their tactics to methods which firms are less able to prevent – using scams to target consumers directly.
This can result in the victim inadvertently handing over their personal details such as their password or Pin directly to a fraudster, or even transferring money straight into a criminal’s bank account.
How do criminals go about these scams?
Unsolicited emails, texts and phone calls purporting to be from a legitimate organisation are common – and many may be hard to distinguish from the real thing.
Intelligence seen by FFA UK suggests that criminals are increasingly using “phishing” emails which appear to be from major retailers or internet companies. People responding to these emails can be tricked into giving away their details, or downloading malware.
Old-fashioned distraction thefts and card entrapments at ATMs are also something to watch out for.
Sometimes people are phoned out of the blue by a fraudster pretending to be from a legitimate organisation, such as a bank or the police, and persuaded to transfer money into a “safe” bank account after being told that their existing account has been compromised. The new account in fact belongs to the fraudster.
Which scams are most likely to catch people out?
NatWest has released a list of common scams which its customers have been caught out by.
The top five are:
Goods not received – you pay for goods or services, but they never turn up.
Advance fee fraud – you’re asked to pay up-front payments for goods, services or financial gains that do not materialise.
Spoof payment requests – you receive a fraudulent request, purporting to be from someone senior
in a company or a client, for money.
Invoice fraud – you are tricked into believing an invoice is from a trusted trading partner, when it is in fact from a fraudster.
Holiday scam – you book a holiday, usually online, only to find it does not exist. What is the industry doing?
Initiatives include a national awareness drive led by FFA UK called Take Five, which encourages people to pause for thought before handing over personal details or money (takefive-stopfraud.org.uk).
National Trading Standards also has a campaign called Friends Against Scams – more information can be found at www.friendsagainstscams.org.uk And HSBC recently outlined plans to become more “dementia-friendly” by improving products and services. A guide to help customers with dementia and those who support them is being piloted in 10 HSBC branches, giving tips on keeping track of spending and protecting against fraud.