The most common scams – and how to avoid them

Couldyou spot the tricks scammers use? It may be harder than you think, as frauds become increasingly sophisticated. Consumers lost £92.9 million to scams – where they were tricked into transferring money directly to a fraudster – in the first half of 2018 alone. And adding insult to injury, people who have been tricked in this way may sadly never see their money again. A voluntary code for banks to follow has just been proposed, which could give people more help in getting their money back. However, victims may still find themselves out of pocket – so it’s always best, if at all possible, to avoid falling for a fraud in the first place. Here are some of the warning signs to spot, highlighted by trade association UK Finance.

1. Purchase scam

The victim pays up-front for goods or services that are never received. These scams often happen online, such as when someone uses an auction website or social media. A warning sign could be if you spot something of high value, such as a car, phone or computer, advertised at a low price.

2. Advance fee scam

Victims may be tricked into parting with their money as a “fee” after being promised a larger reward. Criminals may claim they have won an overseas lottery, or that gold is being held at customs – and a fee must be paid to release money or goods which don’t really exist.

3. Investment scam

People are persuaded to move their money into a fictitious fund, or to pay for a fake investment. The criminal usually offers high returns to entice them. These scams include investment in items such as gold, property, carbon credits, land banks and wine.

4. Romance scam

The victim is convinced to make a payment to a person they have met, often online through social media or dating websites, and with whom they believe they are in a relationship.

5. Invoice and mandate scam

Scammers step into the middle of people’s legitimate transactions to swipe money that was intended for someone else. Someone could be paying a solicitor or a builder, for example, but the criminal intervenes and convinces the victim to redirect the payment into their account instead.

6. Impersonation scam

Someone pretends to be from the police or the victim’s bank, to convince them to make a payment. Often, they will claim there has been a fraud on the victim’s account.

7. Legitimate firm scam

Fraudsters pose as organisations such as utility companies and claim that the victim must settle a fictitious fine or to return an erroneous refund.

8. CEO fraud

Criminals access a company’s system or use spoofing software to send what appears to be a legitimate email from the chief executive with a request to make an urgent payment.