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The latest financial scams to be aware of

Date: 14 July 2022

4 minute read

New data shows that fraud and scam

complaints received by the Financial Ombudsman Service were up by almost a fifth this year when compared to last year. Awareness of these scams can help you remain alert and keep your money safe, particularly when making transactions online.

What scams should I be aware of?

Scams which ask you to authorise the transfer of your money
Half of complaints received by the Ombudsman were related to scams where the victim is tricked into making large bank transfers to an account posing as a legitimate payee – a type of scam known as ‘authorised push payment’. It’s extremely important to stop and think before authorising any transfers of money online, even if the recipient seems trustworthy (see hybrid scams below).

Investment scams particularly involving cryptocurrency

Over a third of the authorised push payment scam complaints were about investment scams, up from a quarter from last year. The majority of these complaints included an element of cryptocurrency, so it’s important to be doubly sure if you receive any investment tips that sound too good to be true or are encouraged to invest in cryptocurrency.

Hybrid scams combining multiple online platforms

In the last financial year, the Financial Ombudsman Service also saw a higher proportion of hybrid scam complaints, which unfortunately are now commonplace. These often combine scams on several different online platforms to trick the victim. For example:

  • Romance scams – fraudsters meet their victim on a dating website and eventually the victim believes they're in a relationship with them. The fraudster then persuades them they're an expert in cryptocurrency trading. Due to the trust the victim has in the fraudster, and given their belief they're in a relationship, they tend to follow the fraudster's advice to invest in cryptocurrency which doesn't exist.
  • Buying goods that don't exist – victims will attempt to make a bank transfer to purchase goods they've seen online – which don't actually exist – and the fraudster tells them the payment is unsuccessful. After receiving this information, the victim will receive either a text or phone call from a fraudster impersonating their bank and the victim often makes multiple payments to the fraudster because someone pretending to be their bank is telling them that their payments aren't going through.
  • ‘Safe account' scams – fraudsters impersonating reputable companies such as the customer's bank or the FCA and telling their victims to move money to cryptocurrency accounts for safe keeping.

With this evolution and the increase of ‘hybrid' scams, it's really important that customers take extra care, and that banks' fraud prevention measures and warnings take account of the latest tactics by fraudsters and the risks.

“Fraud is not just a financial crime – it can have a profound emotional impact too. We continue to receive hundreds of complaints a week from victims of fraud and scams.

We are beginning to see more hybrid scams compared to a year ago. Fraudsters are always trying to stay ahead of the game by evolving their methods of scamming consumers and people should be extra vigilant.

The Financial Ombudsman Service is free for consumers and, if you think you have been treated unfairly by your bank, you should complain to the business first and then get in contact with our service, and we'll see if we can help.”

Pat Hurley, Ombudsman Director at the Financial Ombudsman Service

‘“Financial scams have long been a growing issue, and the current cost-of-living crisis is only serving to exacerbate this as criminals seek to exploit the crisis.

“To help keep its customers and colleagues safe, Quilter provides ‘Stay safe online’ advice which includes a list of the Quilter group’s company websites and official email addresses to allow them to safely navigate the online world and help them identify anything that does not look quite right. This is a simple practice that all businesses should follow to help keep their customers and colleagues safe and minimise the damage they could face.”

Ultimately, the industry-wide aim must be that fraudulent attacks are prevented wherever possible to mitigate the damage they cause, but customers – particularly those most vulnerable – must also be offered appropriate support both in identifying and preventing scams, as well as help should they fall victim.’

Debbie Barton, Quilter Group Financial Crime Director

We’re here to help you stay safe from fraud

Quilter is dedicated to keeping our customers’ investments safe and helping protect you from fraudsters.

Find out what measures we have in place to help combat cybercrime, and the simple steps you can take to help keep you safe from scams and fraud, on our stay safe site.