A QUARTER of us are turning to credit or loans to cover summer spending as we tackle the cost of living crisis – and fraudsters are cashing in.
Data from the Financial Conduct Authority shows a 26 per cent rise in complaints from consumers who fell victim to loan fee fraud last summer compared with 2021, and cases are expected to jump again this year.
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A staggering £1.2 billion was lost to financial fraud in 2022, according to UK Finance data released in May.
And scams are getting more believable, with fraudsters using canny tricks to lure more and more victims in.
In the first quarter of 2023 alone, around 40million adults were targeted by scammers, according to Citizens Advice.
So what can you do to protect yourself?
Professor Mark Button, co-director of the Centre for Cybercrime and Economic Crime at the University of Portsmouth, tells Claire Dunwell the scams you need to be aware of and how to protect yourself from fraud.
WhatsApp cons
IF you’re suddenly asked for cash by someone in your work or neighbour WhatsApp group, alarm bells should ring.
Fraudsters are hacking in and claiming to be members of the group before requesting cash or asking you to donate to a worthy cause.
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Mark explains: “Scammers initially gain access by either stealing someone’s phone or by hacking their account before setting up the victim’s WhatsApp account on another device.
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“They either request money or ask you to send cash to a certain cause while pretending to be someone you know.
“If you’re asked for money or sensitive information, even if you think it’s a family member – call them to check.”
Loan fee fraud
THOUSANDS of us apply for loans every day – but how can you be sure the company you are using is legit?
Scammers are pretending to be credit lenders and rinsing the vulnerable.
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“You apply for a loan, a fee is charged, but the loan doesn’t materialise,” Mark explains.
“Even if you don’t get the loan they still take the money and they also now have your financial information.
“You are set to lose around £260 in the fee alone, so be aware.
“Look up the company on the FCA website to check if it’s genuine.
“Loan scammers pop up when you search online and some use social media to target victims.
“They also lure people in with unrealistic low rates.”
QR code jacking
FROM restaurant menus to car parking, QR codes are popping up everywhere and scammers are honing in on them.
New tricks include pasting a fake QR code over the legitimate one that allows them to steal money and personal details instantly.
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Scammers can call up victims and pretend to be from their bank to get more money out of them.
Mark says: “Look for clues. Has the QR code you’re using been plastered over a genuine one?
“Or maybe the website you’re taken to after scanning the QR doesn’t match exactly the name or location code of the car park.
“QR codes can also lead to identity theft so it’s important to check the one you’re using is genuine and if you can pay another way, then do.”
Shopping no shows
WHETHER you’re buying via a website or through Facebook Marketplace, fraudsters can fool you with products that don’t turn up, are fake, or don’t exist.
According to Mark, shopping fraudsters are getting more and more clever.
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He says: “Their websites often rank high on Google searches because they’re very good at working out the algorithms.
“By the time the tech companies have caught up with them via complaints from victims, they’ve disappeared.
“Red flags include: a deal that’s too good to be true, an unusual web address, or a strange variation of a legitimate brand name.
“The website scamadviser.com tells you if there’s a significant risk, so check first.”
Ghost brokers
YOUNG people especially are at risk of being duped by scammers who sell invalid car insurance policies at unrealistically low prices.
Ghost brokers offer fake insurance, provide false certificates or go to an insurance company with false info to secure lower premiums and pocket the difference.
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Insurance firm LV= reported a 31 per cent increase in policy fraud in the first three months of 2023 and a 143 per cent rise in ghost broker cases it took to police in the past year.
Criminals often advertise on social media, in online forums and around uni and pubs.
Victims rarely know they’ve been targeted until they try to claim.
Mark advises. “If a deal sounds too good to be true you’re probably being scammed.”
Romance rogues
NEVER hand money over to someone you’ve met online because fraudsters are lurking via websites, social media, chatrooms, and even chat-enabled games such as Words with Friends.
They either ask for money directly, or may even encourage you to invest in a property or cryptocurrency platform which is controlled by the scammers.
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“This is the most difficult fraud to deal with because by the time money is passed, the criminal has already gained the victims’ trust,” says Mark.
“If someone is legitimate you should be able to verify who they are in other ways like arranging a video call, Google searching their images, or arranging to meet in person.
“If they refuse any of these, steer clear.”
Jobs & training fraud
JOB-SEEKERS who are looking for training to improve their chances of being hired by potential employers can be another lucrative target.
Mark explains: “Fraudsters make money by offering training or work experience to the unemployed – or recently redundant – in return for a few hundred pounds.
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“It’s either very poor quality or it doesn’t transpire.
“They advertise fake products and services on websites or via social media, often promising a guaranteed job at the end, requesting a deposit upfront.
“It is best to always investigate the company behind the advert and if you part with any money, always use a credit card for extra financial protection, that will help you if it does go wrong.”
Boiler room scams
CYBERCRIMINALS use Twitter/X, Facebook and Instagram to peddle investment scams – and it isn’t just the wealthy who are at risk of being targeted by these hard-sell, pressure tactics.
Mark says: “Fraudsters tell victims about hot investments which they claim will turn a few hundred quid into thousands but they’re fake.”
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Legitimate firms won’t rush you into making an investment on the spot and Mark says it’s important to seek independent advice before making any financial decisions.
He adds: “Investing isn’t the same as gambling, tread carefully – go to the FCA website for a list of genuine investment providers.
“Or speak to a financial adviser if you’re thinking of investing an amount of money, however small.”
