Scams are on the rise. Not a day goes by without us receiving scam messages via email, telephone or social media.
It is pervasive, persistent and annoying. We have learned to ignore these scam messages. But the problem hasn’t gone away.
The fraudsters are determined to get us to part with our monies. They have devised all manner of ploys to defraud us. From romance to investment scam, no area is off limits to these swindlers.
All we can have is eternal vigilance and hope we don’t run out of luck. But is it always possible?
Last week, my wife, Farhat, confided to me that she was the victim of fraud. Scammers had accessed her personal details and opened several credit-card accounts.
Four of the 10 accounts were active by the time she received an Experian fraud alert.
Luckily, she was able to cancel the accounts before any money was taken. She was angry and embarrassed that this had happened to her.
“I never imagined I’d be a victim of a scam,” she said.
I reassured her that she was not alone.
Lois Vallely, a colleague of mine, was also recently targeted by a scammer who hacked into her work email account.
Most times, we assume scams happen to the naïve and the vulnerable in our society. But that’s not always true. Smart people fall for these scams too.
In fact, one in five people across the UK has fallen victim to a scam. An estimated nine million people were affected by financial scams in the past year, according to Citizens Advice.
Scammers are stealing more than £3m a day from victims. Nearly £1.2bn was stolen from customers in 2023, latest data from UK Finance shows.
Research from WEALTH at work found that the average amount people lost to financial scams was over £1,000. It also found that more than a third (34%) of those who had lost money to a scam in the last year had done so to two or more types of scams.
Nearly £1.2bn was stolen from customers in 2023, latest data from UK Finance shows
The study revealed the worrying impact losing money to a financial scam had on people. Two out of five (40%) find it difficult to trust that any financial information is legitimate, more than a quarter (27%) say it has had a negative impact on their mental health, and almost a quarter (24%) do not feel safe investing their money.
Losing money to financial scams has also meant that more than a fifth (22%) have had to change their plans for the future.
WEALTH at work has identified the common financial scams that people lost money to in the last year.
They include purchase scams (27%), investment scams (19%), friends or family scams (18%), bank-account scams (18%), tech-support scams (15%), befriending/romance scams (14%), pension scams (13%), tax-refund scams (10%) and lottery scams (9%)
Jonathan Watts-Lay, director of WEALTH at work, said: “Financial scamming is rife and it’s shocking that many people have lost money not just once, but multiple times to scams.
“People need to be on their guard as fraudsters use many convincing techniques to persuade their victims they are genuine. Many of these scams look completely legitimate and are not easy to spot. People often get seduced by the promise of investment returns that are too good to be true.
“Those that run scams are clever and may have been able to get hold of personal details. They often have very professional-looking websites and literature that makes it hard to distinguish from the real thing. They will also use technology and try to contact individuals through various means, such as social media, texts, telephone calls and emails.”
People often get seduced by the promise of investment returns that are too good to be true
Consumer champion Martin Lewis dubbed social media as the ‘wild west’ for online scams.
He recently warned that scammers are using a fake interview of chancellor Rachel Reeves to trick consumers into sharing their bank details before the budget.
His warning comes as another survey from Barclays shows the growing reliance on social media as a source of financial guidance. This is driven largely by its accessibility and the cost barriers associated with professional financial advice.
The study found that 23% of respondents turn to platforms such as social media, community messaging apps and online forums for investment tips, and 19% are attracted by the ease and speed of obtaining financial guidance through these platforms.
Over half (51%) of Brits who consult social media for investment advice fail to regularly verify the credibility of finfluencers and their content.
However, the Financial Conduct Authority has taken a zero-tolerance approach to unauthorised financial promotions online.
On Tuesday, the regulator interviewed 20 finfluencers under caution for touting financial services products illegally. It also issued 38 alerts against social-media accounts operated by finfluencers that may contain unlawful promotions.
A survey from Barclays shows the growing reliance on social media as a source of financial guidance
In May, FCA brought charges against nine individuals in relation to an unauthorised foreign exchange trading scheme promoted on social media. The individuals, many of whom were former reality TV stars, had appeared in shows including Love Island and The Only Way is Essex.
This week is Scams Awareness Week (21-27 October), a campaign set up by Citizens Advice to create a network of confident, alert consumers who know what to do when they spot a scam.
The charity says it wants individuals, families and organisations looking to protect themselves from scams to be #ScamAware all year round.
“Anyone can fall victim to a scam, and we know scammers aren’t only targeting those looking to invest money, but also those simply going about their day-to-day lives,” Dame Clare Moriarty, chief executive of Citizens Advice, told Metro.
“It’s particularly worrying to see the impact on people’s finances afterwards, especially if they have to borrow to get by. It’s important for us all to be on our guard – if you’re not sure about something, take your time and get advice.”
