Steering Clear of Financial Fraud and Scams

Fraudsters don’t seem to take a day off, so scams are on the up, catching some unsuspecting Britons off guard. It isn’t a question of whether or not you’ll be exposed to some type of fraudulent activity, rather when it will happen – and more importantly, how you choose to respond when the time comes.

Falling victim to a financial scam can have catastrophic consequences, rippling beyond a one-time financial loss. In addition to conning you out of your money, scams may also result in credit damage. Restoring your credit rating after financial fraud costs time and investment, adding to the worry caused by finance scams. Despite consumer warnings and efforts to combat fraud, new scams come to light every day, shaking-down innocent consumers.

Millions Lost to 2019 Scams

Statistics don’t lie, and a new batch of figures analysing financial fraud in the UK point to a decided uptick in the number of scam victims coming forward this year, compared to the same period in 2018. According to the data, bank scams cost UK consumers more than £200 million during the first six months of 2019.

Among the various scams gaining momentum in the UK, “authorised push payment scams” totaled more than 57,000 during the first six months of this year. This type of fraud occurs when individual bank customers knowingly authorise transfers for what they believe to be legitimate purposes – only to find later they have been targeted by scammers.

Recent fraud figures represent a 69 per cent increase in the number of scams, compared to the same period in 2018.

Signs of Scams – What to Look For

Fraudsters are inventive, devising sophisticated new scams, designed to fool even the most skeptical consumers. Though each scam is distinctive, with unique means for conning consumers into parting with cash, several patterns provide clues that an offer or opportunity may actually be a scam.


Scammers initiate this type of fraud by posing as legitimate financial institutions. Using genuine contact information, the scams mimic real entities. Ironically, many of the overtures purport to be combatting fraud, though they are actually scams, in disguise.

Smishing scammers commonly send messages referencing suspicious transactions or other banking issues, asking recipients to call the fraud prevention department for resolution. A well-faked message appears as though it came directly from your bank. Scammers will ask for security information such as passwords and codes, mirroring a typical call with your bank. However, rather than protecting you from fraud, the criminals instead establish new payees on your account, diverting money to themselves. One quick check to avoid smishing scams is matching the number provided with the customer service number on the back of your credit card. And you may be able to double-check your available balance to confirm a fraudulent charge has posted to your account – if no evidence appears, the “fraud protection” scheme doesn’t hold water and it’s time to report a smishing scam to your bank.

False Email Refund Scams

With so much pressure placed on your finances, a bit of good news is always welcome, such as a rebate or refund you didn’t expect. The promise of a financial windfall is enough to lure many consumers into falling for a growing refund scam, which cons them into believing they are due money.

Scammers create worthy fakes, meticulously reproducing company logos and copying communication formats, in order to appear legitimate. Genuine short-term financing is available online, so emails offering opportunities for quick cash should be thoroughly vetted. When cash is needed, it’s easy enough for you to compare lenders online, before submitting a request. More often than not, email refunds and invitations to easy money are ultimately revealed as fakes, conspiring to defraud unknowing consumers who fall for the ruse.

Finance scams are on the up, so staying secure from new forms of fraud requires extra diligence. Scam email contacts, in particular, often appear legitimate on the surface, yet a closer look may reveal tell-tale signs of fraud. To avoid becoming a victim, keep personal information to yourself and steer clear of financial offers that don’t add up.

Paul graduated in 2001 with a degree in Finance. Since then he has gone on to work for several of the UK's most well-known financial institutions.

An avid blogger and a huge football fan, Paul is here to guide you through the ins and outs of personal finance and perhaps save you some money in the process!

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