Amid the cost of living crisis and post-pandemic society, study shows individuals are more vulnerable to financial scams. Not only phishing texts and emails or fake calls that scam people to give out bank details, but recently even WhatsApp, Facebook and Instagram users are being warned about the dangers and spread of cryptocurrency scams on the Meta-owned apps.
It has been revealed that since the start of 2021 cryptocurrency scams have cost victims a staggering £800million in total, with the median victim having over £2,000 stolen. Asian Voice reached out to several banks high streets and national to find out what precautions they are taking to protect their customers, especially the old and vulnerable ones.
Last week, NatWest bank urged Britons to be vigilant after a woman was cruelly scammed out of £25,000 and nearly lost thousands of pounds more. Unfortunately, scams in the UK are becoming increasingly common, with fraudsters deploying numerous tricks to hook innocent victims. One type of scam is a “romance scam” which involves a fraudster building a false relationship with someone to lure them in for their cash.
According to Express UK, this was the case in 2019 for a NatWest customer who was online when she met a man with whom she quickly established a friendship. With the pair hitting it off, over the course of nine months, they gradually grew closer and a relationship developed. The man sent her gifts, the couple spoke on the phone, and they had even exchanged photographs. Although many online relationships begin in this way, there was a factor which meant the situation quickly unravelled. This occurred when NatWest staff found out the customer had been sending her online acquaintance money. In total, she had already parted with £25,000 before the matter became apparent.
According to Asian Image, about 2.1 million tax credits customers are expected to renew their annual claims by July 31. Criminals will mimic government messages to make them appear authentic in their phone calls, texts and emails. HM Revenue and Customs (HMRC) says scammers may try to threaten people about non-existent tax bills, or they may try to tempt them with ‘tax rebates’. Scammers may also claim there is an issue with the person’s national insurance (NI) number or direct debit.
Virendra Sharma MP, speaking to Asian Voice exclusively said, “Scammers target the elderly and vulnerable, but anyone can fall for them. I have pushed the government to do more to track down those committing these heart-breaking and abusive crimes. Fraudulent financial advice with pensions, investments and inheritance often goes undetected for years. If you have been a victim, don’t be ashamed, report the crime to the police.”
Victims between the ages of 55 and 64 still lose the highest amount on average
In a statement shared with Asian Voice, Llyods Bank stated that the number of people who fell victim to a romance scam increased by more than 16% over the last year, according to new data from Lloyds Bank. The average amount lost per victim is now £8,655, slightly more than the previous year (£8,610).
Though victims between the ages of 55 and 64 still lose the highest amount on average (£15,957), the typical age of a victim has fallen, with people between 45 and 54 now the most likely to be tricked into sending money to a fraudster masquerading romantic partner. The average amount lost last year by this younger age group was £7,336. While those most at risk of romance scams tend to be over 45, younger generations do also fall victim. Last year, an average of £2,128 was lost by victims aged between 18 and 24. People aged 25 to 34 lost an average of £3,193.
Social media and technology have further played into the hands of romance scammers, who can easily pretend to be someone else in their profile, using fake information and photos. They have used the pandemic as an excuse not to travel or meet in person.
Romance scams may be less common than other types of impersonation fraud (where the criminal pretends to be from a reputable organisation or someone the victim knows, to trick people into transferring cash out of their account), however, they often leave victims struggling with significant emotional trauma. Not only do they have to deal with the financial impact of the fraud, but they also have to come to terms with the realisation that the relationship – which may have been cultivated over months or even years – was not real.
Lloyds Bank issues an urgent warning to consumers as the number of ‘advance fee’ loan scams
Lloyds Bank has issued an urgent warning to consumers as the number of ‘advance fee’ loan scams has surged in recent months. Loan scams happen when a victim is asked to pay an upfront fee for a loan. They will typically reply to an online advert for a ‘fast loan’ from a company they have never heard of before, though sometimes the fraudster will try to impersonate a genuine firm. They will have their application approved regardless of their credit history. Before they receive the loan, they are told they must pay an upfront fee by bank transfer. Once this fee is paid, the fraudster may even ask for further payments. Eventually, the victim does not hear from the company again and the loan is never received. Reports of this type of scam have increased by more than 90% already this year, with the number of cases continuing to rise sharply. The average amount lost by victims is £231.
Some common reasons given by scammers for these payments in advance include Payment release fee Verification fee Loan company fee, and Processing fee, Guarantor fee.
Holiday scams
Lloyds is urging British sunseekers and staycationers to take care when booking a break this summer, with scams linked to holidays increasing by a third (33%) over the last year.
Based on an analysis of relevant scams reported to Lloyds Bank, fraud relating to flight bookings was up by 13% in the 12 months to March 2022. The average amount lost to a flight scam was £2,955.
Scam reports linked to hotels were up by 18%, with the average amount lost £1,231. Packaged holiday-style scams also saw a 17% increase over the same period, with victims losing £2,342 on average.
However, by far the biggest increase came from scams linked to fake caravan bookings (i.e. a short stay in a caravan, rather than the outright purchase of a vehicle), with cases surging by a massive 108% year-on-year. The average amount lost in each case was much lower though, at £374.
Many of these scams start with false adverts on search engines or social media. Victims often click on a link taking them to a website and believing they are dealing with a legitimate company. However, it is all too easy for scammers to impersonate genuine firms online. Some fraudsters even lurk on real accommodation listing sites, before convincing victims to transfer cash directly rather than through the official platform.
With many consumers now rushing to book holidays as demand returns to pre-pandemic levels, Lloyds Bank is urging people to be on the lookout for potential scams.
According to HSBC bank, “Romance scams are one of the most common types of fraud. Criminals exploit the emotions of their victims to build up a relationship, often via social media or dating sites, and then request money. To avoid falling victim to one of these scams, never send money to someone you’ve only met online. And don’t agree to send money on their behalf, as it could be the proceeds of crime. Purchase scams, where fraudsters trick shoppers into paying in advance for goods or services that are never received, are the most common type of scam by volume. At this time of year, fraudsters will often post adverts and social media posts promising great holidays or travel arrangements which are fake. Customers are advised to purchase through official travel websites and be careful of secondary ticketing sites. if you’ve booked a package holiday, you should check this is ATOL protected.”
HSBC UK was one of the first banks to introduce Voice ID which is one of the most secure methods of authenticating customers. The introduction of this technology has seen a significant reduction in telephone fraud with the rate of attempted fraud down 50% year-on-year. “We were one of the first banks to sign on to the voluntary industry CRM Code which sets out industry standards to increase steps taken to prevent Authorised Push Payment (APP) scams and to reimburse customers fairly and consistently. We support calls for new legislation to make the voluntary code a statutory requirement. We have also rolled out Confirmation of Payee across our UK bank channels and have introduced the ability for customers to confirm the authenticity of payments via text message as well as in our mobile app. We regularly post scam warnings on our website, social media feeds and in our customer communications. We also have a fraud leaflet. We need a ‘whole-system’ approach to tackling fraud, it is the responsibility of all those who bring risk into the system to play a role in preventing fraud, this includes the wider payments industry, but also telcos, internet service providers and social media firms, as well as consumers themselves,” the bank told the newsweekly.
In an official statement, Baz Thompson, Head of Fraud and Investigations at Metro Bank, told us: “Romance scams are an increasingly popular way for fraudsters to scam people, with TV programmes such as Netflix’s “The Tinder Swindler” highlighting this growing trend. We’re urging everyone to be cautious when entering into a new online relationship, especially if you’ve never met them before. No matter what reason is offered, please don’t be tempted to send funds to someone you have never met. Keep a close eye out for inconsistencies in their stories as well as internet dating and social media profiles, or if they refuse to video call or meet you in person. These are red flags that will identify them as a potential scammer.”
In terms of what Metro Bank is doing to help protect customers from fraud, the bank said, “We are active supporters of UK Finance’s ‘Take Five’ fraud awareness campaign and have an extensive online security centre that provides information on how we protect customers' accounts and how they can keep their personal details safe.”
