Scams Awareness Fortnight is now underway, at a time when cons appear to be more widespread than ever. Citizen’s Advice, which runs the campaign, reports that since January alone more than two thirds of adults (36 million) have been targeted by a fraudster.
Pension scams
The financial impact of the pandemic is likely to make more people vulnerable to these scams, many of which promise attractive returns on savings. Investment scams come in many guises, though the cons also stretch to pension funds being robbed.
In fact, the report found that scammers are increasingly targeting over 55s, persuading them to transfer their pension which can lead people to lose their life savings overnight. Many fraudsters take the time to clone the websites of genuine pension firms and extract money by pretending to be part of that firm and offering to take charge of their pension savings.
Action Fraud said reports of scams that clone the details of genuine companies regulated by the Financial Conduct Authority (FCA) were up by 29%. It said that in 2020, victims lost an average of £45,242 each to scammers purporting to be trusted pension providers such as Aviva.
A consultation into pension scams by the Department for Work and Pensions, which closed last week to responses, proposes regulations to allow pension scheme trustees the ability to override a member’s statutory right to transfer, if they have reason to believe that the receiving scheme is a scam. Once transferred the money is likely to be never seen again by the rightful owner.
Investment scams
Investments scams are also rife. Some 12% of fraudulent dealings were by someone offering a fake investment or ‘get rich quick’ scheme. In one case seen by Citizens Advice, a young woman got in touch when she lost £2,000 to a fake cryptocurrency company after receiving a message from a friend’s hacked social media account.
In all cases fraudsters can be very professional in their approach to convince you their proposition is genuine. While over 55s are most likely to be targeted, those 34 and under are almost five times more likely to fall victim to a scam than their older counterparts, the charity can reveal. Younger people under the age of 34 were most likely to be targeted by text or messaging service (61%).
Myron Jobson, personal finance campaigner at Interactive Investor, says ‘With financial scams becoming increasingly sophisticated, it is important to be on your guard. When it comes to investments, anything purporting a guaranteed return is probably a guaranteed way of losing money. Even the most seasoned investor can fall victim to scams, so it is more important than ever to take care with your money and look out for the warning signs.’
Other scams
Over half of scams, 54%, were about fake deliveries or parcels and 41% were by someone pretending to be from the government. Be on your guard for any text or email that asks for money for a delivery to be made. And remember, a genuine institution – bank, building society, HMRC or the police – will never ask for personal information, passwords or account numbers. Do not part with any of this if asked.
Know the warning signs and stay safe
It is up to individuals to be aware of the warning signs that an investment or pensions opportunity is a scam. The main signs are:
- You are contacted out of the blue
- You are rushed into making a decision
- The firm is not registered with the FCA
- They say it’s risk-free
- It sounds too good to be true
- You’re asked for personal information
- You’re told there’s a change in payment details
Been targeted?
Reporting a scam attempt, which fails or is successful, is crucial. Dame Clare Moriarty, chief executive of Citizens Advice, said ‘It’s more important than ever we all do our bit to report scams when we see them to help protect ourselves and others. By learning how scammers operate, and helping each other understand what to look out for, we can all work together to stop fraudsters in their tracks.’
If the scam involves cryptocurrency, investments, insurance or pensions, report it to the FCA here https://www.fca.org.uk/consumers/report-scam-us.
If you think you’ve been scammed into transferring your pension, contact your pension provider. Then get in touch with The Pensions Advisory Service.
You can report other suspected scams to Citizens Advice (https://www.citizensadvice.org.uk/consumer/scams/reporting-a-scam/) at and Action Fraud (https://www.actionfraud.police.uk/reporting-fraud-and-cyber-crime) or call on 0300 123 2040.
If you got a scam email, forward the email to [email protected]. It will go to the National Cyber Security Centre.
Photo by Jefferson Santos on Unsplash
