Damning new figures show losses from fraud keep rising, with banks scrambling to respond.
Financial fraud rose sharply in the first half of 2021, costing victims a staggering £753 million.
New figures from UK Finance, which represents banks, suggest that we’re losing the war against scammers, with fraud losses increasing by 30% compared to the same period last year.
Some types of fraud have rocketed, with incidents of push payment fraud – where a victim is tricked into willingly transferring money to criminals – soaring 71% to £355.3 million.
This dramatic shift in criminal tactics means push payment fraud has actually overtaken card fraud for the first time.
In this article, we’ve picked out seven types of scams you need to watch out for.
If you’ve been the victim of a scam, contact Action Fraud on 0300 123 2040.
Push payment fraud (355m stolen in H1 2021)
The speed at which this type of scam is growing means there's only one place to start: authorised push payment (APP) scams.
In 2018, when UK Finance first started publishing data on APP scams, there were just over 34,100 reported cases in the first six months of the year.
This rose to 57,500 in the first half of 2019 and 66,200 in 2020. But it is in 2021 that criminals truly shifted their focus to APP scam, with the number of cases rocketing 60% to 106,100.
How an APP scam works
In an APP scam, criminals will attempt to trick someone into transferring money directly from their bank account to one which the criminal controls.
In order to gain the trust of victims, criminals will pretend to be from a trusted organisation, such as a person's bank or the taxman.
APP scams can be particularly devastating as there is little legal protection to cover them for losses because they willingly transferred the funds – unlike with an unauthorised transaction.
Thankfully, many banks have signed up to a voluntary code that promises to reimburse APP victims.
You can learn all about APP scams, which banks are signed up to the voluntary code and more by reading this detailed guide.
Note that some of the crimes
Beware: warnings of “unusual activity on your account”
A reoccurring scam involves texts appearing to come from your bank warning of unusual activity.
You are led to a fake bank webpage and asked to log in to your account, at which point the crooks take your details.
Remote purchase (card not present) fraud: £210m
When a criminal uses stolen card details to buy something on the internet, by phone or mail order.
While the amount lost to this type of crime fell slightly compared to 2020, it's still hugely common with losses of £210.5 million in the first six months of 2021.
UK Finance adds: "Intelligence suggests remote purchase fraud continues to result mainly from criminals using card details obtained through data theft, such as third-party data breaches and via phishing emails and scam text messages."
To protect yourself, only use retailers you trust and check your internet browser: most have a padlock icon in the website address bar to indicate the site is secure.
Beware: ‘discount’ Raybans
UK Finance has warned that criminals are increasingly using social media profiles to advertise the ‘sale’ of discounted goods to consumers. When you enter your card details, the criminal does purchase the item, but you never receive it.
Lost and stolen card fraud £35m
When a criminal uses lost or stolen card details to make a purchase or payment, or withdraw cash.
Although losses from this type of fraud have only slightly increased it’s still a huge problem.
UK Finance warns that criminals are using low-tech methods, such as thefts at ATMs, cameras, keypads and looking over your shoulder when you type in your PIN.
Beware: compromised ATMs
We’ve put together a list of signs that an ATM has been tampered with, including pictures of real-life examples. You can read it here.
Investment scams: £50m
When a criminal convinces the victim to move their money to a fictitious fund or fake investment.
This category doesn’t include victims pushed into making investments that were genuine but extremely high-risk or unsuitable.
This is generally categorised as a sub-section of APP scams, but as it's something we're often contacted about at loveMONEY we decided to create a separate section on investment scams.
How to stay safe
Always check that a firm is authorised with the FCA using their register.
Be suspicious of unsolicited approaches (pension cold calling is now illegal), ‘too good to be true’ returns and pressure to act now.
Beware: ‘Martin Lewis’ investment opportunities
MoneySavingsExpert founder Martin Lewis has been clear that he never does adverts, although that’s not stopped crooks using his image with permission to promote scams, particularly on Facebook.
Card ID theft fraud: £11m
When a criminal uses a card or card details, and stolen personal information, to open or take over a card account held in someone else’s name.
UK Finance warns that crooks are ‘harvesting’ victims’ personal information through phishing emails, scams texts and even theft of mail from external mailboxes and multi-occupancy buildings.
Beware: supermarket 'prize draws'
Every few weeks we get notified about texts, emails or WhatsApp messages, claiming that the victim has won a supermarket prize draw. See an example here.
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