During 2023 in the UK alone over £1.2 billion was lost through unauthorised and authorised fraud. If you look at the world-wide picture, then the losses are estimated at over $1 trillion. This figure is unlikely to decrease anytime soon as it’s a very lucrative low risk business for criminals. The advancement of technology and the increase of on-line services has created more opportunities for scammers. There are many different types of scams used, some extremely complex and elaborate, others quite simple. Below is a summary of the most common types used.
- Push Payment fraud or Authorised Push Payment (APP) fraud is the most common type of financial scam it works by simply tricking individuals and businesses into sending money under false pretences. There are many techniques used, one example would be posing as someone from your bank or trusted organisation, claim you’re the victim of fraud and say you need to move your money urgently to a different account.
- Unauthorised payment fraud bad actors steal card or bank account information, forge checks, clone or steal cards or use stolen identity information to make unauthorised transactions. Scams include using stolen card information to purchase goods or services online or in stores, clubs and pubs.
- Remote Banking Fraud occurs when criminals gain access to and transfer funds from the victims account by getting hold of personal information. This is generally done by phishing or some kind of social engineering tactic.
- Investment Scams – fraudsters offer schemes that promise very good returns. These scans can be very elaborate and believable and involve a variety of investments such as stacks, bitcoin, notes, commodities, currency or real estate. They can look legitimate and have credentials and documentation to support the investment. A general rule of thumb is that if its too good to be true then it probably is.
- ‘Hello Mum’ Scams is where criminals text parents or a relative pretending to be one of their children or a close relative asking for money urgently for an emergency.
- Advance Fee Fraud involves scammers asking for funds to pay upfront for goods or services that never materialise.
- Romance scams is where scammers befriend victims on-line and build a relationship and will ask for money once the time is right.
- Phishing is popular with scammers and utilises email to elicit personal information such as login details to bank accounts, social security numbers and other useful information to access banking or other sources of money.
How can you avoid scams
Be Wary of Unsolicited Contact – Avoid responding to unsolicited emails, phone calls, or messages asking for personal or financial information. Legitimate organizations won’t request sensitive data like bank account details or credit card numbers via these channels.
Verify Before You Trust – Always verify the legitimacy of any company or person asking for money. Contact the organization directly using official contact details, not the ones provided in the suspicious message or call.
Use Strong, Unique Passwords – Protect your online accounts with strong, unique passwords and enable two-factor authentication (2FA) wherever possible. This will help safeguard your financial information from hackers. Never share your login details, if you think you may have inadvertently told someone change your password immediately.
Be Cautious of High-Pressure Tactics – Scammers often use urgency or threats to pressure victims into making quick decisions. Take your time to assess the situation. If it seems too good to be true, it probably is. Do not be rushed or bullied on the phone, if in doubt hang up and block the number.
Monitor Your Accounts Regularly – Keep an eye on your bank and credit card statements for any suspicious or unauthorized transactions. Regularly checking your accounts allows you to catch potential fraud early and act.
The key to avoiding financial scams is vigilance and awareness. Archway Securities provide comprehensive awareness training and testing program to ensure you remain vigilant and are aware of the type of scams. Please speak to us to find out more.
