Fraud is a constant worry when it comes to our personal finances and in my time as a Financial Adviser I have helped a number of people avoid scams and protect their money both through our blog posts or people calling the office for advice.
One recent situation involved an elderly couple who almost lost their entire life savings to scammers pretending to be calling from a large international bank.
We need to remain vigilant to the dangers of scammers, especially in our online banking and shopping.
Fraudsters haven’t moved exclusively to online methods, so you should take care if you receive unexpected cold calls, doorstep or postal approaches too.
The finance industry is working hard to prevent fraud where they can.
In the first half of the year, the finance sector prevented £820m worth of unauthorised fraud from taking place.
This represents a 14% improvement in fraud prevention compared with a year earlier, according to the latest figures from trade body UK Finance.
It means that £2 in every £3 of attempted unauthorised fraud is being stopped, with the sector preventing £4.5m of fraud attempts each day.
However, during the same period, £408m was stolen by criminals through unauthorised card, remote banking and cheque fraud.
A further £208m was stolen through authorised push payment (APP) fraud. APP fraud involves a customer being tricked into transferring funds to an account controlled by a criminal.
According to UK Finance, it’s compromised personal and financial data which remains a significant driver behind fraud losses.
Data breaches at third parties outside the finance sector are often the source of stolen customer data.
Credit card information can be stolen using sophisticated ‘digital skimming’ attacks when we’re shopping online, making it so important we shop safely online.
Once credit card details are acquired, the criminals then use social engineering tricks to convince customers to divulge further personal information.
Katy Worobec, Managing Director of Economic Crime at UK Finance, said:
“Not only does fraud have a devastating impact on victims, the money stolen goes on to line the pockets of organised criminal gangs involved in drugs, arms and human trafficking. The finance industry is constantly investing in advanced security systems to protect customers from this threat, while helping law enforcement to apprehend and disrupt the criminals responsible.
“A new voluntary code was introduced in May that has significantly improved consumer protections from authorised push payment fraud, with signatory firms committed to reimbursing victims providing they have met certain standards.
“However, criminals are continuing to exploit vulnerabilities outside the financial sector to obtain customers’ data that is then used to commit fraud. We all have a responsibility to work together, including online retailers and social media companies, to beat the fraudsters and keep customers’ data secure.”
In order to help you avoid becoming a victim of financial fraud, UK Finance is urging us to follow the advice of the Take Five to Stop Fraud campaign and remember that criminals are experts at impersonating people, organisations and the police.
The Take Five to Stop Fraud campaign reminds us that your bank or police will never contact you out of the blue to ask for your PIN, full password, or to move money to another account.To stay safe from financial fraud, you should:
• Stop: Taking a moment to stop and think before parting with your money or information could keep you safe.
• Challenge: Could it be fake? It’s ok to reject, refuse or ignore any requests. Only criminals will try to rush or panic you.
• Protect: Contact your bank immediately if you think you’ve fallen for a scam and report it to Action Fraud.
Jon Doyle is Founder and Financial Planner at Juniper Wealth Management. Advising clients since 2008 he has guided clients through good time, bad times and the ugly. With a clear vision on how advice should be delivered and strong opinions on how we should be investing money in order to live the life we want to live free from money worry.