Did you know there were 8,734 complaints about fraud and scams in the first quarter (Q1) of 2024? This is the “highest ever level” of complaints received by the Financial Ombudsman.
The cost of scams can be very high – both to individuals and the economy as a whole. Last year (2023), £1.17 billion was stolen by criminals through fraud. The average loss per victim is estimated at £25,110.
How can you protect yourself, especially in today’s digitally-connected world? In this guide, our Carlisle financial advisers offer some practical ways to shield your finances.
We hope these insights are helpful. Speak with a financial adviser for more information and discuss your goals and plan.
Get Savvy About Tactics
Criminals’ methods are evolving with new technologies. Since devices and software are always changing, your cyber defence strategies may become outdated if you leave them unattended.
That’s why educating yourself about the latest scams hackers use is important to lower your risk of getting caught out. Here is a list of common fraud tactics to be aware of:
- Phishing and smishing. This one is not too recent, but it is still dangerous. A scammer sends you an email or text (SMS) appearing to be from one of your trusted providers, like HMRC or your bank. They ask for personal information or try to capture it (e.g. using a “dummy” web page posing as your bank login page).
- Investment scams. Here, a scammer offers someone a fraudulent investment, such as overseas property or cryptocurrency, to get the person to move large sums of money to their account.
- Impersonation scams. This might occur in person, over the phone, or via video call. The scammer pretends to be from a trusted organisation, like your bank, asking for money or other sensitive information.
- Online shopping scams. A website or advert (e.g. on social media) may look authentic, but the products it offers are fake. When you attempt to buy them online, your financial details are stolen in the process.
Look out for Red Flags
Often, someone’s behaviour will offer tell-tale signs of a scam artist. Common red flags include:
- Urgency. For instance, someone offering you a fraudulent investment may push you to make a quick decision – e.g. claiming the offer is only available for a short time.
- Cold contact. It could be a scam if someone contacts you out of the blue about a financial product or an investment. Pension cold calling, for instance, is banned in the UK. However, this does not stop some scammers from trying.
- Personal data requests. If someone asks you for sensitive information – e.g. your PIN or login password(s) – then this is likely a scam.
- Glorious offers. If something sounds too good to be true, it often is. For example, if someone presents an investment opportunity with “guaranteed high returns” involving “no/minimal risk”, this is a red flag.
How to Shield Yourself
You can take some time-honoured actions to lower your chances of becoming a scam victim. Firstly, if you receive an unexpected communication like an SMS message, check the source independently.
Avoid clicking on any links or calling any numbers in the message itself. Rather, look up your official contact information (e.g. from your local bank). Check websites by going directly to the URLs, so you know you are visiting the real provider.
Check for “https://” and the padlock symbol in your browser. This is a security signal that the connection between your device and the website is protected.
Speak with your financial adviser if you are still unsure, especially if the communication is about an investment or pension matter. They can give you a trusted second opinion.
Protecting Your Information
A scam attempt may not involve direct forms of contact, such as sending you an email, SMS or social media message. Criminals can attempt to steal information indirectly – e.g. by intercepting your connection when browsing on public WiFi.
To keep your device(s) and data safe, avoid “open” networks and use your mobile data instead when out and about. In your home, your WiFi should have a very strong password.
Be careful about walking around with your device’s Bluetooth always turned on. “Bluejacking” can be a real risk, leaving you vulnerable to unsolicited messages in public. “Bluesnarfing” can also try to intercept your passwords, contact details or even financial data.
Use two-factor authentication (2FA) for digital logins, especially sensitive ones, such as online banking. If someone steals your username and password, they will still be unable to log in without your device to approve the login.
Make sure your privacy settings are secure, and be very careful about what you share. Social media “oversharing”, for instance, could inadvertently reveal personal information to scammers snooping on your account – e.g. where you live and where your children go to school.
This content is for information purposes only. It should not be taken as financial or investment advice. To receive personalised, regulated financial advice regarding your affairs please consult your Financial Planner here at Vesta Wealth in Cumbria, Teesside and across the North of England.