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Financial scams – knowing what to look out for


During lockdown, there has been a surge in financial scams as criminals seek to exploit the current situation to their advantage. We sadly know that it’s far from unusual for scammers to use traumatic events, such as a global pandemic, as a way-in when it comes to exploiting people at a time when many will be more vulnerable than before.

In light of this, it’s important to be more vigilant than ever. To help you, we’ve summarised some of the most common types of scams that you need to look out for.

1. Authorised Push Payment Fraud (bank transfer scams):

UK Finance has reported a stark increase in impersonation scams this year, where the fraudster pretends to be your bank or a trusted organisation and convinces you to make a payment to them. This can take the form of emails, texts or WhatsApp messages stating that your bank account is in trouble due to the crisis, for example. They may push you to transfer your savings to a new account in order to make sure your balance remains secure. In some cases, the fraudsters will hack into your email account to get a sense of any planned transactions or services you’re expecting an invoice for. This gives them the opportunity to time the scam so it takes place when you’re expecting to be contacted for payment by a person or company, and are therefore more likely not to question the request.

As a general rule, if you receive an emailed invoice or a request for payment over the phone and you are asked to pay money to account details you have never used before, your default position should be suspicion.  Phone the company or individual on a recognised number and ask them if they have been in touch. Check that they have asked for the money, and that the bank details provided are correct.

2. Fake endorsements on social media:

You should be cautious about companies you’ve never heard of that claim to be ‘recommended’ or ‘endorsed’ by reputable sources, for example, Martin Lewis from Money Saving Expert has wrongly been linked by fraudsters to their activity. Fraudulent companies will often make up fake endorsements or claim to have won prestigious awards in order to get you to buy a product. 

3. Look out for fraudulent ‘Test & Trace’ texts and calls:

The NHS has confirmed that official ‘Test and Trace’ texts will come directly from the NHS, so the sender will be listed as ‘NHS’ when the text comes through. This means that any text messages that come through from a random number are fake and should be ignored. Also, all NHS calls will come from the official NHS number, which is 0300 0135000.

Legitimate contact tracers will ask for your full name, date of birth and postcode, and will offer you advice if you have come into contact with somebody who has coronavirus symptoms. They will never do the following:

  • Ask for bank details or payments
  • Ask for details of any other account details, such as social media
  • Ask you to set up a password or PIN number over the phone
  • Ask you to call a premium rate number, such as those starting 09 or 087
  • Ask you to download anything or access a non-NHS or Government site

4. Scam 'competitions' and 'free vouchers':

Another common scam – even before the pandemic – takes the form of a bogus email offering a 'free voucher' or a fake competition, which usually claims to be from well-known supermarkets and household brands. Scammer have now also started to use the term 'Covid-19' to draw victims in. These scammers say they are giving you the chance to win free shopping with online vouchers, but in reality they want to steal your personal information. The link they ask you to click leads to a convincing-looking phishing website that is designed to steal your login, personal and financial information.

5. Tapping into puppy fever:

During lockdown a lot of people are spending more time at home and have turned their attention to owning a pet. Scammers are making the most of the surge in demand for puppies or kittens by advertising pets for sale, which in reality don't exist. Scammers will usually demand an upfront deposit payment and then disappear. They will often claim lockdown restrictions are the reason why the purchaser can't see the parent animal or the pet itself before making a payment, and sometimes they will even follow up with requests for more money to cover insurance, vaccinations and even delivery of the puppy or kitten.

Action Fraud advises you to do your research and look up reviews of any website you're using to buy a pet. Ask to see the animal in person or via video chat, and for extra protection, use a credit card for any payments so you're covered. 

There is no doubt that scammers are fast learners and scams are becoming increasingly elaborate. Following these tips will put you in a good position to protect your finances from scams, but if you have any doubt it’s always best to call your financial provider and check.

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551