17 December 2024
Margo Lestz
Head of Communications
In today’s digital age, financial scams have become increasingly more sophisticated, making it harder for us to distinguish between legitimate offers and fraudulent schemes. Criminals are constantly changing their tactics and making their scams more intricate. In this environment, it is crucial for us to stay vigilant and informed. By understanding the warning signs and knowing how to spot common red flags, we can better protect ourselves and our finances from becoming the next target in this ever-growing threat.
Let’s have a look at some sobering statistics:
Financial Scams Impact Us All
“Global financial losses due to scammers exceed $1 trillion, as one in four lose money to fraudsters. …However, the impact isn’t just monetary: 60% of scam victims report significant emotional distress.”
Most People Are Targeted by Scammers
“…The vast majority (96.8%) of people have received spam messages relating to scams through emails, text messages, phone calls, or other types of messages. The most common channel… is email, with almost half (49%) saying they receive spam via emails most often. This was followed by phone calls (26.5%), then text messages (14.7%), and messaging apps like WhatsApp and Facebook Messenger came lowest with 9.8%.”
Scammers Use AI for More Sophisticated Attacks
“Research carried out by Darktrace found a 135% increase in ‘novel social engineering’ attacks in early 2023 following the widespread rollout of ChatGPT. These attacks are designed to create a sense of urgency, fear, or curiosity which persuades victims to take action.
Almost three-quarters (73%) of people said that they were concerned that hackers could use generative AI tools like ChatGPT to create spam emails that were almost impossible to distinguish from genuine emails. A Tooltester study found that 63.5% of people can’t identify content made purely by the ChatGPT 4.0 model.”
What to Do…
Unfortunately, there are criminals who dedicate their time to creating scams designed to deceive and exploit others. However, with a bit of forethought and preparation, you can safeguard yourself and your loved ones from these financial scams:
1. STOP – Pause - Don’t react immediately
Scammers thrive on creating a sense of urgency. They might say things like:
Act now, or you’ll lose this opportunity!
Your account will be closed unless you pay immediately.
Your computer will be locked unless you call this number now.
Resist the pressure and take your time to determine whether it is a scam. Legitimate organizations won’t rush or threaten you into making hasty decisions. Take a step back, evaluate, and think before you act.
2. Verify
Contact the organization directly using verified contact information from their official website or documents - NOT the phone number, link or email provided by the suspicious party.
Example: If you receive an email from your bank requesting sensitive information, DON’T reply or click links. Instead, call your bank using the customer service number on your bank card.
3. When in Doubt, Check it Out
Do an online search. Look up the organization or offer alongside words like “scam” or “fraud.” Check trusted resources, such as consumer protection websites or reviews.
Example: If someone claims you’ve won a lottery you never entered, chances are, it’s a scam! Research the organization or prize to verify.
Common Scams to Watch Out For
Imposter Scams
How They Work: A scammer pretends to be someone you trust, like a family member, government official, or tech support.
Examples/Warning Signs:
Unusual requests for money or personal information.
Claims that your computer or phone has been hacked and needs immediate attention.
Online Shopping or Giveaway Scams
How They Work: Fake websites or offers trick you into providing payment details or personal information.
Examples/Warning Signs:
Prices that are too good to be true.
A sense of urgency: “Only 2 items left!”
Poorly designed websites or unusual payment methods.
Phishing Emails and Texts
How They Work: You receive a message asking you to click a link or provide sensitive details, such as passwords or account numbers.
Examples/Warning Signs:
Messages with poor grammar or spelling mistakes.
Links that don’t match official URLs.
Investment or Financial Scams
How They Work: Promises of high returns with little or no risk to convince you to hand over money.
Examples/Warning Signs:
Pressure to act fast to avoid missing the opportunity.
Claims that are not backed by legitimate documentation or registered firms.
Bonus Tips to Stay Safe
Protect Your Personal Information: Don’t share sensitive details, such as passwords or bank account information, over the phone or online unless you are absolutely certain of the recipient’s identity.
Use Strong Passwords and Two-Factor Authentication: Protect your accounts with secure, unique passwords and enable additional security features such as facial recognition, fingerprints or having a code sent via text.
Be Sceptical of Unsolicited Contact: If you weren’t expecting a call, email or message, question its legitimacy – even if it looks official.
Remember: It’s better to take time to verify than to act quickly and regret it later.
Where to Report Financial Scams
If you have been targeted by a scam, there are several platforms and organizations in the UK where you can report it.
Action Fraud, Website: Action Fraud, the UK's national reporting centre for fraud and cybercrime. You can report scams online or by phone at 0300 123 2040.
Citizens Advice Scams Action, Website: Citizens Advice, offers advice on dealing with scams and can help report them to the relevant authorities.
Social Media Platforms: Report suspicious activity or accounts directly on platforms like Facebook, Instagram, and Twitter. They often have built-in reporting tools for scams and fake accounts.
What to Include in Your Report
When reporting a scam, provide as much detail as possible:
Contact details of the scammer (email, phone, website).
Screenshots or copies of messages/emails.
Description of the scam and any financial losses.
Staying informed and vigilant is your best defence against the new, sophisticated financial scams. By understanding the different types of scams, recognizing the red flags, and knowing how to respond if you suspect you're being targeted, you can protect yourself and your finances.
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The information provided on this website is for educational or informational purposes only. Please refer to our legal disclaimer for further information.
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