Plenty of unscrupulous people have tried to trick me into parting with cash over the years. So far, none have succeeded. A survey this week could possibly reveal why: it turns out “nice people” are far more likely to fall for financial scams than misanthropes like me.
I always assume that anyone cold calling my landline is a con artist; that any unexpected text or email has been sent with criminal intent; and that any investment with a “guaranteed return” is a guaranteed way of losing money.
My inability to suffer fools gladly is, according to HSBC bank, an effective defence against fraud. Research published this week claims that victims of fraud are 10 per cent “nicer” than those who tell the scammers (politely or otherwise) to do one.
Nearly one-third of those who had fallen victim to a fraudster said they thought it was because they were “too trusting” and one in 10 admitted that not wanting to come across as rude was the main reason they were conned.
Extraordinarily, HSBC has decided to create a “Nice Alert” that will play in branches across the UK in the run-up to Christmas, warning people about “being too nice when it comes to parting with their money or personal details”.
For this season of ill-will, I thought I would share 10 common scams that decent people — even FT readers — continue to fall for, to help you and yours say a Scrooge-like bah humbug!
1 “Authorised” bank fraud
Fraudsters used an array of sophisticated methods to persuade unwary bank customers to “authorise” over £350m worth of online transfers last year. Text messages from banks are not secure — fraudsters can “spoof” numbers so their messages appear in the same stream as legitimate ones — and can also make telephone calls appear to come from the number on the back of your bank card. If in doubt, hang up and call back from a different line. The usual patter is that they’re calling from your bank’s fraud department, or the police, and your money must be transferred to a “safe account”. Alternatively, they may hack into legitimate emails from solicitors, financial advisers or builders requesting payment and amend the account and sort code. This type of fraud often occurs on a Friday afternoon, giving them longer to spirit away the proceeds before anyone notices.
2 HMRC scams
In the run-up to January’s tax return deadline, scam emails and texts purporting to be from HM Revenue & Customs tend to surge. Nearly 1m people reported fraudulent contact to the UK tax authority last year — many receiving emails with the HMRC logo that said they were owed a tax rebate.
Others received bogus calls from tax inspectors claiming huge bills were owed. HMRC says it will never contact taxpayers in this way. Other variants of this scam involve emails from TV Licensing or the DVLA saying licences have expired. Click on the link, and convincing-looking websites are set up to harvest payment details and other personal information. Don’t click — just delete.
3 Investment scams
The number of reported investment scams rocketed by 152 per cent this year, with average losses of more than £12,000 per case. Fraudsters never offer anything dull like an index fund — they tempt us by peddling an array of exotic-sounding alternative investments such as art, wine, forestry, carbon credits or land — and will even impersonate private banks or investment firms to gain our trust. Beware of being promised guaranteed returns or being put under time pressure to commit. If it looks too good to be true, it definitely is.
Young people are increasingly falling for “get rich quick” scams on social media. According to an Action Fraud report this year, hundreds of Instagram users have been suckered into giving money to investment schemes promising high returns — sometimes within hours. Losses total £9,000 on average — with the fraudsters extracting more money by sending snaps of huge “returns” piling up in fake investment accounts.
5 Amazon Prime scam
My dad had a phone call last week from an auto-recorded voice — something that should instantly get your hackles up — saying his £79 Amazon Prime membership was about to be renewed. He does not have Prime (I do and keep him well supplied with detective fiction and wild bird food). “Press one to cancel,” said the voice. He pressed one and got through to a human who asked rather too urgently for his card details and other information. He smelled a rat and hung up. Amazon customer services confirmed this is a scam and said it would never call customers asking for financial details.
6 Broadband scams
Sadly, even signing up to the Telephone Preference Service has not stopped my landline receiving calls from people in overseas call centres pretending to be from BT, Openreach or Microsoft. In all cases, I’m told that my broadband is about to be cut off, there’s a virus on my computer or similar. Do not feel bad about hanging up. If such people get hold of your passwords and take control of your computer, they will not feel bad about cleaning out your bank accounts.
7 Apple ID scam
Last year, I had a spate of text messages that appeared to come from Apple support saying that my Apple ID was about to be deleted unless I clicked on a link. Looking carefully at this link, it was from “i-apple” and had been created using a programme that shortens long web addresses.
A quick check on the Apple website confirmed it was a phishing scam. Other variants include fake emails saying you have a huge bill that must be dealt with straightaway by clicking on a link. Remember that fraudsters will always be in a hurry to con you, as there’s less time for you to question what’s going on. If you’re being hassled, you’re probably being hustled.
8 Competition scams
I had a text message last week saying “Congratulations! You’ve won the £500 gift card from Argos! Click here to claim it”. I did not click. Not because I am snobby about Argos (far from it!) but because I had not entered a competition, therefore I knew I could not have won.
9 Pensions review scam
Pension freedoms have been a field day for fraudsters, with huge sums able to be extracted from the retirement nest eggs of the unwitting. The offer of a free pensions review is the most common entry point for scammers — after all, who isn’t confused about their pension options? — so be on your guard. The government’s ban on pensions cold calling means anyone offering such a service is a bona fide fraudster. However, the current legislation is unable to ban calls from overseas jurisdictions. Hang up.
10 Romance scams
As well as preying on our fears, fraudsters also prey upon our desires. Romance fraud is often a slow-burning sting, with gullible victims groomed by a succession of texts and emails after contact is first made on social media or a dating site. After trust is gained, victims are asked to lend money — small amounts at first, but many have lost life-changing sums. Some are so ashamed to have fallen for scams like these, they go unreported.
This is a nasty little list, which added up to more than £1bn of fraud last year. So be nice, and share this article far and wide to make sure it’s the fraudsters who have an absolutely miserable Christmas.
Claer Barrett is the editor of FT Money, and a financial commentator on Eddie Mair’s LBC drive-time show, on weekdays between 4-6pm: firstname.lastname@example.org; Twitter @Claerb; Instagram @Claerb