By Michael Klimes, published on Money Marketing
Coronavirus related fraud reports are up 400 per cent, according to new figures from Action Fraud today. Recently the National Fraud Intelligence Bureau reported a new trend in fraud related to coronavirus. Updated figures show there have been 105 reports to Action Fraud since 1 February 2020, with total losses reaching nearly £970,000.
The update says the majority of reports are related to online shopping scams where people have ordered protective face masks, hand sanitiser, and other products, which have never arrived.
Other frauds being reported include ticket fraud, romance fraud, charity fraud and lender loan fraud.
Action Fraud says it also received more than 200 reports of coronavirus-themed phishing emails that attempt to trick people into opening attachments to steal personal information.
It adds some of the tactics being used in phishing emails include:
- Fraudsters purporting to be from a research group that mimic the Centre for Disease Control and Prevention and World Health Organisation. They claim to provide the victim with a list of active infections in their area but to access this information the victim needs to either: click on a link which redirects them to a credential-stealing page; or make a donation of support in the form of a payment into a Bitcoin account.
- Fraudsters providing articles about the virus outbreak with a link to a fake company website where victims are encouraged to click to subscribe to a daily newsletter for further updates.
- Fraudsters sending investment scheme and trading advice encouraging people to take advantage of the coronavirus downturn.
- Fraudsters purporting to be from HMRC offering a tax refund and directing victims to a fake website to harvest their personal and financial details. The emails often display the HMRC logo making it look reasonably genuine and convincing.
Separately the FCA has issued a warning about fraudsters who may be contacting former clients of the Wales-based financial advisory firm Synergy Wealth Ltd (Synergy) and London-based investment management firm Westbury Private Clients LLP (Westbury).
The watchdog says it believes fraudsters may be offering to review individuals’ pensions and arrange a pension transfer for an inappropriately high fee.
It also believes a third party has provided contact details to companies believed to be linked to Recovery Rooms.
These are fraudsters who approach investors who have been scammed or had failed investments, offering to help them get their money back for an upfront fee.
National Fraud Intelligence Bureau head and superintendent Sanjay Andersen says:
“Fraudsters will use any opportunity they can to take money from innocent people. This includes exploiting tragedies and global emergencies.“The majority of scams we are seeing relate to the online sale of protective items, and items that are in short supply across the country, due to the Covid-19 outbreak. We’re advising people not to panic and to think about the purchase they are making. When you’re online shopping it’s important to do your research and look at reviews of the site you are buying from.”
Reacting to the figures, AJ Bell senior analyst Tom Selby says:
“While the country hunkers down in the hope of slowing the spread of coronavirus, the economic fallout will inevitably lead to an increase in the number of vulnerable or potentially vulnerable people in the UK.“In such an environment, unscrupulous scammers will already be plotting ways to take advantage during what for many will be a time of serious financial strain.
“Scams claiming to allow people early access to their retirement pots could come back to the fore if we see a surge in unemployment placing immediate pressure on household incomes.
“While getting access to your pension before age 55 may be tempting during this period of uncertainty, doing so will as a minimum see you hit with a 55 per cent unauthorised payment charge from HMRC in the first instance.
“At best you’ll then be subject to sky high fees by the fraudster as well, meaning you only get a fraction of your pension back and your retirement prospects are left in tatters. Many people lose everything as a result of these types of scams.”
Adviser view: Why scammers strike in a crisis
- Times of crisis bring out the very best of people and the very worst of those predisposed to be that way.
- Financial advisers cannot protect their clients all of the time.
- It can be a particular issue for those already in a vulnerable situation or have fallen victim to fraud previously.
- Scammers will be playing on people’s isolated position.
- There needs to be a better coordinated response to tackle scams.
- But good people are already showing how best to reconnect with community and we may come out of this as a stronger society.
From New Forest Wealth Management director Adam Johnson – a senior partner practice of St James’s Place.