A beginner’s guide to scams

Money Advice Service

Scams are getting more and more sophisticated, particularly when it comes to targeting you online and through mobile devices. In this guide we take a look at how you can recognise a scam, protect yourself and what to do if you’re a victim or have been targeted.

What is a scam?

Scams can come in many forms, but all are designed to get hold of your money.

They can do this by getting you to reveal your personal details, stealing your information, or even getting you to willingly hand over the cash.

The key is knowing how to recognise a scam, protect yourself and what to do if you think you’ve been targeted or have fallen victim.

Types of scam

The tactics used by scammers and fraudsters can vary from someone coming to your front door to an unexpected phone call.

The internet and advances in digital communications have opened other ways for scammers to target you and steal information.

Chances are, you’ve come across the most common type of scams – the spam email from a Nigerian prince or reporting to be from HMRC or your bank.

However, while email scams can be quite easy to spot and avoid, others are much more sophisticated.

How to recognise a scam

Knowing what to be on the lookout for when it comes to scams is one of the best ways to protect yourself.

  • Unsolicited or unexpected contact. If you have received any kind of contact, but particularly a phone call, out of the blue, it is best to avoid it. Since January 2019, there has been a ban on cold calling about pensions. This means you should not be contacted by any company about your pension unless you’ve asked them to.
  • Email address. If you get an email, expand the pane at the top of the message and see exactly who it has come from. If it is a scam, the email address the message has come from will be filled in with random numbers, or be misspelled.

Is it a scam?

The FCA’s ScamSmart website has a tool to help you check if an investment or pension opportunity is a scam.

There’s also lots more information about avoiding the latest scams. Visit the ScamSmart website.

  • If it sounds too good to be true, it usually is. This is something you normally find with pension or investment scams, where the fraudster guarantees you huge returns, but tells you it is low risk.
  • Personal details, PIN codes and passwords. These are things no legitimate company will ask you for.
  • Quick decisions. If you are pushed into making a decision on the spot, be suspicious. Scammers don’t want you to have time to think about it.
  • Random competitions, particularly if you don’t remember entering them, should ring alarm bells.
You can find a more comprehensive list of the warning signs for specific types of scams on this page.

How to protect yourself against scams

Did you know?

Scammers can hijack phone lines. If you think you’re being targeted, hang up the phone, wait five minutes and then call your bank directly. Find out more what you can do to stop fraud on the Take Five website.

The next step to avoiding scams is to know how to protect yourself. While some of these are good advice in general, many are aimed at keeping you safe online:

  • Avoid any unexpected contact. Any phone calls, letters, emails or people knocking on your door should be ignored.
  • Never give out personal information. This can be used to steal your identity and access accounts.
  • Keep operating system and virus protection software up-to-date. Don’t ignore updates as these can often include patches to protect against new kinds of scams, viruses and ransomware. This goes for mobile devices as well.
  • Make sure all accounts have a strong password. Don’t use the same password for multiple accounts and change them regularly.
  • Don’t make any advanced payments until you are sure the company you’re dealing with is legitimate.
  • If you’re unsure about a financial services company, check the FCA register of regulated companies. If they’re not on it, don’t have anything to do with them.
  • If you’re unsure about any other kind of company, you can look them up on Companies House to find out their background, or search for reviews online.
  • Use safe and secure WiFi connections and avoid public WiFi. Your standard 3G or 4G connection is often more secure than the one in the coffee shop or restaurant.
  • Make sure any websites you are using are secure. Check to see if the web address starts with HTTPS, not just HTTP.
  • Sign-up for a call blocking service like the Telephone Preference Service. This might not stop all scam calls as they operate outside the legal guidelines, but it will stop cold-callers. This means any suspicious or unexpected calls you do receive are almost certainly from people you don’t want to deal with.

What should you do if you’ve been the victim of a scam?

If you think you’ve been scammed there are three things you need to do:

  1. Stop sending money straight away. If the payment has been set up as a Direct Debit, get in touch with your bank to stop this immediately.
  2. Report the scam to Action Fraud on 0300 123 2040, use the Action Fraud online reporting tool, or the FCA Scam Smart website.
  3. Beware of follow-up scams. Sometimes after reporting a scam you might get targeted again by a fraudster who says they can get your money back.
  4. Check your credit file for free through, Noddle, MSE Credit Club, and Clearscore. You’re best to check it monthly for credit applications done by a fraudster. See if there are applications for credit you don’t recognise, or if you have a Cifas marker on your file. If your bank believes you’ve been a victim of fraud if could put a Cifas ‘Victim of impersonation’ note on your account. It warns lenders that you’ve been a victim, or are vulnerable to becoming, a victim of fraud. If you have a Cifas marker on your file, request more information about why from Cifas.

If you think you’ve been targeted by a scam, you should also report it so it can be investigated. You can do this through the Financial Conduct Authority website using their reporting form.

This article is provided by the Money Advice Service.

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