Fraudsters trying to get their hands on your money are using increasingly sophisticated tactics to get you to hand over sensitive information. It could mean losing tens of thousands of pounds that there may be no chances of getting back.

Often, we think ‘I’d never fall for that’ when you read about scam stories in the news. However, when you’re targeted, it’s easy to unwittingly hand over details or believe you’re speaking to someone who is a genuine representative from a service you used, such as your bank. Bank transfer fraud has been rising fast and being aware of the signs could help you prevent a scam.

According to research from Which? £674 is lost every minute in the UK through bank transfer scams, amounting to £345 million a year. Most of this money is stolen from personal accounts. The average victim loses around £2,290 but there have been many instances where the sum has been a victim’s entire life savings, throwing their plans into chaos.

What’s more worrying than being targeted is the fact that in many cases recovering the losses is impossible. In 2018, just 23% of victims recouped their savings. As fraudsters typically convincingly pose as bank staff or other professionals, banks are not obliged to return the money and in the majority of cases do not.

A new voluntary code designed to protect scam victims that had been tricked into transferring money came into force in May. However, this doesn’t cover all banks and building societies and customers will still have to meet the standards expected of them in relation to security. As a result, where possible, prevention is still the best route.

What is Authorised Push Payment (APP) fraud?

APP fraud is where a criminal tricks someone into sending money from their account. This is typically done via the phone, but may also be done via email, social media or text. To gain your trust, fraudsters will often pose as a bank, HMRC, police or someone else you may be willing to give your details too. Fraudsters will often give a sense of urgency, for example, stating that fraudulent activity has occurred on your account and you must transfer money to protect it.  They may ask for your personal details as part of a ‘security check’ or to read ‘confirmation codes’ they send to your phone, this can give them access to your accounts.

One of the reasons APP fraud can be so convincing is due to number spoofing. This allows criminals to appear as if they are calling or texting from a legitimate number used by your bank or other service provider.

What can you do?

  • Question what they say: Whilst fraudsters may sound convincing, ask yourself if this is the procedure organisations usually follow. Would a bank ask you to transfer money if they believed fraudulent payments were occurring, for example? Usually, they will freeze your account as a first step.
  • Call back: Even when a phone number indicates the call is legitimate, say you’ll call back, using a number you know is correct. It’s important here to either use a different phone or place a call to someone you know first as it’s possible for criminals to hold a line open.
  • Don’t share security details: Keep your security details, such as a password or an answer to a security question, to yourself. It could give criminals the details they need to gain access to your accounts.
  • Take your time: A genuine caller will understand why you have concerns and won’t mind waiting whilst you confirm who you’re speaking to. Don’t be rushed into taking any action.
  • Report the crime: If you have been scammed or are concerned about contact you’ve received, take steps to report it immediately. In some cases, it is possible to trace where the money has gone and retrieve it. Where this isn’t possible, the new voluntary code may offer you some protection.

Protecting your pension

Whilst we’re on the subject of scams, it’s worth a reminder to protect your pension too. Pension are often among the largest assets we hold, so it’s not surprising that they’re attractive to fraudsters. According to the Financial Conduct Authority, the average victim of a pension scam loses £91,000; a sum that could have a serious impact on your retirement plans.

You’re particularly vulnerable as you approach the point when you can access your pension, currently age 55, and make plans to retire. Remember to take a step back, check credentials and keep in mind that if it’s too good to be true, it probably is.