There are many fraudsters who con unsuspecting people into their scams and causing them to loose their money. Coming up with new scams constantly, it becomes almost too easy for scam artists to trick you into giving them your money. Here are some common, and recent scams to be aware of:
Working at Home Opportunities
These companies usually advertise opportunities to work on your own from home, usually with an enticing selling pitch. Because many people dream of working from home and becoming their own boss, offers such as ‘huge earnings’, ‘no selling involved’, ‘no experience required’, are very appealing to many. However, don’t fall into the trap. If they require you to pay an upfront fee for administration, expenses or materials, do not pay the fee. This is a scam. A legitimate employer would not ask for an upfront fee. Typically these scams are for stuffing envelopes, making cards or sewing clothes or fabrics.
Prize draw winnings
Often times these work when you receive a phone call or a letter, informing you that you just wan a prize in a prize drawing. You are then required to claim your prize by paying an administration fee or to call a premium rate phone number. If you call the number, they usually have you waiting on the line for several minutes while you rack up a large sum on your phone. If ever you receive a correspondence of this kind, you should disregard it, especially if you know that you never entered a prize draw or a lottery. If it is unsolicited, be suspicious.
Phishing
Phishing is the term used when fraudulent emails appear in your account, believed to be legitimate companies requesting person information from you. These emails can appear to be from your bank requesting information from you to update their company records, or to remain registered online. They will ask you to reply with your full details, such as your name and password. Never respond to these emails. Legitimate companies never ask for personal information by email, so be aware of these scams.
With the number of scams rising, you should be extremely cautious when a selling pitch seems too good to be true. Never agree to purchase or release information, especially if you are not familiar with the company.
£22.5 million—that is enormous sum of money lost by banking customers scammed by online fraudsters in the first half of this year. Alarmingly, that number is up 55 per cent from the same period of 2005.
In the first half of the year, victims also lost a combined total of £53m as a result of counterfeiting. This was up from £45.6m the previous year. Consumers also suffered enormous losses through online, phone and mail order fraud.
Email fraud, known as ‘phishing’ is also on the rise. New figures from the Association of Payment Clearing Services (Apacs) reveal a sixteen-fold increase in the number of ‘phishing’ incidents, where scammers send out an email purporting to be from a consumer’s bank and asking them to type in their account details.
Although chip-and-pin technology has helped to reduce certain types of credit and debit card fraud, criminals are now turning their attentions to other methods, such as ATM fraud. In fact, people are most at risk or being scammed when withdrawing money from a cash machine.
Consumers can reduce the risk of falling victim to this type of fraud by shredding all credit card and bank statements. They should also be careful of how they dispose of receipts as some may show your full card number. And if one has one’s bag or wallet stolen, cancel all cards immediately.
Sandra Quinn at APACS advises: “Everyone one of us can help defeat the fraudsters and protect our cards by keeping Pins, passwords and personal information safe and secure.”
The wealthiest are warned by companies like Experian to keep a close eye on their consumer credit information. Experian, a global information solutions provider, revealed last week the results of their research into the victims of identity fraud.
Their findings include a few startling facts. The people who are victimized the most are the wealthiest, and the successful homeowners. The next group is those who rent their accommodations. London is the identity fraud capital of the UK. The risk of becoming a victim of fraud is four times greater than the UK average. Residents of Kensington are the most at risk, being five times more likely to become a victim of identity fraud. Of the 54 UK areas classified as being ‘very high risk’, 34 are within the M25 and 20 of those are in London itself.
The two most common forms of identity fraud are the misuses of a person’s previous address and credit card or store card fraud.
More than half of all victims are 30 – 50 years old, are an equal balance of male and female, and are in the wealthiest category or are living in rental accommodations.
There are some trends that seem to indicate whether a person is in a high target group. Renters and young singles in a shared accommodation, high-flying graduates, thriving people including young families, and people living in premium city residences.
Consumers need to be aware that identity fraud goes farther than misuse of credit cards. Criminals may take a second mortgage out on a home, or apply for a secured loan against a home. After obtaining the money, they disappear leaving the homeowner with the legal responsibility for the loan.
Morgan Stanley has developed an online risk calculator to help credit card users find out whether they are likely to be victims of identity theft. Identity fraud is one of the fastest growing crimes in the UK. The launch of the tool coincides with National Identity Fraud Prevention Week.
The calculator asks people a series of questions about their homes, how they store or dispose of personal information, how they use their credit cards and other factors which might affect their risk of being victims of identity fraud. It uses a green to red warning system to give people an assessment of their risk.
Morgan Stanley has also issued the following recommendations to help credit card holders avoid becoming victims or card fraud:
- Keep cards safe and in sight (or in your pocket) at all times.
- Discard receipts and personal information carefully – shred such items if possible.
- Report missing cards immediately to enable the issuing bank to block the card.
- Do not give your card details over the phone to cold callers.
- Check statements carefully. If you find an unfamiliar transaction, contact your card issuer.
- Never write down your password or PIN and never disclose them to anyone. We will only ever ask you to confirm certain letters from your password.
- Keep personal documents, plastic cards and chequebooks in a safe and secure location.
- Be alert. If you think someone is watching you enter your PIN, cancel the transaction and go to another machine.
- Shop on secure websites only.
Allianz Cornhill Schemes has launched Identity Protector insurance to coincide with National Identity Fraud Prevention Week. The insurance product protects consumers against the consequences of falling victim to identity fraud, which costs the UK economy £1.7 billion a year. It is estimated that 25 per cent of UK adults have either had their identity stolen or know someone who has.
Identity Protector provides compensation for lost wages and having to reapply for loans, cover for the theft of a driving licence or passport, insurance against legal disputes and a means of alerting policyholders when changes are made to their credit reports.
Caitlin Gomes, product development manager for Allianz Cornhill Schemes said: ‘Identity Protector is different to standard products on the market in that it provides the partners of those who die with specific protection against this particularly unpleasant form of identity fraud. Unlike similar products on the market, we’ve made it crystal clear for customers exactly when we’ll pay out and how much.’
Last year, a Which survey of 1,600 people revealed that five per cent of credit card holders had been victims of fraud within the previous year. However, this may have resulted from failure to protect card details as 11 per cent would give security details to a caller, 17 per cent had written down their PIN or password, and 23 per cent used the same PIN for different accounts.
HBOS Identitycare recently warned that UK consumers are not doing enough to protect themselves against identity fraud, noting that many fraudsters were now using spoof websites and phishing emails to get customers’ details.