Metro Bank: Scam of the Month & How to Avoid Them
The UK’s best community bank, Metro Bank, has named ISA investment and HMRC scams as the scam of the month for April.
Scams in general are on the rise with lockdown and isolation caused by the pandemic creating even more opportunities for fraudsters to target their victims. Data from the first lockdown has seen Action Fraud report a 29% rise of clone firm investment scams with the average loss being a staggering £45,000. UK Finance has just reported that investment scams, in which a criminal convinces their victim to move their money to a fictitious fund or to pay for a fake investment, saw the highest increase in losses of any Authorised Push Payment (APP) scam type in 2020, totalling £135.1 million.
Investment ISA scams promote good rates of return for invested lump sums to tempt investors to act.
“Scams can be seasonal and we want the public to be more aware of this so they can spot and avoid these scams, explains Adam Speakman, Head of Fraud and Investigations at Metro Bank. “Our key advice for any scam is – if you are being pressured to act quickly, move funds or share passwords you need to STOP and THINK, question and investigate further the requests in case you are being scammed. As the tax year comes to a close, we see a lot of HMRC scams and as the new financial year starts in April, fraudsters target investment ISA scams.
“ISA scams offer tempting rates of return and these scams are often advertised online or via social media. Not only is the offer fake, but so too are the reviews from supposedly happy investors. Scams can be difficult to differentiate from real investment opportunities, but alarm bells should ring if the rate of return seems too good to be true, or if you are contacted out of the blue by email, text or even with a call. Pressure to act quickly is also another warning sign.”
Anyone looking to invest in an ISA should double check that the provider – either a company or individual is authorised by the Financial Conduct Authority if it isn’t, it is probably a scam and without this you won’t have the protection of the Financial Ombudsman Service or Financial Services Compensation Scheme (FSCS).
Speakman: “There is always an element of risk in investment – but the risk should come from the movement in market conditions, not from being defrauded by criminals.”
HMRC scams can be by phone, email or text. They have become so common, that the UK Government has published a list of their current messages, so the general public can check.
Speakman: “HMRC scams can be by phone, email or text. They have become so common, that the UK Government has published a list of their current messages, so the general public can check.
“HMRC scams are ever evolving in sophistication. We want everyone to be aware that the HMRC will never call you and pressure or threaten you in to making payments, so if you are contacted by someone purporting to be from HMRC do not engage in their requests to send funds or to share any passwords or personal data. Telephone numbers can be spoofed, so if a phone number looks like it’s in relation to HMRC it doesn’t necessarily mean it is – always take the caller’s details and terminate the call then check the HMRC website for the latest and common scams before calling back on a trusted number.”