The government has unveiled a new ban on pensions cold-calling, in order to protect savers from being targeted by ‘unscrupulous pension scammers’.
In addition to a ban on pensions cold calls, the government will also put in place measures to prohibit the sending of unsolicited pensions-related texts and emails.
HMRC intends to tighten up the rules in order to prevent scammers from targeting savers with fraudulent pension schemes. It will also ensure that only active companies producing regular and up-to-date accounts can register pension schemes.
Firms making cold calls without prior customer consent and businesses making calls to individuals with whom they do not have an existing relationship will incur fines of up to £500,000.
The announcement of the ban on pensions cold-calling comes as newly-published figures have revealed that nearly £5 million was stolen from savers by pensions scammers during the first five months of 2017. An estimated £43 million in pension savings has been stolen by criminals since April 2014.
Commenting on the ban, Guy Opperman, Minister for Pensions and Financial Inclusion, said: ‘If people have saved for a private pension, we want to protect them. This is the biggest lifesaving that individuals normally make over many years of hard work.
‘By tackling these scammers, people should know that cold-calling, apart from exceptional circumstances, is banned.’
The ban will be enforced by the Information Commissioner’s Office (ICO) once it comes into effect. Legislation in regard to the ban will be introduced ‘when parliamentary time allows’.
New data collated by consumer group Which? has outlined fraud ‘hotspots’ around the UK.
Which? has created a map, pinpointing locations where certain types of fraud appear to be more prevalent.
The consumer body revealed that Norfolk is a hotspot for dating fraud, Dorset suffers the most computer virus, malware and spyware fraud and Warwickshire experiences the highest level of retail fraud.
London was revealed to be a hotspot for many types of fraud – Which? suggests that this may be because of its ‘large concentration of money and people’. Individuals residing in London are more at risk of falling victim to social media or email hacking, scam door-to-door sales, ticket fraud and mandate fraud.
Gareth Shaw, money expert at Which?, said: ‘This research highlights how reported fraud in the UK is on the increase and the kinds of scams you are most likely to fall victim to will depend on where you live.
‘These criminals are constantly finding new ways to rip us off and those tackling fraud should be upping their game.
‘The government needs to set out an ambitious agenda to tackle fraud, while law enforcement agencies need to be working harder to identify and protect the people most at risk from fraud.’
Figures published by Financial Fraud Action UK (FFA UK) have revealed a significant rise in the amount of money stolen from contactless bank cards and mobile devices.
Contactless spending rose from £7.75 billion in 2015 to £25.2 billion in 2016. The data revealed that nearly £7 million was stolen in 2016, compared to £2.8 million in 2015.
However, FFA UK also stated that fraud on contactless cards and mobile devices equated to just 1.1% of total card fraud.
In order to combat contactless card fraud, consumers have been urged to never hand over their card at the point of payment, always ask for a receipt when purchasing goods and review financial statements regularly to check for unusual transactions.
Richard Koch, Head of Policy at the UK Cards Association, said: ‘All contactless cards contain robust security features including an in-built security check which triggers the need to enter a PIN at certain points.
‘Customers are fully protected against any losses and will never be left out of pocket in the unlikely event they are the victim of this type of fraud, unlike if they lose cash.’
Consumer group Which? has urged banks to take ‘meaningful action’ in order to safeguard consumers from financial fraud.
Research published by the group has suggested that banks are leaving their customers exposed to bank transfer scams. The findings revealed that 8% of individuals had made a bank transfer to what they believed was a legitimate business, but later turned out to be a criminal.
Of those who had lost money to bank transfer scams, 54% had been victims in the last six months.
The consumer group’s findings also revealed that some people have lost ‘life-changing’ sums of money, with 37% reporting that they didn’t receive any of their money back.
Which? is calling for banks to outline what action they are taking to protect customers from financial fraud. It also stated that the next government must set out an ambitious plan to make sure that banks ‘do more to protect consumers from bank transfer scams’.
Gareth Shaw, money expert at Which?, commented: ‘Despite the fact that consumers are still losing life-changing sums of money to fraudsters, it’s not clear what meaningful action the banks have taken to protect their customers.
‘People assume that banks will look after them and their money. So it’s vital that the industry, regulator and the next government act quickly and decisively to tackle financial fraud.
‘Failure to do so will continue to leave consumers paying the price.’
The number of UK businesses affected by corporate fraud and cybercrime has risen by 16% over the past year, according to a new report published by risk management company Kroll.
90% of firms who were interviewed by Kroll said that they had experienced an incident of cybercrime over the past 12 months.
Theft of physical assets and the misappropriation of funds were found to be the most common types of fraud.
Businesses also reported that the majority of those carrying out fraudulent activities came from inside the company.
The report also suggested that the UK has the second highest rate of cyber incidents: 92% of companies interviewed revealed that they had experienced a cyber-attack or loss of information over the past year.
Tommy Helsby, Co-Chairman of Investigations and Disputes at Kroll, commented: ‘It’s becoming an increasingly risky world, with the largest ever proportion of companies reporting fraud and similarly high levels of cyber and security breaches.
‘The impact of such incidents is significant, with punitive effects on company revenues, business continuity, corporate reputation, customer satisfaction and employee morale.
‘With fraud, cyber and security incidents becoming the new normal for companies all over the world, it’s clear that organisations need to have systemic processes in place to prevent, detect and respond to these risks if they are to avoid reputational and financial damage.’
More than one million incidents of financial fraud occurred in the first six months of 2016, constituting a 53% increase when compared to the same period last year, according to a report released by Financial Fraud Action UK (FFA UK). This equates to an incident occurring every 15 seconds between January and June 2016.
The figures have been released to coincide with the launch of Take Five, a national campaign by the FFA and major banks and financial services providers to combat financial fraud. The campaign focuses on financial scams directly targeting customers, such as email phishing and phone and text-based scams, and is designed to remind people that ‘it pays to stop and think’.
The research reveals that the most common reason for respondents sharing their details was because they felt that the person seemed genuine (43%), while 39% said they did so because they ‘felt pressured’. Almost a quarter of fraud victims said the main reason was because the fraudster was extremely convincing.
More than a third believed they were being scammed during the conversation but still continued with the transaction, and some 23% realised after the conversation had finished.
FFA UK recommends the following five steps to avoid scams:
- Never disclose security details, such as your PIN or full password – it’s never right to reveal these details
- Don’t assume an email request or caller is genuine – people aren’t always who they say they are
- Don’t be rushed – a bank or genuine organisation won’t mind waiting to give you time to stop and think
- Listen to your instincts – if something feels wrong then it is usually right to pause and question it
- Stay in control – have the confidence to refuse unusual requests for information.
Katy Worobec, Director of FFA UK, said: ‘Banks and other financial service providers work hard to protect their customers, using highly sophisticated security systems. Last year, banks stopped £7 in £10 of attempted fraud from happening. But as the banks’ systems get more advanced, fraudsters turn their attention elsewhere and sadly this often means tricking people out of their personal details and money.
‘We are asking people to take five – to take that moment – to pause and think before they respond to any financial requests and share any personal or financial details.’
There are two new HMRC telephone scams to be aware of. Here are some details of what you need to be aware of and what to look out for.
Scam 1. HMRC has become aware of a telephone scam where a recorded message is left, allegedly from HMRC, that starts: “This is Her Majesty’s Revenue & Customs. We have been trying to reach you to let you know that we are filing a law suit against you.” The recipient is then asked to phone 0161 850 8563 and press “1” to speak to the officer dealing with the case. DO NOT reply to the message as they will then try to extract money from you when you call them back.
Scam 2. In this scam a bogus caller rings up an accountant and poses as an HMRC money laundering (ML) investigator. The caller says that they had previously sent a letter to the accountant about an ML report on one of their clients (the accountant may not have actually received a letter). The client then receives a call allegedly from their bank to say HMRC wants three years’ bank statements. So the client calls their accountant who confirms that HMRC has contacted them and so unwittingly gives credibility to the request for bank statements. The fraudsters then try to trick the client into giving them online access to their bank account to access the statements.
Tip 1. If you receive a call from someone and you cannot verify the identity of the person making the call, you should never disclose any personal details whatsoever.
Tip 2. If you receive either of these scam calls, report it on the Action Fraud website or you can call 0300 123 2040.
If you receive a call from HMRC stating that it’s filing a law suit against you or asking you for access to bank statements then it’s a scam. Watch out for the fraudsters contacting you too and posing as HMRC money laundering investigators.