Find out about potential coronavirus (Covid-19) scams, how they could affect you, and how to protect yourself.
A major event like the coronavirus pandemic can initiate new types of scam activity. You may have already seen reports of fraudulent activity around the sale of face masks and hand sanitiser.
With financial services, the scam activity is more nuanced and often appears after the initial shock of a major event. With that in mind, we urge consumers to be vigilant for scams that could appear over the coming months.
Scammers are sophisticated and opportunistic and will try to get personal details or money from victims in many ways. They tend to target people who are more vulnerable or susceptible to being scammed, particularly with so many of us staying at home.
What tactics to look out for
- To exploit your short-term financial concerns, scammers may ask you to hand over an upfront fee – usually between £25 and £450 – when applying for a loan or credit that you never get. This is known as loan fee fraud or advance fee fraud.
- ‘Good cause’ scams. This is where scammers seek investment for good causes such as the production of sanitiser, personal protection equipment (PPE) or new drugs to treat the virus. They use the promise of high returns to entice you.
- Using the uncertainty around stockmarkets, scammers may advise you to invest or transfer existing investments into high return (and high risk) investments.
- Clone firms – firms must be authorised by us to sell, promote, or advise on the sale of insurance products. To appear genuine, some scammers will claim to represent authorised firms. In particular, be aware of life insurance firms that may be cloned.
- Scammers may contact you claiming to be from a claims management company (CMC), insurance company or your credit card provider. They may say they can help you recover losses by submitting a claim, for the cost of a holiday or event such as a wedding cancelled due to the virus. They will ask you to send them money or your bank details.
- Cold calls, emails, texts or WhatsApp messages may claim that your bank is in trouble due to the coronavirus pandemic. They may push you to transfer your money to a new bank with different banking details.
How to protect yourself
- Use the Financial Services Register and Warning List to check who you are dealing with.
- Reject offers that come out of the blue.
- Beware of adverts on social media channels and paid for/sponsored adverts online.
- Don’t click links or open emails from senders you don’t already know.
- Avoid being rushed or pressured into making a decision.
- If a firm calls you unexpectedly, use the contact details on the Register to check you’re dealing with the genuine firm.
- Don’t give out personal details (bank details, address, existing insurance/pensions/investment details).