Financial scams on the rise
Documented cases of financial fraud have increased by 4.5 million in the two years since March 2020, according to the Office for National Statistics (ONS).
The rise in illegal activity has been driven by significant growth in consumer and retail scams and a rise in cyber fraud, driven by cost of living pressures and the financial consequences of the Covid-19 pandemic.
The ONS said that there had been a 17 percentage point increase in fraud reported to the police in the 12 months to March 2021 alone.
Read more: £171.7m lost to investment scams using APP fraud last year
Myron Jobson, senior personal finance analyst at Interactive Investor, said that fraudsters have been preying on consumers at a time when they know many are desperate.
“Scammers have taken advantage of consumers’ fears,” he said. “Fraudsters are trying to take advantage of people struggling as prices soar. There have been countless reports of criminals sending texts, claiming to be from the government or Ofgem given the cost-of-living payments due to be applied to energy bill accounts.”
These statistics are further evidence that criminals are targeting financial services in the current challenging macro economic environment. Earlier this month, Peer2Peer Finance News reported that consumer group Which? had warned that scams are becoming more prevalent.
At the time, Rocio Concha, director of policy and advocacy at Which? called on the government to pass an Online Safety Bill as a matter of priority.
Following behavioural changes during the pandemic, more Britons are embracing online transactions, offering criminals great opportunities for attacks. This has been reflected in the latest ONS statistics.
The percentage of cyber-related fraud incidents has increased by eight per cent since March 2020, which the ONS said was a direct result of the change in digital behaviours since the pandemic began.
Interactive Investor’s Myron Jobson highlighted the growing fraud risks, encouraging consumers to be more diligent when it comes to their security and encouraging organisations to assist their customers.
“We all need to remain on our guard against scams,” he said.
“In addition to the basics, which include not sharing your login credentials and ensuring that online transactions are made from secure and trusted websites, be mindful of who you disclose personal information to and remember that if a proposition seems too good to be true then it probably is.”
Read more: FCA ramps up scam fighting efforts