The 5 scams you need to know about to protect your money

June 2021 marked Scams Awareness Month, a campaign hosted by Citizens Advice to promote awareness and encourage caution over scammers who attempt to fraudulently access your money.

Each year, thousands of people put millions of pounds into scammer’s pockets, losing out on precious savings, investments, and pensions.

Research by Citizens Advice found that more than two-thirds of UK adults were targeted by a scammer in the first half of 2021 alone, a total of 36 million people. Over-55s were the most targeted group, with those under 34 the most likely to fall victim to a scam.

Make sure you familiarise yourself with these five scams that you need to know about so you can protect your hard-earned money.

Pensions scams

Fake pension schemes are some of the most common scams in the UK.

Between 2018 and 2020, scammers managed to get £30.8 million out of savers’ pensions, with a further £1.8 million lost in the first three months of 2021.

There are various pension scams that fraudsters use to try and separate you from your money.

Pension “liberation” schemes promise you access to your pot sooner than retirement age, or offer more of your pot tax-free. While Pension Freedoms does allow you access to some of your pot tax-efficiently aged 55, any scheme that says you can access all your savings early is likely to be a scam.

Other scammers might promise unrealistic returns on overseas investments, while some might offer a loan or cashback scheme.

These scams damage thousands of people’s retirement plans, preventing them from achieving the goals they had in mind.

Always remember: if it sounds too good to be true, it probably is.

Investment scams

Investment scams generally promise unrealistic returns in “creative” or brand-new opportunities.

Between September 2019 to September 2020,  Action Fraud reported that investors had lost more than £650 million to scams.

Recently, scams like these have been spreading on social media, with the City of London Police reporting that investors have lost £63 million via online platforms. Nearly half of all these schemes involved investing in some form of cryptocurrency.

Much like pension scams, be cautious of complicated investments that promise high returns with little risk. As with any investment, if you don’t understand what you’re investing in, it’s probably best to steer clear.

Push-payment fraud

Have you ever received a text message from an unknown number saying your bank account has been hacked and you need to move your funds? Or have you received an email that gives you details of an investment opportunity, telling you to act now to make use of it?

These scams are called “push-payment fraud”, where fraudsters will use the threat of time pressure to force you into acting without thinking too much about who’s asking for your money.

Your bank is unlikely to ever ask you to move money from one account to another immediately, nor do real investment opportunities tend to disappear in seconds.

If anyone ever contacts you out of the blue and asks you to make a snap decision about your finances, take a moment to check that it’s genuine.

Fake online stores and clone firms

“Clone” firms are when scammers create almost indistinguishable websites that pretend to be other genuine sites and businesses.

According to the National Crime Agency, investors have lost more than £78 million to clone firms, believing that they were real investment opportunities.

It can be tricky to recognise a clone firm, but some tell-tale signs are:

  • Spelling and grammar mistakes
  • Inconsistencies in branding
  • Extra punctuation or misspelled web addresses e.g.

Similarly, be aware of fake online stores that advertise a good price on goods and services. Even if social media posts from the company have engagement and it seems authentic, check sites such as Trustpilot to make sure they’re real before you put your card details in.

Coronavirus scams

Scammers are always innovating, looking for new ways to get their hands on your money. Unfortunately, the coronavirus pandemic created a perfect environment for them to try new methods.

Fraudsters have been sending emails and texts pretending to be from the government, NHS, or even GPs, encouraging people to book a Covid vaccination or donate towards pandemic-related charities.

Others have created stores for medical equipment, such as masks and hand gel, at high prices to capitalise on people’s hygiene concerns.

One particularly concerning scam saw an elderly woman pay a scammer to inject her with a fake vaccine, charging her £160 to do so.

Never click links in emails or texts unless you’re 100% certain they’re real. Neither the NHS nor your GP will ever ask you for a payment you’re not expecting.

If anyone claiming to be a healthcare professional contacts you, check their ID and contact their employer to verify who they are. It may seem awkward to do while you’re speaking to them, but it’s better to be safe than sorry.

Recognising scams

It can be difficult to differentiate between scams and the real thing. That’s why you should use Take Five’s “Stop, Challenge, Protect” system to guard yourself from fraudsters.

If something feels wrong, STOP. Does this opportunity feel real? Take a moment to think and be sure that you’re dealing with something genuine.

Next, don’t be afraid to CHALLENGE the person you’re speaking to. A legitimate adviser, investment manager or healthcare professional won’t try to rush you and will understand why you want to be cautious.

Finally, if you think you may have accidentally exposed yourself to a scam, take steps to PROTECT. Contact your bank immediately as they may be able to block a transaction.

Make sure you change any passwords on sites that a fraudster may have access to, and report fraudulent activity to Action Fraud to help prevent someone else from falling victim.

The best protection you can give your money is working with a financial planner. A planner can help you make the most of your money, finding genuine opportunities that boost your wealth and advising you whether opportunities you’ve found elsewhere are legitimate.

We can help you secure your finances

If you’d like help protecting your money for your future, please get in touch with us at Novus.

Email or call 01423 870731 to speak to one of our experienced advisers.

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