Types of scams and how to avoid falling victim to them
The rapid rise in digital activity, especially since the pandemic, has given fraudsters more opportunities to con people. The best way to keep yourself safe is by being aware of the different types of fraud commonly occurring these days and knowing how to spot them. Remember – if in doubt, don’t make the payment – an honest payee will always wait while you check out their credentials.
Types of scams and how they work
Investment and recruitment scams
As the name suggests, these scams involve a fraudster pretending to be an entrepreneur or company asking you to invest in their business with the promise of a high return on investment. Or it might be a fraudster posing as a company offering great job opportunities when no job exists.
If you are taking out a loan for any of the reasons below, please take five minutes to pause and think it through.
- Bitcoin investment or any investment in Crypto Currency
- Get rich quick scheme – you are being encouraged to take out a loan to invest on the basis you will make a large return
- Credit score improvement
- Investing in a new company or product
- Recruitment scams (e.g. you are invited to become a mystery shopper or you are asked to pay a fee to be entered on a recruitment database)
Warning signs that can help you spot a scammer:
- Asking to access your computer remotely using applications such as AnyDesk
- Asking you to invest in a ‘get rich quick scheme’
- Requesting any sort of payment or money, including vouchers and/or wire transfers
- Unavailable over the phone or unable to video call
- Want to communicate via WhatsApp only rather than normal SMS text message
- No information online about them or the company they work for
- They want to borrow your ID or bank account
- Offer to hire you on the spot
- They explain that a new bank account should be set up in your name as part of the investment
- They explain that you will be able to repay the loan very easily and quickly with the money you will make back from the investment
- They explain that they will get the loan ‘written off' as they have done with many other customers. They may even show you an ‘email’ or ‘text’ used previously, impersonating Plata.
If you are tempted to make an investment in a business, it is good practice to first check if the company is regulated by having a look at the FCA’s register or seeing if they are listed on the Companies House website.
Loan fee frauds
If you have been looking for a loan online, beware of companies that might reach out to you offering you a loan for an upfront fee. Chances are you'll pay that upfront fee but never receive the loan you applied for. The best way to stay safe from such scams is to check if the company is registered with the FCA. Other warning signs include being asked to pay the upfront fee through an unusual method like a wire transfer or into a bank account. They might even claim that the fee is refundable.
Please note, Plata we will never charge you an upfront fee.
Vishing is when fraudsters call you pretending to be from a bank, building society or government agency and in doing so trick you into sharing your personal details with them.
These scams aren't always easy to detect. The biggest tip-off is that they often seem to be in a rush to get your personal details. If you are ever in doubt, the best thing to do is to hang up and call your bank or whichever company they were pretending to be from and verify if they were attempting to reach you. But beware, fraudsters can also hijack your phone line, so it is advisable to wait a few minutes before calling back.
This tends to be one of the more common types of frauds people fall victim to. You might receive an email that looks identical to what you usually get from a legitimate source e.g., your bank, Amazon, PayPal, HMRC or the Royal Mail. The email will prompt you to log into your account citing reasons like your account has been locked, or you have a large transfer of money or a delivery is waiting for you.
Others might send a virus as an attachment to the email, e.g., a form for you to fill in.
The best way to spot fraudulent emails is by checking sender details before clicking anything on the email. An authentic email will always come from a recognisable domain e.g email@example.com. Other giveaways tend to be titles like Dear Customer or Dear Sir rather than your actual first name.
Post covid, holiday scams have increased over 120%. As travel restrictions have relaxed, the number of people booking holiday flights and accommodation has soared and unfortunately, scammers are taking advantage by creating supply that doesn't exit. There have been reported cases where travellers book accommodation only to arrive at the destination to find out it doesn't exist or it looks nothing like the photos they saw online.
Always watch out for a listing that seems to be too good to be true. Do your research and look out for (genuine) reviews from other travellers. You can also verify the address of the property you are booking using online maps and web searches.
Dating apps and social networking websites have become another big target for scammers. They create fake profiles and go to great lengths to build trust with their victims often talking to them for months before scamming them. They’ll come up with stories like needing help applying for a visa or buying a ticket so they can meet you in person or they might fake an illness or portray themselves as being in some serious trouble which they need financial help to get out of. They may claim to be trapped in Ukraine or doing important military work – anything to pull on your heartstrings.
Always be extra careful when speaking to someone you haven’t met in person. And if you do find yourself in a situation where you are having doubts, stop communicating immediately. Never send money or gifts until you’ve met in person and are confident the person you are having a relationship with is genuine and trustworthy.
If you think you have been scammed, do report your experience to the dating website and immediately contact your bank. You should also report it to Action Fraud on 0300 123 2040 or through their website actionfraud.police.uk
Authorised Push Payment Scams
Authorised Push Payment scams are when a scammer poses as a genuine company (maybe a supplier you often deal with) and tricks you into sending money to them from your account. They'll do so by tricking you into believing they are someone from a legitimate business, for example, your utility provider, a retailer, a government department or a bank. Proceeds from such scams often go to funding illicit acts that cause further damage.
Payment in advance fraud
The payment in advance fraud or otherwise known as advance fee fraud is quite similar to the above where you are asked to pay an advance fee for high-value goods or services that will never materialise. You might be told the fee is fully refundable or that it will be put down as a deposit for what you are buying. You'll notice being pushed to pay the fee quickly and the payment methods might seem unusual too.
Staying safe online
Here are a few steps you can take to stay safe online:
- Avoid using passwords that include your personal information like your date of birth, wedding anniversary or a family member’s name.
- Always have up-to-date anti-virus software on your device
- Password protect all your devices including your mobile phones. You can use free antivirus apps on your phone too.
- Protect your wifi - read your wireless router's manual on instructions on how to set up a 'key'. This ensures no one else can access the internet through your router.
- Keep your computer's operating system up-to-date. This includes smartphones.
If you fall victim to a scam no matter how big or small, reporting it is always good practice. It not only helps protect others, but by doing so you might even recover your money or help catch the criminal.
Any fake emails can be forwarded to firstname.lastname@example.org. If you have received a scam message, you can forward it to 7726. Phone providers can take action by blocking numbers generating spam.
You can also report any scams to Action Fraud on 0300 123 2040 or by sending them an email at actionfraud.police.uk.
If you have received any suspicious emails or text messages claiming to be Plata, please report them to our Fraud department at email@example.com.
Please be aware, if we contact you via SMS, you’ll see our message as from ‘Plata’ or +44 7782 621113.
We will never contact you from a number other than the above. If in doubt, don’t respond. Call or email us instead.
If you receive an email from us, it will only ever be from an email address ending @plata.com. Also, be wary of any emails asking you to make a payment to get a loan. Plata does NOT charge any upfront fee for your loan application.
Plata have also partnered with CIFAS who offer a facility called ‘protective registration’. This is beneficial for individuals who would like an element of protection against identity theft.