Moira Stuart, the former BBC News presenter, recently shared her experience of nearly falling victim to a scam involving a fraudulent request to transfer her money.
Stuart, now at Classic FM, received a call from an individual claiming to represent her bank, warning her that her account was at risk of fraud. Following their advice, she went to a branch to move her funds to a so-called “safe” account. However, bank staff grew suspicious and halted the transaction.
This incident is an example of authorised push payment (APP) fraud, wherein victims are tricked into transferring money directly to a scammer. In the previous year, over 230,000 individuals fell prey to APP scams, a sharp rise from approximately 155,000 in 2020, collectively losing around £460 million. Experts attribute this increase to the rise of new technologies, including artificial intelligence, which scammers exploit.
Banks are finding it challenging to reimburse victims, even those who have taken precautions to safeguard their accounts. Moreover, the Payments Systems Regulator has agreed to impose a cap on APP scam refunds, limiting them to £85,000 effective from October 7. Currently, there is no refund limit.
Stuart’s experience involved an impersonation scam—one of the many forms of APP fraud—where the scammer poses as a trustworthy entity such as the police or a bank. These impersonation scams have garnered significant attention and have reportedly decreased from 21,177 cases in 2020 to 10,594 in the last year, as indicated by UK Finance.
Despite this decrease, fraudsters continuously invent new schemes, and various types of scams are on the rise. Here are five notable scams to keep on your radar.
1. Purchase Scams
Purchase scams occur when victims utilize online platforms, like auction sites or social media, to buy items. Scammers often advertise products, such as vehicles, electronics, or vacations, at significantly reduced prices. Last year, there were reported 156,516 instances of this fraud type, marking an 85 percent increase since 2020.
In these cases, victims are often persuaded to transfer funds directly to the scammer’s bank account instead of through the official payment process of the platform, leaving them without any buyer protection. Once the money is sent, the scammer disappears without delivering the promised items.
Protection Tip: Avoid sending money to unfamiliar individuals directly into their bank accounts using their account details.
2. Investment Scams
Fraudsters often impersonate financial advisors or investment firms, presenting fake investment opportunities with promises of high returns. These scams frequently begin with a cold call that pressures the victim to make quick decisions or lose out. Scammers may further send fake documents with the logos of reputable firms to mislead victims.
Last year noted 10,226 reports of investment scams, reflecting a 25 percent rise compared to 2020, with total losses amounting to £108 million. However, these cases are likely underreported, as law enforcement investigations can span months or years.
Protection Tip: Do not engage with cold calls offering investment opportunities. Always take your time and verify before investing.
3. Romance Scams
In 2022, there were 4,160 recorded romance scams, an alarming 79 percent increase from 2020. Many victims hesitate to report these scams due to embarrassment. The scam typically involves the victim believing they are in a relationship with someone they met online. Once trust is established, the scammer invents a crisis—like visa issues or health emergencies—asking for financial help.
Protection Tip: Refrain from sending money to anyone you only know online.
4. Impersonation Scams
Scammers often impersonate officials from various organizations, including energy providers or tax agencies, to demand payments for alleged overdue fees. They may even request remote access to the victim’s computer under the guise of assistance. While police and bank impersonation scams have declined since 2020, there were still 23,563 other impersonation reports last year, up 19 percent from before.
Protection Tip: Do not download software from unsolicited calls. If approached unexpectedly, hang up and contact the company directly using verified contact details.
5. Advance Fee Scams
In advance fee scams, criminals convince individuals to pay a fee to unlock a larger sum of money, often claiming it is due to a lottery win or inheritance. Reports of these scams surged by 72 percent since 2020, with 23,849 cases reported last year.
Protection Tip: Never send money with the expectation of receiving a larger amount in return; this is always a scam.