Staying safe against scams

When it comes to a scam, it usually is! Don’t be taken in by the hype and false promises.

Trustworthy firms, especially those you already do business with, never normally ask you for this. They may ask you to confirm certain details when you call them, but usually only after going through a standard security process with you first.

Scammers don’t like to give you time to think about the offer. They will try to pressurise you into making a decision by saying things like "if you don’t act now, you’ll miss out".

You may get a phone call, email or letter from someone you’ve never heard of and you wonder how they got your contact details.

This is where someone steals your personal details and pretends to be you. They may steal money from your bank account, spend money on your credit card, or take out a loan in your name.

You may only realise you're a victim of this when you check your account statements or try to get credit.

They get your details in a number of ways, including the following.

• Discarded or lost documents – such as shop receipts or account statements.
• Email ‘phishing’ and fake websites – not limited to banks, they may also try to con you into giving away your details for websites you use, such as Paypal, eBay and Amazon, or even official organisations such as the Financial Services Authority (FSA), Financial Ombudsman Service (Ombudsman), Financial Services Compensation Scheme (FSCS) or the Office of Fair Trading (OFT).
• Social networking websites – the amount of personal information users put online make sites such as Facebook, Myspace, Bebo and LinkedIn very attractive to fraudsters. Even just your email address is enough to add you to future phishing scams lists.

This is where someone sends you letters or emails that offer you vast sums of money if you make some payment up front. It may be for 'business ventures', lotteries you didn’t enter, or charities that want to move money abroad.

But there is no reward and no such charity – only the risk of losing money if you enrol!

Be wary of unsolicited calls offering you shares in a company you've never heard of. They may be part of a scam using hard-sell tactics to persuade you to buy.

If you do buy the shares, you may find they are worthless, and because most of these so-called 'boiler rooms' are based overseas, you may have no rights to complain or claim compensation.

This type of scam usually targets members of a particular community or a religious, ethnic, elderly or professional group. Often the scammer will claim to be a member, or sell the scam to a few prominent members first in order to gain the trust of the others.

These are letters or emails that guarantee you a huge return for your small initial investment and contain a list of names. This scam operates in a similar way to pyramid schemes (see below), so you pay a fee to join the chain.

These scams ask you to use your bank account to withdraw cash transferred into it and send it on using a money-transfer service (for a generous commission).

But you could wind up with a prison sentence too, as the scammers are only trying to launder money gained through and funding further criminal activity.

It’s likely to be a scam if you see claims that you can transfer your pension to get cash before 55 or you can get more cash than under your current pension scheme.

Fraudsters often target properties where there is no mortgage or the owner lives elsewhere. They may try to get ownership of a property either by using a forged document to transfer it into their own name or by impersonating the registered owner. They then raise money by taking out a mortgage on the property without the owner’s knowledge. After that they disappear without making any repayments, leaving the owner to deal with the outstanding debt.

You can find out more about other non-financial scams and swindles on the Directgov website, including miracle health cures, pyramid schemes, holiday clubs and online dating scams.

Find out whether firms you want to use are registered with Companies House, and do some research online to make sure they’re genuine.

If you’ve been contacted by a firm or organisation and you’re not sure it is genuine, you should contact the organisation directly using details from their official website or documents you already have.

Be careful when surfing the web as fraudsters can easily set up an authentic-looking website.

You can also get details of regulated financial services firms from the FSA Register, or other organisations from our Useful links.

It sounds obvious, but if a stranger rings you out of the blue and tries to sell you shares in companies you've probably never heard of, or other fantastic-sounding offers, take great care. Don’t be afraid to put the phone down.

As long as you take reasonable care of your account details and contact your card provider as soon as you realise something is wrong, you should be entitled to a refund of any money lost through fraudulent activity (except for the first £50).

Make sure your personal information hasn’t been used to set up a fraudulent loan or bank account in your name.

Credit reference agencies can provide you with a copy of your credit report showing your personal credit history for a small fee – usually just £2.

Get Safe Online is a government website that has a ten-minute guide for beginners as well as other advice on how to protect yourself online. It’s a good starting point, and they have an online quiz so you can test your knowledge.

Check what privacy options are available to you to help safeguard your personal details. Remember, it’s not always just your family and friends that can see your profile.

Find out how to protect yourself in different situations, from protecting your personal information to buying services and products on the internet or over the phone.

Some credit-card companies and banks will call you to check if there is an ‘unusual’ transaction on your account, for example a larger amount than usual or an overseas transaction. This is just to check that you actually made it. Or they may block your card, so you will need to contact them to confirm that everything is okay.

If you’re planning a trip overseas, you may want to consider letting your credit-card company and/or bank know before you go.

Some card payment schemes allow you to register for extra security. ‘Verified by VISA’ and ‘Mastercard SecureCode’ both require card users to quote an extra password, chosen by you, when using your card at participating high-street and online stores. This will make it harder for someone else to use your lost, stolen or copied card.

New scams and unauthorised firms start up and shut down all the time, so help the industry investigate and take action against them quickly by reporting any suspicions you have.

• For account and card-related concerns, ask the advice of your product provider.
• You can report online and email scams through the Bank Safe Online website.
• If you’ve been a victim of any type of fraud you should report this to your local police force.
• If you’ve been contacted by an overseas firm trying to sell you or buy your shares, use the FSA's online reporting form.
• You can forward scam emails to Action Fraud at email@actionfraud.org.uk. Or report a fraud over the phone or by using the online fraud reporting tool.

Most UK firms offering financial services have to be regulated, but some try to bypass these requirements.

The FSA regulates most types of financial firm in the UK, such as banks, building societies, insurance companies, financial advisers, stockbrokers, and mortgage and insurance brokers. It also regulates credit unions in England, Scotland and Wales.

Other regulatory organisations include the following.

• The Registry of Credit Unions and Industrial and Provident Societies regulates credit unions and industrial and provident societies in Northern Ireland. The FSA took over the regulation of credit unions in Northern Ireland on 31 March 2012, so check the FSA Register from this date to make sure the credit union is regulated.
• The Office of Fair Trading (OFT) covers the selling of loans and credit cards.
• The Pensions Regulator covers workplace pension schemes.
• Companies House registers all companies.

Most regulatory organisations have publicly available lists of the firms that are registered with or authorised by them. Check these first or you may find you are not protected by industry schemes if things go wrong.

For most financial services firms you can check the FSA Register or, in the case of credit products, such as credit cards or loans, the OFT’s public register.

When you deal with firms not based in the UK you may find you do not have the same level of protection. Try to find out what arrangements are in place for you if things go wrong.

The FSA has lists of unauthorised financial firms and individuals it knows to be targeting UK customers. However, remember these firms are likely to change their name often, so if you can’t find a particular name on these lists that still doesn’t mean it’s genuine.