The new threats driving huge spike in fraud

New figures have revealed that financial fraud losses topped £755 million in 2015 - a 26% increase on 2014. Financial Fraud Action UK is warning that new trends are driving this spike in fraud, and that we all need to be aware of the risks in order to protect ourselves.

Deception

One of the major drivers of the growth in fraud was 'impersonation and deception' scams. These involve criminals pretending to be from your bank, a utility company, a government department - or even the police. They will phone, text or email claiming there has been suspicious activity on your account.

They may insist you tell them your password and PIN so they can 'verify your details' - this then allows them to plunder your account. Alternatively, they may insist that to protect your money, you need to transfer your cash into another account. This is actually under their control - so they then take your money.

Sophisticated attacks

Sophisticated online attacks also remain a serious threat - including fraudsters taking advantage of data breaches and malware attacks.

The data breaches (where hackers get personal details from retailers or government agencies) may be exploited directly - so criminals will use stolen payment card details to shop online. Alternatively, they can use other data stolen during attacks to commit impersonation fraud.

Malware, meanwhile, is hidden in email attachments or on websites. It will download to your computer in the background, and keep an eye on every website you visit and everything you type. It means that when you are online banking, it can steal the security information you input to the site - and send it to fraudsters.

What can you do?

The banks are trying to protect their customers. The figures also revealed that bank and card company security systems detected and prevented a total of £1.76 billion of fraud in 2015 – equivalent to £7 in £10 of potential fraud being stopped.

However, clearly too much is still getting through the net. It means we need to be alive to the threats.
Katy Worobec, Director of Financial Fraud Action UK, warned: "With the continued rise in impersonation scams and data breaches it's vital that all customers are alert to the dangers. Everyone should be very cautious about giving out personal or financial information, and organisations holding data need to do all they can to protect people's private details."

She also says it's essential to be wary of unsolicited phone calls, text messages and emails - and to be extremely cautious about giving out any personal and security information unless you are absolutely sure you know who you are dealing with.

It's always worth bearing in mind that your bank or the police will never call you to ask for your online banking passwords or 4-digit card PIN, or to transfer money to a new account for fraud reasons.

Tony Blake, senior fraud prevention officer for the Dedicated Card and Payment Crime Unit, added: "Criminals will do all they can to make their approach seem genuine, so it's important to be vigilant. Don't take someone at their word – people aren't always who they claim to be, even if they know a bit of information about you already."

"If you receive a call, text or email out of the blue asking for your personal information, hang up the phone and do not reply directly. Instead, wait five minutes and ring your bank to alert them to the scam, using a phone number that you trust – such as the one on the back of your bank card or from the official website."