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How fraudsters trick you out of your money

“Just before I sat down to write this I received an unexpected call from someone who said they were from the fraud department at Visa. They told me there’d been an attempt to spend money on my card that morning and if I didn’t take action immediately then my account would be at risk."

Paul Davis, Fraud & Financial Crime Prevention Director, Retail Bank

Paul Davis
Fraud & Financial Crime Prevention
16 February 2021
3 min read

As the Fraud and Financial Crime Prevention Director at Lloyds Banking Group (Lloyds Bank, Halifax and Bank of Scotland), my accounts are with Lloyds and through my job I knew immediately that what they said didn’t stack up. So that particular fraudster’s attempt was a bust.

But the second they dial the next number, the next victim they target could easily be drawn in by the scam. These people are professional fraudsters, likely working a nine to five shift in an office that may look like a normal job. Normal, apart from the fact that they are making a living trying to steal other people’s cash.

Whilst the pandemic has brought many parts of society closer together, fraud has never been a bigger business. Our research at the end of 2020 found that lack of contact with others has caused nearly a quarter of people to let down their guard against scams during the pandemic – with an estimated 3.6 million people having been scammed since the first lockdown in March, and almost a third (31%) having given out their personal details over the phone to someone they did not know.

Since the first lockdown, an estimated

3.6 million people

have been scammed

Protecting our customers from this threat is a top priority at Lloyds. We invest tens of millions of pounds every year in the latest technology to keep our customers’ money safe and we have a dedicated team working 24/7, 365 days a year.

Amongst the tens of millions of payments made every day, only a tiny fraction are connected to fraud. If we see enough unusual factors or have any doubts about whether the customer may have been a scam victim then we’ll pause the payment for further checks.

The thing is, fraudsters never stand still. Whatever the main topic in the news, that’s the theme they build their scams around. Over the past few months, we’ve seen them send out texts by the million asking for our customers to provide banking details in relation to booking a COVID-19 vaccine, buying fake personal protective equipment (PPE) and rearranging parcel deliveries at Christmas, along with anything else you can imagine.

Fraudsters have been forced to change their game as things move on. Security around card payments and online banking is now very robust and so they’ve turned their attention towards trying to trick people into revealing their card details, PIN numbers, internet banking passwords or even to move money themselves – like the scammer who called me. It doesn’t help that at the same time, millions of people are putting themselves at risk of fraud by oversharing information on social media.

In December, before the latest lockdown, we did a social experiment called 'A shave too close', highlighting the importance of keeping your personal information safe. We teamed up with a barber in London and it was pretty shocking to see how little some people thought about what personal details they were putting out there on social media for fraudsters to snap up.

This time last year, we partnered with professional poker player and Harvard psychologist, Maria Konnikova. She is an expert in the psychology of how people make decisions in situations when the emotional part of your brain takes over and your decisions become less rational. So, we worked together to see how we can make our warnings even more effective to customers, because fraudsters are experts in convincing people to believing them – and it’s often too late when they’ve disappeared with victims’ cash.

 

Fraudsters may be attempting to operate on a bigger scale than ever before, but the best advice on how to stay safe from scammers has never been simpler.

The most common type of scam we see is purchase scams – where non-existent goods are advertised for sale (usually on online marketplaces) and the seller tempts you to pay by bank transfer.

The golden rule for shopping online is pay by card. When you pay by card, you’ll get protection. If a seller asks you to pay by bank transfer, it’s no different to just handing over cash in the street.

What the other types of scam all have in common is that contact by the fraudster quickly builds into a request to send money. So many people fall victim to scams where a cold caller pretends to be from a bank security department or another company. It isn’t unusual to take a phone call from a genuine company, but what they will never do is contact you out of the blue and ask that you move money.

That should be a big red flag that it’s a scam.

This post was originally shared on getsafeonline.org

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