Coronavirus scams: protecting yourself and your finances

The Coronavirus outbreak is currently affecting everyone across the globe. As the world struggles to deal with the pandemic, there are some individuals who are seeking to exploit this opportunity unethically and illegally.

You may have seen reports in the media that there has been a surge in fraudulent activity and scams over the last few weeks. Scammers are opportunistic and will try to get personal details or money from victims in a variety of ways. They are becoming more sophisticated and tend to target people who are vulnerable or susceptible to being scammed.

We have already heard of scams relating to Coronavirus such as the sale of extortionately priced hand sanitisers and facemasks, or people purchasing these products but never receiving them. These types of scams involve exploiting people’s concerns over the virus and their health.

The types of scams affecting the financial services industry can be much harder to anticipate and can have a catastrophic impact on someone’s finances. Financial scams are particularly difficult to detect at the current point in time, due to the fact that the majority of the population is working from home and cannot communicate in a face to face environment.

We all have enough on our plates at the moment, without falling foul to fraudulent activity. With that in mind, the Financial Conduct Authority (FCA) has highlighted some common scams to look out for:

• Exploiting short-term financial concerns, scammers may ask you to hand over an upfront fee when applying for a loan or credit that you never get. This is known as loan fee fraud or advance fee fraud.
• ‘Good cause’ scams. This is where investment is sought for good causes. Recently, this could include the production of sanitiser, manufacture of personal protection equipment (PPE) or new drugs to treat coronavirus. Scammers use the promise of high returns to entice consumers. 
• Using the uncertainty around stock markets, scammers may advise you to invest or transfer existing investments into non-standard investments.
• Clone firms - firms must be authorised by the FCA to sell, promote, or advise on the sale of insurance products. Some scammers will claim to represent authorised firms to appear genuine. In particular, be aware of life insurance firms that may be cloned.
• Scammers may contact you claiming to be from a Claims Management Company (CMC), insurance company or your credit card provider. They may say they can help you recuperate losses by submitting a claim for the cost of a holiday, or event such as a wedding, cancelled due to coronavirus. They will ask you to send them some money or your bank details.  
• Cold calls, emails, texts or WhatsApp messages stating that your bank is in trouble due to the coronavirus crisis. They push you to transfer your money to a new bank with alternative banking details.

The FCA has also provided the following measures to help mitigate the risk of falling victim to fraud:

• Use the Financial Services Register and Warning List to check who you are dealing with.
• Reject offers that come out of the blue.
• Beware of adverts on social media channels and paid for/sponsored adverts online.
• Do not click links or open emails from senders you don't already know.
• Avoid being rushed or pressured into making a decision.
• If a firm calls you unexpectedly, use the contact details on the Register to check that you’re dealing with the genuine firm.
• Do not give out personal details (bank details, address, existing insurance/pensions/investment details).

For further guidance regarding Coronavirus related scams you can visit the government website or the FCA website. 

If you have any questions or would like to discuss your financial arrangements in detail, please contact our team of financial advisers. 

I’m working from home, but available to talk if you need me. If you have a question, I’d much rather you ask it and we spend some time having a free chat, than not. 

There are enough things to worry about at the moment; don’t let that niggle be one of them – get in touch. I can be contacted on 01206 217329