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wise up to scams, and call time on phone fraud

6 July 2015

The Financial Ombudsman Service is urging people to talk to vulnerable relatives, friends and neighbours this summer about the risk of being scammed. As it publishes new research suggesting people over the age of 55 could be four times more likely to be caught out by "vishing" or a "no-hang up" scam. In the report published today, the ombudsman reviewed 200 cases involving a no hang-up scam - where fraudsters pose as the police or banks to deceive consumers. The report finds:

  • 80% of the consumers conned out of their cash were over the age of 55. One in five was over 75.

  • The cases looked at within the report involved losses of over £4 million.

  • 38% of people had lost between £5,000 and £14,999, 20% between £20,000 and £49,999, and some more than £100,000.

  • People living in London and the South East were most likely to have brought a complaint about a no hang-up scam to the ombudsman.

  • 37% of complaints were upheld.

Vishing, like many scams, can leave people feeling powerless, as often there’s little people can do to get their money back. However, in 4 in 10 cases, the ombudsman did find the bank’s response to the fraud had fallen short so the customers were compensated. In the remainder of the cases, the bank had done all that it could - but the money had been stolen and the ombudsman could not find the bank at fault.

Caroline Wayman, chief ombudsman, commented:

One of the most consistently challenging areas of our work is dealing with people who have been affected by financial fraud. These are extremely cruel and convincing deceptions and consumers are tricked into believing they are protecting their money, when in fact it is being stolen.

Scammers are relying on people’s vulnerability and vishing is particularly insidious in exploiting this. This is why we really want to share what we are seeing in the complaints we handle and encourage people to get talking about scams with their friends and relatives so they become more alert to the risks - stopping the fraudsters in their tracks.

Caroline Abrahams, Charity Director at Age UK added:

These figures aren’t surprising to us as scams are a huge problem that show absolutely no sign of easing off and if anything are going to get worse over time as scams become more elaborate. That anyone would target an older person to defraud them in the first place is abhorrent but we know that older people are deliberately targeted and can be especially at risk if they are living with dementia and/or cognitive decline.

Some older people are more vulnerable to fraud because they live alone or in isolation, but fraud is something that can happen to any of us. In fact, people who are financially proficient and avid users of the internet are just as likely to be at risk.

The degree of sophistication used over the phone or online to defraud is frightening. These new figures should act as a wake-up call to get people talking about the threat of fraud and its grave consequences on people’s health as well as their finances. Government and financial institutions need to recognise the relentless threat to older people that fraud represents and take much more determined action against it.

Fraudsters often target the vulnerable and that is why we are urging people seeing relatives over the summer to highlight the risks and prevent these scams happening in the first place. The hints and tips below will help people to protect themselves from financial fraud:

  • Never give out personal or banking information when answering an incoming call, and don’t always rely on the Caller ID for identification.

  • If you’re in any doubt about the identity of a caller claiming to be from your bank or the police, hang up and call the phone number on your account statements, back of your debit or credit card, in the phone book, or on the company's website. Use a different phone or wait at least five minutes before making the call to make sure you’re not speaking to the same fraudsters.

  • An easy way to protect your financial details is by shredding bank statements, receipts and other documents containing any financial information, such as account numbers.

  • Remember, if your bank suspects your account has been compromised by fraudsters they will usually ‘freeze the account’ which will prevent any transactions happening – there is no need for you to do anything.

  • We’ve spoken to the banks and police and can assure you they will NEVER:

    • Ask you to authorise the transfer of money to a new account or hand over cash

    • Ask for your PIN or passwords in full on the phone or via email, including keying your PIN into the phone keypad

    • Send someone to your home to collect cash, bank cards or anything else

    • Ask you to send personal or banking information via email or text

    • Send an email with a link to a page which asks you to enter your online banking log-in details

    • Ask you to carry out a test transaction online

    • Provide banking services through any mobile apps other than the bank’s official apps

    • Call to advise you to buy diamonds, land or other commodities