Trading Standards Scotand Issues Warning About Financial Scams

22nd September 2022

Financial Scams

Scammers are targeting people with misleading online adverts for quick and easy loans or investments which are supposedly endorsed by celebrities.

They are also cold calling and sending scam emails and text messages posing as bank staff or offering investment opportunities.

Common Financial Scams
Investment Scams

"This couple were able to retire at 30 and travel the world after using this one great investment tip!"

"Hi! I'm offering a one-off opportunity to earn thousands in cryptocurrency! Add my WhatsApp and I'll send you more info. “
Social media adverts or messages offering huge returns for a small initial payment are usually misleading.

Before making any investment, check that the company is regulated by the FCA at register.fca.org.uk/s/.

Advance Loan Fee Fraud

“Get a loan in minutes! Apply now. We’ll ask you to pay an insurance fee via bank transfer before receiving the loan."
Although legitimate lenders do charge fees, these will typically be added to the loan and are rarely charged up front.

Courier Fraud

“I’m calling from your bank’s fraud department. There has been suspicious activity on your account and it has been compromised - the police are assisting us with our enquiries. You’ll need to withdraw some money - a police officer will visit your house to collect it.”

Your bank will never cold call and ask you to transfer money to a ‘safe’ account. Your bank or the police will never call you to ask you to verify your personal details or PIN by phone or offer to pick up your card by courier

Pension Scams

“We’re offering free pension reviews – we can guarantee that we’ll get you better returns on your savings.”

“We can help you release cash on your pension, even if you’re under 55. Apply quickly – the offer is only available this week.”

Don’t respond to unsolicited calls, emails or texts about your pension – check the status of a firm before making a financial decision about your pension by visiting the FCA register: register.fca.org.uk/s/

Avoid Financial Scams
If applying for a loan, making an investment or making a decision about your pension, only deal with firms that have been authorised by the Financial Conduct Authority. Check the Financial Services Register at register.fca.org.uk/s/

Be wary of social media adverts or messages offering huge returns for a small initial payment.

Be suspicious if you are contacted via phone, email or social media by someone you don’t know about an investment opportunity.

Do plenty of research before considering buying cryptocurrency, starting with online searches for background, ownership, reports and reviews on the company.

Don’t be rushed into making a decision about an investment – seek advice from someone you trust or from a financial advisor accredited by the FCA.

If you are asked to pay an upfront fee before getting a loan from an authorised firm, the firm should send you a notice setting out certain information including the amount of the charge (or how it will be calculated), when the firm will take payment from you and how you will pay

Don’t respond to unsolicited calls, emails or texts about your pension and don’t be rushed or pressured into making a decision.

Seek advice from a firm authorised by the FCA before making any changes to your pension arrangements, or contact Money Helper, who offer free independent and impartial information and guidance.

Check the FCA’s warning list of firms they know to be operating without permission or running scams. If a firm appear on this list it is because the FCA has identified that they are operating without their authorisation: www.fca.org.uk/scamsmart/warning-list

Be suspicious of any unexpected phone call or text message which appears to be from your bank, a government agency or a service provider and asks you to act urgently to avoid losing money
Remember that your bank or the police will never call you to ask you to verify your personal details or PIN by phone or offer to pick up your card by courier

Case Studies
Advance Loan Fee Fraud
Stuart, a retail worker from Aberdeen, was recently scrolling through social media when he saw an advert for a ‘fast and easy loan’. He had been worried about paying his bills, so clicked on the advert to find out more.

He was taken to a website with the name of a firm based in London, where he was asked to fill in an application form. A few minutes after submitting the form, he was called by a woman who told him that his application had been successful. She said that, before receiving the loan, he would need to pay a £30 ‘insurance fee’ via bank transfer.

Stuart transferred the money and expected to receive his loan within a couple of days. However, he kept receiving phone calls asking him to pay more money, either via bank transfer or in gift cards, supposedly to facilitate the arrangement of the loan.

He ended up paying almost £1,000, at which point the caller he had been dealing with cut off all contact with him.

He looked up the financial firm online and contacted them – they had no record of his application and confirmed that they would never ask customers to pay upfront fees before receiving a loan.