What type of fraud has been committed during the pandemic and at what cost?
We have previously written about the increase of fraud due to the COVID-19 Pandemic. More information has been reported on the scale, type and size of fraud that has been committed in the last two years, with criminals taking advantage of the vulnerability of its victims. The following types of scams have been identified, according to Victims First, https://www.victims-first.org.uk, an organisation that provides support and advice to victims of fraud:
-Vaccine or testing scams;
-Fake medical supplies or support;
-Online shopping scams for sanitiser, face masks, fake testing kits that never arrive;
-Fake HMRC branded emails, phone calls and text messages with spurious offers of financial support;
-Phishing scams or calls claiming to be from government departments offering grants, tax rebates, or compensation
-Bogus loans, high return investment scams, targeting of pensions;
-Computer service fraud (due to high numbers of people working from home).
Some of the above types of frauds have been around for years but were adapted and branded for COVID-19 to maximise their effect. Criminals increasingly turned to more online and technology-enabled scams to exploit people’s fears about the pandemic.
It is now possible to report any type of scam (from phishing, texts, websites, phone calls) to The National Cyber Security Centre at the following link: https://www.ncsc.gov.uk/collection/phishing-scams. Note if you have lost money due to a scam, you will still need to report it to your local police force. However, if you have received a suspicious e-mail/text do report it at the above link as it will enable the NCSC to investigate and take it down.
There have been a number of reports about the cost of fraud. According to UK Finance, the industry body for banking and finance:
-Impersonation scam cases doubled in 2020 to 39,364 cases;
-32% increase in investment scams in 2020, predominantly promoted through adverts on search engines offering high than average returns. This cost £135.1 million;
-Authorised Push Payments fraud losses increased 5% to £479 million. (APP Is where customers are tricked into transferring money to the criminals, this includes the investment scam);
-Unauthorised fraud fell to £783.3 million. This is where the account holder does not give permission for the payment.
UK Finance body also reported it stopped over £1.6 billion of fraud in 2020. https://www.ukfinance.org.uk/press/press-releases/criminals-exploit-covid-19-pandemic-rise-scams-targeting-victims-online
In the USA, the Federal Trade Commission reported in April 2022, that it had logged more than 732,000 consumer complaints related to COVID-19 and stimulus payments since the start of the pandemic. The majority of them involving fraud or identify theft and cost consumers $778 million. https://www.aarp.org/money/scams-fraud/info-2020/coronavirus.html
Whilst the COVID-19 pandemic recedes, for many the move to working from home is permanent and therefore leaves them still vulnerable to computer service fraud (listed above). Furthermore, criminals will target the next crisis to defraud more victims. In this case the ongoing conflict in Ukraine with phishing attempts to contribute to fake charities or purchase food, medical supplies or arms for the Ukrainian Army.
These scams are convincing and sophisticated. Therefore, before transferring any money, always conduct some background checks to see if the charity/investment etc is genuine. If it is too good to be true or if in any doubt do not part with your money.
Page Group offers both Red Flag checks and enhanced due diligence enquiries in the majority of countries worldwide.