Victims of fraud are losing an average of £20,000 after falling prey to 'investment' scams involving non-existent stocks and shares, diamonds and fine wines, Citizens Advice has found.
Even pensions are being targeted, with people losing life savings after fraudsters offered them 'free advice' on how to increase the value of their retirement pot.
Across all types of scams, including buying fake services or being tricked into handing over their bank details, people are being conned out of £2,500 on average. Those hit specifically by investment scams lose on average £20,000.
In analysis the charity Citizens Advice found con artists were luring victims with online adverts and fake websites, as well as cold calls and doorstep selling.
Scam Awareness Month, launched today by Citizens Advice and the Chartered Trading Standards Institute, is a national campaign to help people avoid falling prey to scams.
Read our guide to learn How to Beat Cold Calls and Junk Mail.
Citizens Advice analysed 5,000 scams reported to it between January and March this year. The consumer body identified devastating cases of victims losing out.
One man paid £150,000 for diamonds, which although genuine, turned out to be worth a fraction of the cost.
Another individual invested £65,000 with a share trader who offered them 3% dividends every month. They contacted Citizens Advice after the trader made excuses not to give the money back.
What types of scams could I face?
Common scams reported to Citizens Advice include:
- Investment – Victims are persuaded to invest money into fake ventures and are then unable to get their money back.
- Fake services – People are offered a service for a fee, only to find the service isn't real or doesn't exist at all. Examples include offers to fix computers remotely and invoices for fake advertising.
- 'Vishing' – Con artists cold-call people pretending to be from a legitimate company, asking for credit or debit card details – for example, on the pretence that they need to refund overpaid bills. Vishing refers to 'voice phishing'; phishing being a type of spam email where scammers try to dupe you by pretending to be from a company you've a connection to.
- Doorstep selling – Victims are offered goods door-to-door or from the back of a van, which are likely to be counterfeit. Fraudsters selling mattresses, fresh fish and cleaning products were all reported to Citizens Advice.
- Upfront payment or fee – Fraudsters ask for a payment in advance for a service or product that never materialises, such as asking for a fee to get a loan, or to pay for a training course to secure a job.
- Premium rate texts – Victims inadvertently agree to receive premium rate texts about games or competitions, usually costing around £4 each.
- Counterfeit goods – People buy goods at markets or online that turn out to be counterfeit or even stolen. Common products include cigarettes, shoes and clothing, and tickets for events.
- Goods not received – People place orders for goods that don't arrive. Scams are often carried out through social media and online auction sites.
What should I do if I suspect a scam?
The scam awareness campaign urges people who fear they've encountered a scam to follow a three-step rule – get advice, report it, and tell others about it.
You can get guidance from the Citizens Advice consumer service by calling 03454 04 05 06. The body will also be able to pass details of your case to Trading Standards.
Scams or suspected scams can also be reported to national fraud and cyber-crime reporting centre Action Fraud on 0300 123 2040 or at its website.
You're encouraged to tell friends, neighbours and relatives about any scams you find out about, to raise awareness and help others avoid them.
What do the experts say?
Gillian Guy, Citizens Advice chief executive, says: "Scams can devastate people's finances and leave them empty-handed.
"Fraudsters vary their tactics to target different people, from pushing cut-price offers to those on a budget, to high-interest investments for those looking to grow their savings. We're warning people to be on their guard against opportunities that come out of the blue and far exceed the deals you'd get elsewhere – they may well be a scam.
"If you think you've lost money to a scam, seek advice as soon as possible so you have the best chance of getting your money back. It's vital that people who have fallen prey to fraudsters alert others to stop the scam from spreading, and report it to the authorities so we can stop con artists from getting away with it."
Leon Livermore, chief executive of the Chartered Trading Standards Institute, which represents trading standards professionals in the UK, adds: "Anyone can fall victim to a scam and while the criminals' methods are becoming increasingly more sophisticated the advice remains the same, if it looks too good to be true, it probably is.
"Trading standards teams at local councils across the UK are working hard to protect consumers but it is vital that individuals do what they can to protect themselves.
"All too often, scam victims do not realise they are being scammed until it's too late and the criminals have bled them dry."