April 13, 2024
SOLOBIS

5 Financial Scams in UK Made us Aware of Finances

Financial Scams in UK

Today, you may come across various Financial Scams in UK and happening all across the globe. Some of them make you wonder how it began in the first place and how people got misled into it.

But, sometimes, we are shocked at how easy it is for frauds to carry out their scam. Financial Scams in UK have always been full of amazement that blows your mind and tests your knowledge.

We have shared below some of the Financial Scams in UK that brought light to the scamming reality happening.

Five Common Financial Scams in UK

Common Financial Scams in UK

#1-Phishing/smishing:

Often, it has been noticed that Financial Scams are an outcome of fraudsters acting as officials from financial institutions or reputable societies.

It all begins with a simple mail or message asking you to click on a particular link and verify your details.

This further results in sharing your credentials which you must never do as you should never share passwords without knowing the person.

As individuals fall for the fraudster’s trick, they get access to your account and skim through all the information.

Fraudsters then raid your account, and you lose your hard-earned money, which you do not recover back in most instances. This was mainly carried on in the name of banks and credit card companies.

Lesson:

Never share your bank or other important credentials with unknown people to avoid Financial Scams in UK.

#2-Free-bie Scams:

Fraudsters offer free trials of products to gain millions of pounds and access customer details. They ask customers to enter their card details and do not charge them for the initial period.

At times, they ask you to sign up for an expensive subscription to earn huge profits right at the start. This way, they earn easy, quick money with less effort.

There was an instance with a well-known company wherein they charged the subscription fee but did not offer their services.

Lesson:

It is, therefore, important to research the company before you purchase its subscription. Do not get carried away with free offers.

If you find any interesting offers, make sure that you look into the terms and conditions before you sign-up for them.

#3-Boiler-room Schemes:

Some schemes promise investors huge returns but do not generate returns as promised which means investors end up at a loss.

It has been observed that approximately 5000 individuals invested through the boiler-room scheme and collectively lost £1.73 billion.

A random call that offers you to invest and earn almost double returns, think twice before doing so.

You might be excited to earn high returns, but it is always wise to research the company you are investing in and think rationally about how it is possible to earn 40% higher profit at such a fast pace.

Victims who invested have lost thousands of pounds in this scheme. The Financial Conduct Authority does not authorise these schemes.

Lesson:

Invest in schemes which have legal authority. You must check the basic functionality of the scheme and check whether the policy is reliable or not.

#4- Pension Liberation:

A Financial Scams in UK triggered individuals aged 55 and above it with fake investment opportunities to increase their pension savings.

Investing in schemes abroad is a pension scheme that lures people on the verge of retirement. It has been observed that one in three people of this age group has been a potential customer of this pension scam.

Financial Scammers in UK send mail, message or call for free pension advice, retirement plans, etc. The most attractive feature of this fake policy was the low-interest rate, which boosts vulnerable investors to take risks.

Lesson:

It is important to calculate and enquire about the interest rate and other terms and conditions of the policy.

If you find any feature weird, ask your friends and family about it. You can also ask a financial advisor if investing in that policy is a good choice or not.

The UK also faced a major financial scam in the PPI scandal, wherein this policy was mis-sold along with other insurance, loan and mortgage policy.

PPI policy was a provision to repay the loan or borrowed sum if you lose your job in case of any physical disability or accidental death.

However, people unknowingly bought this policy and paid for the same. However, years later, they are making successful PPI claim to gain compensation.

Fortunately, some well-known and experienced companies provide a helping hand to such victims by guiding them in the right process.

#5-Home Buying Fraud:

This Financial Scams in UK revolves around the transfer of cash in the form of a home deposit to the solicitor. The payment is done via the internet, wherein a computer hacker traces all the details between the two.

When the actual payment is to be made, the fraudster acts as a solicitor and changes the firm details to theirs to make the payment to their account. The home buyer unknowingly transfers the amount to the fraudster.

Lesson:

Make sure that you have the correct credentials of the broker or estate agent so that you do not end up transferring it to the wrong person. Also, confirm whether the amount is transferred to them immediately as it is done.

All these scams should teach us something and send a clear message. But, one common message that they indicate is that we all need to be careful with our hard-earned money.

Check where you are investing or making payments to avoid falling into any of these all too common traps.

For More Latest Finance Updates and Information about Financial Scams in UK, Visit Solobis NEWS Magazine.

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