How to spot banking scams

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How to spot banking scams

We've all heard the horror stories about bank scams. But how do you know whether that phone call or email from your bank is legitimate? Our quick guide to banking scams should help you spot a scam before it's too late.

Different types of banking scams

There are a few different kinds of banking scams that you should be aware of:

Bank transfer scams

If you've heard of someone getting defrauded by scammers, the chances are they fell victim to an authorised push payment fraud (APP fraud). 

The phone rings, or you're contacted by email to tell you there's a problem with your account. You need to take action fast. You'll probably be told there's a security issue:

  • Your account has been hacked or accessed illegally
  • You've been the victim of identity fraud
  • The scammer will ask you to transfer your money to a new 'safe account' as quickly as possible. The scammer may also:
  • Tell you some of your personal information — this establishes trust
  • Ask you to supply your PIN or card number
  • Pressure you into making the bank transfer as quickly as possible

Phone call scams

There are several different phone call scams, or vishing, apart from APP fraud. The most common are:

Scammers taking control of your computer remotely by telling you there's a virus or an unauthorised access attempt has been made. Instead, they'll install spyware to harvest your bank details.

Scammers say you've received compensation or a refund, but you've been overpaid. You'll be asked to send a bank transfer for the difference.

Phishing scams

You'll receive an email that looks legitimate from your bank. Then, you'll be asked to click on a link and log into your account.

In fact, the link leads to a fake website that collects your information.

Spotting a banking scam before it's too late

Spotting a banking scam isn't easy. Spoofed emails and phone numbers can be as convincing as the real thing. However, there are telltale signs to look out for if you think you're being scammed:

  • Your bank will never ask you to make a bank transfer to another 'safe' account.
  • Your bank will never ask you to reveal personal information, including passwords and PIN.
  • Your bank won't send someone to your home to collect your PIN, cards or cash.
  • Your bank won't use a generic greeting like Sir or Madam in an email but will always address you by name.
  • Your bank email doesn't consist of a string of numbers or letters.

If you have any doubts that something is a scam, don't go along with it. Instead, ignore the email or hang up the phone, then take the following action:

  • If you feel you're being pressured into making a bank transfer, hang up. Call your bank directly. If you don't know the number, you'll find it on the back of your credit or debit card. Then ask if there really is a problem with your account. 
  • Never agree to a bank transfer. Bank transfers are almost instant, making them nearly impossible to cancel. And once your money is moved, it's extremely difficult to get it back. UK Finance reports that only a quarter of the money transferred to scammers using APP fraud techniques is ever recovered and returned to the victims. 
  • Don't click that link. The easiest way to check whether an email is genuine is to log on to your online banking and see if you have any messages.

Avoiding bank scams

If you want to avoid falling victim to an APP or phishing fraud, here's how to protect yourself:

Question who you're talking to

However convincing the fraudsters sound, remember that your bank will never contact you out of the blue. Instead, contact your bank directly using their direct number or log onto online banking to check your account for yourself.

Just say no

It can take a lot of confidence to say no to someone professional sounding who claims to be from your bank. But remember, a trustworthy person won't pressure you or make you feel guilty for not doing as they suggest. Instead, if your instinct tells you something is off, or you're unhappy with the situation, have the confidence to put down the phone. Then double-check what you're being told directly with your bank.

Take your time

Don't be pressured by scammers telling you that you must act immediately or that they'll involve the police. A professional organisation would never bully you into taking action on the spot or prevent you from thinking it over. If you're being pressured to send money over the phone, hang up and check with your bank using trusted contact details.

What to do if it the scammers target you

If fraudsters have targeted you, you need to report the scam as quickly as possible.

Call your bank and report the phone call. Even if you didn't fall for the scam, the information could help them protect other customers.

If you have handed over personal information, including PINs and card details, cancel your cards immediately and stop any payments or transfers.

Finally, get in touch with Action Fraud on 0300 123 2040 or complete their online form.

Peace of mind with Salad Money

At Salad Money, we use Open Banking, which means we can't receive payments or bank details without your permission. And you'll never be asked to give your login details to anyone except your bank. To find out more about our secure and affordable loans, apply online today

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