How to protect your money from cost of living scammers

Energy customers being offered “cut price” electricity, fake offers from Ofgem promising rebates to help with council tax bills and dangerous devices being sold claiming to help with rising costs are just some of the scams currently circulating.

Fraud rocketed during the pandemic, as so many of us were stuck at home and relying on the internet to get by and the trend appears to be continuing into 2022.

But this time it’s the cost of living crisis which criminals are using to steal money from desperate consumers who are struggling to make ends meet.

With inflation soaring, currently at a historic 40-year high of 9 per cent, and the price of everything rising, millions are facing serious financial problems.

Household bills have risen across the board with energy up 52 per cent already and expected to climb further.

In this desperate climate, fraudsters are targeting those in need with a range of new scams to try and lure them into parting with their cash.

In the last 13 months, £12.7m was lost to cyber crime with 32,248 cases reported to Action Fraud. The majority of 16,000 were related to hacking, social media and email, followed by 7,400 computer virus and malware scams.

In the year to September 2021, cases of fraud increased by 36 per cent to 5.1 million, according to the Office for National Statistics (ONS).

There were 360,000 cases reported to the National Fraud Database last year, a rise from 309,849 the previous year, according to CIFAS. It says 63 per cent were identity fraud cases, a 22 per cent rise, and that 91 per cent of all cases were online.

Experts at CIFAS have shared some of the most common scams currently in circulation with The Independent.

Customers of the big energy firms including British Gas, EDF Energy, Npower, Scottish Power and SSE are being targeted. Around 200,000 people have already fallen victim to this kind of scam which includes customers being offered cut-price energy if they have a pre-payment meter.

Criminals are using cloned keys to illegally top up pre-payment meters and telling customers they can receive cheaper electricity by using one. For example, they’ll be offered £50 of electricity for just £25 paid in cash which they are then unable to use.

The regulator Ofgem has also issued a warning about criminals contacting consumers and asking for their bank details to pay them a council tax rebate. This is often via text message, emails, or even door-to-door contacts.

There has also been a warning that householders are being told they can save money on their energy bills by buying certain devices, which are highly dangerous.

Electrical Safety First has warned that some of these devices, which claim to “stabilise electrical currents” are unsafe. It says four bought by the organisation failed basic safety standards with some exploding, risking fire and electric shock.

Several scams are also circulating relating to energy efficiency. More than two-thirds of those thinking about making changes to their homes have been contacted by criminals, according to data from Citizens Advice.

Scams include offers of boiler installations and are often via doorstep criminals or those making multiple phone calls, sending emails and text messages to potential victims.

Gus Tomlinson, chief product officer at digital identity firm GBG, said: “What is clear, is that the techniques and methods used by fraudsters will continue to evolve over time.

“During Covid-19, scammers pretended to be from delivery companies, the government, GPs, retail companies and more to try and scam people out of their hard-earned money.

“We can expect to see similar scams in many different guises – criminals may be offering to help reduce the water bill, offer ways to reduce the food shop, or may pretend to be the government helping you with your benefits.”

The Online Safety Bill is currently going through parliament and it has been confirmed that paid-for adverts will be included in it.

It will give Ofgem the power to fine companies that do not comply with the bill, yet it may not be fully operational for another two years.

It’s more important than ever that consumers remain vigilant to potential fraudsters, even though it can often be hard to determine what is genuine and what is a fraud.

Colum Smith, fraud expert for the law firm Taylor Rose MW, said: “Right now be particularly wary of any emails or text messages suggesting deals or special offers requiring you to sign up and pass on your bank details. If it sounds too good to be true it probably is. Never share your details unless it is with someone you know or trust.

“It is also increasingly common for fraudsters to pose as bank officials. Criminals regularly call victims saying they can help provide loans and extend an overdraft, preying on the fact you might need a bit of breathing space with your bills. Never hand over details to cold-callers like this.”