What do you think the most common crime in the UK is? Theft? Burglary? Anti-social behaviour? In fact, more than 40% of crime is fraud. And the UK suffers particularly badly. In fact, an EU study shows that only Denmark and the Republic of Ireland experience a higher number of consumer fraud cases.
Closer to home, Sussex-based people and businesses have lost £38.1m to fraud over the last year, with Action Fraud receiving over 10,000 separate reports. Victim Support, whose two Sussex caseworkers provide support and advocacy to victims, received over 1,300 referrals over the same time period.
And while the financial loss from fraud can be extremely stressful, the emotional impact is often “completely devastating”, according to Lisa Mills, Senior Fraud Manager for Victim Support. Recent research shows that 60% of fraud victims experienced mental health problems afterwards, including anxiety, depression, sleep problems and suicidal thoughts.
How does fraud work and who is being targeted?
Fraud relies on social engineering, which the police define as “clever manipulation of the natural human tendency to trust.” Criminals target people’s emotions, particularly the desire to get a good deal or make money. This is a particularly effective tactic in a cost-of-living crisis.
These psychological techniques are combined with the opportunities afforded to fraudsters by an online world, where our digital footprints, the anonymity of the Internet and technological advances can all be used to their advantage.
And there is no such thing as a ‘typical’ fraud victim. It can happen to anyone. Victim Support have clients of all ages and backgrounds, including some who have worked in banks or even been police officers. Unfortunately, there are many different types of fraud, and here in Part 1 we cover a few of them.
Advance fee and Investment Fraud
You will almost certainly, at some point, have received a badly spelled email from a ‘Nigerian prince’, offering you millions of dollars if you’ll provide a small sum to deal with administrative matters. But now, advance fee fraud extends to all manner of different scams, including investment fraud.
In the last four years, across the UK, more than £2.6bn has been stolen in investment fraud.
Victim Support have seen individuals in Sussex losing thousands of pounds to it.
Common scams include ‘Boiler Room Frauds’, where victims are contacted by pretend stockbrokers or traders and deceived into investing in fake or worthless companies, with the promise of a guaranteed return.
Cryptocurrency is also a target area, with fraudsters gaining investors’ confidence either through adopting some form of romance fraud, or by demonstrating huge gains on what appears to be a reputable and independent app. But the criminals have access to said app and can show the victim whatever they want them to see, while draining funds from their ‘investment account.’
It’s often family who identify investment scams, with victims denying they need help, having been convinced they are going to make a huge amount of money.
“They say,” says Mills, “I’m not a victim, why are you telling me that I am?”
Bank account fraud
Bank account fraud tactics are numerous, but often involve ‘vishing’, where the victim is contacted by phone by someone claiming to be from their bank or another trusted authority (such as HMRC) and asked to confirm details to stop an issue with a ‘cloned card’ or ‘tax rebate’. Victims may confirm or give further details to the criminals, which then allows them to steal their money.
Sussex’s Police and Crime Commissioner, Katy Bourne, says: “We don’t like to be rude, do we? It goes against our nature, but if somebody’s on the phone and you’re not sure, put the phone down on them. If it’s urgent, they’ll call back.”
Other advice includes waiting for several minutes after the call, then contacting your bank on a number such as the one on the back of your card, ideally on another line (as scammers can actually stay connected even after you’ve terminated a call).
‘Smishing’ is vishing by text message and appears to be particularly prevalent on Whatsapp. Scammers can be reported by opening the chat, clicking the contact details and scrolling down to ‘report’. You can also choose to ‘block’ the contact.
Finally, ‘phishing’ scams are the same thing, but conducted by email. In April, University of Sussex students were warned about the ‘yearbook scam’, an email targeting final year students and asking for personal information and payment details for the student to be included in the 2024 yearbook.
Courier fraud
Courier fraud sees criminals contacting the victim by phone, often impersonating the police, providing credible information such as a crime number and collar number of the ‘police officer’. Victims will be told, for example, that they need to help catch a criminal by participating in a secret investigation; normally through passing money or valuables in a special envelope to a courier. Alternatively, they may be informed that their bank needs to collect their bank card to issue a replacement due to, ironically, ‘fraudulent activity’.
Victim Support say that fraudsters often use the Met as their police force and Hammersmith police station as the reference site because it’s harder for victims to validate information with such a large police force.
A recent case saw a victim in Sussex hand over a private collection of gold coins as part of a courier fraud. However, Mills also tells us that a fraudulent courier was recently caught due to the intervention of a neighbour, allowing the police to lie in wait and arrest them.
The real police and banks will never ask you to pass them money or bank cards on the doorstep.
Who are the fraudsters?
While some fraud, such as rogue trading, necessarily happens in person and therefore ‘in country’, 70% of UK fraud cases have ties to overseas criminals. A Head of Risk at a bank advises that “organised crime groups are behind the more sophisticated operations, with proceeds going to criminal cartels, who are often also involved in drug manufacture and dealing, and modern slavery / human exploitation.”
What are the Government doing?
Funding for tackling fraud across UK police forces needs a serious cash injection. Despite being over 40% of all crime, fraud receives, on average, 1% of the police budget according to the Home Office.
And although the Online Safety Bill is now law, technology companies also have a long way to go, with criminals making extensive use of social media to target and exploit victims.
In 2023, the Government published its Fraud Strategy, promising a new national fraud squad, improved regulation of the tech sector and providing a state-of-the-art fraud reporting system by the end of 2024.
While the police and other agencies do what they can at the local level, international crime requires an international solution. The UK Government set up and hosted the inaugural Global Fraud Summit in March, attended by representatives of the G7, Five Eyes, Singapore and South Korea.
But the parliamentary term has ended, and we are now in an election campaign. It remains to be seen what the new government will do to tackle this important issue.
Part Two will follow soon.
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