Canada Life urges 'constant vigilence' as scams affect 5 million in UK

Over 5 million people in the UK have fallen victim to, or know someone who has been duped by, a financial scam since the beginning of the covid-19 outbreak, according to research carried out by Canada Life.

The research found that 5.2 million UK adults had either fallen victim or know someone who has fallen victim to a scam since the start of the pandemic, meaning that 10% of UK adults have either been a victim of a financial scam or know someone who has since the beginning of March.

Canada Life, a life insurance provider headquartered in Winnipeg, Canada, said the most common financial scams are banking (60%), followed by insurance (35%) and pensions (19%).

The average financial impact for those scammed is £567, although one in ten has lost £1,000, the company said.

The company is warning that people need to be constantly vigilant as fraudsters are preying on the nation's current financial anxieties and concerns to scam at will.

The financial cost of being scammed is significant, with victims losing £566 on average per scam. Although one in ten of those who know someone who has been scammed or have been a victim themselves has lost over £1,000.

Being scammed or knowing someone who has during the outbreak has left many feeling foolish (47%), although almost half (48%) felt the scams are so convincing they are hard to spot. This experience has an impact beyond the financial consequences, with more than half (55%) agreeing that it's taken a toll on their mental health and 37% feeling like their trust in people has completely gone.

A worsening situation
When Canada Life asked people in August 2019 if they had been approached by phone, text or email with the offer of a free pensions review (a very clear indication of pension scamming activity), just over one in ten (12%) of non-retirees suggested they had been contacted this way in the preceding three months. This has risen to almost one in five (17%) for those people yet to retire who have received similar contact over the last three months.

Of those who have been approached with pensions ‘advice' in the last three months, 43% are more worried about scams, and 25% feel increasingly vulnerable.

On average Britons have received three suspicious or fraudulent messages since the outbreak. The most common way to contact people is through suspicious email activity (75%), but a third (32%) have received a phone call, and a quarter (24%) have been sent text messages. Retirees said they received significantly more phone calls (at 46% vs 32% for UK adults), despite the ban on pension cold calling being introduced in January 2019.

Nearly one in six (13%) think they're more vulnerable to scams during the Covid-19 outbreak, and 26% are increasingly concerned about financial scams. A quarter (25%) don't know how to prevent fraudsters from targeting them; 30% don't know which services they can use to protect themselves and 30% wouldn't know who to contact if they were scammed.

The increases come despite public awareness campaigns on how to spot and avoid scams. Canada Life is warning that people need to be extra-alert to the dangers.

Andrew Tully, technical director at Canada Life, said: "Falling prey to a scam can be devastating, not only for the individual involved but also for their family and friends. The covid-19 pandemic has provided a fertile opportunity for ‘lowlifes' to prey on not only the vulnerable but also people who are worried and anxious about both their health and their wealth. With families trying to make ends meet as the economy dips, an offer of money or easy access to your pension early might seem the perfect opportunity to dig yourself out of trouble - at face value."

"Sadly it's highly likely it will be scammers, so be aware and follow the simple rule of thumb - if it appears too good to be true, it inevitably is. Simply walk away, hang up, or delete the email or text."

"We all need to be on our guard for any signs of fraudulent activity as scammers continue to evolve and adopt ever more sophisticated and ingenious ways of encouraging people to part with their hard-earned money. Follow our tips to help spot and avoid being a victim of a scam."

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