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How to identify and avoid bank transfer scams

by Raquel
| April 14, 2021
Reading time: 4 minutes
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Have you noticed the steep increase in scam calls and text messages in the last year? If so, you are not alone. Bank transfer scams, also known as authorised push payment fraud (APP fraud) are becoming more and more common. Unfortunately, the pandemic has accelerated their growth, with 42% of the British public reporting being targeted over the last year as fraudsters are taking advantage of increased vulnerability due to loss of income, reduced access to support systems, and the move into a more remote world.

We are working towards a world where this type of fraud doesn’t happen to anyone anymore. In the meantime, we have outlined how these scams look like and what you can do to protect yourself from them.

How to identify a bank transfer scam

Fraudsters use bank transfers as their preferred payment method because they’re instant, efficient, and free. Because of their immediacy, intercepting them is tricky. This type of scam (also known as ‘Authorised Push Payment’ fraud), occurs when a fraudster tricks an unknowing victim into transferring them money from their own bank. 

Whilst the scams are becoming more sophisticated day by day they often follow a similar path:

  • First, they come as unsolicited calls from someone disguised as an official from a trusted institution (like your bank or a government agency) where they tell you that there is a problem with your account or that you owe some money.
  • They are usually security-related, informing you that someone has tried making a big purchase or tried stealing your identity.
  • They involve personal details. You might get asked your full name, address, email, card, and PIN numbers, to name a few. Fraudsters tend to already know some of the information, making them sound more trustworthy.
  • They pressure you into acting quickly by highlighting imminent danger to your finances.
  • Finally, they always prompt you to transfer money into a ‘safe account’, authorising it on your side as you would any other bank transfer. This is when the scam becomes successful.

We are working towards a world where this type of fraud doesn’t happen to anyone anymore. In the meantime, we have outlined how these scams look like and what you can do to protect yourself from them.

Beware: sometimes, the scam isn’t where you think it is.

This was the case for drama student Emmeline Hartley, who was a victim of the Royal Mail scam. The text message she received asked her to input her card and bank details on a website to pay a £2.99 delivery fee.

After a few hours, she was contacted by a spoof Barclays number to inform her that someone had attempted a £300 transaction at Argos. Little did she know, this was the real scam. The fraudster skillfully talked her into draining her bank accounts. Read her full account below.

What can you do to keep your money safe?

If you fall victim to a bank transfer scam, the odds are unfortunately not always on your side. Historically, banks have given refunds for payment fraud, but not when an unsuspecting customer has tricked into making a payment. In the last few months, banks have started signing up to voluntary codes to avoid this, but their efforts have not been enough.

The best thing you can do is to be alert and ‘in the know’ at all times. 

1. Always contact companies directly

Fraudsters can easily spoof phone numbers and email addresses. Huw Saunders, director at OFCOM, recently warned people to be wary of caller IDs and to not use them as means of verifying a caller’s identity. If you are contacted unexpectedly, the best thing to do is to hang up and contact the company directly using a trusted email or phone number listed on their website.

2. Never disclose your pin or full password to anyone.

Official organisations will never ask for these details or request money transfers to other accounts. They will also never pressure you into doing anything in a rush.

Clicking on unsolicited links can easily expose you to scams and your devices to viruses. The best thing you can do is delete them straight away.

4. Trust your instincts

If you feel like there’s something off about the situation, just hang up. It’s better to be safe than sorry.

How will we help?

With Juno, you can benefit from all the good things bank transfers have to offer but without any risks. This is possible thanks to secure links through Open Banking and payee verification, so you always know who you are paying.

When you use Juno, you can create payment requests that you can share with your friends through their email, with a text message or even in person with a QR code. This way they know it is coming from you. Also because you don’t need to share your bank details with anyone to pay or receive money through Juno, we keep your bank details safe from scammers.

Juno is at the forefront of a payment revolution, making bank payments secure, simple and instant. Sign up for early access.

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