5 types of scams – and how to spot them

So, here’s a quick crash course on some of the different types of scams out there – and how to spot them. 

Perhaps one of the most common types of scams, phishing scams are when you get an email or message that appears to be from a reliable source. This could be a company you hold a bank account with, HMRC, or a company you have a subscription with, such as Netflix. ‘Vishing’ scams are similar, but are conducted over the telephone. 

These scams work by gaining your trust, and making emails look as legitimate as possible. They may also cause a sense of urgency, but telling you your account has been locked, or compromised in some way. The email will suggest you click the link provided, enter your details, and regain access to your account. 

However, this will be a fake link, to a fake website, where your details will be collected. This may be personal information or bank details. Sometimes, these links may create a virus within your computer, meaning your entire system is compromised. 

To avoid being the victim of a phishing scam, check the email address the message has been sent from. The email address will likely be comprised of random letters or numbers or have spelling mistakes. Never click on links within emails that make you suspicious. Do not believe things at face value, and immediately delete any emails such as this. 

If you receive a telephone call, hang up immediately and contact your bank directly. Remember – banks will never ask you to move money between accounts – anyone asking you to do this is likely a scammer. 

Romance scams are becoming increasingly common due to the online presence most of us have. These scams, sometimes known as ‘love scams’, are when a person in duped into giving a scammer money, by being convinced they are in a genuine, trusting relationship. 

Fraudsters will spend great time and effort convincing you of their love and dedication to you, to gain your trust. They use great manipulation tactics and will often claim they have an emergency and need funds. 

It is important you don’t send money to anyone you have not met in person or allow them access to your bank account or transfer money for them. Profile photos may not be genuine, so it is important you do some checks, and if the person you are in a relationship with refuses to video call, this could be a huge warning sign. 

Similarly, never take out a loan on someone’s behalf, give them your personal information or passport details, and don’t invest for them. If you have not met someone in person, do not risk your finances. 

This type of fraud is extremely common, and unfortunately, we authorise the payments without realising it is a con. The goal of this scam is to get a person to send a payment, or authorise a payment voluntarily, by using manipulation tactics. 

As with phishing scams, fraudsters will pose as a well-known business by intercepting emails. Scammers will intercept company emails, then pretend to be them. So, if you are getting your house decorated, for example, scammers may intercept the emails of the company doing the work to your home, and email you pretending to be them, asking for payment.  

What makes this scam hard to spot is that if you are aware you are going to have a payment leaving your account already, it may not seem suspicious when a company asks for it. Don’t assume all messages are genuine. Double check the email address and contact the company directly to ask them if it legitimate. 

It can be extremely hard to get your money back if you are the person who authorised the payment – so always be suspicious. Genuine businesses will understand any uncertainty you may have and will be more than happy to talk through any suspicions you have. 

One of the oldest scams in the book – getting someone to invest in a company or product that simply doesn’t exist! These scams vary – they may be online, over the telephone, or even face to face, with people knocking on your door. Fraudsters put in a lot of work to make these scams seem legit – they will create a website, a social media page, and include testimonials. 

The most important thing to do is make sure the company is approved by the Financial Conduct Authority (FCA). You can also see if the company is on the FCA’s warning list. You can also check the Companies House website to see if the business or product is real. 

Similarly, if it seems too good to be true, it probably is. Anyone who promises huge returns and very little risk, or promises huge sums of money, is likely a scammer.  

There is a huge number of scams revolving around messaging app Whatsapp. WhatsApp scams are on the rise and the app is now the latest tool that fraudulent criminals are using to commit impersonation fraud, according to a study by Lloyds Bank. 

Fraudsters are using the app to pretend to be family or friends asking for financial help from WhatsApp users. Most fraudsters will blanket post the same message to lots of phone numbers to see if they get any responses. The scammers will then pretend to be a family member who has bought an emergency replacement for a lost phone, hence the different phone number. 

Approaches vary but most often the scammers will claim to simply be ‘Mum’ or ‘Dad’ and say they don’t have access to their bank account to pay an urgent bill. 

Always be wary of ANY messages, no matter how real they seem, you receive from unknown contacts, even if it appears to be from someone familiar. 

Always check with the 'old’ number of the person this is claiming to be. It doesn’t take much to text or call a friend or family member and ask, “was this from you?” before doing anything. If it’s genuine, the person at the other end won’t mind being contacted. 

Read more:  How to avoid the latest scams this year

Read more:  Credit card types and how to choose the best one for you

Keep up with the top stories from Reader's Digest by subscribing to our weekly newsletter