The fight against fraud
Jonathan Flint, Citigate Dewe Rogerson’s Chairman, explores the growth of financial fraud during the pandemic and the need for better communication alongside a new legal framework to combat scammers.
A fool and his money are soon parted is a phrase coined in 1557 by poet Thomas Tusser in his work Five Hundred Points of Good Husbandry. It was a best-seller at the time. Nowadays, you don’t have to be a fool to be scammed as too many people have found out at severe cost to their livelihoods and their mental and financial well-being.
Online fraud and financial scamming is an industry that has boomed during the Covid pandemic. I know I’m not the only one who receives almost daily mobile calls from people masquerading as Amazon, HMRC, Royal Mail, et al, let alone the daily phishing emails and bogus texts.
Cases of fraud reported to Action Fraud, the specialist UK police unit, rose by a third in 2020 to more than 410,000. The COVID-19 pandemic has been a playground for financial scammers as more people have had to go online to carry out essential business. The full scale of the problem should be seen in the context of ONS crime stats showing there were more than four million incidents of fraud in 2020.
The UK Government’s to-do list is packed-full with pandemic-driven action plans but a priority which must be kept near top of the list is a cohesive strategy to combat the insidious presence of scammers. It’s a thorny communications challenge and the government needs to be seen to be doing more. Much more.
Recent research by one of Citigate Dewe Rogerson’s clients, The Openwork Partnership, one of the UK’s largest and longest established financial advice and investment networks, found 38% of adults – the equivalent of more than 20 million people – reported a rise in financial scam attempts in the past 12 months.
There’s a perception problem too, with around 45% of those questioned saying they are frustrated that the authorities such as the Government and regulators appear to be doing nothing to stop scams while 39% are outraged attempted crime goes unpunished.
MoneySavingExpert.com and the Money and Mental Health Policy Institute, both founded by financial guru Martin Lewis, are among 13 organisations that have very recently renewed calls for the Government to do more to tackle online fraud.
The sad truth is that behind the crime stats are real victims, individuals and businesses, who have often had their lives turned upside down and inside out. Clearly legislators, regulators, ISPs, mobile companies, retailers and the financial services industry as a whole have a huge battle on their hands to keep up with the evolving and sinister tactics of scammers.
Creative and cohesive communications plans to protect consumers and businesses are vital weapons to fight the fraudsters and much has been achieved so far. But the criminals will only be killed off by a robust legal framework that puts them out of business and that’s what the authorities need to start talking to us about.