How millennials can protect themselves from bank fraud
No matter how careful you are, it can be easy to fall victim to bank fraud – particularly, it turns out, if you are from Generation Y.
Recent research from Lloyds Bank found that millennials are more likely than any other age group to hand money over to scammers.
The data shows that victims aged 18 to 34 are losing an average of £2,630 to frauds, which typically involve scammers impersonating banking staff, the police or HMRC.
People over 55 lose the most to fraudsters—an average of £10,716 per scam—but are now less likely to be duped than younger people.
So why is this the case – and is there anything you can do to protect yourself from scams?
“Millennials and younger generations are shopping online and using online banking to a much larger extent than previous generations,” says Philip Haglund CEO and founder of Gimi, a pocket money and chores app which teaches children to be smart with money.
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“This generation has a long online history and their digital footprint is big. People that use online services on a regular basis might become more complacent, and more likely to share personal details without questioning the site and purpose.
“There is also a lack of awareness and knowledge among this generation on how to keep money secure compared to older people,” Haglund adds.
Although it can be difficult to keep bank details safe and to avoid scams and bank frauds, there are some actions people can take in order to protect their accounts.
“First, they should check their bank accounts and statements often to detect any potential irregularities, even sophisticated technology might not always alert the card user that there is an issue,” Haglund explains.
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“It also helps to change passwords and pins a few times a year, and not give out any personal details via email or over the phone. Keep in mind that banks will never ask for pin and password for online accounts.”
To avoid fraudsters, the Money Advice Service recommends look for signs of unsolicited or unexpected contact. If you have received any kind of contact out of the blue – particularly a phone call – then you should be wary of their intentions. If you’re in doubt as to whether the call is legitimate, hang up – it’s not worth the risk.
Authorised push payment fraud is a type of scam in which someone tricks you into sending them money from your account. They often do this by contacting you via phone, email or social media pretending to be someone else, such as your bank or an estate agent. Victims believe they are transferring money to someone official – and these scammers often strike during a housing transaction, or when paying an invoice.
Although we all like to think we’re pretty savvy, scammers can be particularly sneaky. For example, some will say they’re calling from your bank’s fraud team about a security issue. And because you have done the work for them – transferring the money yourself – it can be tricky to get it back. A total of £236m was lost to transfer scams in 2017, according to the banking trade body UK Finance, with banks unable to return nearly three-quarters (74%) of the money lost.
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It can be hard to tell who is legitimate, but there are signs of a scam. If you’ve received an email where the email address is misspelled or contains random numbers, it’s probably not legitimate. And you should only use safe and secure WIFI connections and avoid public WIFI - your 3G or 4G connection is often more secure than one in a coffee shop.
It’s also important to keep your operating systems and virus protection software on your laptop up-to-date, as these can protect you from scams, viruses and ransomware.
If you think you’ve been a victim of a scam, stop sending money straight away and call Action Fraud on 0300 123 2040 to report what has happened. If you notice that money has gone out of your account without you having anything to do with it, or if a payment has been set up as a direct debit, get in touch with your bank straight away.
“Even if there are things an individual can do it is also up to banks, financial organisations and the government to protect the financial wellbeing of our younger generation as well as educate them on how to remain secure online,” Haglund says. “For example, we ... are teaching our users safe online shopping and card usage through guided education session on our platform and app.”
