Lessons from a fraud case


Article by Phil

The HSBC case

Details of an online fraud case involving HSBC and one of its customers has emerged. The case highlighted just how fraud works in reality and provides valuable lessons to help prevent it in the future.

The first stage in the process was when the client received a text purporting to be from Virgin asking for him to update his details. It appears that the customer did have reason to believe that Virgin might be contacting him and so he started to provide his personal details. He became suspicious however when the questions started to get more detailed.

The first lesson here is to be very wary about contact by text message. This is a common tactic used by scammers. Look at the number and if it’s a mobile number ask yourself, would Virgin contact me from a mobile number?

Next always be careful when providing personal details from phone via text. Think why am I giving these details by text, why am I not using an App to input my details?

The customer then received a phone call about his Virgin account purporting to be from his bank HSBC. They said that his account was being targeted by fraudsters and that he needed to move his money into a safe account.

This is the main way that scammers operate. By getting you to move your money “voluntarily” from one account to another.

You must NEVER EVER do this. There is no reason to do it. Banks do not create “safe accounts” ever under any circumstances.

You should also NEVER accept a call from your bank out of the blue asking you about your account. You must always put the phone down and call the bank back yourself to verify that it is them that you are speaking to. It’s the only way to be sure.

The customer and HSBC in this case are still in dispute about compensation and the customer has so far had 50% back. The issue is that he transferred the money out of his account of his own free will.

So, remember:

  • Do not respond to text messages especially those from another mobile number.
  • Do not give your details to your bank over the phone especially when you are not expecting their call.
  • Never, ever transfer money into a different account at the bank’s suggestion.
  • If in doubt always call the Banks fraud department to check.

Please bear all these factors in mind when you are dealing with your bank and stay safe.

The Halifax case

Another example of a scam has also just come to light, this time involving a Halifax customer experiencing a less sophisticated scam. This time the customer received an automated call out of the blue claiming to be from HMRC.

This is warning sign #1. A call out of the blue.

The scammers claimed that her National Insurance number had been cloned and that she was under investigation from HMRC in relation to Anti Money Laundering suspicions. These threats had the desired effect, and the customer was frightened by the threat of legal action.

Its easy to say in hindsight but threats are a sure sign of a scam. Stay calm and step back to independently verify the claim.

The next step was for the scammer to tell the customer that they needed to transfer their money into a Safe Account (this time in a different name to hers – which is a real alarm bell),. Remember there is no such thing as a SAFE ACCOUNT.

The final piece of the jigsaw was a letter that the scammer sent by WhatsApp telling the customer to ignore the fraud warnings on her Halifax account before she transferred the money.

Two clear warning signs here. First the use of a social media platform to send a letter. A Bank would NEVER do that. And second the advice to ignore warnings. Again, a Bank would never tell you ignore the warnings.

You must be diligent and remain calm.

Unfortunately, the Halifax have refused to refund the money – almost £10,000. They argue that the customer made the transfer voluntarily and that she ignored the repeated warnings. The customer argues that the Halifax should have noticed the unusually large transfer and stopped it. Being a victim of a scam is terrible and a crime but based on the facts presented we’re not sure what more the Halifax could have done.

Again, please remember the basic rules.

We have now been told that the Halifax have given the client a refund of money they received back from the receiving account (in other words the fraudster) – the amount was a massive £1.24!

In another update, HSBC have just agreed to refund £14,000 to a lady who fell victim to a “push” notification scam. The type where you are persuaded to transfer money to another account. In this case the bank refunded the customer as a result of an appeal by her son (using helpful online template letters) but pointing out his mother’s vulnerability at the time of the fraud. This is an important point. The FCA are very keen to be seen to protect vulnerable customers, so if you are victim to a scam you need to consider whether you felt vulnerable at the same time. This could help your claim.

There is also a very helpful new website – take five – stop fraud. Which has lots of helpful hints and tips to stay safe.

It’s worth a look.

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