Article by Phil
Money advisor help with latest scam updates
Sadly, attempts to scam money from people is not reducing, its increasing. The latest figures from the Financial Ombudsman Service (FOS) show the number of reports up by 20% on last year. The regulator is warning that scams are becoming more sophisticated involving one or more techniques. They are urging people to be aware of the following techniques and common themes:
- Romance related scams initiated through meeting people in online dating environments. Please be on your guard at all times in this environment. Especially when
- Requests or offers are made to invest in projects, often involving cryptocurrencies.
- Then reports of failed transactions leading to victims making transfers to so called “safe accounts” or making multiple transfers having been told that they haven’t gone through. Please don’t do it.
Please keep up to date with scam risks and take money advisor help by regularly looking at the FCA’s Scam Smart website service.
The FCA has recently written to all cryptocurrency traders in the UK warning them about the need to comply with the financial promotions regime from October this year. That means all adverts must be signed off by an authorised person. Only crypto companies that comply with the Money Laundering regulations are allowed to advertise. The rules cover all advertising on websites, social media, via apps and anywhere else online.
There are also a number of tax rebate scams still circulating online. With the increase in the number of taxpayers this creates additional opportunities, so please be aware. HMRC have reported:
- Over 850,000 people rate now paying the 45% top rate of tax
- And 5.6 million people are paying the higher rate tax at 40%
These increases are being driven by the freeze in personal allowances which have remained at £12,500 since 2019. If the rate remains the same until 2028 as expected, then it will cost someone on £30,000 a year the equivalent of 5 pence in the pound tax increase. This is why the current method of freezing allowances is a “stealth tax”.
The number of pensioners paying tax has also increased.
- 5 million pensioners are now paying tax
- 10% more than the year before
- Double the number who were paying tax back in 2004, just 20 years ago
- The overall number of taxpayers rose to 36 million
Some of this may have been driven by the 10.1% increase in the state pension rate last year.
Others who may be vulnerable to scams include the 200,000 plus customers who are “mortgage prisoners”. These are mortgage customers who were with Northern Rock before they went bust in 2008. Their mortgages were then transferred to the state run UK Asset Recovery scheme which stepped in to take over. Since then, the mortgages have been sold and transferred to private equity companies. The problem for customers is that they are locked into their standard variable rates. They can’t move even with money advisor help because lenders now have to comply with new rules since 2008, like not lending on interest only deals. So, they can’t move. Some are now paying 13% interest rates. It’s becoming a scandal that the government has allowed these people to remain exploited through no fault of their own. Trapped by the governments own bureaucratic rules pushed down through the Financial Conduct Authority. A number of MP’s are lobbying for these customers to be given a special status.
Others may soon fall into a similar trap. Perhaps over 300,000 more. With their mortgage rates increasing and not being able to qualify for a better rate elsewhere for whatever bureaucratic reason of meeting the “rules”.
No wonder online searches for interest only mortgages were up by 40% according to Legal and General. This is now the most searched for term in the mortgage market. It might be a good idea for the FCA to consider relaxing the rules around interest only mortgages to help relieve the situation. The fear is that without capital repayments people are exposed to negative equity. But the alternative is remaining as a mortgage prisoner or selling up and moving into the rented sector. Surely those are both worse options?
Meanwhile scam offers of better rates will always appear attractive despite genuine offers of money advisor help.
