Bank warns of spike in online cost-of-living scams

TSB has revealed that fraudsters are taking advantage of the cost-of-living crisis by impersonating family members and tricking relatives into sending them money to help pay bills.

Friends and family fraud, as it is known, has increased by 58% in recent months, according to TSB data.

These online scams typically see criminals use online profiles to pretend to be the children of their targets before requesting funds to help them pay bills. According to TSB, 89% of cases reported used WhatsApp to trick victims.  

TSB revealed details of a case where a 71-year-old customer sent £1,700 to a fraudster following a request claiming to be from his daughter urgently needing money to pay bills. Meanwhile, a fraudster stole £50 from a 29-year-old customer after impersonating a close friend in need of help paying energy bills. Both cases were refunded in full through TSB’s Fraud Refund Guarantee. 

During a recent month, TSB found attempted frauds averaging £1,500, with the lowest £50 and the highest £9,500.

TSB said victims typically receive a message from a new number with an explanation of why the contact has a new number. They then engage in a conversation and trick victims into sending them money.

The data also revealed a 53% increase in what is known as advance-fee fraud. This type of scam persuades vulnerable people into paying money up front to access finances, services or prizes that don’t exist. The average loss to these scams was £550, said TSB.

A 32-year-old customer was refunded £1,800 by TSB after making a payment to a company named IVA Relief, which claimed to help people to manage their debts. After making the down payment, he contacted the fake company, but the line was dead.  

TSB’s research also showed the impact of fraud on people during the tough economic times. With £500 fraud loss having almost doubled in a year, TSB revealed that 58% of households would struggle to afford food for over a week if they lost up to £500 to fraud. In 2021, this was 32%.

It also found that half of households would not be able to afford a rent or mortgage payment if they lost £500 to fraud, compared with one in five (22%) this time last year. 

Paul Davis, director of fraud prevention at TSB, said: “A fraud loss will be particularly painful for households during these tough economic conditions, so we are urging the public to be extra vigilant to unsolicited contact, or online offers that could be a scam.  

“With over half of fraud losses not refunded to victims by other banks, take your time and don’t rush in, no matter how emotive and urgent the request.”