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Investment scams – how to spot the signs to help protect you and your money

We take a closer look at the latest spate of investment scams and how you can help protect yourself and your money.

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

Amy Murray
Client Communication Manager

Published on 9 December 2022

This article is more than 6 months old

It was correct at the time of publishing. Our views and any references to tax, investment and pension rules may have changed since then.

Fraud now makes up over 40% of all crimes recorded in England and Wales.

One particularly prevalent type of scam is Authorised Push Payment (APP) fraud. This type of scam isn’t new, but is becoming more popular with fraudsters. In 2021, losses to APP fraud in the UK hit £583.2m.

What is Authorised Push Payment (APP) fraud?

APP fraud is where victims are tricked into transferring money to an account controlled by fraudsters. They do this by pretending to be a trusted organisation like the Financial Conduct Authority (FCA), HMRC, law enforcement, the victim’s bank or investment provider, like HL for example. Sometimes they’ll even pretend to be someone the victim knows like a family member or friend.

The fraudster will often tell the victim their money is at risk and they need to move it to a ‘safe’ account. They might even ask the victim to lie to their bank or other organisation about the reason for the withdrawals – this is a tell-tale sign of a scam.

As more of us use online banking these days to make it easier and quicker to transfer money, unfortunately it means more of us are at risk. Scammers can trick victims into transferring them money in real time which means the money is received and available in the fraudster’s account immediately. These payments are irreversible – a victim can’t cancel the payment once they realise they’ve been scammed.

While banks are required to refund card fraud, there’s limited protection against APP fraud. It’s notoriously difficult to detect as the victim authorises the payment themselves – making it appear a legitimate instruction. This makes knowing how to spot the signs of APP fraud crucial.

Fraudsters come up with new tactics all the time. You can keep up to date with information across our Security Centre about the most common threats to be aware of.

Spotting the signs – what to beware of

Cold calls – beware of unexpected calls claiming to be your bank, HMRC, or another reputable company, like HL.
Pressure to send payments – if anyone asks you to send a payment or move your savings, and pressures you to do it quickly – this is likely to be a scam.
Intercepted messages – be careful of the emails and messages you’re sending and receiving as they can be intercepted. Look out for anything unusual. For example, is the message you’ve received in a tone you’d expect your bank or financial company to use?
Security details – never disclose your full security details over the phone. We’ll never ask you for them and it’s unlikely other companies will either.
Ask questions – just because someone knows your basic details (like your name/address), doesn’t mean they’re genuine. A quick online search and your own personal research around the contact you’ve received can quickly reveal if it could be a scam.

If you think it might be a scam, don’t try and catch them out. Stop contact with them and report your concerns straight away using contact details provided on the company’s website or letters they’ve sent you.

Most importantly, trust your instincts. If it feels wrong, it probably is. Fraudsters are clever, and for many it’s their full-time job. They might sound convincing, authoritative or professional, and will use numerous tactics to get your trust and ultimately your money.

If you think you’ve been scammed, you should report it to Action Fraud either online or by calling 0300 123 2040.

You can also report it to the FCA either online or by calling 0800 111 6768.

Further guidance and support:

Get Safe Online

A leading source of up to date, straightforward information about online safety.

ScamSmart

An FCA campaign providing information on how to avoid investment and pension scams.

MET POLICE – PERSONAL FRAUD AND HOW TO PREVENT IT

What to look out for and how to stay safe.

Take Five to Stop Fraud

A national campaign to help everyone in the UK protect themselves against fraud.

Age UK

How to spot and avoid the latest scams.

Help with the emotional impact of fraud

If you’re a victim of fraud, we know it can have a huge emotional impact, as well as being financially crippling. Victims can often feel embarrassed and not want to tell people what’s happened, even though it’s not their fault.

If you need to talk to someone about how you’re feeling, contact Victim Support either online or through their support line on 0808 168 9111.

You can also contact The Samaritans at any time of the day or night on 116 123.

If a scam has left you struggling financially, contact Citizens Advice. You can speak to an adviser to help you find a way forward, through their advice line. They’re available 9am – 5pm, Monday to Friday. If you live in England, call 0800 144 8848. If you live in Wales, call 0800 702 2020.

If you have any concerns about your HL account, please get in touch with our Helpdesk on 0117 900 9000.

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