Rise in scams expected as banks exit market

Victims of SMS scams have been left out of pocket to the tune of €1,700 on average in the first six months of this year, according to FraudSMART – a fraud awareness initiative run by the Federation of Banks and Payments .

Companies have suffered an average loss of €14,000 as a result of billing fraud, but in some cases individual companies have lost up to €50,000.

Scams of both varieties have increased in prevalence in recent months with the impending departure of Ulster Bank and KBC Bank from the market here.

Consumers and businesses are warned to be on high alert for fraudsters looking to profit from the decision of thousands of customers to create new accounts.

“FraudSMART members have seen SMS scams nearly double in the first half of this year compared to the same period last year,” said Niamh Davenport, Head of Financial BPFI and Head of FraudSMART.

“Fraudsters are adept at taking advantage of changing circumstances to commit fraud and with two retail banks exiting the Irish market and hundreds of thousands of retail and business customers transferring bank accounts, FraudSMART members anticipate that we could see an increase in identity theft fraud attempts that rely on the process of verifying and updating bank details,” she added.

The BPFI has launched an information and awareness campaign urging individuals to beware of suspicious text messages, emails or calls claiming to be from a legitimate organization such as a bank, utility company or telephone operator mobile.

There have also recently been reported incidents of fake overdue mail purporting to be from an employer’s HR department.

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The Federation expects fraudsters to be particularly active in the coming months as many consumers establish new banking and payment arrangements.

“We warn consumers to be on the lookout for text messages that report fraud on your bank account or the impending cancellation of your paycheck, standing orders or direct debits to utilities and then request personal information or account details. We know that scammers have recently started to follow up on these text messages with a phone call from a number that appears to be your bank,” said Niamh Davenport.

More than 70,000 businesses are also set to transfer bank accounts, increasing the threat of invoice fraud.

“Invoice fraud involves a fraudster informing your company that the supplier’s payment details have changed and providing alternative information in order to defraud you. The fraudster could pretend to be from your company’s real supplier, or even impersonate for a member of your own company,” Ms. Davenport explained.

Banks will do their best to ensure that customers are not left behind as a result of fraud, but in some circumstances this may not be possible and the consumer or business will end up bearing the loss .

“It’s all on a case-by-case basis,” Niamh Davenport told Morning Ireland.

“They will thoroughly investigate every fraud, whether it’s an SMS, email or phone scam. If it’s bill fraud, a long time may have passed, so the money has been taken out of the fraudster’s account and there is nothing to return, so time is running out.. The sooner you report it, the more likely you are to get your money back,” she explained.

Ahead of an expected increase in fraudulent communications, Ms Davenport advised consumers and business people to be on alert.

“Do not click on any links. If you receive an SMS from your bank, it will never contain a link. You will only be asked for a Y or N response from a bank-specific SMS. You will never be asked to provide personal information. All those things like links, personal information, ask to confirm, verify or update – those are all red flags,” she warned.

BPFI’s fraud awareness campaign will launch this week on radio, online and via social media.

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