Whether you are tech-savvy and know exactly what to look out for, or you’re nervous about conducting transactions online, it makes no difference; anyone can fall prey to a scam or fraud.

While there are certainly ways to protect yourself from fraudsters - including understanding how scams work and what you need to do to protect your personal information – it’s also crucial to know what to do should the worst happen and you feel you’ve been scammed.

A Rise in Fraudster Activity

From texts that seem to come from your bank to emails you’d swear were sent by money transfer services to fully blown fake websites, scammers aren’t shy about their tactics when it comes to defrauding people of their hard-earned cash.

Scammers and fraudsters can employ the latest technology to aid their plans. Yet they’re also adept at exploiting situations and manipulating emotions to build trust with you, create a sense of panic or urgency that compels you to take action, and then convince you the best course is to divulge your details. This may be over a text or email. However, it can also be through a phone call, on which you are fully convinced you’re speaking to your bank or another valid institution with a reasonable reason to ask for those details.

And it’s not just bank accounts that need protecting from potential fraudsters. Scammers will also target investment accounts, pensions, and even insurance. Vigilance is essential, particularly now, as we’re seeing a rise in the number of fraudulent activities taking place. This often takes the form of fraudulent payment requests, which occur when a client’s email has been compromised. With scammers controlling customer email accounts, they may request large pay-outs from their investments and direct those funds to fraudulent bank accounts.

Should their request be successful, that money is rapidly transferred overseas, making it tough to recover once the fraud is discovered. Unfortunately, this can happen to anyone, even financial advisers!

Rising Living Costs Are Raising Vulnerability

With the cost of living continuing to rise, many are searching for ways to supplement their income. This is leaving them more vulnerable to scams that promise an instant cash influx, or to rapidly deliver a high return.

A higher level of need can easily create greater vulnerability. When your mortgage or utility bills suddenly skyrocket it can leave a gap in your budget that’s tough to fill. Taking on another job isn’t always possible or practical, and it certainly isn’t appealing. It’s also not a swift fix to the issue; if you need money in the bank immediately, waiting a month for your first paycheque doesn’t solve the problem.

Even if you’re not struggling to make ends meet, there is a heightened level of anxiety at the moment around fixed income levels vs rising costs. The promise of a solution to a gap in your budget, or a buffer in the event one develops, is extremely appealing. In fact, it’s tough to turn down, so much so that even those who suspect a scam are more likely to chance it in the hope of getting that extra money in the bank.

Any situation that leads to a concern over finances is easily exploited by the criminal element – we saw it repeatedly throughout the pandemic.

Common Scams

There are new scams popping up all the time but, generally speaking, there are four main types to avoid:

Purchase Scams – we all love a good deal, and those rising living costs are driving more and more people to search for cheap online deals. Offers that appear too good to be true often are. If you’re making a purchase online and the seller tries to entice you into securing a bargain by making a quick bank transfer instead of paying by a more secure method, be wary.

Impersonation Fraud – you get a call from the bank telling you there’s an issue, and asking you to confirm your identity to continue. Concerned, you dutifully hand over your personal and financial details in answer to their questions, not realising the person you’re speaking to isn’t from your bank at all. This is a common scam that can be run with any well known, popular, trusted brands. They may come via the phone, email or even text, and usually either panic you with the threat of a crisis, or excite you with the promise of a pay-out.

Investment Fraud – investment opportunities are always appealing, but rising living costs are prompting more people than ever to look for ways of turning their existing money into more money. Investment frauds focus on convincing you to move your money into their funds, or make a payment for an investment that turns out to be fake. They will generally promise you a high return to make the deal as appealing as possible.

Payment in Advance Fraud – another common fraud is the promise of a loan or cash payment which requires an advance payment from you. In order to release the promised funds you must make a payment for the service. Once you do so, your loan or cash pay-out never appears.

How Do We Protect Clients’ Investments?

We contact clients directly through a known or registered phone number. Where possible, a face-to-face meeting is arranged – although may be conducted electronically - to ensure the instructions are legitimate. We can also consider extra verification options, such as asking questions only a genuine client would know.

At Blacktower, we can assist you with all of the areas above and help you to develop an effective and bespoke wealth management strategy to help you achieve financial stability or grow your assets.

Contact us in the Lisbon office to review how we can help you – Telephone +351 214 648 220.