Is the Financial Conduct Authority really contacting you? How to spot a scam

Thousands of people have been targetted by scammers pretending to be the Financial Conduct Authority (FCA) and stealing funds.

The City watchdog revealed that there have been 4,465 reports of scammers pretending to be the FCA to the regulator’s consumer helpline already this year, while 480 victims were duped into sending money to the fraudster.

The majority, almost two-thirds, of reports came from people 56 years old or above.

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It comes amid a rise in investment scams across the country, while taxpayers have also reported concerns about increasing numbers of fraudsters pretending to be HMRC.

Steve Smart, joint executive director of enforcement and market oversight at the FCA, said: “Fraudsters are ruthless. They attempt to steal money from innocent victims by impersonating the FCA.

“We will never ask you to transfer money to us or for sensitive banking information such as account PINs and passwords. If in doubt, always check.”

How scammers are pretending to be the FCA

As with most financial scams, the fraudsters pretending to be the FCA are trying to steal money by getting people to hand over funds or sensitive information, such as bank account PINs and passwords.

One of the most common reported methods is fraudsters claiming that the FCA has recovered funds from a crypto wallet that was opened illegally in the individual's name.

Another is to target loan scam victims, who are often very vulnerable, and claim the FCA can help them recover the money they have lost. They are then persuaded to hand over further funds.

A separate trend involves emailing consumers telling them their creditors have taken out a County Court Judgement against them and they need to pay the FCA the monies owed.

The FCA also identified a technique described as ‘pig butchering,’ where scammers 'fatten up' victims by building a connection, often a romantic one, and then carrying out a long-term investment scam.

After the victim has lost money, the scammers then attempt to defraud victims a second time by pretending to be the FCA under the guise of helping to 'recover' the money.

These are also known as ‘double dip’ scams.

Charlene Young, senior pensions and savings expert at AJ Bell, suggested the true volume of victims and attempts will likely be much higher than what the FCA has on record.

She said: “Depressingly, the most vulnerable people continue to be those who are most actively targeted. We saw financial vulnerability particularly exposed by fraudsters during the worst of the Covid pandemic, and the cost-of-living crisis that followed it.

“Impersonation schemes are particularly attractive to these bad actors."

How to avoid a fake FCA scam

People of all ages can fall victim to scammers, but those who are able to access their retirement pot – potentially the biggest asset they own – will inevitably be a prime target.

Be alert If someone contacts you unprompted, whether by phone, text, email or WhatsApp, be alert.

Never hand over sensitive personal information, like bank account PINs and passwords.

Check that any contact from the FCA is genuine.

Scammers impersonating the FCA often use ‘call spoofing’ to make certain numbers appear in your caller ID. If you’re at all suspicious on a call then you should simply hang up. You can check whether contact from the FCA is genuine by calling 0800 111 6768 or use the online contact form to report and help protect other investors.

The FCA isn’t the only official body that scammers will try to impersonate.

Fraudsters often also claim to be from government organisations or services. This might include HMRC, the Financial Ombudsman Service, or the Financial Services Compensation Scheme.

Young added: “The best way to avoid becoming a scam victim is to know the tricks they use and not hand over your money in the first place.”