There is a common misconception that the world is a more dangerous and dishonest place than it was in past generations. There are the clichéd stories from grandparents about how it used never to be necessary to lock doors, and how children could wander the streets without fearing predators. These days, so the stories go, we need to triple lock everything and cannot let our children out of our sight for a moment.
In reality, the jury is out on whether we live in a more dangerous society today or not. In all likelihood, the chances of someone trying to break into our home or do something unspeakable to a child are probably around the same. The difference is that we are far more aware of the risks and consequences. By being better informed, these hazards are on our radar in a way that they were not in the past, and we are proactive in mitigating the risk, so perhaps that means that today we are safer than 50 years ago.
The same principles apply when it comes to financial crime. It is, and always has been, one of the primary focuses of criminal activity, because it is the most direct way of attaining financial gain – why steal a car or some other property and then try to convert it into money when you can just steal the money instead?
As technology has advanced, the methods used by fraudsters have also evolved. These days, there is so much talk about identity fraud, mis-sold PPI and so on that you would think we are living in the midst of a crime wave. This publicity is, however, our best weapon in combating the crime.
The PPI scandal
It is impossible to talk about financial irregularities without mentioning what has been described as the biggest mis-selling scandal ever. From the 1990s onwards, 53 million PPI policies were sold, the vast majority by banks. The policies were designed to protect the consumer by covering payments on loans in the event of illness or job loss.
However, a significant proportion of these policies were sold either as add-ons, without the buyer’s knowledge, or by misrepresenting the nature of the cover. In some cases, consumers were falsely informed that the cover was mandatory, or that it would improve the chances of the loan being granted.
By the beginning of last year, 12 million consumers had received compensation for having been mis-sold PPI, and the number is still rising. Lloyds sold more PPI policies than any other bank, but all high street branches were involved, to a greater or lesser extent. The good news is that the deadline for claiming compensation has now been extended to 2019, so if you have a Lloyds PPI claim, or indeed a claim against any other financial institution, it is not too late.
It sounds like the most personal violation – what could be worse than having your actual identity stolen? It typically involves somebody fraudulently obtaining your personal information and thereby being able to impersonate you and run up hefty expenses on your behalf.
If the thief gains access to your bank details, this can result in the direct siphoning of money – typically, this will be through purchases made in your name.
Not only will this result in financial loss, but it can also have a serious impact on your credit rating if the fraudster runs up bills in your name without any intention to pay them.
So much for the bad news stories. As was the case with the examples we gave earlier, though, the good news is that today, we are in a far stronger position to defend ourselves. Despite the scare stories, the truth is that just like our children, our money is safer now than it ever was, because we are conscious of the risks.
Follow these tips to stay safe:
- Statements – if a fraudster gets hold of your details, he will usually start with a small transaction to test it. If you see anything you don’t recognise, check it with the bank straight away
- Passwords – almost half of us use the same password for everything. That means if one system is compromised, so are they all.
- Shred – invest in a shredder to get rid of all waste paper with your personal information on it.
- Privacy – set privacy settings on browsers and social media to “friends only” – you never know who is watching, and learning about your pet’s name, your best friend at school and the answers to all your other security questions.
- Report – if you are a victim of fraud, report it immediately, to give investigators the best chance to catch the culprits.