27 September 2022

TSB warns of spike in cost-of-living scams, as fraudsters prey on squeezed household finances

  • 58 percent increase in Friends and Family fraud – driven by scam requests for help paying bills
  • 53 percent increase in Advanced fee fraud duping customers with non-existent loans, services and prizes
  • Accompanying research reveals the rising impact a £500 fraud loss would have on households, leaving 58 percent struggling to afford food
  • TSB emphasises importance of fraud reimbursement in current climate - as £1.6m lost daily to fraud, £850,000 of which not refunded

TSB is today warning of a rise in cost-of-living scams, as accompanying research1 reveals that a £500 fraud loss would leave three fifths of households struggling to afford food for over a week.

Friends and family bill request impersonation

New TSB research finds that Friends and Family fraud has recently doubled to become the biggest form of impersonation fraud by number of cases

The scam has spiked by 58 percent2 since the same point last year, as fraudsters typically impersonate their targets’ sons and daughters with bogus requests for help paying bills.

Over the month analysed, TSB reported cases ranging from £50.00 right up to £9,500.00 (a case in which TSB prevented payments) - with an average loss of £1500.

One such case saw a 71-year-old customer send £1,700 to a fraudster following an urgent, emotive request claiming to be from his daughter needing money to help with bills. 

A fraudster also stole £50 from a 29-year-old customer after impersonating a close friend and requesting support for energy payments.

Both cases were refunded in full through TSB’s Fraud Refund Guarantee.

TSB found that WhatsApp is by far the preferred communication route of Friends & Family scammers, accounting for nine in 10 (89%) of all cases analysed.

Victims typically receive a message from a new number alongside a plausible story on why their number has changed. After striking up conversation an emotive request for payment is sent through – made more believable and pressing due to the current economic climate.

Advanced fee fraud

Advanced Fee Fraud has increased by 53 percent3 in a year to become the third biggest fraud category by volume – with an average loss of £550 per case.

The scam typically targets some of the most financially vulnerable by persuading victims to pay an upfront fee to access non-existent loans, services, or prizes.

A 32-year-old customer was refunded £1,800 by TSB after making a payment to a company named "IVA relief,” which claimed to help people with managing their debts. After making the down payment with the promise that debts would be managed and cleared, he contacted the ‘company’ to find the line dead. 

Rising impact of fraud loss on households

Accompanying TSB research shows that the impact on households of a £500 fraud loss has almost doubled in a year.

Three fifths (58%) of households now report they would struggle to afford food for over a week after losing up to £500 to fraud, compared to a third (32%) in 2021.

Additionally, half (50%) of households would not be able to afford a rent or mortgage payment, compared to one in five (22%) this time last year.

Daily losses and vital refunds

TSB is urging households to remain extra vigilant to potential frauds, as £1.6 million4 is lost to fraud in the UK every day – and with just 47% of losses returned to victims.

As the Payment Systems Regulator is scheduled to update on the future of fraud reimbursement, TSB emphasises its calls for mandated refunds to all bank customers to protect household finances against rising fraud levels.

Paul Davis, Director of Fraud Prevention, TSB said:

“A fraud loss will be particularly painful for households during these tough economic conditions, so we are urging the public to be extra vigilant to unsolicited contact, or online offers that could well be a scam.

“With over half of fraud losses not refunded to victims by other banks – take your time and don’t rush in, no matter how emotive and urgent the request.”

Media Contacts

Matthew Hepburn | Media Relations Manager, TSB
T: 07483 431 309 | matthew.hepburn@tsb.co.uk

Follow us on twitter: @TSB_News

Notes to editors

TSB advice

  • If you ever receive requests for payment, check in with the individual, or company directly to confirm the message is genuine, and not from a criminal

  • Take your time – fraudsters thrive on causing panic and making you rush

  • Taking out a loan is an important financial step. Consult your bank, or Fairer Finance before committing your finances

  • Spread the word: Talking about fraud with family and friends raises awareness and keeps you ready to spot and repel a scam

  • No matter how complex fraudsters’ tricks are the power is in your hands to: Hang up, delete a message, cut a conversation off if ever in doubt

1 TSB surveyed over 2,000 UK adults in August 2022 to understand the impact a fraud loss would have on UK households. The survey was a re-run of questions asked in August 2021 to also determine the increased impact.

2 TSB compared customers’ data from July 2021 to July 2022 which revealed a 58 percent increase in Friends and Family fraud.

3 TSB customer data revealed a 53 percent increase in Advanced Fee Fraud between January 2022 – August 2022

4 £1.6 million daily fraud loss is calculated from UK Finance data, which reports that £583.2m was lost to fraud in 2021. Additionally, 47% was returned – meaning £855,000 is not refunded daily.

Read more about TSB’s Fraud Refund Guarantee, here: Fraud Refund Guarantee

 
The information contained in this press release is intended solely for journalists and should not be used by consumers to make financial decisions. ‚Äč