Smart Money – Sam Richardson: Make sure you take steps to avoid becoming a victim of identity theft


Answer: I’m really sorry to hear that. It is a reminder of the devastating impact that fraud can have on the victim and their family.

It is also a stark reminder that due to the increasingly sophisticated and evolving tactics of fraudsters, each of us can be at risk. Scams can start in unlikely places: your son was first approached on the social networking app Snapchat, by a scammer claiming your son could make money from a bitcoin exchange.

At this point you would expect the scammer to ask for the money – but what he was interested in were the details, in particular the personal details he would need to apply for the £10,000 loan on behalf of your son. They used threats of violence to get your son to transfer the money to the fraudster’s account and pressured him not to speak to Santander despite the bank‘s attempts to contact him about the unusual transfer.

Cifas, the association for combating fraud in the financial sector, reported that identity fraud had increased by a fifth in the last year.

Luckily, after learning what happened and approaching Santander, they returned the £10,000 and Nationwide agreed to write off the interest on your son’s loan and remove it from your credit report. But questions remain as to why Nationwide was willing to lend the money. The fraudster claimed your son was a Lloyds Bank employee earning £1,400 a month with no expenses. Neither a check of your son’s credit report nor his personal details would necessarily have revealed this to be false, but you hope a 19-year-old trying to borrow £10,000 – not to mention the curious lack of spending – would induce an additional checks.

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Your son isn’t the only victim – Cifas, the association for combating fraud in the financial sector, reports that identity theft has increased by a fifth in the last year. If you are having trouble getting the money back because your bank is refusing your request, you can take your case to the Financial Ombudsman Service (FOS). The FOS will act as an independent arbiter between the complainant and the bank, and is used to settle disputes.

We can take several steps to avoid becoming a victim. Don’t share any personal information with anyone unless you can verify their identity: Banks will never ask customers for your PIN or security passwords over the phone. Hang up the phone, take five minutes to think about what you’ve been told, and call the organization back using a trusted phone number (like the number on the back of your debit card).

Check what personal information you share on social media and with whom, and be wary of any friend or connection requests from people you don’t know. When disposing of paper documents, consider shredding those that contain personal information. If you’re moving – and as your son is a student this could be quite common over the next few years – then ask the Royal Mail to redirect your message for at least a year.


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