This content is for information purposes only. It should not be taken as financial or investment advice. To receive personalised, regulated financial advice regarding your affairs please consult our financial planning team here at Vesta Wealth Limited in Cumbria, Teesside and across the North of England.
With the UK under lockdown since March 2020, one of the sad and concerning outcomes has been a notable rise in ‘Covid-19 scams’. Here at Vesta Wealth, our financial advisers have been working hard to raise awareness about this issue in Cumbria, Teesside and across the North of England.
We offer this update on coronavirus scams in 2020 to provide some of the information you need to help protect yourself and your family. We hope you find this content useful. To discuss your own financial plan, feel free to get in touch with your financial adviser:
t: 01228 210 137
e: [email protected]
Panic-induced vulnerability
Most of our readers would have noticed the volatility in the value of investment portfolios and retirement savings in the first quarter of 2020. Stock markets tumbled as they reacted to the global Covid-19 outbreak and subsequent lockdowns, with the FTSE 100 reporting its biggest quarterly fall since the 1987 Black Monday fallout. Many pension savers saw the value of their retirement savings decline sharply, with some losing between 10-25% of their value.
Naturally, the reaction of many people is to worry about the possibility of things getting worse. As a result of this increased vulnerability, some people have unfortunately fallen prey to the false promises of fraudulent companies and individuals, who claim to be able to ‘protect’ and even ‘recover’ these short-term losses. Here at Vesta Wealth, we want to help ensure that this doesn’t happen to you.
Look out for red flags
Financial scams come in many inventive forms and are becoming increasingly sophisticated, especially due to advances in technology which can present new online security challenges. Here, it can help to know some of the warning signs that an individual, company or ‘opportunity’ presented to you might be fraudulent:
- Unsolicited contact. If you are contacted out of the blue about your pension or investments, then there’s a high chance it is a scam. Bear in mind that in January 2019, the government officially banned cold calling about pensions. Unless the call is from your trusted financial adviser or similar person, we suggest hanging up the call.
- Pressure. Scammers will often present an investment opportunity to you which needs to be seized upon ‘quickly’ before it passes. A real financial adviser would never pressure you in this way to make a rapid decision but gives you time to weigh your options.
- Downplayed risks. There is always a degree of risk involved with investing. So, if someone claims that you can generate ‘high returns’ with little or no risk, be extremely careful. A wise financial adviser will make you fully aware of risks, not downplay them.
- Exclusivity. Sometimes a scammer will offer an individual an ‘opportunity’ which they claim will not be offered to anyone else, because they are special in some way. The scammer can then sometimes ask that their conversation and the opportunity not be mentioned to anyone else. Clear warning signs!
Protection measures against ‘Covid-19 scams’
Here at Vesta Wealth, we’ve compiled a short list of steps you can take to help protect yourself against financial against Covid-19 scams in 2020 and beyond:
- Check authorisation. To provide you with financial advice and investment offers, a firm or individual must be regulated by the Financial Conduct Authority (FCA). Make sure you check anyone who contacts you on financial matters, using free and easy online tools such as the FCA register.
- Clone firms. Some scammers will try to pose legitimacy by pretending to be a registered firm. Make sure you’re dealing with the real, regulated business by ending the call and returning using the switchboard number on the FCA register.
- FCA Warning List. As you can probably see already, the FCA is a useful point of reference when determining whether something is a scam! They also have a list of scams and fraudulent firms which have been reported, so keep an eye on this.
- Reject anything unexpected. As a general rule, end any conversation about your pension or investments with someone who has contacted you suddenly, who you do not know. Be especially careful about internet links in emails and texts, which might take you to a ‘dummy page’ to try and capture your personal information.
Conclusion
Of course, it’s still possible to fall victim to a scam even after taking considerable steps to protect yourself. If you are at all concerned about whether you have done enough to shield your wealth and finances, or if you believe that you might have been scammed, please contact your bank / financial company directly or call your independent financial adviser. Any incident of cybercrime should be reported to Action Fraud as well as to the FCA.
If you are interested in discussing your financial plan, please get in touch with your financial adviser at Vesta Wealth in Cumbria, Teesside and across the North of England. Reach us via:
t: 01228 210 137
e: [email protected]