Since the beginning of 2021, the cost of living in the UK has been rising rapidly. According to the Consumer Prices Index (CPI), consumer prices were 10.1% higher in July 2022 than the previous year. People are struggling to keep up with rising prices.
Scammers are now finding new ways to exploit widespread feelings of fear and desperation by launching fake text, phone, email, and even WhatsApp campaigns to offer free samples, grants, rebates, and support payments to households.
These scams are particularly effective because many people expect help from the government, which means they may be more easily misled. We'll outline four key ways scammers are exploiting the cost of living crisis.
1. Email and text reminders to apply for cost of living payments
Cost of living payments are paid automatically by the government to those who are eligible. However, many scammers are capitalizing on people's fears by emailing or texting them and warning that they might not receive the payments they’re entitled to unless they apply for them directly.
These emails often contain phishing links that trick recipients into downloading a virus, entering their credit card information, or providing sensitive information such as account login details.
The Department for Work and Pensions (DWP) recently tweeted a warning to people that any messages suggesting they should apply or contact someone about cost of living payments might be a scam.
2. Hosting fake contests on social media
By now, most people know the signs of a blatant scam. But a Facebook post that appears to have been written by a popular brand offering a £25 voucher is much more believable.
Many scammers tell participants they need to like and share a page to enter. This helps them to build a following that can be used to share future scams with a larger audience.
Other scams tell participants that they must fill out a survey to enter the competition. Some install malware on someone's computer, while others request that participants enter their card details to pay a small 'handling fee.'
Some will simply request that participants hand over their email addresses, which they'll use to carry out phishing attacks at a later date.
3. Offering rebates through SMS messages
Energy regulator Ofgem recently tweeted a warning that scammers are sending out fake SMS messages pretending to be from Ofgem offering rebates.
These messages include a link to a spoof website that typically includes a web form designed to 'set up a direct debit.' This form asks for a person's full name, date of birth, email address, and bank details.
Those who enter these details are likely to be fraudulently debited and at risk of further identity fraud.
In an attempt to reduce the number of people who fall victim to these scams, Ofgem published a guide containing tips on how to distinguish genuine communications from false ones. It has also highlighted that legitimate emails will always be sent from an address that ends in '@ofgem.gov.uk'.
4. Offering fake gas card entries through email
It's not just the UK that's experiencing a rise in scammers trying to capitalize on the increasing cost of living.
Rising fuel costs have led to an increase in the number of people joining loyalty programs and rewards schemes in an attempt to save money. In the US, Shell Energy's Fuel Rewards is a popular scheme.
Shell recently warned Fuel Rewards members of suspicious emails and told them that it doesn't ask competition winners to pay for any prizes. It also warned them not to hand over payment or personal information.
Over 75% of UK adults have been targeted by a scammer this year
According to Citizens Advice, the number of people targeted by scammers this year has increased by 14% compared to this time last year.
Are you concerned that you or someone you know may have fallen victim to a scam? If so, immediately end all communication with the scammer and contact your bank to cancel any recurring payments.
Those in the UK can also call the new 159 hotline – a service designed to help people determine whether a call is genuine.