COVID-19 – A fraudster’s playground

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Whilst COVID-19 is having a devastating impact upon the World’s economies, one section of society is making the most of the new opportunities it has brought.

In addition to the usual on-going scams, Action Fraud has already identified 26 fraud typologies directly related to COVID-19 with an estimated £2.5 to £3.5 million already being lost. 

These include:

• Fake emails from HMRC asking for bank details to make payments under the various government COVID funding schemes;
• Fake emails from local authorities asking for bank details to make council tax and other rebate payments;
• Fake emails from payroll departments asking for confirmation of bank details;
• Requests from suppliers to make payments via less safe payment platforms due to alleged COVID restrictions;
• Offers of PPE from foreign jurisdictions (some organisations have placed orders for hundreds of thousands of pounds of PPE, which never turned up);
• Offering fake COVID testing kits (often door to door sales targeting the elderly and vulnerable); and
• Fake school meal vouchers.

In addition, there is also an increased threat from employees who have changed employer during the lockdown and may still have equipment and access to their former employer’s systems.  Whilst most people are honest, this could lead to thefts of intellectual property, financial theft or sabotage.  Businesses need to ensure any employees leaving during lockdown have their access rights removed as soon as possible.

In addition, the lockdown may be resulting in an increase in more established scams such as:

• Romance fraud – where lonely victims believe they are involved in a genuine online relationship but are then asked to send funds to help with medical treatment or another emergency issue, where victims lose an average of £47,000;
• Investment fraud – Fraudsters are using COVID to persuade victims to move their investments into ‘guaranteed’ safe investments;
• Online sales of pets and vehicles – the fraudsters use the excuse of COVID to delay the delivery of the purchased items;
• Fake emails from Ebay, PayPal, Etsy etc., asking you to click on a link and change your password; and
• Car accident claim calls.

The huge increase in online sales during lockdown is also leading to an upsurge in fake websites and counterfeit goods being sold.

There has also been a worrying increase in hacks and denial of service cases, where criminals take over your computer systems and demand a ransom to let you back in.  One US law firm is facing significant embarrassment and claims over they have stolen confidential information relating to Donald Trump, Lady Gaga and other A list celebrities.  Over the last few weeks there have also been a number of attacks targeting businesses involved in establishing the Nightingale hospitals.

The lockdown has meant fraudsters are sitting at home with a phone and a computer and lots of time on their hands to continue and expand their scams.  They are often banking on the desperation and vulnerability of people affected by the virus or they are hoping businesses are being less scrupulous in their fraud checks.

However, protecting yourself against these fraudsters comes down to a few simple rules:

• Be sceptical of anything which seems too good to be true – it usually is;
• Check anything which purports to come from a government department or local authority (often the true email address can be identified by hovering over the sender’s details – sometimes it is only one or two characters different to the genuine one);
• Read the email thoroughly for spelling and grammatical mistakes – often the sign of a fraud;
• Don’t divert from your usual payment procedures – the banks are working normally so there should be no reason to change;
• Never click on a link in an unsolicited ‘change your password’ email.  Go to the website via your internet browser and check whether that shows there is a problem; and
• If you are uncertain about anything, query it before you do anything.  In most frauds a few simple questions and a pause for thought would have prevented a financial loss.

Above all keep safe and don’t let the fraudster win!

Liesel Annible is forensic director with Armstrong Watson.  She has specialised in fraud and financial investigations for over 25 years.