How to spot a scam as the number of warnings rise

March 01, 2021

Spotting and avoiding financial scams feature in the news a lot. But as scammers become more sophisticated, the number of victims continues to rise.

While many of us think we’d easily spot the red flags, it’s easy to fall victim, especially if you’ve got other things on your mind. Reviewing the warning signs can help you avoid scams should you be targeted. In many financial scams, it’s impossible to reclaim what’s been stolen. It can devastate your long-term financial plans if a scammer is able to get their hands on your savings, investments or pensions. Being vigilant is crucial.

This year the Financial Conduct Authority (FCA) has issued 80% more scam warnings than it did in 2019. Over the last five years, the figure has increased by more than 300%.

One trend among scams is the rise of clone firms. These scammers use the name and details of legitimate financial services firms to dupe victims. With emails that look trustworthy and advertised products that appear legitimate, it can be hard to spot a clone firm. Combined with number spoofing, where a criminal can make it look as though they’re calling from a different number, they can make you believe you’re speaking to a finance professional.

Since 2015, scams involving an impersonation now constitute 45% of all FCA warnings. As a result, it’s more important than ever that you’re cautious when making financial decisions.

5 steps that can help you avoid scams

1. Be cautious of unsolicited contact

If you’re contacted out of the blue, whether through email, text, social media or a call, be cautious. Cold calling is one of the most common ways a scammer will try to engage with victims initially. They’ll attempt to build a rapport and lull you into a false sense of security. There is a ban on cold calling in relation to pensions.

Even if you’re expecting to be contacted, don’t feel too embarrassed to ask for verification if you have some concerns. Legitimate financial services firms will understand why you’re asking.

2. Always check the credentials of those you speak to

Never hand over your personal details without checking who you’re speaking to. One of the first steps to take is to check the FCA register. This register contains all the firms and individuals that are involved in regulated activities. It will also show you what permissions each firm has and their contact details.

As mentioned above, some scammers will pretend to be from a legitimate firm, so don’t just check the register. Verify the contact details and get in touch with the firm using the information on the register directly.

3. Don’t rush into making financial decisions

Scammers rely on you making quick decisions without fully thinking through the consequences. They may use high-pressure tactics to get you to make a snap decision, such as time-limited offers or sending documents to be signed immediately.

The financial decisions you make can have a long-term impact on your situation and plans. Take the time to fully understand what your options are and don’t feel rushed to make a quick decision. Again, if you need more time or would like to discuss opportunities, a legitimate financial services provider will understand this.

4. Focus on your long-term plans

When you’re approached by someone offering appealing opportunities, it can be tempting to take them. However, keep in mind that if something sounds too good to be true, it probably is. Investment opportunities that claim to be low risk but high return, for instance, are a red flag.

While quick opportunities to increase wealth or access assets can be attractive, understanding your finances and long-term plan can help you spot those that are too good to be true.

5. Speak to us

Speaking to someone else about the offer you’ve been made can help you see red flags that you’ve previously overlooked. This may include a partner or someone else you trust. Another pair of eyes can help you identify a scam.

As well as loved ones, as your financial planner, we’re here to offer you support when making financial decisions too. If you’re approached with a financial opportunity, whether a ‘free pension review’ or a high return investment, you can contact us to discuss this. We’ll help you check that it’s a legitimate opportunity as well as reviewing how it fits into your wider plans.

If you have any concerns or would simply like to review your financial plan, please get in touch.

Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.


What our clients say

The people we help are at the heart of what we do. Here are some of their testimonials.

I knew I needed to begin saving and planning for the future but didn’t know where to start. Stratton helped me to understand my finances and put together a savings plan that is affordable and works for me. I now have and an ISA and a pension, and whilst retirement is many years away, I have the peace of mind that I am saving for my future. I look forward to working with them for many years to come.

Martin Corrigan -

A client since 2016

I have been impressed with the advice and service provided by Stratton Wealth Management and have always found Darius to be approachable, dependable and highly professional in his approach. It is reassuring to be able to have such a high level of confidence and trust when it comes to financial advice.

Russell Jones -

A client since 2018

Many thanks indeed for your in depth report for my client Mrs H – it is most thorough and above all readable. This might sound particularly strange; however you may well gather that in my profession we see many such reports, and I often feel that if the adviser fills it with charts and graphs it evidences a level of research. In truth most of what is produced is readily obtainable from the internet.

I would like to thank you (and your organisation) for your prompt and professional attention to my requirements on behalf of my client. As a practice we shall definitely be putting Stratton Wealth Management on our “preferred supplier list".

Colin Dunstall, Donaldson Dunstall Solicitors -

A client since 2015

I would highly recommend Darius and John. I’ve used a financial adviser previously and could never get in contact with them when I needed their help. Stratton Wealth Management have been excellent from the start. They are always available to talk, and they also don’t talk in financial jargon!

Dave Rigby -

A client since 2015

Having recently transferred my financial management to Stratton Wealth Management, I have been extremely impressed with the highly professional service I have received. I feel I have been fully involved in all decision making, and the company's highly skilled advisers have shown commitment and patience in any dealings I have had with them. I have also always found them to be easily accessible for any discussion I may require.

Denise Thornton -

A client since 2019

As a business owner and father of four children, finances are usually the last thing we think about. Stratton oversees and manages our finances, both in terms of advice for my business and our personal investments. It is comforting to know that our retirement, investment and life insurance planning has been taken care of. Darius and John are always so efficient in dealing with our affairs. As someone with no real understanding of the ins and outs, it has been fantastic to have experts giving us great advice and making sure our best interests are always the top priority.

Lee and Claire Parkinson -

Clients since 2016

Darius deals with my family’s finances and is a very trusted adviser. We meet a number of times a year, but I know I can call him any time if I have any questions. He is proactive, helpful and friendly!

Jonathan Dennis -

A client since 2019

Darius has been our adviser for a number of years, and when he told us he was starting his own firm, we had no hesitation in moving with him. We had a number of areas that we needed help with, including the complexities around an employee share scheme, investments for us and our new child, in addition to our retirement planning. Darius has continually provided us with a first-rate level of service and we would highly recommend Stratton.

Eamon and Holly O’Hara -

Clients since 2017

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