A major UK bank has warned consumers of a rise in frauds where victims are asked to pay for goods and services in advance.
According to Lloyds Bank, so-called “advance payment” fraud surged 82% year-on-year in 2022. One of the most common tactics used by scammers is fake ads for loans, jobs and rental properties.
Lenders argued that the cost of living crisis could be forcing consumers to make risky decisions.
This is especially true for loan fee scams. Scammers target people with low incomes and poor credit histories for bait. They approve the loan regardless of the victim’s credit history and demand an upfront fee to receive the funds, which never arrives.
Loan fee fraud reports continue to soar, up 105% year-over-year, warns Lloyds.
“As fraudsters ruthlessly adapt to every shift in consumer behavior, and the rising cost of living puts further pressure on people’s finances, the recent surge in advance payment scams targeting low-income earners and those with poor credit histories has It’s alarming,” Lloyds insisted. Liz Ziegler, the bank’s fraud prevention director;
“The important thing to remember is that genuine lenders always perform a thorough credit check before agreeing to a loan and do not require an upfront payment before releasing the funds. If there are, there are plenty of organizations you can trust and it always makes sense to consult your bank first.”
The bank added victims lost an average of £711 ($881) last year, down from £1194 ($1479) in 2021.
This is likely due to scammers targeting a large number of low value scams.
Ages 25-34 are the most vulnerable, followed by age 35-44. These two groups of hers appear to make up about half (49%) of all victims.
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