Self-Assessment Payers Targeted

HM Revenue and Customs has sent out a warning about gangs stealing taxpayers’ passwords and submitting claims for tax refunds to be paid to them after a series of claims of attempted fraud through self-assessment repayments system has been discovered.

Figures have not been released detailing the extent to which the fraud has reached, but a Revenue and Customs spokesman said that this was a new method of trying to extract money and urged people to make sure their passwords from HMRC were kept secure.

He said: “They should treat these details as carefully as they would a Pin for their bank account.”

Over nine and a half million taxpayers are on the self-assessment system, which was changed this year in order to encourage more people to submit their details online.

In 2007-8, two-thirds of all filings were made via the internet rather than on paper.

What’s Going Wrong?

When someone applies to use the system they are sent a password through the mail which is then used when the taxpayer logs onto the HMRC website within a 30 day period.

But fraudsters are somehow getting hold of these passwords and other personal details – perhaps through stealing mail, tricking people out of their details or even finding the letters discarded in bins. They then use these details to make fraudulent repayment claims, requesting the funds be sent to other bank accounts.

According to Revenue and Customs, this is different from so-called phishing emails which pretend to be from the tax authority and aim to discover taxpayers’ banking details so their accounts could be raided.

Their spokesman also adds that liability for any losses will be judged on a case-by-case basis.

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Targeted!

Bogus emails are apparently targeting people who are aiming to meet next Friday’s tax credit renewal deadline according to credit reference agency Equifax.

These emails offer tax refunds in return for credit card or bank details. It is therefore making sure people know that organisations such as HM Revenue and Customs do not ask for details such as these either via email or telephone.

The government introduced the tax credit system in 2003, but it has been the cause of many problems such as overpayments ever since it began.

In recent weeks most people have received tax credit renewal packs in the post in order to sort out their own.

Always Double-Check!

Equifax external affairs director, Neil Munroe, said that fraudsters were showing “cynical timing” as they send out emails to people offering relief from tax bills.

He advised: “If you were worried about money and then got the email you might think all your prayers had been answered.

“They ask for credit card or bank details and if you gave those you could find yourself very quickly a victim of ID fraud. However, generally a person would be alerted to a tax refund at the end of the financial year.”

He also warns that people should always double-check with the tax authority if they are not sure what to do about any documents they receive.

Other prevention tips to avoid becoming victim to this fraud, or similar things include the installation of virus protection software on your computer, having a range of passwords, and destroying hard drives on old computers.

What Do You Think?

Could more be done by the government  and HM Revenue and Customs to prevent such fraud? What else can the general public do to protect themselves? We would love to know your thoughts and opinions on this. Leave your comments here.

Some of the UK banks have begun screening customer transactions in an attempt to stop what they call “boiler room” fraud.

It is estimated that up to 30,000 people are losing hundreds of millions of pounds each year to such share scams according to the Financial Services Authority (FSA).

This is when criminals call potential investors to sell shares which are effectively worthless. But banks such as Barclays and HSBC said they have suspended such transactions if they are being paid to known boiler room firms.

Saving Customers Millions!

Together, the banks use a warning list that has been published by the FSA containing the names of hundreds of companies. The FSA says these companies aren’t authorised to pose a high risk to customers.

According to Barclays, there have been around 150 transactions blocked since the introduction of the screening scheme in February, thus potentially saving customers millions.

It adds that around 90% of customers choose to cancel such transactions once warned that the company they are paying is on the warning list, but 10% still go through with the transaction.

HSBC has been using the screening procedure since 2006, and also claims to have saved customers millions.

Most Customers Follow Banks Advice

A spokesman from the bank explained: “If we receive requests for payment to any of these companies we will delay payments until we have checked with our customers to ensure that they are aware of the company’s activities.”

“Usually, when customers realise that the companies in question are on the non-authorised list, they want to stop the payment.”

The FSA and police from Operation Archway in London have been working together for years to track boiler room fraud.

According to officers, the fraudsters are usually persuasive, getting customers to shed out tens of thousands of pounds.

Detective Superintendent Bob Wishart said: “We’re having some notable successes. If we can help them identify potential fraud and a bank is 100% happy that it is a potential fraud, then it can take the appropriate action.”

More Measures Needed

Jonathan Phelan of the FSA agrees that banks are making an important contribution to the effort to stop such frauds, but screening can’t be completely successful alone.

“We are in discussion with banks. It is a very difficult area. There’s a certain amount of intrusion about it, so one has to be careful about promoting it too much.”

The FSA and police say they have had some success shutting down some operations and prosecuting the criminals involved. The FSA claim to have recently closed down 6 boiler room agents, recovering nearly 3 million pounds of investors money from 4 boiler room operations.

Operation Archway officers also say they are involved in a dozen major boiler room investigations.

What Do You Think?

Have you been the target of one of these operations? Do you have any advice for others? Are banks, the FSA and the police doing enough to track down these criminals? Have your say here.

75% Increase!

A watchdog is warning that more people are losing control of their bank accounts and credit cards due to fraud, and victims don’t usually even realise.

In the UK over the last year, ‘takeover fraud’ has increased by 75% according to Cifas, a fraud prevention service.

A few years ago, fraudsters who gained personal details would take loans or credit cards out in your name, but these days lenders are more reluctant to give out credit, so criminals are attempting to take over peoples bank accounts or current credit cards instead.

Criminals usually set up fake websites based on popular stories or events, and/or sending out emails. If someone visits one of these sites, their computer is often infected with a malicious software.

The main security analyst at McAffee says: “Cyber criminals out there are trying to infect us so they are going to al places that we go. They’ll try to hide their threats in genuine websites or set up fake websites to look like genuine websites.

“They’ll commonly tie in to current affairs or activities – whither it’s something like swine flu or the World Cup or the latest cricket… they’re trying to make sure that we trip over their attacks.”

Don’t Panic!

Once infected, the computer monitors the websites you visit on your computer and what you type in, such as password details and who you bank with. This information is then sent over the internet to the criminal who can take control of your bank account to draw cash.

There are lots of malware programmes available. These are programmes that detect and remove spyware, viruses and other malicious programmes.  The number available increased more than 400% in 2008 compared to 2007.

But steps can be taken by people to protect themselves: “there are threats everywhere. You wouldn’t dream of leaving your house with windows open or with the door open. It’s exactly the same with a computer,”  says Tony Neate of Get Safe Online.

“You need to make sure you lock your computer. Anti-virus anti-spyware, update the operating system – these are the things you need to do to secure your computer like you would secure your house.”

A good firewall is also very important. But experts say that we shouldn’t get too paranoid about the internet because it is a fantastic tool that can help us with our lives if we use it sensibly.

What Do You Think?

We would love to know your thoughts and opinions. Leave your comments here.

272 Page Document!

Ferrero, famous for its chocolates Ferrero Rocher, Nutella and Tic-tacs, has been cleared of fraudulent allegations regarding their supply of hazelnuts.

The case came about because two banks lent the equivalent of £24.5 million, to a Turkish firm, Baskan Gida, which was the world’s biggest hazelnut supplier at the time.

The firm used the money to buy hazelnuts, but then transferred the nuts to a second company so that the banks could not get their money back. The banks then claimed that they believed Ferrero to be involved in the offence.

However, a judge disagrees with the allegations against Ferrero, clearing the company. He also handed down a 272 page long document that describes the trial as “very long and no doubt enormously expensive.”

Long And Expensive Battle

The judges’ rulings say that another defendant, Shabbir Abidali was involved instead. Therefore there will be another hearing at the end of the month in order to decide the price Mr Abidali will pay.

The judge has already said he will not be liable to pay the full £24.5 million, but the hearing will decide who will have to pay the costs of the case.

The case itself has been running for a total of seven years, appearing in court a total of 84 days since October last year. Therefore the costs are expected to be higher than the initial amount of money the banks initially lost out on.

A parallel trial being undergone in Italy recently included an estimate of 11 million euros for the cost of Ferrero’s legal representation alone.

‘Dishonest’

Mr Abidali and the banks involved in the case will have to decide whether they want to appeal against the judgement, after the judge decided that three Ferrero witnesses deliberately lied in court.

The judge decided that the three witnesses lied about Ferrero’s relationship with Baskan Gida in order to protect their company’s reputation, but he also decided that this did not mean that they had anything to do with trying to defraud the banks.

The company is defending its employees: “Ferrero remains of the view that all of its personnel acted properly and with integrity throughout,” said the company’s solicitor Andrew Howell.

The judge also added that Mr Abidali was dishonest after creating backdated documents that were designed to give false and misleading information.

What Do You Think?

Who should be made to pay the price for the legal action incurred and the original crime? Was the right judgment reached? Should Ferrero’s employees that lied in court face charges or should the whole thing just be put to bed? We would love to know your thoughts and opinions. Leave your comments here.

Some holidaymakers believe that some of the foreign currency they are issued through the bureaux de change has been forged.

The BBC have been contacted by several holiday makers who claim that they only found out about the forgery when they came to use the notes abroad in shops and hotels. This has caused people to call for greater consumer protection.

But it would seem impossible as the UK foreign currency providers are saying that they are not the source of such notes and that their security systems are secure.

One example of a holidaymaker short-changed is Mr Macdonald from London who was about to holiday in South America and so ordered $1,100 (£690) from the Post Office online currency service last month.

He had several notes rejected upon trying to spend them, and so investigated further, discovering that he had 32 $20 bills that were fake. This amounts to £400.

He is positive that the only place he could have received these notes was from the Post Office and that there was no chance that people could have switched genuine notes for forged ones after they came to be within his possession.

No Proof

After returning home from his holiday, he sent the forged notes off to the Post Office, who confirmed that they were in fact fake, but refused to refund them.

Mr Macdonals says: “They’ve got all the dollars, they accept they’re counterfeit. That suggests to me, there are a lot of serious flaws in their systems. They haven’t suggested any way this could have occurred.”

The Post Office also insists it has checked their security, but found no breaches. It says: “The Post Office only supplies mint condition notes for these orders, supplied directly from the US Federal Reserve Bank through our currency partner, First Rate. We are very confident that the currency we issued was genuine.”

Another victim to the forgery was Ms Chandler from Kent who was again sold fake US dollars for her holiday in Las Vagas.

The US Secret Service detained her after discovering that she had $800 worth of counterfeit money in her possession.

“The said ‘stand up please, put your hands behind your back, they are counterfeit notes’ and they marched me off,” she described.

No Compensation

She was later released after she revealed that she was a regular visitor to the country and that she had a receipt from her foreign exchange provider, Thompson, in her possession.

Thompson is also refusing to take responsibility for the notes, insisting that the notes they issued were all previously used notes, therefore if the notes were new as Ms Chandler claims, they were not the provider, therefore refusing compensation.

“Our US currency undergoes rigorous checks for forgery before being sold on to customers. Our staff are trained to spot counterfeit notes and systems are in place to ensure any forgeries are intercepted,” it says.

Legally, victims who aren’t offered compensation can’t do much.

What Do You Think?

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It seems that the recession has driven people to desperate measures in order to get some extra cash in.

Figures have been gradually on the rise for the last four years, but around 107,000 false claims were filed in the last year claiming a total of £730 million according to the Association of British Insurers (ABI). This is up 30% on the year before.

The ABI claims that fraud is “more of a temptation” during a recession. This is shown to be likely as one motorist went so far as to push his car over a cliff in order to claim insurance on it.

The detection of fraud has risen, but the ABI still believes that the actual number of fraudulent claims in the home and motor insurance areas has also increased.

Fraudulent house insurance claims for either false or exaggerated claims is thought to have risen to around 55,000 people in the last year.

However, fake claims on motor insurance are thought to be at their highest value of £360 million worth. This includes a man that claimed his car had been stolen from a car park but later admitted pushing it off a cliff in order to use the insurance money to clear his debts.

Recession Making People Desperate?

One person holidaying in West Africa, went so far as to claim “recovery expenses”. This was however declined when it was found that some of these expenses included services at a local brothel.

Nick Starling, the director of insurance at the ABI said: “Fraud thrives in a recession, so insurers are intensifying their crackdown on insurance cheats.

“Fraud adds an extra £40 a year to the average premium, which is why the harder we make it for cheats, the more competitive premiums will be for honest customers.”

According to the ABI’s figures, in 2004, the amount of fraudulent claims would have cost £260 million in total, in 2005 this rose to £410 million, rising again to £470 million in 2006. In 2007 the figure stood around £560 million.

Norwich Union fraud investigator Sue Cowes says however that the majority of insurance claims are genuine. She is still on the lookout for suspicious remarks, how many claims the customers have previously and how long ago the policy was taken out.

She did admit that people were telling half-truths however, saying that: “unfortunately people are exaggerating some types of claims.”

What Do You Think?

We would love to know your thoughts on this subject. Leave your comments here.

Officers at the Serious Organised Crime Agency (Soca) have shut down a scam letter scheme that could have gained organisers around £35 million each year.

The police raided a Summerset address that was used in the scam which had already made nearly five hundred thousand pounds.

Cheques recovered are currently being distributed back to around 22,000 senders along with letters informing them they have been scammed and warning them to be more careful in the future.

The letters responded to an international lottery scams and fake offers, and were intercepted by the police during a Summerset raid in June before reaching their final destination overseas.

They usually contained £20 each in cash, which leads Soca to believe that this scam could have made the fraudsters over £35  million each year in profits.

‘Be on Your Guard’

Soca’s director of enforcement Trevor Pearce has said: “mass market frauds are often sophisticated and convincing – criminals know just which buttons to press to make people part with money, especially in an economic downturn when we are more susceptible to believing good news.

“In this case, we’ve been able to return people’s money, and although the perpetrators are abroad and outside out jurisdiction, a substantial blow has been dealt to their operation by cutting off this particular channel.

“The most powerful way to defeat the fraudsters though is to ignore them. Quite simply, be on your guard. Don’t be a willing victim for their crime – if something seems too good to be true, it probably is.”

He also added that people who fall for one scam may find their names on a list that gets sold on to other fraudsters and can end up losing their life’s savings in the long run.

Jacqui Smith, the Home Secretary, has congratulated Soca on their success, adding that it has sent a “strong message” to the criminal network that people are working to stop them victimising innocent people.

She also said: “we will continue to invest in agencies like Soca to enable them to tackle these criminals effectively. The public can be very confident that we are doing everything in our power to make it as difficult as possible for those groups to continue to operate.”

What Do You Think?

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635 Incidents Reported Last Year Alone

On average, two cash machines each day are being targeted by criminals, according to cash machine operator Link.

635 incidents were reported to the police last year, a rise of 17% compared to 2007. Figures that have been released have also shown that fraud in cash machines cost £37 million in 2007 alone.

In response to this, rewards of £25,000 are being offered to anyone that has any tip-offs about cash machine crimes.

Most of these crimes involve a skimming machine being fitted to cash machines in order to copy customer’s card details, and miniature cameras being fitted to record people typing in their PIN numbers. These details can then be used to create fake debit cards and used in other machines.

‘Cracking Down Hard’

“We are urging the public to pass on information that they may have about cash machine crime, for example card skimming or physical attacks on cash machines themselves,” said Graham Mott from Link.

“Even something that may sound insignificant could be part of a bigger picture and prove invaluable in convicting someone involved in cash machine crime.”

John Folan, Detectie Chief Inspector of the Dedicated Cheque and Plastic Crime Unit (DCPCU) has also said: “Tackling cash machine fraud is a continuing priority for the DCPCU, and a joined-up initiative of this nature has our full support.

“Any relevant information should be passed through Crimestoppers will be used to help track down and arrest those responsible – which will not only disrupt criminal activity but also send out a clear message that we are cracking down hard on those carrying out crimes of this nature.”

What Do You Think?

What do you think should be done to help tackle this crime? Have you ever been targeted by cash machine fraud? What do you advise other people to do if they find themselves in the same position? Let us know. Leave your comments here.

In an effort to target illegal downloader’s, six of the UK’s biggest internet service providers (ISPs) have agreed a plan with the music industry. The deal was negotiated by the government, and will see hundreds of thousands of letters sent to users who as under suspicion of net piracy.

The music industry have said they want people’s internet cut-off if they ignore repeated warnings, something ISPs say they are not prepared to do. The six providers are; BT, Virgin, Orange, Tiscali, BSkyB and Carphone Warehouse.

Feargal Sharkey, chief executive of British Music Rights, said the plan was “a first step, and a very big step, in what we all acknowledge is going to be quite a long process”.

The plan commits the firms to working towards a “significant reduction” in the illegal downloading of music. The deal also commits firms to develop legal music services.

The BPI, which represents the music industry in the UK, has focused on educational efforts and limited legal action in recent years. This is in stark contrast to the US which has embarked on tens of thousands of lawsuits against alleged file sharers.

The six ISPs have reportedly signed a Memorandum of Understanding, which was drawn up by the Department of Business, Enterprise & Regulatory Reform (BERR). The firms have all agreed to ensure their customers know it is illegal to share copyrighted music, and all firms have to agree to go further in their attempts to tackle illegal file-sharing.

Over the last few weeks Virgin and BT have sent letters to some customers identified by the BPI, as persistent music pirates. The BPI had called for a “three-strike” system which would see net connections of persistent pirate’s cut-off if these warnings went ignored. However, net firms said to BPI that it is not their job to act as policemen.