Increase in ‘hybrid’ scams
Fraudsters are often based overseas compounding the difficulty of redress via criminal means or otherwise
Commenting on the figures released today by the Financial Ombudsman Service regarding fraud and scam complaints in 2022/2023, William Christopher, Civil Fraud Partner at law firm Kingsley Napley, said:
“The Financial Ombudsman Service saw a higher proportion of complex scam complaints last year compared with previously, which they are dubbing ‘hybrid’ scams involving features of more than one scam. Furthermore, the majority involved an element of cryptocurrency.
“This accords with our experience from the enquiries we receive as a firm. Often the scams are simply classic investment scams, with a crypto badge, whereby victims are attracted by the promise of large returns. These are often on online platforms which purport to have generated huge (but fictional) profits for the investor, and when the victim asks to withdraw the profits made, they are then faced with an advance fee fraud, namely the need to pay some kind of fee, for example for tax, before the funds can be released. In reality, no profits have been generated at all, and the original investment has simply been stolen, as will the advance fee if paid.
“Sadly anyone can find themselves a target from teenagers to the most sophisticated financial professionals. The fraudsters are often based overseas compounding the difficulty of redress via criminal means or otherwise. However, there are sometimes steps that can be taken via a civil law route such as obtaining freezing injunctions and search orders so it is certainly worth considering such, especially where losses are sizeable. Fraudsters thrive on the idea they are beyond the law but that need not always be the case.”
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