Victims often report a loss of confidence and losing trust in people, long after the scammer has struck. And scams are getting more and more sophisticated, especially online. In this guide we take a look at how you can recognise a scam, protect yourself and what to do if you’re a victim or have been targeted.

What is a scam?

Scams can come in many forms, but all are designed to get hold of your money. It’s a criminal offence of course, but criminals know there are rich pickings to be made, and as with most forms of crime, prevention is better than detection. Many scammers will not be apprehended so the best protection you have is your own self awareness and vigilance.

Scammers can strike by getting you to reveal your personal details, stealing your information, or even getting you to willingly hand over the cash.

Types of scam

Not all scams are "online". Scammers and fraudsters still operate "door to door" or by unsolicited phone calls. But there is no doubt the internet and advances in digital communications have opened up other ways for scammers to target victims.

Chances are you've come across the most common type of scams, like the spam email from a Nigerian prince or reporting to be from HMRC or your bank. However, while email scams like this can be pretty easy to spot and avoid, others are much more sophisticated. Scams 

Spotting as scam

Knowing what to be on the lookout for when it comes to scams is one of the best ways to protect yourself.

If you have received any contact, particularly a phone call out of the blue, it is best to avoid it. Since January 2019, there has been a ban on cold calling about pensions. This means any company offering pensions services should not contact you unless you've asked them.

If you get an email, expand the pane at the top of the message and see exactly who it has come from. If it is a scam, the email address the message has come from will be filled in with random numbers or be misspelt.

The FCA's ScamSmart website has a tool to help you check if an investment or pension opportunity is a scam.

There's also lots more information about avoiding the latest scams. Visit the ScamSmart website.

The top tips are:

Scammers will often:

• try to gain trust by claiming to be from a well-known business or impersonating a known contact

• will suggest their verification procedures, like going to websites they have created or calling numbers they provide to you

• know how to appeal to your emotions and press your buttons to get what they want

• create a sense of urgency to get you to make decisions without thinking.

So remember:

• The adage "If it sounds too good to be true, it usually is" absolutely applies. You usually find this something with pension or investment scams, where the fraudster guarantees you huge returns but tells you it is low risk.

• If you are pushed into deciding on the spot, be suspicious. Scammers don't want you to have time to think about it.

• Random competitions, particularly if you don't remember entering them, should ring alarm bells.

• Personal details, PIN codes and passwords. These are things no legitimate company will ask you for.

The next step to avoiding scams is to know how to protect yourself. While some of these are good advice in general, many are aimed at keeping you safe online:

• Avoid any unexpected contact. Any phone calls, letters, emails or people knocking on your door should be ignored.

• Never give out personal information. This can be used to steal your identity and access accounts.

• Keep operating system and virus protection software up-to-date. The same applies to mobile devices as well.

• Make sure all accounts have a strong password. You shouldn't use the same password for multiple accounts and change them regularly.

• Don't make any advanced payments until you are sure the company you're dealing with is legitimate.

• If you're unsure about a financial services company, check the FCA register of regulated companies. If they're not on it, don't have anything to do with them.

• If you're unsure about any other kind of company, you can look them up on Companies House to find out their background or search for reviews online.

• Use safe and secure WiFi connections and avoid public WiFi. Your standard 3G or 4G connection is often more secure than the one in a public setting.

• Make sure any websites you are using are secure. Check to see if the web address starts with HTTPS, not just HTTP.

• Sign-up for a call blocking service like the Telephone Preference Service. This might not stop all scam calls as they operate outside the legal guidelines, but it will stop cold-callers. Any suspicious or unexpected calls you receive are almost certainly from people you don't want to deal with.

What should you do if you've been the victim of a scam?

If you think you've fallen victim to a scam, there are three things you need to do:

• Stop sending money straight away. If the payment has been set up as a Direct Debit, contact your bank to stop this immediately.

• Report the scam to Action Fraud on 0300 123 2040, use the Action Fraud online reporting tool, or the FCA Scam Smart website.

• Beware of follow-up scams. Sometimes after reporting a scam, you might get targeted again by a fraudster who says they can get your money back.

• Check your credit file. You're best to check it monthly for credit applications made by a fraudster. See if there are credit applications you don't recognise or have a Cifas marker on your file. If your bank believes you've been a victim of fraud, it could put a Cifas' victim of impersonation' note on your account. It warns lenders that you've been a victim, or are vulnerable to becoming, a victim of fraud. If you have a Cifas marker on your file, request more information about why from Cifas.

• If you think a scammer has targeted you, you should also report it so it can be investigated. You can do this through the Financial Conduct Authority website using their reporting form.