UK Financial Ombudsman Reports Increase in 'Hybrid' Scams

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The UK's Financial Ombudsman Service (FOS) has communicated an increasing number of financial scams, especially those <a href="https://www.financemagnates.com/cryptocurrency/education-centre/the-importance-of-staying-vigilant-against-crypto-scams/" target="_blank">related
to cryptocurrencies</a>. The FOS stated that there was an increase in complaints involving 'hybrid' stings or at least more than one type of scam.</p><p>The latest data shows
that in the 2022-2023 financial year, the FOS received 21,918 fraud and scam
complaints. The figure represents an 18 percent increase from 18,450 cases reported
between 2021 and 2022. Furthermore, the FOS reported that almost half of the complaints were related
to online payments.</p><p>Rising ‘Hybrid’ Scams</p><p>The FOS, which settles complaints between financial
institutions and consumers, observed that 'hybrid' scams have become rampant. They involve a combination of romance, purchase and 'safe account' scams.
In light of this, the FOS noted that banks should consider the latest trends in
their fraud prevention measures.</p><p>More people seeking the
services of the FOS were receiving favourable responses, the FOS said. It added that the uphold rate, which shows
how often it agrees with consumers, was recorded at 35% for financial products and services, standing above its average. In addition, the uphold rate for fraud and
scams was 45% while online payment scams were above 50%.</p><p>Commenting on the FOS
report, William Christopher, the Civil Fraud Partner at the law firm, Kingsley
Napley, told <a href="https://www.financemagnates.com/cryptocurrency/education-centre/the-importance-of-staying-vigilant-against-crypto-scams/" target="_blank">Finance
Magnates</a> that most
investment scams were usually done by online platforms purporting to generate huge
returns for their investors. In reality, the scammers do not generate any profits but instead steal from their victims.</p><p>"However, there are
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," Christopher explained. "Fraudsters
thrive on the idea that they are beyond the law, but that need not always be
the case."</p><p>UK Strengthens
Regulations </p><p>Meanwhile, in a separate
report, the Financial Conduct Authority (FCA) said at the beginning
of the month that it was <a href="https://www.financemagnates.com/cryptocurrency/fca-seeks-incentives-ban-with-new-crypto-promotion-rules/" target="_blank">finalizing
regulations</a> regarding
cryptocurrency <a href="https://www.financemagnates.com/terms/m/marketing/">marketing</a> and advertising in the UK. The new rules are expected
to take effect from October 8. </p><p>According
to a document published by the regulator, the regulations will categorize
<a href="https://www.financemagnates.com/terms/c/cryptocurrencies/">cryptocurrencies</a> are 'restricted mass market investments'. Furthermore, they will compel cryptocurrency companies to conduct <a href="https://www.financemagnates.com/forex/the-fca-wants-greater-investor-protection-this-is-their-plan/" target="_blank">adequate due diligence</a> for cryptocurrency services to be advertised. This is to ensure that financial promotions are 'fair, clear and not misleading'. </p><p>Revolut slashes crypto fees; BitPay adds new payment options; <a href="https://www.financemagnates.com/forex/news-nuggets-28-june-revolut-slashes-crypto-fees-bitpay-adds-new-payment-options/">read
today’s news nuggets</a>.</p>

This article was written by Jared Kirui at www.financemagnates.com.