Barclays’ 2024 scam investigation reveals a concerning surge in investment fraud, with social media platforms emerging as the primary breeding ground for financial deception.
At a Glance
- Investment scams increased by 29% in 2023, accounting for 33% of all money lost to scammers
- 75% of scams originated on social media and tech platforms
- Purchase scams made up 74% of claims but only 24% of total value
- 93% of scam victims fell prey online
- Barclays urges cross-industry collaboration and consumer vigilance to combat fraud
Investment Scams Lead in Financial Losses
The latest investigation by Barclays into scams in 2024 has unveiled a troubling trend in the world of financial fraud. Investment scams have emerged as the most financially damaging, with an average claim of $19,490.02. This type of fraud now accounts for a staggering 33% of all money lost to scammers by Barclays’ current account customers.
The rise in investment scams is particularly alarming, with a 29% increase reported in 2023. Men appear to be more susceptible to these schemes, with their average claim exceeding $20,036. The Financial Conduct Authority (FCA) has seen a 193% increase in calls related to investment scams over the past five years, highlighting the growing prevalence of this issue.
Scammers use social media to lure people into investment scams. Last year, the average victim lost over £14,000.
Never invest on impulse. Always use the FCA’s ScamSmart tool to help you decide if something could be a scam.
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— Barclays UK (@BarclaysUK) April 26, 2024
Purchase Scams Dominate in Volume
While investment scams lead in financial damage, purchase scams dominate in terms of quantity. These scams account for 74% of all claims but only 24% of the total value, with an average claim of $814. The prevalence of purchase scams underscores the need for heightened consumer awareness, especially during peak shopping seasons.
The investigation reveals that January saw the highest value of reported scams, driven primarily by investment fraud. This timing suggests that scammers may be targeting individuals when they are most financially vulnerable or looking to make New Year’s resolutions regarding their finances.
Social Media: A Breeding Ground for Scams
The role of social media in facilitating scams cannot be overstated. Barclays’ investigation found that 75% of scams originated on social media and tech platforms. This revelation has intensified calls for greater corporate responsibility in protecting consumers from fraudulent activities online.
“The variety of scam tactics and channels continued to evolve considerably this year, but it’s clear that there are a number of enduring scam trends; the majority of scams started on social media once again. Purchase scams continue to be the most reported scam type, and consumers demonstrated they are overwhelmed by the scam risks posed to them and their loved ones,” said Kirsty Adams of Barclay’s.
The public sentiment reflects this concern, with 77% of consumers believing that tech companies should do more to prevent scams, and 64% thinking they should reimburse victims. Interestingly, 49% of respondents are comfortable with banks and tech companies sharing personal data to prevent scams, indicating a willingness to prioritize security over privacy.
Combating the Scam Epidemic
Barclays emphasizes the need for cross-industry collaboration to effectively combat the scam epidemic. The bank is calling for social media platforms to improve verification of financial advertisements as part of the Online Fraud Charter. Additionally, Barclays provides tips for staying scam-safe, including not disclosing personal details, verifying company information, taking time with decisions, being skeptical of promises, and remaining cautious of suspicious texts.
As digital platforms continue to be exploited by scammers, Barclays urges consumers to remain vigilant and informed. The battle against financial fraud requires not only institutional efforts but also individual awareness and caution in an increasingly digital financial landscape.
