With loan fee fraud – where a consumer pays a fee for a loan they never receive – rising, the FCA’s latest research highlights a heightened risk to vulnerable consumers at Christmas.
With nearly two-thirds of consumers unaware of what loan fee fraud is (64%), and just one in five (22%) able to identify all its warning signs, the FCA is launching its latest campaign to arm consumers with the knowledge and tools they need to avoid loan fee fraud this year.
The FCA said that those who are contacted about a loan or asked for an upfront payment to be vigilant and check the information of the Loan Fee Fraud website, including the FCA Register, before accepting.
Typically, the FCA receives an increase in reports of loan fee fraud over the festive period. It has already risen in frequency in the last year, with the number of cases reported rising by 21% compared to the previous year.
However, this Christmas, the cost-of-living crisis, compounded by the war in Ukraine and the Covid pandemic, is putting consumers are under even more financial pressure than usual.
This is likely to leave people more vulnerable to fraudsters’ tactics. Two in five people feel pressured to maintain their usual Christmas spending this year; a third of these are worried about how they will afford it amidst the cost-of-living crisis.
More than one in eight say they plan to take out a loan this year to support their Christmas spending, making them susceptible to…
