Here at WiseGuys, we’re no stranger to the various scams that take place both online and offline. Though online scams like phishing emails and malicious software (malware) are constantly on the rise and ever-evolving, the good old telephone is still a preferred route for many would-be criminals.

We often post about telephone scams, including those that affect our very own residents of Dorset. But the truth is that it’s a national problem that sees numerous victims conned out of thousands of pounds with a simple call or two.

And now the media are reporting on a new scam that’s specifically targeting some of the most financially vulnerable members of society, those on government benefits.

The Universal Credit loan scam

UK residents who are in receipt of benefits and already struggling financially are being targeted by fraudsters who make promises about low-interest government loans. They coax the victims into handing over personal information, but use said information to then make an application under the victim’s name for Universal Credit.

According to the Citizen’s Advice website, people who apply for Universal Credit can apply for advance payments to help cover the cost of living and essential bills. And it is precisely this system that fraudsters are praying upon to rip off unsuspecting families.

“You can ask for an advance payment of Universal Credit to help you get by while you’re waiting for your first payment. You can also ask for an advance payment if your circumstances have changed and you expect your Universal Credit payments to increase.”

Citizen’s Advice website

Once the victim has handed their details over, the scammer can put an application through for Universal Credit. However, not all of the money will go to the victim; instead, the scammer will have arranged to siphon off part of the money from the advance payment, deposited to an account that they have access to. Cruelly, it doesn’t end there.

Because of the way that the Universal Credit system works, once the ‘claimant’ has applied, their existing benefits are brought to a halt. This leaves them not only with a lack of benefits that they were already receiving, but also a large Universal Credit debt that they’re expected to pay back under the new system.

The newspaper ‘Birmingham Live’ has reported on how Trading Standards officers have been warned of the scam, which is supposedly affecting areas throughout the UK.

One pregnant mother of 3 children was affected in Derbyshire, when scammers applied for an advance payment of £1,500 under the Universal Credit system. She only received £1,100, after £400 was siphoned off by the scammers. What’s more, after her usual benefit payments didn’t arrive, she found that the Universal Credit application had halted her payments for housing benefit, income support, and child-related benefits.

Avoiding telephone scams

Our advice on telephone scams doesn’t change often. There are certain things that you can do to avoid falling victim to unsolicited calls from people looking to steal your personal information:

  • If you receive a call from somebody claiming to be from your bank, don’t hand over personal information;
  • If somebody does claim to be your bank and insists it’s urgent, hang up and dial the number on the back of your card;
  • When dialling from a landline, be sure you hear a dial tone, as scammers can remain on the line even after you hang up on your end;
  • Consider blocking nuisance numbers after receiving a spam call – this can be done on both iPhone and Android smartphones.

If you’d like any more advice on keeping yourself and your personal information safe, then get in touch with WiseGuys on 0808 123 2820.