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Law360, London (April 29, 2020, 12:46 PM BST) -- Investment managers warned investors Wednesday that they have seen a jump in financial crime in Britain in recent weeks as fraudsters take advantage of the COVID-19 crisis to target vulnerable consumers.
The Investment Association, a group representing fund managers, said that retirement savers and investors should be aware that the outbreak has encouraged criminals to create specific scams tailored to COVID-19 and to update existing frauds with a coronavirus twist.
Financial criminals "never miss a trick," Chris Cummings, chief executive of the Investment Association, said.
"So, during this time of heightened criminal activity, we are urging savers and investors to think very carefully about the risks criminals pose to their financial well-being and life-long savings," Cummings said.
Early evidence has shown that fraudsters are already taking advantage of the pandemic panic to pressure investors into making rushed decisions to move their pension pots or investments, the association said.
Criminals are using increasingly aggressive tactics to put pressure on consumers, the IA warned. In one case, fraudsters posed as the police and convinced an investor to withdraw money invested in a savings bond. Conmen are also putting new spins on old tactics to target vulnerable savers amid COVID-19.
Investment managers have seen a rise in so-called phishing scams — fraudulent emails designed to trick users into handing over their personal data — with messages linked to COVID-19 to lure consumers. One company spotted 513 files containing malware with coronavirus in their titles by the end of March.
There has also been a rise in smishing scams — fraudulent messages sent to consumers via text message. These scammers often pose as government departments, banks or investment managers and attempt to collect personal information.
They also operate under the guise of offering payments to consumers who have lost out because of COVID-19, or they pretend to be collecting fines linked to the crisis, the association found.
The body urged consumers to be wary of any offers or communication that could be fraudulent.
"If it looks too good to be true, it probably is," Cummings said. "That's why today we are reminding savers and investors to take all necessary, vigilant steps to protect their hard-earned savings from ruthless financial criminals."
Britain's Financial Conduct Authority warned consumers this month of the potential for COVID-19 to become a breeding ground for financial crime, and urged savers to be careful when making investment decisions during this time.
European regulators have followed suit, with the European Insurance and Occupational Pensions Authority also warning savers to look out for COVID-19 related financial scams.
--Editing by Ed Harris.
For a reprint of this article, please contact reprints@law360.com.
