The Financial Conduct Authority has launched a new tool to help fight financial crime, as nearly a million people report losing money to scams.
The ‘Firm Checker’ tool will enable consumers to check if a firm is authorised and has the correct permissions to provide services.
It follows data from the FCA which revealed that 800,000 people reported losing money to investments or pensions-related scams in the 12 months to May 2024.
Those who had experienced any Authorised Push Payment fraud, unauthorised consumer investments or pensions-related fraud, were most likely to have heard about it by seeing it promoted on social media (17%) or via a telephone call (17%).
A further 16% were initially approached via text message, WhatsApp or another messaging service.
The FCA said that as well as checking if a financial firm is authorised by the FCA, people should also confirm that the contact details match those listed on Firm Checker.
Sheree Howard, executive director of authorisations at the FCA, said: “Ruthless fraudsters are constantly evolving their tactics so they can steal money from innocent victims. Whether you’re considering an investment, pension opportunity, loan or other financial service, use Firm Checker to confirm the firm is authorised and help fight financial crime.”
Nick Sacre-Hardy, interim chief risk officer at Quilter, said: “Fraud is a hugely prevalent issue that can devastate people’s financial resilience. Impersonation fraud, where scammers use the credentials of legitimate businesses or trusted people to access a victim’s personal information or finances, can be very convincing and therefore one of the more challenging scams to decipher.
“The Firm Checker should help alleviate the issue by providing victims with a reliable source to determine whether they are speaking to a genuine business or person. The new tool should become the first port of call for anyone concerned about an investment or pension opportunity, and the ability to compare contact details should help prevent many scammers getting away with unsolicited contact and impersonation.”
Sacre-Hardy said there is also an onus on the financial services industry to ensure customers are better protected. He said firms must be committed to investing in better fraud detection and consumer education to help prevent scams from happening and ensure that victims receive fast, fair treatment if things go wrong.
“A strong, trusted financial system depends on more than just security, but on responsiveness and support when customers are at their most vulnerable,” he added.
