Scamming: Vulnerable Individuals

Michael Tomlinson Excerpts

Thursday 8th September 2016 Commons Chamber

[Julian Knight]

My right hon. Friend is absolutely correct. There is an ever-rising tide and the methods are becoming more sophisticated. While we are talking about logos, these people use governmental logos—that of Her Majesty’s Revenue and Customs among others—so that they can pretend to be quasi-governmental. They also use logos that are very similar to governmental logos and those of other institutions. He is quite right to raise that point.

As I say, it is easy for us to rush to snap judgments, and some people do that about what they perceive as their own foolishness. However, the gentleman I was discussing was no fool. He had run his own business for more than 30 years. The scammers were not only persuasive but, as they often do, preyed on his very best instincts, especially the thought of how he could help his children with the winnings.

I thank the hon. Member for North Ayrshire and Arran (Patricia Gibson) for co-signing the motion. I also thank all right hon. and hon. Members who have talked to me prior to the debate to recount their stories of constituents who have been affected. I was struck by one from my hon. Friend the Member for Banbury (Victoria Prentis), who wrote to tell me that an elderly lady in her constituency was robbed of almost £35,000 by people posing as, of all things, an anti-fraud unit from her local bank. Unfortunately those fraudsters were not caught, and as the banks are not liable, her savings have not been returned. That has had a devastating impact—not just financial but emotional—on the lady concerned.

Those incidents are just two among the thousands that occur each and every year. They highlight why we need to do more to combat this detestable style of crime. I thank the many external organisations that got in touch with me, especially those that provided so much useful data and information, such as the Chartered Trading Standards Institute, Age UK, Financial Fraud Action UK, Standard Life and the Fairway financial consultancy.

The cost of fraud to the economy is truly astonishing. According to the Chartered Trading Standards Institute, it amounts to £52 billion a year. Numbers can get thrown around, but to put that into context, £52 billion is more than we spend on defence or education. If we were to cut that figure by just 10%, we would reinject £5 billion into people’s savings and the wider economy itself. That would equate to much of the economic boost that has come about in recent years due to payment protection insurance payouts.

[Michael Tomlinson (Mid Dorset and North Poole) (Con)]

I am grateful to my hon. Friend for leading the debate. A quarter of the population of my constituency is over the age of 65, and the average age of those being scammed is 74, so my constituents are particularly concerned. He talked about financial cost, which is of course important, but those being scammed are some of the most vulnerable in society. This is an issue of not just the financial cost, but the human cost.

[Julian Knight]

I could not agree more. The demographics in our constituencies are very similar, certainly in terms of age—in Silhill ward in my constituency, 40% of people are over 65. As my hon. Friend says, the average age of scamming victims is 74. Fraudsters have many different ways of making their approach, but in the main they instinctively target elderly people—although not to the exclusion of everyone else—because, frankly, the older generation is quite polite. They do not want to put the phone down straightaway and they might respond to a letter. However, as I will explain, as soon as someone does that, they enter a whole new world in terms of the information gathered by these fraudsters.

The national average cost of fraud per victim is purportedly just over £1,000, but the amounts can be a lot higher. I was staggered to find that in my constituency the average cost is £9,000 for each event of fraud, which probably reflects our relatively affluent population and also the fact that we have an older population, as my hon. Friend and I discussed a moment ago. Older people are disproportionately the target of scammers, but we must not forget that the youngest reported victim that I have been alerted to was only 19. Can we imagine starting out in life, effectively, as an adult, and finding that one of our first experiences is to be hoodwinked by one of those despicable fraudsters? That demonstrates that no one who is old enough to handle their own finances can afford to be complacent about the risk of fraud.

Being stung is often only the start of the process. A victim’s details can be sold on more than 200 times, putting them in the sights of a much larger pool of international criminals. The National Trading Standards scams team has found an astonishing 106,000 potential victims of fraud on captured criminal target lists. The fraudsters call those sucker lists, which shows what they think of people. Investigations suggest that the names of 560,000 victims from the UK are already in circulation.

We must not fall into the trap of considering only financial costs as the social and human damage caused by fraud can be just as severe. Indeed, according to trueCall, the phone screening service, the impact of scamming is comparable to that of violent crime. For starters, 29% of victims suffer a major depressive episode in the 20 months after a crime, compared with just 2% of non-victims.