There was a bit of good news this week in the seemingly never-ending war on scammers and financial crime.
The FCA announced its first prosecution of scammers running not one, but two cloned financial firms.
This milestone marks the first time the FCA has tracked down scammers running cloned or ‘copied’ businesses.
Together with the FCA’s new Business Plan out this week which committed to step up the battle against financial scams, there is at least some hope that more will be done to tackle the pernicious and confidence-eroding impact of financial crime.
Clones are nothing new but pinning down the crooks who run fake websites has proved to be a tough task for the FCA.
Some see it as a minor part of financial crime but several Financial Planning and wealth management firms would disagree. Along with several fund managers and financial providers they have all have woken up one day to find that some crook or other has copied their website and is busy trying to cheat consumers by luring them in.
Many of these cloners hide behind a network of internet domains, often overseas. It all makes them very difficult to track down.
Despite this, behind the scenes the FCA is having some success in blocking these websites and has made progress in convincing search engines such as Google and social media providers such as Facebook to intervene when rogues are spotted.
It is having an effect and it needs to. We are all living with the impact and cost of financial crime. The cost is borne through taxes, FSCS levies and the like.
That’s not to mention the erosion of trust and confidence in the financial services sector every time a new financial crime is reported.
Just the simple act of logging on to a banking or financial provider website is taking longer and longer these days as we wade through layers of security. While these delays are irritating they are necessary if we are to halt the crooks in their tracks.
There is a good case to say that the Government and the regulators have been caught out by the huge rise in financial crime in the last 10 years but they are slowly catching up.
Ultimately, if trust is to be restored in financial advice and financial services it must be through trusted advisers and providers who are safe havens for client money. Clients need to know they can save and invest their money without the fear or losing all or part of it to crooks.
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Kevin O’Donnell is editor of Financial Planning Today and has worked as a journalist and editor for over three decades.
