FCA Launches Firm Checker Tool to Combat Financial Scams

The UK’s financial regulator, the Financial Conduct Authority (FCA), announced earlier today, December 10, the launch of a new tool called Firm Checker. The tool’s purpose is to help fight financial crime and reduce or completely eliminate financial scams.

According to the watchdog’s announcement, around 800,000 people reported losing money to investments or pension-related scams in the 12 months leading up to May 2024. Many of those who had experienced Authorised Push Payment (APP) fraud, or unauthorised consumer investments, or pension-related fraud, most likely saw it promoted on social media, according to the FCA’s research.

The agency said that around 1 in 6, or roughly 17% have seen it on social media, while another 17% were exposed to it via phone calls. The FCA said that 16% were initially approached via text messages, WhatsApp, or some similar messaging service.

The report further highlighted that scammers can make it difficult for consumers to know if they are dealing with the real firm or someone just pretending to represent a firm. One way to combat this would be for users to check if the financial services firm that is contacting them is authorized by the FCA for the services being offered.

In addition to that, people should also try to confirm if the company’s contact details match those listed on the FCA Firm Checker.

FCA’s Firm Checker Can Help Reduce Financial Scams

To help fight this issue, the FCA has rolled out Firm Checker – a new tool aimed at consumers that can help them avoid scams. By using the tool and checking if a company is authorized and has the correct permissions to provide services, users can reduce their chances of falling victim to this type of fraud.

Commenting on the matter, FCA’s executive director of authorizations, Sheree Howard, said that fraudsters are ruthless and are constantly evolving their tactics in order to trick innocent victims out of their money.

Howard noted that, whether consumers are considering an investment, pension opportunity, loan, or other financial service, they are highly recommended to use Firm Checker to ensure that the company they are working with is authorized. This will not only keep them safe but also help fight financial crime in general by making this type of scam obsolete.

FCA’s research also found that consumers are taking certain precautions to protect themselves against fraud on their own. However, there is room for improvement, as around 3 in 4 adults say that they always, or at least usually, reject and ignore any unsolicited calls, emails, or texts about investments or pension opportunities.

However, only six in 10 consumers said that they try to verify the authenticity of emails, messages, and calls before they provide personal or financial data.