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Kirk Rice Blog

Coronavirus – Money, Scams And Action You Should ConsiderWritten on May 7, 2020 by Kirk Rice LLP

You will be concerned about whether to sell shares and other long term investments; whether banks will survive; and how you'll meet your bills and debt repayments. In this blog, we have suggested what you should consider and be aware of at this time.

Analyse

The first step is to consider whether your long-term plans are as badly affected as you might think. In a multi-asset investment portfolio losses would not have been as high as the headlines might suggest. Over the first quarter of 2020, the FTSE100 is down 22%; whereas multi-asset portfolios could be down much less and therefore you may be reassured rather than concerned. Valuations now might even be similar to those you had during last year so less worrying.

Check

Banks are said to be better financed today than when we experienced the crisis of 2008-09. You should consider spreading your money when you have more than £85,000 in cash because in the event of a failure the Financial Services Compensation Scheme will meet up tot £85,000 per person for any insolvent banking group. Where a bank has more than one trading names they can all be under one compensation limit so you should check all your accounts on the FSCS website.

Think

If you are about to make a key decision about retirement, buying a home, changing job you need to be practical and think about ways to defer the decision. In some cases, this may be out of your hands of course. If so investigate which of the government’s schemes to support individuals and businesses could help you. Seek guidance and advice from professionals. Our COVID-19 Information hub is a good place to start.

Pensions

Investments held in pensions are set up to cope with the ups and downs of markets over the long term, and it’s rarely good to make changes during periods when there is very high volatility such as now. Before making any significant decisions relating to your pension, take the time to get independent guidance or speak to a regulated financial adviser. You can obtain guidance from the Pension Advisory Service for free on 0800 011 3797 or going online to make a phone appointment with Pension Wise if you’re over 50.

Need an adviser?

However you find a new adviser check them out, a referral from a trusted acquaintance is usually a good start. UK-based investors can confirm the authenticity of any financial adviser at unbiased.co.uk.

Company pensions

Any company pension schemes will have guidance on their webpages and may send you information too. If you have been sent details of how to register for access to your pension scheme online now would be a good time to act on it so that you can be better informed.

Workplace pensions

If you are on reduced pay, the pension contributions will also be reduced as most people pay a percentage. If you have a fixed contribution or a salary reduction in exchange for a pension contribution you might wish to reduce your outgoings if you are on reduced pay. Your employer will be able to help you with the options you can take.

As many of the investments that you are buying each month are now cheaper than they were it is arguably time to be buying in the investment markets, so if you can maintain payments at this time this action will pay off in the long term.

Investments

As with pensions, long term investment plans are possibly not in need of changes, but you may have short term needs that you would be expecting to pay for by making a withdrawal. You’ll need to assess whether you can defer the plans until a later date and whether the money you need has been invested long enough that it is still worth more than when you started anyway.

More information is available on an impartial basis at the government’s Money Advice Service.

If you have concerns about debt repayments then I suggest you look at the Money Advice Service and the information available from Citizen’s Advice.

It is not possible for you to meet your financial adviser face to face at present, but we are able to hold online meetings using popular systems like Teams. We will ask you to register for our Personal Finance Portal wherever possible to conduct meetings and exchange documents. You can register for our Personal Finance Portal here.

Alternatively, we will send personal information password protected and to a file sharing service where you can retrieve the information. We also use an e-signing service for documents requiring a signature and instructions will come with any such documents.

To send personal information through normal unencrypted email is not secure could be helping criminals gather information which might be used in a future scam.

Beware of Scams

Already there are too many cases of fraud and sizeable sums of money disappearing into the hands of criminals to fund their other activities such as drugs, criminal acts and terrorism.

All of the scams rely on our willingness to trust and act on triggers rather than check, assess and decide. Most people who lose money to scams are enticed to part with their hard-earned pension money.

The FCA says common signs of a scam include:

  • Unexpected and unsolicited advice
  • High rates of return which sound too good to be true
  • So-called special offers
  • Pressure to make a quick decision

The FCA publishes details of known scam schemes here, but it’s not uncommon to find they are still operating after being published here. You can also report scams to the FCA’s site.

What are the warning signs? How do I protect myself?

Unexpected contact, or repeated calls

If you are cold-called, the safest thing to do is to hang up. If you get unexpectedly contacted by email, it’s always best to simply ignore it.

Requesting your PIN or password, or asking you to confirm a transaction on your account.

A genuine bank or organisation will never ask for these types of personal details. Never give them if prompted. Contact your bank on a different device using contact details from a trusted source if you are concerned.

Tempting returns that sound too good to be true.

If an investment sounds too good to be true, then it probably is. Trust your instinct, and do not proceed.

Offering reassurance about the risks involved

If you are told not to worry about the risks and that the investment is safe don’t simply accept that it’s true.  Genuine offers will include a balanced explanation of the risks.

Exclusive offers

If you are told the offer is only available to you, or you are asked not to tell anyone else about the opportunity, this is a sign it’s not genuine. Do not engage in any further communication.

Unnecessary time pressure

If for example you’re told it’s a time-limited offer, or you are offered a bonus or discount if you invest before a set date. Don’t be pressured into acting quickly – a genuine bank or financial services firm won’t mind giving you time to think.

Receiving an email offer or request that seems to be from a real firm

Some scammers make emails appear to be from well-known brands. If unsure, always use the contact details on the FCA Register, not the details the firm gives you. You should also check the firm’s details with directory enquiries or Companies House to make sure they’re the same.

Unrecognisable email address

If you get an email, expand the pane at the top of the message and see exactly who it has come from – if it’s a scam, the email address of the sender may be filled with random numbers or be misspelt.

Unconfirmed changes on your account

If you have any doubts at all about what you are being asked to do, check with your provider. Always use contact details you can trust, for example, the phone number on your bank statement or policy documentation.

You may also want to read the FCA’s pension scams leaflet, which is part of the FCA’s wider ScamSmart campaign.

And Interpol has given this update.

Protect yourself

Having your identity stolen is not only disconcerting but time-consuming too. By taking a few easy steps, you can prevent identity crime happening to you.

Actions I can take every day

  • Be wary of shoulder-surfers at cash machines who stand close enough to see you punch in your PIN.
  • Limit the number of personal documents you carry around on a daily basis, for example, your driving licence and passport.
  • Always think about who you are giving information to and why they would need it. Don’t provide personal information unless you know who you’re talking to. If necessary, ask them to provide a telephone number. You can check their identity and then ring them back.

Actions I can take regularly

  • If you have to post any personal documents, ask the post office for advice on secure postage.
  • Store any documents which contain any personal details in a safe place and shred everything else – credit card receipts, old bank statements, everyday bills, pre-approved credit card offers – basically any document that has personal financial information on it can give an identity thief a foothold into your life.
  • If you share a house or flat or have a communal area where mail is left, always chase overdue mail in case, it’s got into the wrong hands.
  • Be mindful of credit card receipts; some still contain the full credit card number. Put the charge slip copies in a safe spot until your credit card bill arrives and check your bank and credit card statements carefully for unfamiliar transactions.
  • Monitor your credit accounts carefully, so you’ll know if a bill’s missing or unauthorised purchases have been made. Shred old credit and debit cards and ensure the account is closed.

Actions I can take occasionally

  • Get a credit report at least once a year and clean up any errors. Look for personal information and credit accounts that aren’t yours. Credit bureaus can make mistakes.
  • If you’re moving, contact all your creditors and update them with your new address immediately. Make sure they acknowledge your change of address. Leave a forwarding address; you don’t want credit information and new credit cards being delivered to the wrong address.

The freedom of the internet allows hacking to occur. It’s important to take simple steps to keep you safe and secure.

Hackers can plant hidden programs on your PC, such as keyboard loggers which will automatically record your keystrokes, so when you use your online banking facility, they can capture account information and use it to commit crimes. Phishers are those who send out legitimate-looking emails to try to get the recipient to give them their financial and personal details.

Here are the most common ways that people keep themselves safe online:

Protect your personal details

  • Be wary when entering your personal details to subscribe to sites like YouTube or social networking sites like Facebook and Twitter. This sort of information can make it a lot easier for a criminal to steal your identity. If you do use such sites, make sure your privacy is protected when editing your social networking page.
  • Use different passwords and PINs for different accounts.  Use encrypted and verified secure Password Manager software.
  • Be careful when using public computers to access your personal information and always log out fully from websites when you are finished.

Protect your emails

  • Only open email messages from people you know and delete messages from those you don’t know. Never click on an email link or attachment unless you’re sure it was requested. Some can lead you to fake web sites that look like the real thing where a criminal will be waiting to steal your details.
  • Disable the email preview function. This can help prevent potentially malicious code in messages from installing onto your PC.

Protect your internet use

  • If you have a wireless connection or network, then ensure that it is configured correctly. Change the password from the default.
  • Whether your web browser is Internet Explorer, Firefox or Opera, make sure you have the safety features enabled.
  • Use parental control software to ensure your children don’t visit any inappropriate web sites.
  • Don’t download programs you’re not absolutely certain are genuine and never accept a link or download a file through Instant Messaging.
  • Set Instant Messaging preferences to keep strangers at bay.
  • Always log out when you’re not using Instant Messaging.
  • Be careful with the information you give out on blog sites – anyone could be reading it.

Protect your online payments

  • Make sure any online credit card charges are handled through a secure site or in an encrypted mode. You’ll know you’re on a secure site if the web page address you’re entering your details on begins with https instead of the usual http, and a padlock symbol is displayed in the bottom of the screen.
  • When shopping online check, the retailer is genuine; look for the Trust-e symbol or a Better Business Bureau online seal. These symbols show the seller has been independently audited and is thought to be trustworthy. Check that you can see the web browser address starting with ‘https’ or that there’s a padlock logo at the bottom of the screen.

Use software to protect you

  • Install anti-virus software and ensure that it is updated at least weekly.
  • Make sure you have a personal firewall as part of your system configuration. Many Internet Service Providers include these with your broadband or dial-up package.
  • Make sure all your software is set to automatically update, so you do not miss any security patches

If you would like to discuss your pensions or investments with one of our Financial Planners please call 01344 875 000 or email info@kirkrice.co.uk.

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